Larson v. Wasemiller

• Decision Date: 25 July 2006
• Docket Number: No. A05-1698.,No. A05-1701.,A05-1698.,A05-1701.
• Citation: 718 N.W.2d 461
• Parties: Mary LARSON, et al, Respondents, v. James Preston WASEMILLER, M.D., Appellant (A05-1698), Defendant (A05-1701), Paul Scot Wasemiller, M.D., et al., Defendants (A05-1698), St. Francis Medical Center, Appellant (A05-1701).
• Court: Minnesota Court of Appeals

718 N.W.2d 461

Mary LARSON, et al, Respondents, v. James Preston WASEMILLER, M.D., Appellant (A05-1698), Defendant (A05-1701), Paul Scot Wasemiller, M.D., et al., Defendants (A05-1698),

St. Francis Medical Center, Appellant (A05-1701).

No. A05-1698.

No. A05-1701.

Court of Appeals of Minnesota.

July 25, 2006.

COPYRIGHT MATERIAL OMITTED

Terry L. Wade, William J. Maddix, Robins, Kaplan, Miller & Ciresi, L.L.P., Minneapolis, MN, for respondents.

Louise Dovre Bjorkman, Mark A. Solheim, Charles A. Gross, Larson • King, L.L.P., St. Paul, MN; and M. Daniel Vogel, Vogel Law Firm, Fargo, ND, for appellant James Preston Wasemiller.

Rodger A. Hagen, William M. Hart, Meagher & Geer, P.L.L.P., Minneapolis, MN, for defendant Paul Scot Wasemiller and Dakota Clinic.

Robert M. Mahoney, Mark W. Hardy, Geraghty, O'Loughlin & Kenney, P.A., St. Paul, MN, for appellant St. Francis Medical Center.

Mark R. Whitmore, Charles E. Lundberg, Bassford Remele, P.A., Minneapolis, MN, for Amici Minnesota Hospital Ass'n, Minnesota Medical Ass'n, and American Medical Ass'n.

Diane B. Bratvold, Shanda K. Pearson, Rider Bennett, L.L.P., Minneapolis, MN, for Amicus MN Defense Lawyers Ass'n.

Considered and decided by STONEBURNER, Presiding Judge; DIETZEN, Judge; and HARTEN, Judge.^*

OPINION

STONEBURNER, Judge.

Respondents brought a medical-malpractice action against appellant James Preston Wasemiller, M.D. and defendant Paul Scott Wasemiller, M.D. Respondents amended the complaint to add claims against appellant St. Francis Medical Center for negligent credentialing of Dr. James Wasemiller and negligence in a joint venture. St. Francis Medical Center moved to dismiss under Minn. R. Civ. P. 12.02(e), arguing that (1) Minnesota does not recognize legal claims of "negligent credentialing" or "negligent privileging" against a hospital; (2) Minn.Stat. § 145.63, subd. 1, limits liability for review organizations; (3) the peer-review privilege, as codified in Minn.Stat. § 145.63, impliedly rejects such claims against hospitals; and (4) respondents have failed to state a claim against the hospital for liability based on joint enterprise with Dr. James Wasemiller¹. The district court denied the motion but certified two questions to this court:

1. Does the state of Minnesota recognize a common-law cause of action of negligent credentialing or privileging of a physician against a hospital or other review organization?

The district court answered in the affirmative.

2. Do Minn.Stat. §§ 145.63-.64 grant immunity from or otherwise limit liability of a hospital or other review organization for a claim of negligent credentialing or privileging of a physician?

The district court answered in the negative.

FACTS

We initially note that this matter was handled in the district court as a motion to dismiss for failure to state a claim on which relief can be granted. We have not considered any facts beyond those stated in the pleadings.²

Appellant James Preston Wasemiller, M.D. and defendant Paul Scot Wasemiller, M.D. are physicians licensed in Minnesota, who hold themselves out as surgery specialists. Appellant St. Francis Medical Center (the hospital) is a Minnesota corporation that granted Drs. James P. and Paul S. Wasemiller privileges to perform surgical procedures, including bariatric surgery, on patients. According to the compliant, Dr. James P. Wasemiller performed a gastric bypass and splenectomy on respondent Mary Larson, with the assistance of Dr. Paul S. Wasemiller at the hospital, and both were negligent in her post-surgery care, causing respondents to suffer damages.

The complaint asserts that the hospital knew, or should have known, before the Larson surgery that Dr. James P. Wasemiller posed an unreasonable danger of harm to bariatric surgery patients at the hospital and that the hospital breached its duty to Larson by granting privileges to Dr. James P. Wasemiller to perform bariatric surgery at the hospital, causing respondents to suffer damages.

ISSUES

1. Are the certified questions important and doubtful?

2. Should Minnesota recognize a common-law cause of action for negligent credentialing or privileging of a physician against a hospital or other review organization?

