This opinion will be unpublished and

may not be cited except as provided by

Minn. Stat. § 480A.08, subd. 3 (2000).






Blue Cross and Blue Shield of Minnesota,



Wells Fargo Bank Minnesota, N.A., et al.,





Mount Sinai Hospital, et al.,



Filed March 12, 2002

Klaphake, Judge


Hennepin County District Court

File No. CT97021950


John Paul Martin, Kristine K. Nogosek, Martin & Squires, P.A., 444 Cedar Street, Suite 2050, St. Paul, MN  55101 (for respondents)


Jon R. Hawks, Jon R. Hawks, Ltd., 7301 Ohms Lane, Suite 535, Edina, MN  55439-2340 (for appellants)


            Considered and decided by Lansing, Presiding Judge, Klaphake, Judge, and Huspeni, Judge.*


U N P U B L I S H E D   O P I N I O N


            Blue Cross and Blue Shield of Minnesota (Blue Cross) brought an interpleader action to determine whether its insured, Sanford Komissar, was entitled to payments for out-of-state medical treatment under his medical insurance policy, or whether the payments were subject to garnishment by Komissar’s judgment creditor, respondent Wells Fargo Bank.  Mount Sinai Hospital, Mount Sinai Home Hospice Care, Dr. L. Brian Katz, and Dr. Anthony J. Vine, from whom Komissar had received treatment, asserted that he had assigned the insurance payments to them, and intervened.

            Pursuant to the jury verdict, the court awarded the interpleaded funds that Mount Sinai Hospital, Mount Sinai Home Hospice Care, and Dr. Katz had sought, to Wells Fargo, but awarded Dr. Vine the sum he had sought.  These intervenors filed a notice of appeal, and Wells Fargo filed a notice of review challenging the award to Dr. Vine.

            Intervenors contend that (1) health care benefits should be exempt from garnishment as a matter of public policy; (2) there were errors in the jury instructions and special verdict form; and (3) the insured’s assignments of benefits were effective before the garnishment summonses were served.  Intervenors and Wells Fargo both challenge portions of the jury verdict.  Because (1) exemptions from garnishment are determined by the legislature and this court lacks the authority to read additional exemptions into the statute; (2) intervenors are precluded from challenging the jury instructions and special verdict form when they did not raise the issues in a new trial motion; (3) assignment is not effective until the insurer waives the provision when the insurance policy has a non-assignment clause; and (4) the jury’s verdict is not palpably contrary to the evidence, we affirm.


I.  Summary Judgment

            Before trial, the district court denied intervenors’ motion for summary judgment.  Intervenors contend that the district court erred in denying their motion for summary judgment as a matter of law because health insurance proceeds should be exempt from garnishment based on public policy.  In an appeal from summary judgment, the appellate court must review the record to determine whether there are genuine issues of material fact and whether the district court erred in its application of law.  Offerdahl v. Univ. of Minn. Hosps. & Clinics, 426 N.W.2d 425, 427 (Minn. 1988).

            A.        Failure to Raise Issue in New Trial Motion

            As a preliminary issue, Wells Fargo argues that the intervenors are precluded from challenging the summary judgment because they did not raise it in the first instance in a new trial motion.  Generally, to preserve issues of trial procedure, evidentiary rulings, and jury instructions for appellate review, a party must assign these matters as error in a motion for a new trial.  Sauter v. Wasemiller, 389 N.W.2d 200, 201 (Minn. 1986).  The scope of review “depends on whether [the] appeal involves a matter of trial procedure.”  Hagel v. Schoenbauer, 532 N.W.2d 255, 256 (Minn. App. 1995).  Because a denial of a summary judgment is not in the nature of trial procedure, we may review it without a new trial motion.

            B.        Merits

            We next address intervenors’ public policy argument.  “Garnishment is essentially a statutory remedy.”  Gustafson v. Johnson, 235 Minn. 358, 373, 51 N.W.2d 108, 116 (1952).  Its purpose “is to reach property of the defendant in the hands of the garnishee in order to apply it in satisfaction of the judgment.”  Buysse v. Baumann-Furrie & Co., 448 N.W.2d 865, 870 (Minn. 1989) (citation omitted).

            The statute exempts certain property from garnishment.  Minn. Stat. § 550.37, subd. 1 (2000).  This is “to ensure that debtors, despite their debts, will nevertheless have a reasonable means to support themselves and their dependents.”  Estate of Jones by Blume v. Kvamme, 529 N.W.2d 335, 339 (Minn. 1995) (citation omitted) (addressing exemption for retirement account).  Earnings that are not subject to garnishment and public assistance payments are exempt.  Minn. Stat. § 550.37, subds. 13, 14 (2000).  Also exempt, but limited to specified values, are household goods, one motor vehicle, and retirement accounts.  Id., subds. 4(b), 12a, 24(a) (2000).  Certain insurance proceeds are also exempt, including life insurance proceeds subject to a dollar limit and disability insurance payments.  Minn. Stat. §§ 550.37, subd. 10, 550.39 (2000).

            Intervenors do not refer to any statutory provision that would exempt the health care benefits from garnishment, and no such statutory exemption can be found.  Instead, they rely on public policy reasons relating to the importance of health insurance.  They cite the need to contain cost, to pay health care providers, and to encourage out-of-state providers to provide care to locally insured Minnesotans.  Intervenors assert that exempting the payment of health care benefits is consistent with the humane and enlightened spirit behind other exemptions.

            The legislature has not provided a statutory exemption from garnishments for health care benefits, and this court has no authority to read such an exemption into the statute.  Intervenors’ argument therefore is beyond our reach and they must direct it to the legislature.

