        IN THE COURT OF APPEALS OF TENNESSEE
                               FILED
                                  December 3, 1999

                               Cecil Crowson, Jr.
                              Appellate Court Clerk
                              AT NASHVILLE


BOARD OF TRUSTEES OF THE              )
SUMNER COUNTY EMPLOYEES’              )
TRUST FUND ON BEHALF OF               )
THE SUMNER COUNTY                     )
EMPLOYEES’ TRUST,                     )     Sumner Circuit
                                      )     No. 14647-C
      Plaintiff/Appellee,     )
                                      )
VS.                                   )     Appeal No.
                                      )     M1997-00069-COA-R3-CV
RUBY GRAVES,                          )
                                      )
      Defendant/Appellant,            )
                                      )
and son, JERRY D. GRAVES,             )
                                      )
      Defendant.                      )




       APPEAL FROM THE CIRCUIT COURT FOR SUMNER COUNTY
                    AT GALLATIN, TENNESSEE


                THE HONORABLE THOMAS GOODALL, JUDGE



For the Plaintiff/Appellee:                 For the Defendant/Appellant:

William R. Wright                           C. Tracey Parks


                                                                           Page 1
Leah May Dennen              Harsh, Parks & Harsh
Office of the Law Director         Gallatin, Tennessee
Gallatin, Tennessee




             VACATED IN PART AND REMANDED



                             WILLIAM C. KOCH, JR., JUDGE




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                                    OPINION

       This appeal involves a dispute over the obligation of a member of a group health
insurance plan to reimburse the plan for medical payments made on behalf of the member’s
dependent. The plan’s administrator requested the member and her dependent to reimburse
the plan for the medical payments after discovering that the dependent had received a
financial settlement from the person who caused the dependent’s injuries.          When the
member and the dependent refused to reimburse the payments, the plan filed suit in the
Circuit Court for Sumner County against both parties. The trial court granted the plan’s
motion for summary judgment and ordered both the member and her dependent to reimburse
the plan for medical payments. We have determined that the plan was not entitled to a
judgment as a matter of law against the member and accordingly vacate the summary
judgment against her.


                                             I.


       Ruby Graves works for the Sumner County Board of Education. County employees
like Ms. Graves participate in a group health insurance plan established and maintained by the
Sumner County Employees’ Trust and administered by Blue Cross/Blue Shield of Tennessee.
 The plan permits its members to purchase individual coverage, family coverage, or coverage
for themselves and one designated eligible dependent. 1 Ms. Graves elected to purchase
coverage for herself and her son, Jerry Graves.


       Jerry Graves was seriously injured three months after his eighteenth birthday while
riding as a passenger in an automobile owned and driven by Erik Vincent. Jerry Graves
incurred $8,622.95 in medical expenses which were paid by the Trust. Sometime later, he
received $18,000 for his injuries in a settlement with Mr. Vincent’s insurance company. The
settlement check was made out solely to Jerry Graves, and Ms. Graves received no part of
the settlement proceeds.


       When Blue Cross/Blue Shield learned of the settlement, it requested Ms. Graves and
her son to reimburse the Trust for the payments for medical expenses it had made on behalf
of Jerry Graves. Despite the reimbursement provision in the health insurance policy, both


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Ms. Graves and her son declined to reimburse the Trust. Accordingly, in September 1995,
the Trust filed suit against Ms. Graves and Jerry Graves in the Circuit Court for Sumner
County seeking a judgment against them for $8,622.95 plus attorney’s fees and costs. Ms.
Graves filed an answer denying any obligation to reimburse the Trust. Jerry Graves did not
file an answer and made no other response to the suit.
       The Trust later moved for a summary judgment against both Ms. Graves and her son.
Ms. Graves opposed the motion on the ground that she had no legal obligation to reimburse
the Trust for the medical payments made on her son’s behalf. The trial court granted the
summary judgment and entered an order directing Ms. Graves and Jerry Graves to pay the
Trust $8,622.95 for the medical payments and $1,452 for its legal expenses. Ms. Graves has
appealed.


                                             II.


       We begin with the well-settled standards governing appellate review of summary
judgments. Summary judgments are proper in virtually any civil case that can be resolved on
the basis of legal issues alone. See Byrd v. Hall, 847 S.W.2d 208, 210 (Tenn. 1993);
Tomlinson v. Kelley, 969 S.W.2d 402, 405 (Tenn. Ct. App. 1997). They are not, however,
appropriate when genuine disputes regarding material facts exist. See Tenn. R. Civ. P. 56.04.
 Thus, a summary judgment should be granted only when the undisputed facts, and the
inferences reasonably drawn from the undisputed facts, support one conclusion – that the
party seeking the summary judgment is entitled to a judgment as a matter of law. See White
v. Lawrence, 975 S.W.2d 525, 529-30 (Tenn. 1998); Shadrick v. Coker, 963 S.W.2d 726,
731 (Tenn. 1998); Bain v. Wells, 936 S.W.2d 618, 622 (Tenn. 1997). A summary judgment
should not be granted if any reasonable doubt exists with regard to the conclusions to be
drawn from the evidence. See Chrisman v. Hill Home Dev., Inc., 978 S.W.2d 535, 538
(Tenn. 1998).


