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Lawyers Journal

Limits on hospital liability revisited

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The Massachusetts Superior Court recently declined to extend the scope of corporate liability, holding that a hospital and parent corporation could not be held liable for the alleged malpractice of a doctor merely because the operation causing the patient’s injury was performed within the hospital’s walls.

The court in Ward v. Kylander found no employment relationship between the doctor, hospital and parent corporation, foreclosing the applicability of the doctrine of respondeat superior, in which the master/principal is responsible for the wrongful acts of his servant/agent in the course of the servant/agent’s employment. Furthermore, the court declined to adopt a theory of corporate negligence for the "failure" of the hospital and corporate parent to assure that the patient’s informed consent was obtained.

Ward v. Kylander arose out of a stapedectomy performed by Dr. Clarence Kylander within Worcester’s Saint Vincent Hospital, managed by a wholly owned subsidiary of Tenet Health Systems.

In September of 2000, the plaintiff, Louis Ward, met with Kylander to discuss the possibility of undergoing a surgical procedure on his left ear known as a stapedectomy. (The fixed stapes, the third of three small hearing bones in the middle ear, are removed and replaced with a prosthesis, allowing sound vibrations to be transmitted properly to the inner ear fluids for hearing.)

During their meeting, Ward signed an informed consent form, which was witnessed by a nurse. After the stapedectomy, the patient experienced a range of complications, including numbness and facial paralysis, as well as a loss of hearing and vision. The patient brought suit against the doctor performing the procedure, the hospital and the hospital’s corporate parent, alleging that he had not been properly informed of the risks and dangers associated with the stapedectomy and that he would not have elected to undergo the procedure had he been aware of the risks.

The court granted summary judgment to St. Vincent and Tenet Health Systems on all counts of the complaint by applying settled law of the commonwealth, that a physician is presumed to be an independent contractor and not an employee of the hospital in which he works.

While a doctor can be considered an employee if it is proven that the hospital had the right to direct and control the treatment of patients by that physician, the failure of the patient to meet that burden here prevented a finding of vicarious liability as a matter of law.

The court declined to adopt a theory of corporate negligence based on the failure of the hospital and its parent corporation to arrange and coordinate the informed consent procedure.

By refusing to allow recovery on a theory of pure corporate negligence, Massachusetts has adopted the minority position on this issue. In Ward v. Kylander, Massachusetts joined Maine and Ohio in refusing to adopt the theory of corporate negligence as an avenue of recovery. In Massachusetts, Maine and Ohio, the only avenue to corporate liability is to meet the elements of respondeat superior or otherwise demonstrate that the corporation was vicariously liable for the acts of its servant.

As David Gould, Ficksman & Conley, Boston, pointed out, "This is a Superior Court decision, which is a trial court decision by one judge on a particular fact pattern. It is not precedent and not something that other judges can rely on. But it’s an interesting decision."

"It is absolutely consistent with what the well-established precedent is in Massachusetts regarding liability of a hospital for actions of non-employee…. The law in this state is well settled on who has responsibility for obtaining informed consent and what the vicarious liability is and isn’t of a hospital for the actions of a physician who is not an employee. This is very consistent with the way courts have decided these cases for many years," said Gould.

According to Gould, this is not a case of first impression. He is familiar with several cases where lawyers have tried to litigate charitable immunity and whether a hospital has exposure for the actions of independent contractors.

Massachusetts hospitals enjoy unique insularity unavailable in other states. Direct corporate negligence for hospitals has not been adopted in Massachusetts, and most of the time, hospitals are nonprofit, with a charitable cap. In Massachusetts, that cap is $20,000, the lowest of any state. In this case, where the hospital is for-profit, there is no $20,000 charitable cap and it was worth the plaintiff’s effort to pursue a corporate negligence theory.

"What is unique about this case is attempting to impose a duty on the hospital to arrange and coordinate total health care, including informed consent. That is not the law in this state," said Gould.

But Jeffrey Catalano, Todd & Weld, Boston, argues that where a hospital fails to create a policy that protects the patient, the hospital has potentially created an unnecessarily unsafe environment for the patient. "There should be an opportunity to sue the hospital, independent of the physician, strictly on a theory of corporate negligence."

According to Catalano, the Ward decision does not close the door on hospital liability where it can be proven that hospital policies and procedures were inadequate or failed to exist.

"To the contrary, as the Supreme Judicial Court recognized in Santos v. Kim, there can be instances where an institution such as a hospital can be liable even in the absence of individual liability," said Catalano.

 

©2014 Massachusetts Bar Association