Court Finds Hospital Vicariously Liable : Under the doctrine of apparent agency, an entity may be found vicariously liable to a third party for the negligence of its apparent agent if (1) the entity represents, or acquiesces in the appearance, that an individual is its agent; (2) the third party relies on that appearance to the party’s detriment; and (3) the third party’s reliance is reasonable under the circumstances.
In a Maryland medical malpractice case decided by the Court of Appeals of Maryland (“Maryland Appellate Court”), Maryland’s highest appellate court, on July 28, 2022, the Court held that there was sufficient evidence to support a jury verdict finding a hospital vicariously liable for the negligence of a surgeon in its trauma center when (1) the hospital had obtained designation under State law of its emergency room as a trauma center, which required that it have a trauma surgeon available to treat serious injuries sustained as a result of emergencies; (2) emergency medical services personnel dispatched to the scene of a serious car accident relied on that designation to transport the victim of the accident to that trauma center in accordance with State regulations; and (3) there was no evidence that the victim was informed in any way at the trauma center that the surgeon was an independent contractor, as opposed to an employee, of the hospital. Even if forms or signs at the trauma center had described the formal contractual relationship of the surgeon with the hospital, such notice would not have been timely and meaningful so as to negate the apparent agency relationship in a situation involving a patient in distress as a result of a serious car accident.
“Even when the legal definition of actual agency is not satisfied, the parties may still have an “apparent agency” relationship – sometimes referred to as “ostensible agency” or “agency by estoppel.” While the existence of an actual agency relationship depends in part on the perspective of a reasonable agent, the existence of an apparent agency relationship depends in part on the perspective of a reasonable third party.”
In the case the Maryland Appellate Court was deciding, “The Hospital’s designation as a Level II trauma center required that it have on call an attending board-certified or board-eligible orthopedic surgeon … the jury returned a verdict finding that: (1) Dr. Blundon had breached the standard of care when treating Mr. Williams; (2) Dr. Blundon’s negligence was the cause of Mr. Williams’ damages; and (3) Dr. Blundon was an agent of the Hospital. The jury awarded damages to Mr. Williams, and the trial court entered judgment in the amount of $6,137,049 in favor of Mr. Williams … In February 2020, the court issued a two-page written order granting the Hospital’s motion for JNOV, indicating briefly that there were no “sufficiently analogous” cases in Maryland to support the jury’s finding of apparent agency.”
In an unreported opinion, the Court of Special Appeals of Maryland (Maryland’s intermediate appellate court) agreed with the Circuit Court, concluding there was insufficient evidence from which a reasonable jury could find that Mr. Williams specifically believed that Dr. Blundon was the Hospital’s agent. The intermediate appellate court acknowledged that a patient does not have a duty to inquire into the precise relationship that a physician has with a hospital. However, it held that the evidence was insufficient to establish that Mr. Williams had a “subjective belief” that Dr. Blundon was an agent or employee of the Hospital.
The Court of Appeals stated, “The only question for us to decide is whether there was sufficient evidence, “however slight” and viewed in the light most favorable to Mr. Williams, for the jury to find that Dr. Blundon was the apparent agent of the hospital … No specific evidence was presented by the Hospital at trial as to the precise contractual relationship between it and Dr. Blundon. But the implicit representation that Dr. Blundon was its agent in providing the required orthopedic surgery services was reinforced by the fact, also introduced at trial, that he was Chief of Orthopedic Surgery at the Hospital at the time he treated Mr. Williams … In most instances in which a patient in acute distress – or one acting in the patient’s interest – seeks emergency medical assistance, that person looks to the hospital or emergency facility rather than to a specific health care provider. In other words, the patient, or the person acting for the patient, relies on the facility’s representation that its personnel will provide the required treatment as that person has no time to either choose among individual physicians or make fine distinctions on their precise contractual relationship with the facility. Such was the case here when the EMS personnel, in accordance with MIEMSS protocols, transported Mr. Williams to the Hospital, instead of another hospital closer to the accident, because of the Hospital’s designation as a Level II trauma center … This was an occasion where the patient, and those acting in his interest, chose the Hospital, not Dr. Blundon or any other provider, to provide necessary treatment. In sum, there was sufficient evidence for the jury to conclude that that the reliance element was satisfied … in cases involving patients in distress brought to emergency rooms, the reasonableness element in the application of the apparent agency doctrine often involves a discussion whether the hospital gave meaningful notice that emergency room staff were independent contractors and whether such notice could ever be meaningful in that context … Mr. Williams did not sign the form, and there was no evidence that he ever saw it. As the trial court opined, the relevance of this consent form to the question of apparent agency was “marginal to none.””
The Court of Appeals held: “there was sufficient evidence at trial for a reasonable jury find that Dr. Blundon was at least the apparent agent of the Hospital at the time he treated Mr. Williams at the Hospital’s trauma center. Accordingly, there was sufficient evidence to find the Hospital vicariously liable for the surgeon’s negligence.”
A dissenting opinion stated: “Viewing the record in the light most favorable to Mr. Williams, a reasonable jury could not infer from Mr. Williams’ testimony that Mr. Williams had a subjective belief that an agency relationship existed between Dr. Blundon and the Hospital. Nor could a reasonable jury find that Mr. Williams relied on that belief in seeking the medical services of the Hospital or Dr. Blundon … the Majority’s analysis creates a strict liability scenario, which is not supported by this Court’s established precedent and is nearly impossible for medical providers, emergency facilities and hospitals to overcome.”
Source Terence Williams v. Dimensions Health Corporation, No. 42, September Term 2021.
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