Mercy Health Sys. of Nw. Ark. v. McGraw

• Decision Date: 28 August 2013
• Docket Number: No. CV–13–229.,CV–13–229.
• Citation: 2013 Ark. App. 459,429 S.W.3d 298
• Court: Arkansas Court of Appeals
• Parties: MERCY HEALTH SYSTEM OF NORTHWEST ARKANSAS, Appellant v. Dr. Lisa McGRAW, Appellee.

2013 Ark. App. 459

429 S.W.3d 298

MERCY HEALTH SYSTEM OF NORTHWEST ARKANSAS, Appellant

v.Dr. Lisa McGRAW, Appellee.

No. CV–13–229.

Court of Appeals of Arkansas.

Aug. 28, 2013.

Wright, Lindsey & Jennings, LLP, Little Rock, by: Edwin L. Lowther, Jr., Gary D. Marts, Jr., and Caley B. Vo, for appellant.

Shemin Law Firm, PLLC, Fayetteville, by: Kenneth R. Shemin; and Cullen & Company, PLLC, by: Tim Cullen, for appellee.

WAYMOND M. BROWN, Judge.

After we dismissed an earlier appeal for lack of a final order, Mercy Health System of Northwest Arkansas brings this appeal from a judgment entered in favor of appelleeDr. Lisa McGraw in the sum of $350,000.¹For reversal, Mercy argues that Dr. McGraw's contributory negligence bars her recovery because she is claiming only economic damages; that Mercy is entitled to judgment notwithstanding the verdict on Dr. McGraw's negligence and breach-of-fiduciary-duty claims because it owed her no duty; and that Mercy is entitled to judgment notwithstanding the verdict on Dr. McGraw's promissory estoppel claim.Finding no error, we affirm.

This appeal has its origin in a medical-negligence case filed against Dr. McGraw.²After a default judgment in the amount of $500,000 was entered against Dr. McGraw in the underlying action, she filed suit against Mercy, alleging causes of action for negligence, promissory estoppel, violation of the deceptive trade practices act, breach of fiduciary duty, and indemnification.She also sought punitive damages.The basis for Dr. McGraw's suit was her assertion that Cynthia Bosley, the office manager at Mercy's Pea Ridge clinic, and Ann Spencer, the office coordinator at the clinic, assumed the duty to respond to the complaint in the underlying action.Mercy denied that it owed any duty to Dr. McGraw.It also denied that Bosley and Spencer, while employees of Mercy, had authority to assume any obligation on its behalf.

Mercy filed a motion for summary judgment, alleging that, as a matter of law, Mercy did not owe Dr. McGraw any duty to handle the lawsuit or report the matter to her insurance carrier.Mercy also asserted that Dr. McGraw had breached her contractual duties to report any lawsuits to Mercy within ten days of receipt of a summons and to report any lawsuits to her insurer.The court granted the motion as to the deceptive-trade-practices act and the punitive-damages claims, but denied the motion as to Dr. McGraw's claims for negligence, promissory estoppel, breach of fiduciary duty, and indemnification.

The case was tried before a jury over two days in May 2011.At the conclusion of Dr. McGraw's proof, Mercy moved for a directed verdict on each of her claims.The circuit court denied the motion.Dr. McGraw took a nonsuit on her claim for indemnification.Mercy renewed its motion for directed verdict at the close of all of the proof.The court again denied the motion.The case was submitted to the jury on interrogatories:

INTERROGATORYNO. 1: Do you find from a preponderance of the evidence that Cynthia Bosley made an oral promise to plaintiffDr. Lisa McGraw that the lawsuit filed by Scott and Lizabeth Jones would be taken care of by Mercy Health System of Northwest Arkansas?ANSWER: yes.The interrogatory was signed by the jury foreperson.

INTERROGATORYNO. 2: Do you find from a preponderance of the evidence that defendant Mercy Health System of Northwest Arkansas held out Cynthia Bosley as having authority to bind it to an oral promise to plaintiffDr. Lisa McGraw that the lawsuit filed by Scott and Lizabeth Jones would be taken care of by Mercy Health System of Northwest Arkansas?ANSWER: yes.The interrogatory was signed by the jury foreperson.

INTERROGATORYNO. 3: Do you find from a preponderance of the evidence that Dr. Lisa McGraw has proven her claim for negligence?ANSWER: yes.The interrogatory was signed by the jury foreperson.

INTERROGATORYNO. 4: Do you find from a preponderance of the evidence that Dr. Lisa McGraw has proven her claim for promissory estoppel?ANSWER: yes.This interrogatory was also signed by the jury foreperson.

INTERROGATORYNO. 5: Do you find from a preponderance of the evidence that Dr. Lisa McGraw has proven her claim for breach of fiduciary duty?ANSWER: yes.This interrogatory was signed by the jury foreperson.

