Irving v. Doctors Hosp. of Lake Worth, Inc., 81-118

• Decision Date: 02 June 1982
• Docket Number: No. 81-118,81-118
• Citation: 415 So.2d 55
• Parties: Deborah IRVING, individually, and as mother and next friend of Jennifer Johnson, Appellant, v. DOCTORS HOSPITAL OF LAKE WORTH, INC., Appellee.
• Court: Florida District Court of Appeals

Page 55

415 So.2d 55

Deborah IRVING, individually, and as mother and next friend of Jennifer Johnson, Appellant, v. DOCTORS HOSPITAL OF LAKE WORTH, INC., Appellee.

No. 81-118.

District Court of Appeal of Florida,

Fourth District.

June 2, 1982.

Rehearings Denied July 8, 1982.

Paul A. Louis and Paul Siegel of Sinclair, Louis, Siegel, Heath, Nussbaum & Zavertnik, P. A., Miami, for appellant.

Robert T. Bergin, Jr., of Brennan, McAliley, Hayskar & McAliley, P. A., West Palm Beach, for appellee.

DOWNEY, Judge.

This action involves the liability of a hospital for alleged negligent diagnosis and treatment by an emergency room physician that resulted in serious injury to appellant's minor daughter.

The appellant, Deborah Irving as mother and next friend of her daughter, Jennifer Johnson, sued Gilbert R. Panzer, M.D., Doctors Hospital of Lake Worth, Inc., and Florida Patients Compensation Fund to recover damages for the negligence of Dr. Panzer in failing to diagnose that Jennifer Johnson was suffering from meningitis when she was brought to the emergency room of Doctors Hospital for treatment. Prior to trial Irving settled with Panzer and the hospital's primary insurer paid her $100,000. The Patients Compensation Fund was obliged to pay any damages for which the hospital was liable in excess of $100,000. The case against the hospital was tried by jury, and resulted in a finding of no liability because the jury agreed Panzer was not an employee of the hospital.

Irving contends the judgment should be reversed because the trial court erred 1) in failing to direct a verdict for the plaintiff because there was no dispute that Panzer was the hospital's employee and that he was negligent; and 2) in failing to give appellant's requested instructions to the jury on the exceptions to the independent contractor rule. From our study of the briefs and record we conclude no error is demonstrated by the first point because a jury question was presented. However, we conclude that reversible error was committed when the trial court instructed the jury regarding the non-liability of an independent contractor without including the inculpatory exceptions to that rule that had been requested by Irving.

The critical issue to be decided by the jury in this case was whether Panzer, as the emergency room physician, was an employee of Doctor's Hospital, thus making the hospital vicariously liable for his negligence, or an independent contractor that shielded the hospital from vicarious liability. Evidence was adduced at length to show that Panzer operated as a professional association. Panzer worked only in the emergency room of Doctors Hospital, for 48 to 50 hours per week; he had no patients of his own, kept no records and sent no bills; he performed no follow up care on hospital patients he treated unless they had no regular physician. He was required to see all patients who came to the emergency room. The hospital furnished all support personnel for the emergency room, provided all supplies and medicines, managed the billing and receipts, and paid Panzer $35 per hour for his services. The hospital withheld no income tax or social security on payments to Panzer. The hospital's emergency department had a policy and procedure manual and the medical and dental staff of the hospital had by-laws that controlled the emergency room. These by-laws contained detailed instructions on the manner in which emergency room care was to be administered, including mandatory procedures to be followed in specific situations. There was no sign in the emergency room or any other matter or thing that would put a person on notice that the emergency room doctor was not an employee of the hospital. Furthermore, Irving testified that, when she went to the emergency room, she thought Panzer was a hospital employee.

The hospital and the Fund contended Panzer was an independent contractor rather than an employee and, as a consequence, they were not liable for his alleged negligence. Accordingly, the trial court instructed the jury in accordance with Standard Jury Instruction 3.3b, ¹ on the vicarious liability of an employer for the negligence of an employee or agent committed within the scope of his employment. The standard instruction further advises the jury that the employer is not responsible for such negligence if the person employed is an independent contractor.

