Charges of civil conspiracy, unjust enrichment and legal malpractice have been reinstated against two lawyers that allegedly conspired with a nursing home to charge a resident illegal fees.
A three-judge Superior Court panel in Pennsylvania made the decision to revive the case Oct. 12.
Representatives of ManorCare King of Prussia, including a lawyer acting as ManorCare’s counsel, started scheming in 2010 to declare one of the residents incapacitated to perpetrate a fraud, according to a story at Law.com.
The alleged schemers brought in a third-party attorney and the ManorCare counsel began the fraud by filing a collections complaint on behalf of the facility against the woman. Days later, a court declared the resident incapacitated and appointed a volunteer attorney to represent the resident, allegedly at the suggestion of the ManorCare counsel. The volunteer attorney then retained the third-party attorney, also allegedly at the suggestion of the ManorCare counsel, to represent the resident in the collections action.
The ManorCare counsel served the third-party attorney with papers for entering a default judgement in the collections action. But the papers were never served to the volunteer attorney or the resident’s family.
The third-party attorney did not respond to the collections action, leading to a default judgement of more than $81,000, including attorney fees. Some of those default payments were also duplicative of the payments ManorCare received for public assistance in connection with caring for the resident. After the resident’s death in 2012, the resident’s family had to reimburse the state nearly $5,000.
An acting administrator of the resident’s estate sued the facility, the ManorCare counsel and the third-party attorney, alleging civil conspiracy and unjust enrichment against both attorneys; legal malpractice and breach of fiduciary duty against the third party lawyer; and inducement and aiding and abetting against the ManorCare counsel. The estate administrator also sought punitive damages.
When the lawyers filed preliminary objections, arguing that the claims against them were insufficient, a judge agreed. The estate administrator settled with ManorCare but appealed the ruling that upheld the lawyers’ objections.
A second judge assigned reversed that decisions and last week’s decision by the three-judge panel upheld the appeal. The case is now headed to trial court.
“The allegations about the conspiracy and the acts taken in furtherance of the conspiracy, furthermore, are sufficiently outrageous, that if true, they support (the) requests for punitive damages,” a panel judge told Law.Com.
ManorCare, now operating as ProMedica, did not respond for a request for comment by publication deadline.
A lawyer for the ManorCare counsel defended his client.
“He aggressively represented his client, and we’re not concerned about these references to wrongdoing,” he said. ”Obviously we are disappointed and disagree with the ruling of the Superior Court. We look forward to addressing these meritless allegations against our client.”