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West Virginia High Court Holds Hospital Could Be Vicariously Liable For Physicians' Negligence Under Apparent Agency Theory


HLD, v. 32, n. 8 (August 2004)

West Virginia High Court Holds Hospital Could Be Vicariously Liable For Physicians' Negligence Under Apparent Agency Theory

Jaclyn Burless had been receiving prenatal care at the Cornerstone Care Clinic but went to West Virginia University Hospitals (WVUH) for an ultrasound on her physician's instructions. At the time of the ultrasound, Burless signed a consent form acknowledging that the faculty physicians and residents who provided treatment at WVUH were not hospital employees. Burless subsequently experienced high blood pressure and edema and physicians eventually decided to induce labor. Burless delivered her daughter, Alexis Price, by cesarean section. According to Burless, Alexis suffers from severe and permanent injuries because the hospital and the physicians negligently monitored her labor and delivery. Burless sued the West Virginia University Board of Trustees (BOT) as the physicians' employer and the WVUH based on a theory of apparent agency. WVUH moved for summary judgment, arguing no apparent agency relationship existed between the hospital and the doctors and residents who provided care to Burless. The trial court granted WVUH's motion for summary judgment.

In a second case, Melony Pritt presented to WVUH's emergency department complaining of pain in her abdomen. The emergency department physicians determined that Pritt was nine weeks pregnant and had an ovarian cyst. Pritt was instructed to follow up at the obstetrics and gynecology clinic for prenatal care and monitoring of the cyst. During the course of her treatment at the clinic, Pritt signed three consent forms acknowledging that the faculty physicians and residents who provided her care were not hospital employees. Pritt underwent a surgical procedure to remove the cyst when she was twenty-three-and-one-half works pregnant. The cyst broke open during the procedure resulting in an infection that caused her to go into premature labor. According to Pritt, her son Adam has suffered severe and permanent injuries as a result of his premature birth. Pritt sued the BOT and WVUH claiming the injuries to herself and her son resulted from the physicians' negligence in recommending and performing the surgical procedure to remove the cyst. WVUH moved for summary judgment, again arguing no apparent agency relationship existed between the hospitals and the physicians who provided Pritt's care. The trial care granted WVUH's motion. Pritt appealed.

Consolidating the two actions, the West Virginia Supreme Court of Appeals held that the trial courts erred in granting WVUH summary judgment on the issue of apparent agency, although the high court upheld their rulings that no actual agency relationship existed.

The high court agreed with the lower courts' findings that no actual agency relationship existed between WVUH and the BOT physicians who treated Burless and Pritt. The high court noted specific statutory language declaring WVUH and BOT separate entities to split the business service functions of the hospital from the education functions of the medical schools for financial reasons. "Thus, it is plain that the Legislature's intent was that the BOT and WVUH operate as two separate entities, with distinct employees," the high court concluded.

But the high court disagreed with the lower courts' conclusion that no apparent agency relationship existed between WVUH and the BOT physicians. The high court acknowledged that the physicians were independent contractors and that generally a hospital is not liable for the negligence of its independent contractor physicians. The high court noted that apparent agency is an exception to this general rule. Instead of relying on the general rule regarding apparent agency, the high court said a more particular rule in the hospital-physician context was warranted given that "modern hospitals and their relationships with the physicians who treat patients within their facilities are rather unique and complex."

The high court previously has ruled that a hospital may be vicariously liable for the negligence of a physician who is an independent contractor in the emergency room context. Looking to other jurisdictions for guidance, the high court here defined the apparent agency theory outside the emergency room as requiring a plaintiff to show "(1) the hospital either committed an act that would cause a reasonable person to believe that the physician in question was an agent of the hospital, or, by failing to take an action, created a circumstance that would allow a reasonable person to hold such a belief, and (2) the plaintiff relied on the apparent agency relationship."

As to the first prong, the high court said that a hospital's failure to provide meaningful written notice may constitute "failing to take an action" that would allow a reasonable person to believe that a particular physician is the hospital's agent. Conversely, an unambiguous disclaimer by the hospital explaining a physician's independent contractor status is generally enough to immunize the hospital from a vicarious liability claim. Turning to the facts of the instant cases, the high court rejected WVUH's contention that the consent forms signed by Pritt and Burless were a sufficient disclaimer to inform them that the treating physicians were not hospital employees. Specifically, the high court noted that the consent form language referenced "faculty physicians and resident physicians who provide treatment in the hospital" as independent contractors. But this language, the high court reasoned, "presupposes that all patients can distinguish between 'faculty physicians,' 'resident physicians' and any other type of physician having privileges at the hospital." For this language to be meaningful, patients would have to inquire about the status of everyone treating them. Thus, the high court held the trial courts improperly granted WVUH summary judgment.

The high court characterized the second "reliance" prong as "a subjective molehill." In the high court's view, Pritt and Burless provided evidence that they believed the physicians treating them were WVUH employees. Because Pritt and Burless established genuine issues of material fact on both prongs of the apparent agency test, the high court held summary judgment was inappropriate.

Burless v. West Virginia Univ. Hosps., Inc., No. 31424 (W. Va. June 30, 2004).

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