Darrell V. McGraw, Jr.,
Esq.
Jeffrey K. Matherly, Esq.
Attorney
General
Heather G. Harlan, Esq.
Charleston, West
Virginia
Bowles Rice McDavid Graff
Rocco S. Fucillo,
Esq.
& Love PLLC
Assistant Attorney
General
Catherine D. Munster, Esq.
McNeer, Highland, McMunn
and Varner,
L.C.
Clarksburg, West Virginia
Attorney for the minor child,
Joseph
G.
The Opinion of the Court was delivered PER CURIAM.
1. “'It is the province of the
Court, and not of the jury, to interpret a written contract.' Syl. Pt. 1,
Stephens v. Bartlett, 118 W. Va. 421, 191 S.E. 550 (1937).” Syllabus
point 1, Orteza v. Monongalia County General Hospital, 173 W. Va.
461, 318 S.E.2d 40 (1984).
2. “The mere fact that parties
do not agree to the construction of a contract does not render it ambiguous. The
question as to whether a contract is ambiguous is a question of law to be
determined by the court.” Syllabus point 1, Berkeley County Public Service
District v. Vitro Corporation of America, 152 W. Va. 252, 162 S.E.2d
189 (1968).
3. “Contract language is
considered ambiguous where an agreement's terms are inconsistent on their face
or where the phraseology can support reasonable differences of opinion as to the
meaning of words employed and obligations undertaken.” Syllabus point 6,
State ex rel. Frazier & Oxley, L.C. v. Cummings, 212 W. Va. 275,
569 S.E.2d 796 (2002).
4. “Evidence of usage or
custom may be considered in the construction of language of a written instrument
which is uncertain or ambiguous but may not be considered to alter the legal
effect of or to engraft stipulations upon language which is clear and
unambiguous.” Syllabus point 5, Cotiga Development Co. v. United Fuel Gas
Co., 147 W. Va. 484, 128 S.E.2d 626 (1962).
Per Curiam:
The appellant herein, the West Virginia
Department of Health and Human Resources [hereinafter referred to as “DHHR”],
appeals from an order entered April 29, 2002, by the Circuit Court of Harrison
County. In that order, the circuit court ruled that DHHR was obligated to pay
the appellee herein, Stepping Stone, Inc. [hereinafter referred to as “Stepping
Stone”], a per diem rate for Joseph G.'s care equal to the amount to which
Stepping Stone would have been entitled under Medicaid. On appeal to this Court,
DHHR disputes that it is obligated to pay these monies to Stepping Stone. Upon a
review of the parties' arguments, the pertinent authorities, and the record
designated for appellate consideration, we affirm the decision of the Harrison
County Circuit Court.
Pursuant to a scheduled review of juveniles within
DHHR's custody and the Medicaid services they were receiving, an Administrative
Services Organization (See footnote 5) [hereinafter
referred to as “ASO”] determined, in January, 2002, that Joseph no longer
required the services of Stepping Stone and, thus, that he was no longer
entitled to the same. Moreover, the ASO made this determination retroactive
finding that Joseph's Medicaid eligibility for said services had ceased on
November 1, 2001. In order to permit Joseph to nevertheless remain at Stepping
Stone, his counsel moved the court, in February, 2002, for an order to that
effect. Ultimately, DHHR, Stepping Stone, and Joseph's counsel acquiesced to an
agreed order whereby DHHR would waive the independent living age requirement and
expedite efforts to place him in such a setting; in the meantime, Joseph would
remain at Stepping Stone. Because Joseph was not entitled to Stepping Stone's
Medicaid services, however, the instant controversy ensued as to whether
Stepping Stone could nonetheless recover such Medicaid monies from DHHR for the
period from November 1, 2001, until his discharge from Stepping Stone on April
17, 2002. (See footnote 6)
On November 1, 1998, DHHR and Stepping Stone entered into a Child Care Agreement [hereinafter referred to as “Agreement I”]. Pertinent to the instant controversy, this contract provided that “the Office of Social Services shall pay the treatment rate established by the Office of Audits, Research, and Analysis for those youth for whom treatment was provided but which cannot be billed to Medicaid because [the] child was not eligible for the service under Medicaid regulations.” Agreement I, at Article XV. Agreement I remained in force and effect through December 31, 2001. In light of the above-quoted language, DHHR concedes that it is obligated to pay the Medicaid monies to Stepping Stone for the contract period Joseph was housed at Stepping Stone but was not eligible for Medicaid services, i.e., November 1, 2001, through December 31, 2001, which sum is approximately $2,328.98. (See footnote 7)
