Carter v. St. John's Regional Med. Center, 24247.
| Decision Date | 25 July 2002 |
| Docket Number | No. 24247.,No. 24248.,24247.,24248. |
| Citation | 88 S.W.3d 1 |
| Parties | Robert CARTER, M.D., Plaintiff-Appellant-Cross-Respondent, v. ST. JOHN'S REGIONAL MEDICAL CENTER, Defendant-Respondent-Cross-Appellant. |
| Court | Missouri Court of Appeals |
L. Thomas Elliston, Webb City, James R. Spradling, Carthage, for appellant.
James Bandy, Horn Aylward & Bandy, LLC, Kansas City, for respondent.
This damage suit by Dr. Robert L. Carter ("Dr. Carter") against St. John's Regional Medical Center ("St. John's") was submitted to the jury as a breach of contract claim and a claim of tortious interference with business expectancy. The trial court would not submit Dr. Carter's claim for punitive damages to the jury. The jury awarded Dr. Carter compensatory damages on both claims, and St. John's appeals from the judgment entered on those verdicts. Dr. Carter also appeals and claims the trial court erred by not submitting his punitive damage claim to the jury. The trial court did not err in its refusal to give a punitive damage instruction with the contract claim. We affirm the judgment for Dr. Carter for compensatory damages on his breach of contract claim; we reverse the judgment for Dr. Carter on his tort claim and remand for further proceedings.
Dr. Carter graduated from medical school in 1966 and ultimately became a board-certified pathologist. In 1981, Dr. Carter left private practice to work for Scripps Clinic and Research in California. Scripps did work in "clinical hematologyoncology for the advanced treatment and diagnosis of cancer and allied diseases." While working there, Dr. Carter became a specialist in hematology-oncology and received training in bone marrow transplants. Dr. Carter explained that this field was then "literally exploding."
In 1982, Dr. Carter was asked to travel to Joplin, Missouri, to speak on the topic of bone marrow transplants.1 Part of Dr. Carter's visit to Joplin included a tour of St. John's and discussions with the administration about joining their emerging cancer center. At that time, no doctor at St. John's had training in the area of bone marrows, and Dr. Carter's fellowship at Scripps Clinic was scheduled to end June 30, 1983.
After his initial discussions with St. John's about locating in Joplin, Dr. Carter applied for active privileges, both clinical and procedural, as an oncologist/hematologist in St. John's department of medicine and family practice. He also applied for consulting privileges in pathology. His initial application was dated October 20, 1982. Dr. Carter explained that he viewed privileges in the pathology department as "absolutely essential" in the care and treatment of a cancer patient.
In June 1983, Richard Hammer ("Hammer"), vice president of St. John's, called Dr. Carter in California, and during the conversation, they agreed Dr. Carter would withdraw his request for pathology privileges, and his "main area of service [would] be hematology-oncology ... and in that framework be able to perform and officially report bone marrows[.]" After the conversation, Dr. Carter immediately transcribed a letter and sent it to Hammer in which Dr. Carter described their discussion and agreement. As explained more fully below, this letter and other documents prepared by St. John's form the basis of Dr. Carter's claim that he had a contract right to officially "report bone marrow" test results and charge therefor.
Sometime after June 30, 1983, Dr. Carter began a private practice in Joplin, Missouri, and began using the hospital's facilities in connection with his practice. From 1983 to 1997, Dr. Carter continued to report on bone marrow aspirations and had an excellent relationship with the pathology laboratory at St. John's. For example, he testified that pathology lab personnel at St. John's often did the technical preparation of slides for him, and he had performed close to 3,000 bone marrows "since I've been here."
This relationship deteriorated in September 1997. Dr. Carter claimed the collapse was due to his discovery of many instances of misdiagnoses by the lab, and his complaints about this perceived problem. St. John's then informed Dr. Carter he should not remove pathology slides from the hospital premises as he had done in the past. In explanation, St. John's stated such practice violated their policies. Dr. Carter also testified that St. John's and the lab would not allow him to view the pathology slides when he would actually go to the hospital. Finally, on October 14, 1997, St. John's informed Dr. Carter via letter that although he was a boardcertified pathologist, he did "not have privileges to practice this speciality at St. John's."
