Chehval v. St. John's Mercy Medical Center

• Decision Date: 04 November 1997
• Docket Number: No. 72287,72287
• Citation: 958 S.W.2d 36
• Parties: Michael J. CHEHVAL, M.D., Plaintiff-Respondent, v. ST. JOHN'S MERCY MEDICAL CENTER, Defendant-Appellant.
• Court: Missouri Court of Appeals

Page 36

958 S.W.2d 36

Michael J. CHEHVAL, M.D., Plaintiff-Respondent, v. ST. JOHN'S MERCY MEDICAL CENTER, Defendant-Appellant.

No. 72287.

Missouri Court of Appeals,

Eastern District,

Division Four.

Nov. 4, 1997.

Motion for Rehearing and/or Transfer to

Supreme Court Denied Jan. 8, 1998.

Gary P. Paul, Brinker & Doyen, St. Louis, for appellant.

Morris E. Stokes, Morris E. Stokes, P.C., St. Louis, for respondent.

HOFF, Judge.

St. John's Mercy Medical Center (Medical Center) appeals from the trial court's "Judgement, Order and Decree" (Judgment) entered in favor of Michael J. Chehval, M.D. ¹ (Physician) in Physician's declaratory judgment action focusing on a contractual indemnity provision. The trial court's Judgment, which resolved cross-motions for summary judgment, requires Medical Center to pay all costs and to "defend, indemnify, and hold harmless" Physician in a separate wrongful death action ² in which Physician is a defendant. We affirm because the parties' agreement clearly and unequivocally expresses an intent that Medical Center defend, indemnify, and hold harmless Physician for sums he is required to pay for personal injuries arising out of his own negligence in his rendering of or failure to render professional services to patients of two Medical Center clinics.

Summary judgment is proper to resolve claims interpreting a contractual indemnification provision. RJF Int'l Corp. v. B.F. Goodrich Co., 880 S.W.2d 366, 371 (Mo.App. E.D.1994). When considering an appeal from summary judgment, we review the record in the light most favorable to the party against whom the judgment was entered. Combined Communications Corp. v. City of Bridgeton, 939 S.W.2d 460, 462 (Mo.App. E.D.1996), citing ITT Commercial Fin. Corp. v. Mid-America Marine Supply Corp., 854 S.W.2d 371, 376 (Mo. banc 1993). In essence, our review is de novo and the key is the undisputed right to judgment as a matter of law. Id. at 462-63.

The undisputed facts disclose the following. In 1993 Physician and Medical Center entered into a written agreement regarding Physician's professional services (Agreement). In relevant part, that Agreement addressed Physician's responsibilities as Chief of Staff at the Medical Center, Chairman of the Medical Center's Division of Genito-Urinary Surgery, member of the Medical Center's Medical Staff, and physician at the Medical Center's clinics. Under the heading Clinic and Charity Patients the Agreement states in full

Physician will provide professional consultative services to patients in the J.F.K. and Meacham Park Clinics at the Medical Center. Physician agrees that billings and collections for these clinic patients will become part of the Medical Education and Research Institute. Physician shall also provide professional consultative services for charity patients as required in the Medical Staff Bylaws.

Paragraph 7.1 at page 4 of the Agreement. By paragraphs 6.1 and 6.2 of the Agreement, Physician is required to "restrict his private practice of medicine to a level that will not interfere with Physician carrying out the primary responsibilities as outlined in this Agreement" and to "restrict his private practice of medicine to the Medical Center." Pages 3-4 of the Agreement. The Agreement addresses the issue of Physician's potential liability for professional services as follows:

13. PROFESSIONAL LIABILITY INSURANCE

13.1 Medical Center hereby agrees to defend, indemnify and hold harmless Physician for all sums, including defense costs, which Physician shall become legally obligated to pay as damages because of injury to any person arising out of the rendering of or failure to render the professional services and obligations, including clinical duties, which are the subject of and which are described in this Agreement.

13.2 Physician hereby agrees to maintain a minimum level of professional liability coverage of Five Hundred Thousand ($500,000) dollars per occurrence, Five Hundred Thousand ($500,000) dollars annual aggregate, or at such limits as required by the laws of the State of Missouri as time to time revised, for any private practice activities or other rendering of professional services not included within the scope of this Agreement.

Page 6 of the Agreement.

Sharon Moeller was a clinic patient of Physician when she died on May 24, 1994. Sharon Moeller's husband, Michael Moeller, sued Medical Center and Physician in a wrongful death action alleging his wife's death resulted from their negligence and carelessness in the conduct and monitoring of surgery by Physician.