II.  Jury Instructions and Special Verdict Form

            Next, intervenors contend that the district court erred in denying their proposed jury instructions and special verdict form.  They sought an instruction based on Minn. Stat. § 571.73, subd. 4(1), which provides that indebtedness is not subject to attachment by garnishment “unless at the time of the garnishment summons the same is due absolutely or does not depend on any contingency.”

            Wells Fargo asserts that intervenors are precluded from raising this argument on appeal because they did not raise it in a motion for a new trial.  Jury instructions are a matter of trial procedure and are subject to appellate review only if there has been a motion for a new trial in which the matter has been assigned as error.  Sauter, 389 N.W.2d at 201.

            Intervenors contend that they preserved the issue for appeal by moving for a mistrial based on the failure to give the instruction.  They argue that it would have been pointless to seek a new trial after the verdict when the court had already denied their motion for a mistrial on the same ground.  Because intervenors do not provide any case law supporting their argument that no new trial motion is required under the circumstances, we decline to address this issue.

III.  Assignment of Benefits

            The next issue is whether the court erred in applying the law to the facts as found by the jury.  Intervenors do not have a contractual relationship with Blue Cross and are considered nonparticipating providers.  When insureds obtain medical care from a nonparticipating provider, under the terms of the policy, Blue Cross will pay the insureds directly.  The insureds are then directly liable for the provider’s charges.  Further, the policy provides that insureds “may not assign [their] benefits to a nonparticipating provider.”  In dispute here is when, as a matter of law, the assignment became final in light of the nonassignment clause.

The jury determined that as to intervenors Mount Sinai Hospital, Mount Sinai Hospice Home Care, and Dr. Katz, Blue Cross waived the nonassignment clause with respect to their claims only after Wells Fargo served the garnishment summons on Blue Cross.  Based on these findings, the court determined that the garnishments were effective.  Intervenors contend that the court erred as a matter of law because the assignment was final when Komissar assigned his benefits to his health care provider before the garnishment summonses were served.

            A judgment creditor may garnish property in the hands of a third party that is “due or belonging to the debtor.”  Minn. Stat. § 571.73, subd. 3(2).  “An assignee under a valid assignment generally takes priority over subsequent creditors of the assignor who had no lien” at the time the assignment was made.  6A C.J.S. Assignments § 81 (1975).

            In the absence of a contractual clause to the contrary, an obligor may assign all benefits and rights under a contract to another.  Vetter v. Sec. Cont’l Ins. Co., 567 N.W.2d 516, 521 (Minn. 1997).  When the terms of the contract provide that it is nonassignable, the contract may not be assigned unless the provision is waived.  Wilkie v. Becker, 268 Minn. 262, 267, 128 N.W.2d 704, 707 (1964).  In such a case, it is “axiomatic that the policy could not be assigned without the consent” of the insurer.  Sauber v. Northland Ins. Co., 251 Minn. 237, 248, 87 N.W.2d 591, 599 (1958).  Consequently, the fact that Komissar assigned his benefits was not sufficient to finalize the assignment; it was not effective until Blue Cross waived the nonassignment clause.  Consequently, the district court applied the law correctly to the facts as found by the jury.

IV.  Jury Verdict

            Mount Sinai and Wells Fargo both challenge portions of the jury verdict adverse to their claims.  An appellate court will not set aside answers to special verdict questions unless they are “perverse and palpably contrary to the evidence or where the evidence is so clear to leave no room for differences among reasonable people.”  Jennie-O Foods, Inc. v. Safe-Glo Prods. Corp., 582 N.W.2d 576, 579 (Minn. App. 1998) (citation omitted), review denied (Minn. Oct. 20, 1998).  “The evidence must be viewed in a light most favorable to the jury verdict.”  Id.

            The parties do not dispute the jury determination that Blue Cross waived the nonassignment clause as to the various claims.  At issue is when this occurred—before or after the garnishment summons was served.  Waiver is the “voluntary and intentional relinquishment or abandonment of a known right.”  In re Estate of Sangren, 504 N.W.2d 786, 790 (Minn. App. 1993) (citation omitted), review denied (Minn. Oct. 28, 1993).  Intent may be inferred from the parties’ conduct.  Id.

            The intervenors cite the fact that Blue Cross had paid them directly on an earlier claim and insiste that this shows it was unnecessary to waive the nonassignability clause.  There is no evidence, however, that Blue Cross had to consider the effect of a garnishment on that claim.  Next, they argue that because Komissar assigned the payments for his medical treatment, he had no remaining interest in them to be garnished.  This argument ignores the effect of the nonassignment clause under which the assignment is not effective until the nonassignment clause has been waived.  Sauber, 251 Minn. at 248, 87 N.W.2d at 599.

            Finally, the intervenors argue that there was no testimony from which the jury could determine when Blue Cross waived the nonassignability clause.  The court instructed the jury that the intervenors had the burden of showing the benefits had been assigned and that Blue Cross had waived the nonassignment clause.  A Blue Cross employee provided testimony as to the claims and garnishments.  Based on the testimony, a jury could conclude that the intervenors did not meet their burden of proving that Blue Cross waived the nonassignment clause before the garnishment summonses were served.

            The jury also determined that Blue Cross waived the nonassignment clause as to Dr. Vine before service of the garnishment.  Wells Fargo contends that the evidence was insufficient to establish the existence of an assignment on the exact date of the waiver and that the jury answer was inconsistent with its answers as to the intervenors.  We disagree.  The facts and inferences from those facts were sufficient for the jury to determine that as to intervenor Dr. Vine, the garnishment summons was served after the nonassignment clause was waived.  The jury considered the evidence, and we cannot say that its decision was palpably contrary to the evidence.


* Retired judge of the Minnesota Court of Appeals, serving by appointment pursuant to Minn. Const. art. VI, § 10.