       Unlike other dispositions by a trial court without a jury, a summary judgment does not
enjoy a presumption of correctness on appeal. See Nelson v. Martin, 958 S.W.2d 643, 646
(Tenn. 1997); City of Tullahoma v. Bedford County, 938 S.W.2d 408, 412 (Tenn. 1997).
Accordingly, reviewing courts must make a fresh determination concerning whether the
requirements of Tenn. R. Civ. P. 56 have been satisfied. See Hunter v. Brown, 955 S.W.2d
49, 50-51 (Tenn. 1997); Mason v. Seaton, 942 S.W.2d 470, 472 (Tenn. 1997). We must
consider the evidence in the light most favorable to the nonmoving party, and we must


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resolve all inferences in the nonmoving party’s favor. See Terry v. Niblack, 979 S.W.2d
583, 585 (Tenn. 1998); Robinson v. Omer, 952 S.W.2d 423, 426 (Tenn. 1997). When
reviewing the evidence, we must determine first whether factual disputes exist. If a factual
dispute exists, we must then determine whether the fact is material to the claim or defense
upon which the summary judgment is predicated and whether the disputed fact creates a
genuine issue for trial. See Byrd v. Hall, 847 S.W.2d at 214; Rutherford v. Polar Tank
Trailer, Inc., 978 S.W.2d 102, 104 (Tenn. Ct. App. 1998).


       Because the material facts in this case are essentially undisputed, the outcome of this
appeal depends solely on the proper interpretation of the group health insurance contract.
Interpreting contracts is, of course, a question of law.2 See Guiliano v. Cleo, Inc., 995
S.W.2d 88, 95 (Tenn. 1999).       Accordingly, a summary judgment proceeding was an
appropriate avenue for resolving the parties’ dispute.      See Standard Fire Ins. Co. v.
Chester-O’Donley & Assocs., Inc., 972 S.W.2d 1, 6 (Tenn. Ct. App. 1998); Miller v. Mabe,
947 S.W.2d 151, 153 (Tenn. Ct. App. 1997).


                                             III.


       Reimbursement provisions are commonplace in employer-provided health insurance
plans. The typical reimbursement provision requires the insured to repay the insurer for
payments made on the insured’s behalf if the insured ultimately recovers from the person
who caused the insured’s injury. See York v. Sevier County Ambulance Auth., ___ S.W.3d
___, ___ (Tenn. 1999). 3 The benefit to the insured of a reimbursement provision in a group
health plan is that the insured receives immediate payment for covered medical expense.
However, any such payments are merely advances that must be repaid once the insured
finally collects from the party at fault. See Waller v. Hormel Foods Corp., 950 F. Supp.
941, 944 (D. Minn. 1996); Gibson v. Country Mut. Ins. Co., 549 N.E.2d 23, 26 (Ill. App. Ct.
1990). 4


       The exact parameters of an insurer’s right to reimbursement depend on the specific
language of the plan or policy at issue. As with other clauses in insurance policies, courts
will enforce reimbursement provisions in an employee benefit plan according to their plain
meaning. See Wood v. Prosser, No. 01A01-9510-CV-00468, 1997 WL 311529, at *3
(Tenn. Ct. App. June 11, 1997) (No Tenn. R. App. P. 11 application filed). We will consider
reimbursement provisions in the context of the policy as a whole, see Demontbreun v. CNA


                                                                                                 Page 5
Ins. Co., 822 S.W.2d 619, 621 (Tenn. Ct. App. 1991), and in construing them, we will not
give them such a forced, unnatural or unreasonable construction as would lead to nonsense
or absurdity. See Mid-South Title Ins. Corp. v. Resolution Trust Corp., 840 F. Supp. 522,
526 (W.D. Tenn. 1993).


       The group health insurance plan booklet 5 for Sumner County employees contains a
reimbursement provision. In a subsection entitled “Rights of Recovery and Reimbursement,
” the booklet states that if the county employee or an insured dependent is injured due to the
fault of another person and the insurance company pays the insured person’s medical
expenses, then
               You6 [the primary insured] or your covered dependent must
               reimburse us for our payment of medical expenses if you also
               receive payments for these expenses from any other source.
               This right of reimbursement is in addition to, and separate from,
               our right of subrogation and is primary -- even if the payments
               you or your covered dependent receive are for other types of
               damages or expenses. This also applies if the person recovering
               such amounts is a minor.

The question to be answered by this appeal is whether the phrase “you or your covered
dependent must reimburse us . . .” means that both the insured and the covered dependent are
jointly liable to reimburse the insurer for payments made on behalf of the covered
dependent. The Trust asserts that the liability is joint; while Ms. Graves asserts that it is not.


