Hainer v. American Medical Intern., Inc.

• Decision Date: 12 September 1995
• Docket Number: No. 2413,2413
• Citation: 465 S.E.2d 112,320 S.C. 316
• Parties: Anne T. HAINER, Respondent, v. AMERICAN MEDICAL INTERNATIONAL, INC.; East Cooper Community Hospital, Inc.; Cindy Woltman; Patricia Condon; and Katherine Sellers, Appellants. . Heard
• Court: South Carolina Court of Appeals

Page 112

465 S.E.2d 112

320 S.C. 316

Anne T. HAINER, Respondent, v. AMERICAN MEDICAL INTERNATIONAL, INC.; East Cooper Community Hospital, Inc.; Cindy Woltman; Patricia Condon and Katherine Sellers, Appellants.

No. 2413.

Court of Appeals of South Carolina.

Heard Sept. 12, 1995.

Filed Nov. 6, 1995.

Rehearing Denied Dec. 20, 1995.

Certiorari Granted Aug. 8, 1996.

E. Douglas Pratt-Thomas, Allison M. Carter, and D. Kay Tennyson, all of Wise & Cole, Charleston, for appellants.

Fleet Freeman, of Freeman & Freeman; and Justin O'Toole Lucey, of Justin O'Toole Lucey, P.A., Mt. Pleasant, for respondent.

PER CURIAM:

Respondent, Anne T. Hainer, sued appellants, American Medical International, Inc. (AMI), East Cooper Community Hospital, Inc. (Hospital), Cindy Woltman, Patricia Condon, and Katherine Sellers, for abuse of process, intentional infliction of emotional distress, civil conspiracy, and defamation. ¹ The jury awarded Hainer compensatory damages of $75,000 against all appellants and punitive damages of $225,000 against the corporate appellants. We reverse.

This action arose after Hainer, a registered nurse, was reported to the State Board of Nursing for South Carolina (the Board) by her supervisor, Katherine Sellers, for misconduct committed by Hainer on July 16, 1989. After the report, the Board began an investigation into Hainer's conduct which culminated in a complaint being filed by the Board against her alleging she was guilty of "patient abandonment" as defined in 26 S.C.Code Ann.Regs. 91-19.c. (3)(p) (Supp.1994) and S.C.Code Ann. § 40-33-935(e) (1986). A disciplinary hearing panel appointed by the Board concluded Hainer "committed misconduct in violation of R 91-19.c. (3)(p) ... in that [she] left her assigned patients requiring nursing care without properly notifying appropriate personnel." In reaching that conclusion, the panel specifically found on July 16, 1989, Hainer clocked in for her assigned shift, accepted responsibility for patients, and took a patient assignment. However, after she became angry at the charge nurse, she left the hospital without notifying the charge nurse or administrative supervisor. In its order, the Board adopted the panel's report and recommendation ² in its entirety, and the circuit court affirmed. Hainer did not appeal the order of the circuit court, and, as such, the findings of the Board became final. Therefore, the court in this action ruled that under the doctrine of collateral estoppel, Hainer was estopped from raising or relitigating the issue of whether or not she was, in fact, guilty of misconduct. ³ Thus, the finding that Hainer was guilty of patient abandonment is the law of this case. Bennett v. S.C. Dept. of Corrections, 305 S.C. 310, 408 S.E.2d 230 (1991) (under the doctrine of collateral estoppel, the decision of an administrative tribunal precludes the relitigation of the issues addressed by that tribunal in a collateral action).

Hainer's claims in this action are based on allegations that appellants delayed reporting her to the Board intentionally and maliciously for the purpose of preventing her from testifying as a witness against appellants in the lawsuit of a co-worker, Sandra Enright. Enright sued the Hospital for negligence, outrage, breach of fiduciary duty and civil conspiracy arising out of the Hospital's alleged threat to have her nursing license revoked for patient abandonment if she failed to report to work during Hurricane Hugo, even though she was not scheduled to work. The Enright suit alleged impropriety on the part of the Hospital by using threats of licensure loss against its personnel in order to control them. In this suit, Hainer maintained the reason for the delay in reporting her to the Board was to chill her testimony in the Enright suit. ⁴I. Abuse of Process

Appellants argue they were entitled to a directed verdict on Hainer's abuse of process claim because they were statutorily required to report Hainer's misconduct. Because the communication to the Board was subject to a qualified privilege, they contend that they cannot be held liable for their action in reporting her. We agree and, thus, reverse the jury verdict.

