Hefner v. Dausmann

• Decision Date: 14 May 1999
• Docket Number: No. 22311,22311
• Citation: 996 S.W.2d 660
• Parties: David HEFNER and Teresa L. Hefner, Plaintiffs-Appellants, v. Gary W. DAUSMANN, M.D., and Poplar Bluff Physicians Group, Inc., d/b/a Doctors Regional Medical Center, Defendants-Respondents. . Division One
• Court: Missouri Court of Appeals

Page 660

996 S.W.2d 660

David HEFNER and Teresa L. Hefner, Plaintiffs-Appellants, v. Gary W. DAUSMANN, M.D., and Poplar Bluff Physicians Group Inc., d/b/a Doctors Regional Medical Center Defendants-Respondents.

No. 22311.

Missouri Court of Appeals,

Southern District.

Division One.

May 14, 1999.

Motion for Rehearing and Transfer to

Supreme Court Denied June 4, 1999.

Application for Transfer Denied

Aug. 24, 1999.

Thomas J. Casey and Stephen F. Meyerkord, Casey & Meyerkord, P.C., of St. Louis for Appellants.

Kenneth W. Bean and Carl J. Geraci, Sandberg, Phoenix & VonGontard, P.C., of St. Louis, for Respondents.

PREWITT, Presiding J.

Plaintiffs sought damages for wrongful death of their child, claiming medical malpractice on the part of the listed Defendants and Barnes Hospital of the City of St. Louis. The original petition through the fourth amended petition, upon which this matter was tried in Butler County, was filed in the Circuit Court of the City of St. Louis. That court dismissed Barnes Hospital from the suit and transferred the case to the Circuit Court of Butler County. Following jury trial, judgment was entered in accordance with the verdict in favor of Defendants. Plaintiffs appeal.

Plaintiffs present one point relied on. There they contend that the Circuit Court in the City of St. Louis erred in dismissing the claim against Barnes Hospital and transferring the claim, because Plaintiffs' fourth amended petition "stated a claim against resident defendant Barnes Hospital under theories of vicarious liability. Thus venue in the City of St. Louis was proper." Defendants counter that dismissal of Barnes Hospital and argue that the transfer was proper because Barnes Hospital was "pretensively joined" in order to attempt to have venue in the City of St. Louis.

Because the trial court derived its opinion solely from written documents, "the usual rule of deference to the trail court's assessment of credibility ... does not apply." Garner-Roe v. Anderson, 894 S.W.2d 223, 227 (Mo.App.1995).

We therefore examine the record, at the time of the hearing on pretensive joinder, to determine if it reflected a cause of action against Barnes Hospital. Appellants alleged that joinder was not pretensive because the petition sufficiently stated a claim against resident defendant Barnes Hospital under the theories of vicarious liability due to actual and/or apparent agency.

Venue is pretensive if(1) the petition fails to state a claim for which relief can be granted against the resident defendant, or (2) the record in support of a motion asserting pretensive joinder establishes there is no cause of action against the resident defendant and the information available at the time the petition was filed would not support a reasonable legal opinion that a case could be made against that defendant. State ex rel. Breckenridge v. Sweeney, 920 S.W.2d 901, 902 (Mo.banc 1996). See also Lynch v. Blanke Baer & Bowey Krimko, 901 S.W.2d 147, 153 (Mo.App.1995).

Courts will not permit a plaintiff to engage in the pretense of joining defendants for the sole purpose of obtaining venue; the party claiming pretensive joinder bears the burden of persuasion and proof. Lynch, 901 S.W.2d at 153. "Pretensive joinder exists where joinder appears pretensive on the face of the pleadings and where no cause of action exists against the joined defendant." Id . If venue was properly in the City of St. Louis, steps taken by the St. Louis Circuit Court to transfer the cause were void. State ex rel. Watts v. Hanna, 868 S.W.2d 549, 551 (Mo.App.1994).

The pretensive joinder test is disjunctive: we need find only that the first or second prong applies. The second prong is conclusive in this appeal. We conclude that the record reflects that there is no cause of action against Barnes Hospital, and the information available at the time the petition was filed would not support a reasonable legal opinion otherwise. It is unnecessary to discuss the first prong of the pretensive joinder test.

A challenge of pretensive venue based on defective pleadings should be determined when the challenge is adjudicated and upon the state of the pleadings at that time. Sweeney, 920 S.W.2d at 903. However, "the pleadings, whether original or amended, must be premised on information known to plaintiffs when the suit was originally filed." Id.