Physician then filed this separate declaratory judgment action against Medical Center. ³ In his petition, Physician alleged he unsuccessfully asked Medical Center, pursuant to their Agreement, to defend Physician and to indemnify him for any loss, cost, expense or obligation incurred in the wrongful death action. Physician and Medical Center filed cross-motions for summary judgment. ⁴ In resolving the cross-motions for summary judgment, the trial court found no genuine issues of material fact, summary judgment was appropriate, Sharon Moeller was a clinic patient, and "as such ... the agreement of the parties requires [Medical Center] to defend, indemnify, hold harmless, and pay all defense costs in Moeller v. St. Johns, et al # 670115."

Medical Center concedes the basic facts are not in dispute. It urges, however, the trial court erroneously applied the law to the facts because the language of the Agreement does not clearly and unequivocally express the intent to indemnify Physician for his own negligent acts. Medical Center also argues the Agreement required Physician to maintain professional liability insurance of $500,000 and "[a] fair reading of the agreement contemplated instances in which Physician would be directly sued for his own professional negligence." Medical Center's arguments are not persuasive.

One party may agree to indemnify a second party for loss resulting in whole or in part from the second party's own negligence; but such intention must be expressed in clear and unequivocal terms. Missouri Dist. Tel. Co. v. Southwestern Bell Tel. Co., 338 Mo. 692, 93 S.W.2d 19, 27-28 (1935). Broad and general indemnification language is alone insufficient to provide such indemnification. See, e.g., Howe v. Lever Bros. Co., 851 S.W.2d 769 (Mo.App. E.D.1993). There is, however, no special wording required. See RJF Int'l Corp., 880 S.W.2d at 371 (interpreting non-explicit indemnification language as providing indemnification "irrelevant of fault").

Rules applicable to the construction of contracts apply generally to indemnity agreements. Denny's Inc. v. Avesta Enters., Ltd., 884 S.W.2d 281, 290 (Mo.App. W.D.1994) . When a contract uses plain and unequivocal language it must be enforced as written. Lake Cable, Inc. v. Trittler, 914 S.W.2d 431, 436 (Mo.App. E.D.1996). To ascertain the intent of the parties to an unambiguous contract, we give the language used its natural, ordinary, and common sense meaning, and consider the entire contract, along with its object, nature, and purpose. Central City Ltd. Partnership v. United Postal Sav. Ass'n, 903 S.W.2d 179, 182 (Mo.App. E.D.1995). An ambiguity does not exist merely because the parties dispute the meaning of the contract. Id. Rather, a contract is ambiguous when the terms are susceptible of more than one meaning so that reasonable persons may fairly and honestly differ in their construction of the terms. Id.

Looking at the Agreement as a whole, we find its purpose is to delineate an employment relationship between Medical Center and Physician. Importantly, the Agreement expressly distinguishes between Physician's professional obligations and services at the Medical Center's clinics and his other professional obligations and services for the Medical Center. The Agreement also makes explicit distinctions between Physician engaging in professional services within the scope of the Agreement and Physician engaging in such services outside the scope of the Agreement.

With respect to Physician's clinical duties, the Agreement required Physician to see and treat patients at two specified clinics of the Medical Center and expressly denied any payment to Physician as compensation for such work. Instead, Medical Center required that payment for Physician's required clinic services be contributed to a specific institute. The Agreement also expressly recognized Physician may engage in professional services outside the scope of the Agreement by noting Physician's private practice must not interfere with his services under the Agreement and was restricted to the Medical Center.

This distinction between the rendering of services within the scope of the Agreement and the rendering of services beyond the scope of the Agreement is reiterated by the manner in which Physician's potential liability for providing professional services is addressed in Paragraph 13.1 of the Agreement:

Medical Center hereby agrees to defend, indemnify and hold harmless Physician for all sums, including defense costs, which Physician shall become legally obligated to pay as damages because of injury to any person arising out of the rendering of or failure to render the professional services and obligations, including clinical duties, which are the subject of and which are described in this Agreement.

(emphasis added.) In the next paragraph of the Agreement, Physician is required to maintain a minimum level of professional liability coverage for "any private practice activities or other ... professional services not included within the scope of this Agreement " (emphasis added).

Paragraph 13.1 of the parties' Agreement clearly indicates Medical Center's intent to indemnify Physician for any sum he is obligated to pay for injury to any person arising out of his acts or failure to act, while carrying out "clinical duties" that are the subject of the Agreement. The Agreement clearly and unambiguously requires...