       As we construe this policy, covered dependents are insured parties in their own right.
This concept runs throughout the policy and is reflected in the use of terms such as “covered
subscriber or dependent,” “you or a dependent,” or “you and a covered dependent.” The plan
booklet even points out that “[i]t is important that you [the primary insured] keep separate
records of the eligible medical expenses for yourself and each of your eligible dependents
since the deductible and the maximum amounts are calculated separately for each of you.”
Accordingly, under the terms of the policy involved in this case, a covered dependent’s rights
and obligations are independent from those of the primary insured.


       The independence of the rights and obligations of the insured parties points to a
conclusion that the liability for reimbursing the insurer is not joint. This conclusion is
consistent with the rule that an insured who actively seeks an insurance policy’s protections
may not take the benefits afforded by the policy and simultaneously not fulfill the policy’s



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obligations. See Nationwide Mut. Ins. Co. v. Chantos, 214 S.E.2d 438, 443 (N.C. Ct. App.
1975). Thus, as a general matter, only the insured who invokes the benefits of an insurance
policy should have the obligation to reimburse the insurer. See Employers Mut. Liab. Ins.
Co. v. Byers, 114 A.2d 888, 890 (N.H. 1955).


       The application of this general rule in factual circumstances similar to this case is
illustrated in a recent decision by the Arkansas Court of Appeals. The primary insured was a
public school employee whose group health insurance covered her nineteen-year-old
daughter as a dependent. The insurer paid the daughter’s medical expenses after she was
injured in an automobile accident. The daughter later settled with the person who caused her
injuries. When the daughter declined to reimburse the insurer for the medical payments
made on her behalf, the insurer sued the daughter based on the reimbursement provision in
the group insurance policy. Invoking the principle that personal liability for reimbursement
follows the extension of benefits, the Arkansas Court of Appeals held that just as the injured
daughter had the right to call upon the policy for benefits, so the insurer had the reciprocal
contractual right, upon extending benefits to the daughter, to recoup these payments from
her. See Storey v. Arkansas Blue Cross & Blue Shield, Inc., 704 S.W.2d 176, 177 (Ark. Ct.
App. 1986).


       Insurance policies, like other contracts, should be construed to give effect to the
parties’ intentions and the language used to express these intentions. See Tata v. Nichols,
848 S.W.2d 649, 650 (Tenn. 1993). Words used in an insurance policy should be given their
ordinary meaning, unless the policy itself gives the words some other, more technical
import. See Harrell v. Minnesota Mut. Life Ins. Co., 937 S.W.2d 809, 814 (Tenn. 1996);
Swindler v. St. Paul Fire & Marine Ins. Co., 223 Tenn. 304, 307, 444 S.W.2d 147, 148
(1969). Accordingly, the courts should construe an insurance policy keeping in mind the “
understanding and reasonable expectations of the average insurance policyholder,” Harrell v.
Minnesota Mut. Life Ins. Co., 937 S.W.2d at 810, rather than the more sophisticated
understanding of a “Philadelphia lawyer.” Paul v. Insurance Co. of N. Am., 675 S.W.2d 481,
484 (Tenn. Ct. App. 1984).


       No one in this case, not even Ms. Graves, insists that the policy language does not
give the Trust an unambiguous contractual right to seek reimbursement from Jerry Graves.
However, nothing in the language of the policy reasonably puts Ms. Graves, the primary
beneficiary, on notice that he or she will be required to reimburse the Trust for medical


                                                                                                 Page 7
expenses advanced on behalf of an adult dependent when that dependent subsequently
recovers those expenses from a third party. The Trust’s argument that Jerry Graves would
not have been insured had his mother not been able to obtain group health insurance coverage
for him does not require a different conclusion because, as we have already held, the
language of the policy itself requires the rights and obligations of each of the persons
insured by the policy to be considered independently.


         Equally unavailing is the Trust’s argument that its payments for Jerry Graves’s
medical expenses were, in effect, on Ms. Graves’s behalf. The argument would have more
weight if Jerry Graves had been a minor when he was injured. 7 However, Jerry Graves was
legally emancipated from his mother when he was injured, see Tenn. Code Ann. § 1-3-113
(1994); Garey v. Garey, 482 S.W.2d 133, 135 (Tenn. 1972), even though he continued to
live at home. See Nichols v. Atnip, 844 S.W.2d 655, 659 (Tenn. Ct. App. 1992). Jerry
Graves was legally liable to the health care providers for the medical care he received
following the September 1994 accident. The health care providers could not have required
Ms. Graves to pay for these services.       Accordingly, the payments made by the Trust
benefitted Jerry Graves, not his mother, and the Trust must look exclusively to the person
who benefitted directly from the payments for reimbursement.


                                             IV.


         We vacate the summary judgment against Ruby Graves and remand the case to the
trial court with directions that the complaint against her be dismissed. We also tax the costs
of this appeal to Sumner County Employees’ Trust for which execution, if necessary, may
issue.



                                                   ______________________________
                                                   WILLIAM C. KOCH, JR., JUDGE

CONCUR:

__________________________________
HENRY F. TODD, PRESIDING JUDGE
MIDDLE SECTION


__________________________________


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SAMUEL L. LEWIS, JUDGE




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