The adjudication of the challenge of pretensive joinder in this case was held after Appellants filed their Fourth Amended Petition. Sometime after that date, judging by the omission of reference in that amended petition, the Appellants became aware of an affiliation agreement between Barnes Hospital and Poplar Bluff Physicians Group, Inc. d/b/a Doctors Regional Medical Center (hereinafter Doctors Regional). A copy of the Clinical Affiliation Agreement was included with the pleadings filed by the present parties and Barnes Hospital on the motion to transfer. Because the Clinical Affiliation Agreement was part of the record at the time of adjudication, we have examined it to determine if it established that Barnes Hospital could be liable for the acts of Doctors Regional and concluded it does not.

Appellants cite State ex rel. Cross v. Anderson, 878 S.W.2d 37, 38 (Mo. banc 1994) to state that the trial court, when deciding if venue is pretensive, must look to the record. Although that is true, that case is not helpful to Appellants in this appeal. In Cross, the Supreme Court noted there was "no indication that the trial court considered whether the plaintiffs could have had a reasonable legal opinion that a case could be made against" defendant. Id. at 39. In the case presently before this court, the trial court did look to the record, including the Clinical Affiliation Agreement submitted by the defendants, and it thoroughly considered whether the Appellants could have had a reasonable legal opinion that a case could be made against Barnes Hospital. The Order states that the Appellants did not plead "any facts which would give rise to such vicarious liability." In fact, the Order begins by reciting that the trial court considered the "pleadings, exhibits, and authorities." The omissions made by the trial court in Cross were not made by the trial court in this case.

The trial court noted in its Order that it had not been made aware of any Missouri cases involving affiliated corporations and the liability of one for the acts of another. The court, however, used the same standard as is applied in cases of related corporations, such as a parent and a subsidiary. Generally, two different corporations are treated as two different persons, even if one corporation is the sole shareholder of the other. Grease Monkey Intern., Inc. v. Godat, 916 S.W.2d 257, 262 (Mo.App.1995). A parent corporation is not responsible for the acts of its subsidiary except where the wronged party pierces the corporate veil. Id. "Two separate corporations may be treated as one only where there is such dominion and control that the controlled corporation has no separate mind, will or existence of its own and is but an alter ego for its principal. Such dominion and control must be established by evidence, and is not presumed." Id. ¹

Actual Agency

To establish agency, evidence must support a finding that the principal has consented to the agent's acting on the principal's behalf, and the agent must be subject to the principal's control. Wray v. Samuel U. Rodgers' Community Health Center, Inc., 901 S.W.2d 167, 170 (Mo.App.1995). Absent evidence that the controlled corporation has no separate mind, will or existence of its own, the parent corporation is not liable for the acts of the subsidiary, or in this case, the affiliated corporation. Grease Monkey, 916 S.W.2d at 262. To establish a principal-agent relationship between two corporate entities, the controlled corporation must be merely a business conduit for its principal. Sedalia Mercantile Bank and Trust Co. v. Loges Farms, Inc. 740 S.W.2d 188, 202 (Mo.App.1987) . The control must be "actual, participatory and total." Id. at 202-203.

The question for this court to answer, therefore, is whether the facts alleged or presented establish that Doctors Regional is an agent of Barnes Hospital; that is, did Barnes Hospital consent to Doctors Regional acting on their behalf, and, if so, was Doctors Regional subject to Barnes Hospital's control?

The amended petition alleged agency in three paragraphs:

[paragraph] 8. That defendant Doctors Regional, and its administrators, directors, agents, servants and employees were at all times herein mentioned the actual agents of Barnes Hospital and as a result of such agency defendant Barnes Hospital is vicariously liable for the negligence of defendant Doctors Regional; that alternatively defendant Doctors Regional, and its administrators, directors, agents, servants and employees were at all times herein mentioned ostensible and apparent agents of defendant Barnes Hospital.

9. That it was represented to plaintiffs by defendant Doctors Regional, with the acquiescence, permission and knowledge of defendants Barnes, that Doctors Regional was affiliated with Barnes Hospital and that because of this affiliation, Doctors Regional, with the acquiescence, permission and knowledge of Barnes, represented to the community in which plaintiffs reside and to plaintiffs that Doctors Regional was a full services hospital with superior services, facilities, physicians, nurses and other health care providers.

10. That plaintiffs knew that plaintiff Teresa Hefner was to deliver twins and relied on the aforementioned representation of defendant Doctors Regional and Barnes Hospital and chose defendant Doctors Regional as the place where she would deliver her babies because of said representation.

Similar statements were reiterated in Count II of the amended petition. Respondents denied the allegations in these paragraphs.

Appellants alleged, in conclusionary terms, that Barnes Hospital...