INTERROGATORYNO. 6: Do you find from a preponderance of the evidence that there was fault on the part of Dr. Lisa McGraw that was a proximate cause of any damages she sustained as a result of the lawsuit filed against her by Scott and Lizabeth Jones?ANSWER: yes.This interrogatory was signed by the jury foreperson.

INTERROGATORYNO. 7: Using 100% to represent the total responsibility for the damages proximately caused the fault by both parties, apportion the responsibility between the parties.ANSWER: 30% Dr. Lisa McGraw; 70% Mercy Health System of Northwest Arkansas.³

Judgment was entered on May 24, 2011, awarding Dr. McGraw $350,000.On June 7, 2011, Mercy filed a motion for judgment notwithstanding the verdict, arguing that the jury's findings that Dr. McGraw was negligent and 30% at fault served to bar all of her claims.Dr. McGraw filed her response to the motion.The circuit court entered an order on July 22, 2011, stating that Mercy's motion was deemed denied as of July 6, 2011.

Mercy attempted to appeal to this court.However, we dismissed the appeal for lack of a final order on January 30, 2013.⁴The specific defect was that Dr. McGraw had taken a nonsuit as to her indemnification claim, but no order had been entered dismissing the claim.⁵On February 5, 2013, the circuit court entered an order dismissing the unresolved claim with prejudice.Mercy filed its notice of appeal on February 26, 2013.

Mercy first argues that the jury's finding that Dr. McGraw was 30% negligent precludes her recovery.Mercy's argument is that the common law doctrine of contributory negligence applies to bar all of Dr. McGraw's claims because the supreme court has held that comparative fault does not apply in situations where a party seeks only economic damages, as Dr. McGraw does in this case.⁶For her part, Dr. McGraw argues that the issue is not preserved for our review because Mercy did not object to the jury's being instructed on comparative fault and did not raise this issue until its posttrial motion for judgment notwithstanding the verdict.We agree that the issue is not preserved.

Assuming arguendo that Mercy's answer asserting that “any damages sustained by [Dr. McGraw] were proximately caused by her own negligence” was sufficient to raise the issue of contributory negligence, there was no further mention of it until Mercy filed its posttrial motion seeking judgment notwithstanding the jury's verdict.Our supreme court has observed that a motion for a directed verdict is a condition precedent to moving for judgment notwithstanding the verdict.⁷Because a motion for judgment notwithstanding the verdict is technically only a renewal of the motion for a directed verdict made at the close of the evidence, it cannot assert a ground not included in the motion for a directed verdict.⁸Here, although Mercy raised the contributory-negligence argument in its judgment notwithstanding the verdict motion, it failed to make the argument in its directed-verdict motion.Therefore, the contributory-negligence argument is not preserved for our review.

We next address Mercy's point that it was entitled to judgment notwithstanding the verdict on Dr. McGraw's claim for promissory estoppel.In its argument, Mercy contends that any promise Bosley may have made to the doctor was too indefinite and uncertain to be enforceable.It further contends that the doctor's reliance on any such promise was unreasonable in light of the doctor's obligations under the malpractice-insurance policy and other contractual documents with Mercy.We disagree with these arguments.

Our standard of review for a denial of a directed-verdict motion is well settled:

[I]n reviewing the denial of a motion for [a directed verdict], we will reverse only if there is no substantial evidence to support the jury's verdict, and the moving party is entitled to judgment as a matter of law.Substantial evidence is that which goes beyond suspicion or conjecture and is sufficient to compel a conclusion one way or the other.It is not our place to try issues of fact; we simply review the record for substantial evidence to support the jury's verdict.In determining whether there is substantial evidence, we view the evidence and all reasonable inferences arising therefrom in the light most favorable to the party on whose behalf judgment was entered.A motion for directed verdict should be denied when there is conflict in the evidence, or when the evidence is such that fair-minded people might reach different conclusions.⁹

The same standard holds true for a motion for judgment notwithstanding the verdict.¹⁰A circuit court may enter a judgment notwithstanding the verdict only if there is no substantial evidence to support the verdict and the moving party is entitled to judgment as a matter of law.¹¹We defer to the jury's resolution of the issue unless we can say there is no reasonable probability to support Dr. McGraw's version.¹²

A party asserting estoppel must prove that in good faith he relied on some act or failure to act by the other party and, in reliance on that act, suffered some detriment.¹³Whether there was actual reliance and whether that reliance was reasonable are questions for the trier of fact.¹⁴

Dr. McGraw testified that, after she was served with the summons and complaint, Ann Spencer, the clinic's office coordinator, told her that she had spoken with Cindy Bosley, the office manager at the Pea Ridge clinic, and that Bosley had instructed her to take the complaint and summons and to make a copy of the chart notes, and that per office policy they would get the complaint and summons and the chart note to Mercy's in-house counsel...