Illinois Appellate Court Holds Settlement With Medical Malpractice Physician Extinguished Vicarious Liability Claim Against His Employer

The Appellate Court of Illinois Fifth District (“Illinois Appellate Court”) held in its Order dated January 7, 2022: “After reviewing the allegations in count I, as pled, it is reasonable to conclude that the plaintiff’s claim against Physician Services was based solely on a theory of vicarious liability for the acts of its employee, Dr. Parham. The allegations in count I did not reasonably inform the defendants or the trial court that the plaintiff’s claim against Physician Services was separate from and independent of the negligence claim against Dr. Parham … When a plaintiff brings an action against the principal under a theory of vicarious liability, a settlement between the agent and the plaintiff extinguishes the principal’s vicarious liability, even if the plaintiff’s covenant not to sue the agent expressly reserves the plaintiff’s right to seek recovery from the principal.”

The Underlying Facts

The plaintiff, Penny Campbell-Henry, special administrator of the estate of Kent Henry, deceased, filed an Illinois medical negligence action against the defendants, Good Samaritan Regional Health Center (Good Samaritan), Walter A. Parham, M.D., and Physician Services Corporation of Southern Illinois, Inc., d/b/a Heart and Vascular Center (Physician Services), his employer. After the plaintiff settled with Dr. Parham, Physician Services filed a motion for summary judgment. Physician Services argued that the claims against it were based upon vicarious liability for the actions of its employee, Dr. Parham, and that those claims were extinguished when Dr. Parham settled with the plaintiff. The trial court granted Physician Services’ motion for summary judgment, and subsequently denied the plaintiff’s motion to reconsider. On appeal, the plaintiff contended that the trial court erred in granting summary judgment in favor of Physician Services because count I of the first amended complaint included separate and independent allegations of negligence against Physician Services.

The Illinois Appellate Court stated: “The plaintiff’s claim that she alleged a separate and independent claim of negligence against Physician Services is refuted by the allegations in count I of the first amended complaint, and by the plaintiff’s overall prosecution of her case against Physician Services. The record demonstrates that the plaintiff relied upon the theory that Physician Services was vicariously liable for the negligence of Dr. Parham from the inception of the case through the summary judgment proceedings. Based upon the record, the trial court reasonably concluded that the plaintiff’s claim against Physician Services was based solely on a theory of vicarious liability for the alleged negligence of Dr. Parham, and that the Gilbert case applied. Under Gilbert, when a plaintiff’s action against a principal is based upon vicarious liability, any settlement between the agent and the plaintiff must also extinguish the principal’s vicarious liability, regardless of whether the plaintiff’s covenant not to sue the agent expressly reserves the plaintiff’s right to seek recovery from the principal.”

Source Campbell-Henry v. Good Samaritan Regional Health Center, 2022 IL App (5th) 210147-U.

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This entry was posted on Thursday, February 3rd, 2022 at 5:25 am. Both comments and pings are currently closed.

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