Irving's Complaint alleged that Panzer was employed by the hospital. This allegation was denied by the answers of the hospital and the Fund. The evidence was such that the jury could have found that Panzer was an employee or that he was an independent contractor. Irving's theory maintained that Panzer was an employee, but argued that even if he was an independent contractor the hospital remained liable under the several exceptions to the independent contractor rule. Thus, at the charge conference, Irving requested three instructions that would constitute exceptions to the general exculpatory effect of the independent contractor rule, all of which the court denied. If any of those charges were proper under the law and evidence, then a reversal is mandated. It is almost trite to restate the rule that each party is entitled to have the jury properly instructed on his theory of the case. City of Tamarac v. Garchar, 398 So.2d 889 (Fla. 4th DCA 1981).

Of the three instructions that Irving requested ² at least the first two should have been given.

The first instruction, designated in footnote 2 as [a], is an admixture of the agency doctrine of apparent authority and the doctrine of estoppel. The instruction as requested was lifted verbatim from Sapp v. City of Tallahassee, 348 So.2d 363 (Fla. 1st DCA 1977), a case involving questions of independent contractor and apparent authority. A legion of cases throughout the country espouses the doctrine of apparent authority and provides that an employer who holds one out as his employee is estopped to deny the employee's authority. One such case is Thomas v. Checker Cab Co., 66 Mich.App. 152, 238 N.W.2d 558, 560-561 (1975), wherein it was stated:

As a general rule, an employer is vicariously liable for the torts of his employee committed while that employee is acting within the scope of his employment, but is not similarly liable for the tortious actions of independent contractors. One exception to the independent contractor rule is found in the doctrine of "estoppel". The application of that doctrine to the area of vicarious liability is found in 1 Restatement Agency 2d, § 267, p. 578:

"One who represents that another is his servant or other agent and thereby causes a third person justifiably to rely upon the care or skill of such apparent agent is subject to liability to the third person for harm caused by the lack of skill of the one appearing to be a servant or other agent as if he were such."

Where one holds himself out as the employer of a certain person, and there is reliance, that apparent employer is estopped from arguing that such person is an independent contractor. (Emphasis supplied).

This principle has been applied in the context of a hospital setting as to the status of the doctor and the vicarious liability of the hospital. Thus, in Mehlman v. Powell, 281 Md. 269, 378 A.2d 1121, 1123-24 (1977), the court stated:

In B. P. Oil Corp. v. Mabe, 279 Md. 632, 643, 370 A.2d 554, 560 (1977), this Court endorsed § 267 of Restatement (Second) of Agency, which provides in part:

"One who represents that another is his servant or other agent and thereby causes a third person justifiably to rely upon the care or skill of such apparent agent is subject to liability to the third person for harm caused by the lack of care or skill of the one appearing to be a servant or other agent as if he were such." (Emphasis supplied).

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In the instant case, all appearances suggest and all ordinary expectations would be that the Hospital emergency room, physically a part of the Hospital, was in fact an integral part of the institution. It is not to be expected, and nothing put Mr. Powell on notice, that the various procedures and departments of a complex, modern hospital like Holy Cross are in fact franchised out to various independent contractors. The situation seems to us substantially similar to that in Stanhope v. Los Angeles College of Chiropractic, 54 Cal.App.2d 141, 128 P.2d 705 (1942), where the court, holding that an apparent agency existed between a hospital and an independent radiologist, stated (128 P.2d at 708):

"... [The] appellant did nothing to put respondent on notice that the X-ray laboratory was not an integral part of appellant institution, and it cannot seriously be contended that respondent, when he was being carried from room to room ... should have inquired whether the individual doctors who examined him were employees ... or were independent contractors."

We thus hold that Holy Cross Hospital represented to the decedent that the staff of the Holy Cross Hospital emergency room were its employees, thereby causing the decedent to rely on the skill of the emergency room staff, and that the Hospital is consequently liable to the decedent as if the emergency room staff were its employees. (Emphasis in original.)

Another excellent explication of the apparent authority rule within the hospital setting occurs in Arthur v. St. Peters Hospital, 169 N.J.Super. 575, 405 A.2d 443 (1979), where a plaintiff was examined in the emergency room of the defendant hospital and subsequently x-rayed in the radiology department. In subsequent litigation involving the alleged negligence of the emergency room and radiology doctors, the hospital relied on the absence of deductions from the doctors' compensation to demonstrate that the doctors involved were independent contractors. With regard to the doctors' apparent authority and its effect upon their status as independent contractors, the court said:

Since it has been assumed for purposes of this...