Slovik v. Prime Healthcare Corporation

William Slovik’s (plaintiff) stepfather resided in Dadeville Convalescent Home (DCH), a nursing home operated by Prime Healthcare (defendant). Alabama Medicaid covered part of Slovik’s stepfather’s care, and Slovik paid the balance from his stepfather’s social security benefits. Slovik controlled his stepfather’s social security benefits as his social security personal representative, also called a representative payee. Several years into Slovik’s stepfather’s residence at DCH, Medicaid notified Slovik that it had overpaid approximately $6,500 in benefits to Slovik’s stepfather and would not continue coverage until the overpayment was cured. Shortly after, Prime Healthcare notified Slovik that the monthly cost of his stepfather’s care had increased. Slovik refused to pay the increased rate, causing arrears to accrue. Prime Healthcare sued Slovik, arguing that (1) Slovik entered an oral contract with Prime Healthcare accepting personal responsibility for paying his stepfather’s bills from his stepfather’s social security income; and (2) because Slovik failed to pay his stepfather’s bills, he was liable for damages. Prime Healthcare submitted a document Slovik signed as his stepfather’s personal representative to support its claim; however, the document was not submitted for its contents. The district court entered judgment for Prime Healthcare. Prime Healthcare then moved to evict Slovik’s stepfather. Slovik appealed. The circuit court affirmed, holding that, under the statute of frauds, Prime Healthcare could enforce the alleged payment agreement without a writing because Slovik was the primary obligor, not a guarantor for his stepfather. Slovik appealed to the Alabama Court of Civil Appeals, arguing that (1) he did not assume any personal responsibility for his stepfather’s debts; and (2) Prime Healthcare could not enforce the alleged payment agreement without a writing.