In ruling on the denial of motions for directed verdict, j.n.o.v. and a new trial, the evidence and all reasonable inferences from the evidence must be considered in a light most favorable to the non-moving party. Rush v. Blanchard, 310 S.C. 375, 426 S.E.2d 802 (1993); Brown v. Orndorff, 309 S.C. 320, 422 S.E.2d 151 (Ct.App.1992). We are not at liberty to pass upon the veracity of the witnesses and determine the case according to our view of the weight of the evidence. Id. 422 S.E.2d at 154. If the evidence as a whole is susceptible of more than one reasonable inference, a jury issue is created and the motions for directed verdict and j.n.o.v. are properly denied. Horry County v. Laychur, 315 S.C. 364, 434 S.E.2d 259 (1993). However, if only one reasonable inference can be drawn from the evidence, the motion must be granted. Id.

In order to insure that licensed nurses comply with the standards of their profession, the State of South Carolina has mandated that "all employers of nurses shall report any incidence of the misconduct or the incapacities described in § 40-33-935 to the State Board of Nursing." S.C.Code Ann. § 40-33-970 (1986). Pursuant to 26 S.C.Code Ann.Regs. 91-19.c. (3)(p) and S.C.Code Ann. § 40-33-935(e), patient abandonment is defined and designated as an act of misconduct, the violation of which would mandate the reporting of the offense to the Board. Section 40-33-936 (1986) further provides that communications to the Board shall be privileged except when made with malice:

Every communication, whether oral or written, made by or on behalf of any person, firm or corporation to the Board or any person designated by it to investigate or otherwise hear matters relating to the revocation, suspension, or other restriction on a license or the limitation on or other discipline of a licensee, whether by way of complaint or testimony, shall be privileged; and no action or proceeding, civil or criminal, shall lie against any such person, firm or corporation by or on whose behalf such communication shall have been made by reason thereof, except upon proof that such communication was made with malice.

The obvious legislative intent behind this statutory scheme is to insure that nurses meet minimum requirements for safe practice and that those falling below minimum competency be prohibited from practicing. See S.C.Code Ann. § 40-33-220 (Supp.1994).

Hainer, in fact, concedes that appellants had a duty to report her to the Board. She alleges, however, that the appellants' filed the disciplinary complaint not to comply with that statutory duty; rather, they filed the complaint to the Board for the ulterior purpose of chilling her testimony in the Enright suit. Hainer maintains the Enright lawsuit provided appellants with collateral reasons to attack and discredit her since that suit involved the alleged improper use of threats against Enright's nursing license for patient abandonment in order to obtain her compliance, and Hainer could have been a critical witness for Enright. Thus, the use of the process for this ulterior and wrongful purpose is what created liability for abuse of process.

In support of her contention, Hainer relies on Huggins v. Winn Dixie Greenville, Inc., 249 S.C. 206, 153 S.E.2d 693 (1967), aff'd 252 S.C. 353, 166 S.E.2d 297 (1969) where our Supreme Court outlined the essential elements of the tort of abuse of process: first, an ulterior purpose, and second, a wilful act in the use of the process not proper in the regular conduct of the proceeding. ⁵ In Huggins the court further held:

Some definite act or threat not authorized by the process, or aimed at an objective not legitimate in the use of the process, is required; and there is no liability where the defendant has done nothing more than carry out the process to its authorized conclusion, even though with bad intentions. The improper purpose usually takes the form of coercion to obtain a collateral advantage, not properly involved in the proceeding itself, such as the surrender of property or the payment of money, by the use of the process as a threat or club. There is, in other words, a form of extortion, and it is what is done in the course of negotiation, rather than the issuance or any formal use of the process itself, which constitutes the tort. (Emphasis added).

Id. 153 S.E.2d at 694.

The dispositive issue on appeal is whether the report of Hainer's misconduct was made with the requisite malice. There are no South Carolina cases which interpret the meaning of malice as used in § 40-33-936. The appellants point out that our interpretation of this Section not only affects the nursing profession but will likewise affect many professionals since the language in this Section is virtually identical to immunity provisions granted to persons reporting or testifying before boards regulating chiropractors, physical therapist, physicians, and social workers. Therefore, as a matter of public policy, the appellants urge that our holding avoid any possible construction of the statutory scheme which would diminish or have a chilling effect on the legal responsibility and requirement of licensees to report possible violations of 26 S.C.Code Ann.Regs. 91-19 and S.C.Code Ann. § 40-33-935 to appropriate authorities.

Therefore, keeping in mind the described statutory scheme which obligates licensees to communicate knowledge of a violation, public policy considerations, and the procedure for implementing the legislative purpose and intent underlying the regulation of nurses, we hold the evidence was legally insufficient to prove the essential element of malice. In her brief, Hainer notes that the trial judge "defined the different forms of malice [for the jury], and then charged the appellants' requested charge that 'malice is the...