Thereafter, DHHR and Stepping Stone entered into
a Group Residential Provider Agreement [hereinafter referred to as “Agreement
II”], which replaced Agreement I, and remained in force and effect from January
1, 2002, through December 31, 2002. Unlike the parties' prior Agreement I,
Agreement II does not contain any language to indicate who is responsible for
the payment of Medicaid monies if a Stepping Stone resident is deemed to be
ineligible for such services. Therefore, the parties disagree as to who is
liable for such Medicaid payments for Joseph's residence at Stepping Stone from
January 1, 2002, until his discharge on April 17, 2002. At the per diem Medicaid
rate of $38.18, the total amount in controversy is approximately
$4,085.26. (See footnote 8)
By order entered April 29, 2002, the Circuit Court of
Harrison County determined DHHR to be liable to Stepping Stone for the
theretofore unreimbursed Medicaid monies for Joseph's residence at that
facility:
The Court . . . finds that
based upon the intent of the parties, as evidenced by other contractual terms,
Stepping Stone was no longer obligated to keep Joseph at its facility, absent a
court order, once Joseph failed to meet the target population admission criteria
and the ASO determined that treatment provided by Stepping Stone was no longer
medically necessary.
The Court further finds that
although Joseph no longer met the target population admission criteria and
treatment provided by Stepping Stone was no longer medically necessary, the
Department, Stepping Stone and the MDT agreed that Joseph's best interests would
be served by his continued placement at Stepping Stone rather than an
alternative placement.
The Court further finds
that Stepping Stone had the right to condition Joseph's continued placement at
its facility upon payment by the Department because, under the Current Agreement
[Agreement II], Stepping Stone was not required to keep Joseph at its facility
once he failed to meet the target population admission criteria and treatment
was deemed no longer medically necessary.
From this ruling of the circuit
court, DHHR appeals to this Court.
In support of its assignment of error, DHHR
contends that the language of Agreement II is plain and easily resolves the
instant controversy. Unlike Agreement I, Agreement II is silent as to who is
responsible for the payment of Medicaid monies once a resident child is no
longer eligible for said Medicaid services. Because Agreement II further states
that it “contains all the terms and provisions relating to the subject matter
hereof and there are no other understandings, oral or otherwise,” Agreement II,
at Article XIV, § 4, DHHR asserts that the circuit court should have
applied, rather than construed, the parties' contract. Citing Syl. pt. 1,
Cotiga Dev. Co. v. United Fuel Gas Co., 147 W. Va. 484, 128 S.E.2d
626 (1962) (“A valid written instrument which expresses the intent of the
parties in plain and unambiguous language is not subject to judicial
construction or interpretation but will be applied and enforced according to
such intent.”).
Stepping Stone responds by stating that the circuit
court correctly determined DHHR to be responsible for the Medicaid monies at
issue herein. Under the terms of Agreement II, the prior provisions of Agreement
I were revised in order to prevent a situation such as the one at issue here by
permitting Stepping Stone to accept only those youth who are medically eligible
for the Medicaid services it provides. Because Agreement II does not resolve the
situation at hand, where a resident is deemed to be medically ineligible for
Medicaid services but nevertheless continues to be housed at Stepping Stone,
Stepping Stone urges the Court to look outside the parameters of the contract in
order to resolve this dispute. Citing Syl. pt. 2, in part, Berkeley
County Pub. Serv. Dist. v. Vitro Corp. of America, 152 W. Va. 252, 162
S.E.2d 189 (1968) (“Extrinsic evidence may be used to aid in the construction of
a contract if the matter in controversy is not clearly expressed in the
contract, and in such case the intention of the parties is always
important[.]”). In this regard, Stepping Stone contends that this Court should
be instructed by the terms of Agreement I in resolving this dispute as Joseph
was admitted to Stepping Stone under those terms.