When Dr. Carter ultimately sued St. John's, he alleged that St. John's actions, as recounted above, amounted to a breach of their contract by which he had the right to officially report on bone marrows. At trial, he presented evidence that he had lost business profits in 1997 through 2000 because of this alleged breach of contract.
Also, because of the antagonism between the hospital and him, Dr. Carter claimed other doctors who were associated with St. John's stopped referring patients to his office. According to Dr. Carter, this resulted in a decrease in his patient load and a decline in profits for his practice. This allegation was the primary basis of Dr. Carter's suit against St. John's for tortious interference with his practice. To prove damages on this claim, Dr. Carter hired an expert witness, Thomas Beisner ("Beisner"), and directed him to "look at changes in [Dr Carter's] practice over the ... years[]" and form some opinions with regard thereto. Dr. Carter directed Beisner to make his analysis by calculating what profits Dr. Carter lost in 1996, 1997, and 1998, due to the decrease in patient referrals by certain physicians (twenty in number) as named by Dr. Carter. Beisner testified this loss was $261,000. This figure was then used to predict future lost profits allegedly caused by St. John's interference with Dr. Carter's practice.
Dr. Carter sued St. John's in late 1997 and ultimately went to trial on a breach of contract count and a claim of tortious interference with his practice. The jury returned a verdict of $1.0 million on the contract count and $1.5 million on his tort claim.
In No. 24247 St. John's appeals from the judgment rendered on these verdicts. In No. 24248, Dr. Carter appeals, charging that the trial court erred when it refused to submit his claim for punitive damages to the jury.
St. John's first point claims there was insufficient evidence to support the jury verdict and resultant judgment on the contract count. Specifically, St. John's claims the evidence did not "support a finding that [Dr. Carter] and [St. John's] reached a binding agreement for medical staff privileges in that: (A) medical staff privileges cannot be granted or agreed to by a hospital employee; (B) there was no consideration or mutuality of obligation for the alleged contract; and (C) the agent of [St. John's] with whom [Dr. Carter] reached the alleged agreement [Hammer] had no authority to enter into a contract for medical staff privileges."
The essential elements of a contract are: (1) competency of the parties to contract; (2) proper subject matter; (3) legal consideration; (4) mutuality of agreement; and (5) mutuality of obligation. Baris v. Layton, 43 S.W.3d 390, 396[13] (Mo.App.2001).
In its brief, St. John's never questions the "proper subject matter" element of Dr. Carter's alleged contract with St. John's. Specifically, neither St. John's point nor the argument beneath it addresses the question of whether (a) hospital privileges could properly be the subject of a contract via formal action of the Board, or (b) Board, by its conduct, could ratify an unauthorized contract for privileges made by its agent. By not briefing the "subject matter" element, St. John's waives any claim about it as a submissibility issue.
To make a submissible case in a breach of contract suit, substantial evidence must support every fact essential to liability. Gateway Exteriors, Inc. v. Suntide Homes, Inc., 882 S.W.2d 275, 279[2] (Mo.App.1994). The questions of whether the evidence is substantial and whether the inferences drawn are reasonable are questions of law. Id. at 279[4]. In determining if Dr. Carter made a submissible case, we view the evidence in the light most favorable to him, presume his evidence is true, and give him the benefit of all reasonable and favorable inferences to be drawn from the evidence. Eidson v. Reproductive Health Services, 863 S.W.2d 621, 626[3] (Mo.App.1993).
As we understand prong (A) of St. John's first point, it contends there was no mutuality of agreement because "[a]s a matter of law, medical staff privileges can only be granted to a physician by the governing body of the hospital[,]" and, according to St. John's, Dr. Carter presented no evidence that St. John's board of directors ("Board") agreed to the contract or even had any knowledge of it. To support the argument, St. John's points to the evidence adduced by Dr. Carter that the alleged contract was negotiated between Hammer (who had no authority to bind the Board) and him.
The contract claimed by Carter is found in a letter written by Dr. Carter to Hammer in which he set out the agreement he made with Hammer in their June 15, 1983, telephone call and in a handwritten note by Hammer on Dr. Carter's delineation of privileges form. Hammer's notation was confirmatory of Dr. Carter's letter, i.e., that Carter's "privileges to do bone marrows [as a hematologist and oncologist] includes the right to report same on...
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