3. Do Minn.Stat. §§ 145.63-.64 grant immunity from or otherwise limit the liability of a hospital or other review organization for a claim of negligent credentialing or privileging of a physician?

ANALYSIS

I. Are the certified questions important and doubtful?

This court may hear an appeal from a denial of a motion to dismiss "if the trial court certifies that the question presented is important and doubtful." Minn. R. Civ.App. P. 103.03(i) (2004); Jostens, Inc. v. Federated Mut. Ins. Co., 612 N.W.2d 878, 883 (Minn.2000). All parties to this action agree that no appellate court in Minnesota has recognized a cause of action for negligent credentialing or privileging of a physician against a hospital or other review organization and that the district court's certified questions are "important and doubtful." We agree.

Whether a question is important and doubtful is a legal question subject to de novo review. Jostens, 612 N.W.2d at 883. We balance a number of factors in determining if a question is important. Id. at 884. "A question is increasingly important if:" it has statewide impact, reversal is likely, lengthy proceedings will be terminated, and a district court's incorrect ruling will inflict substantial harm on the parties. Id. "[A] great deal of importance should be placed on whether reversal of the question will terminate the proceedings." Id.

The district court made extensive findings regarding the benefit of interlocutory appeal in this case. Although our answers to the certified questions will not terminate the proceedings, the answers will have a substantial impact on the scope of the litigation. Recognition of the proposed new tort would have statewide impact, and an incorrect ruling would result in substantial harm to the parties. We conclude that the issues presented are important.

A question is properly certified as doubtful if there is no controlling precedent. Jostens, 612 N.W.2d at 884. "That the question is one of first impression is not . . . of itself sufficient to justify certification as doubtful; the question should be one on which there is substantial ground for a difference of opinion." Emme v. C.O.M.B., Inc., 418 N.W.2d 176, 180 (Minn. 1988). Because there is no direct controlling caselaw on point and there is substantial ground for a difference of opinion, despite the widespread recognition of the tort of negligent credentialing or privileging in other states, we conclude that the questions presented are doubtful. Because the certified questions are both important and doubtful, we accept certification.

II. Does Minnesota recognize a common-law cause of action against a hospital or other review organization for negligent credentialing or privileging of a physician?

We review de novo a district court's decision on a motion to dismiss for failure to state a claim on which relief can be granted under Minn. R. Civ. P. 12.02(e), and the question before the appellate court is whether the complaint sets forth a legally sufficient claim for relief. Bodah v. Lakeville Motor Express, Inc., 663 N.W.2d 550, 553 (Minn.2003). "The reviewing court must consider only the facts alleged in the complaint, accepting those facts as true and must construe all reasonable inferences in favor of the nonmoving party." Id. (citing Marquette Nat'l Bank v. Norris, 270 N.W.2d 290, 292 (Minn.1978)).

Whether Minnesota should recognize a cause of action for negligent credentialing or privileging is a question of first impression in Minnesota and a question of law, subject to de novo review. See Modrow v. JP Foodservice, Inc., 656 N.W.2d 389, 393 (Minn.2003) (stating that a reviewing court is not bound by and need not give deference to a district court's decision on a purely legal issue). It has long been established that adaptation and development of common-law principles is part of judicial power. See Lake v. Wal-Mart Stores Inc., 582 N.W.2d 231, 233 (Minn. 1998) (stating that the supreme court "has the power to recognize and abolish common law doctrines."); Silesky v. Kelman, 281 Minn. 431, 433, 161 N.W.2d 631, 632 (1968) (stating "[t]he court may modify the common law, adopting such of its principles as are applicable and rejecting such others as are inapplicable.") (overruled on other grounds by Anderson v. Stream, 295 N.W.2d 595, 601 (Minn.1980)). But it is not our function to create new law. See Stubbs v. N. Mem'l Med. Ctr., 448 N.W.2d 78, 81, 83 (Minn.App.1989) (refusing to create a cause of action that had not been recognized by the courts or established by the legislature because "[t]he function of this court is primarily decisional and error correcting, rather than legislative or doctrinal"), review denied (Minn. Jan. 12, 1990).

Respondents argue that the district court has inherent authority to recognize a new cause of action and correctly exercised that authority in this case. Respondents argue that because a majority of other states have recognized a cause of action against a hospital for negligently granting doctors privileges, we should answer the first question in the affirmative. We disagree.

Acknowledging a district court's inherent authority to recognize a new cause of action does not end the inquiry. The supreme court has on more than one occasion declined to exercise such power when it deems that the flexibility of the legislative process is a more appropriate avenue in a given situation. Cracraft v. City of St. Louis Park, 279 N.W.2d 801, 808 (Minn. 1979) (declining to create a new tort that would create a new duty owed by government entities to enforce the law with reasonable care, stating that such a change in the law is one that should be made by the legislature)³; Schumann v. McGinn, 307 Minn. 446, 467, 240 N.W.2d 525, 537 (1976) (quoti...