The sole issue presented by the instant appeal
requires us to determine whether the parties' contractual agreement required
DHHR to pay Stepping Stone the monies to which it claims to be entitled.
Ordinarily, “[a] valid written instrument which expresses the intent of the
parties in plain and unambiguous language is not subject to judicial
construction or interpretation but will be applied and enforced according to
such intent.” Syl. pt. 1, Cotiga Dev. Co. v. United Fuel Gas Co., 147
W. Va. 484, 128 S.E.2d 626 (1962). However, “[t]he mere fact that parties
do not agree to the construction of a contract does not render it ambiguous. The
question as to whether a contract is ambiguous is a question of law to be
determined by the court.” Syl. pt. 1, Berkeley County Pub. Serv. Dist. v.
Vitro Corp. of America, 152 W. Va. 252, 162 S.E.2d 189 (1968).
In making such a determination of contractual
ambiguity, we consider whether the subject contract is capable of more than one
interpretation. Thus, “[c]ontract language is considered ambiguous where an
agreement's terms are inconsistent on their face or where the phraseology can
support reasonable differences of opinion as to the meaning of words employed
and obligations undertaken.” Syl. pt. 6, State ex rel. Frazier & Oxley,
L.C. v. Cummings, 212 W. Va. 275, 569 S.E.2d 796 (2002). Once we have
determined a contract to be ambiguous, we look to the parties' relationship to
glean the parties' intent in entering into the agreement under scrutiny.
“Evidence of usage or custom may be considered in the construction of language
of a written instrument which is uncertain or ambiguous but may not be
considered to alter the legal effect of or to engraft stipulations upon language
which is clear and unambiguous.” Syl. pt. 5, Cotiga, 147 W. Va. 484,
128 S.E.2d 626.
Having reviewed the contract in question, we find it
to be ambiguous insofar as it does not clearly indicate which party is
responsible for payment of the Medicaid funds to which Stepping Stone would have
been entitled had Joseph been eligible for such services from January 1, 2002,
until April 17, 2002. Given the parties' prior dealings under Agreement I, DHHR
clearly would have been required to reimburse Stepping Stone. (See footnote 9) Upon execution of
Agreement II, however, the parties attempted to prevent the present scenario by
specifically providing that “[y]outh admitted to group residential program(s)
shall meet the targeted population admission criteria for the level of treatment
offered by Provider as established by the Bureau for Medical Services.”
Agreement II, at Article I, § 3.06. Thus, Agreement II does not contemplate
a situation such as the one presented herein because every child housed at
Stepping Stone would first have to have been certified as medically eligible to
receive the facility's services.
Despite this strategic wording, the fact nevertheless
remains that a non- medically eligible child, namely Joseph, was, in fact,
housed at Stepping Stone while Agreement II was in force and effect. That said,
some party is responsible either for paying for the Medicaid services Joseph
received while in residence at Stepping Stone or for absorbing such costs. We
find, based upon the parties' prior agreement addressing similar situations,
that DHHR is the party responsible for such costs. To find otherwise would, in
short, be unjust and inequitable, particularly when, under the parties' second
agreement, Stepping Stone was prohibited from discharging Joseph because no
other placement plan had been devised, much less implemented, for him.
See Agreement II, at Article I, § 5.01 (“Provider shall not
discharge a youth meeting targeted population criteria without an appropriate
plan and living arrangement agreed upon by the child's MDT except in the event
of court ordered discharges and as allowed in Section XIII.3.03(1-4).”).
Accordingly, we affirm the circuit court's ruling imposing such liability upon
the West Virginia Department of Health and Human Resources.
Affirmed.