Orteza v. Monongalia County General Hosp.

• Decision Date: 02 March 1984
• Docket Number: No. 15936,15936
• Citation: 173 W.Va. 461,318 S.E.2d 40
• Parties: Josefina M. ORTEZA v. The MONONGALIA COUNTY GENERAL HOSPITAL.
• Court: West Virginia Supreme Court

Page 40

318 S.E.2d 40

173 W.Va. 461

Josefina M. ORTEZA v. The MONONGALIA COUNTY GENERAL HOSPITAL.

No. 15936.

Supreme Court of Appeals of

West Virginia.

March 2, 1984.

Rehearing Denied April 11, 1984.

1. 'It is the syllabus of the court, and not of the jury, to interpret a written contract.' Syl. Pt. 1, Stephens v. Bartlett, 118 W.Va. 421, 191 S.E. 550 (1937).

2. 'Where the terms of a contract are clear and unambiguous, they must be applied and not construed.' Syl. Pt. 2, Bethlehem Mines Corp. v. Haden, 153 W.Va. 721, 172 S.E.2d 126 (1969).

3. 'A property interest protected by due process must derive from private contract or state law, and must be more than the unilateral expectation of continued employment.' Major v. DeFrench, W.Va. 286 S.E.2d 688, 695 (1982).

4. In order for the termination of a public employee to call into question a liberty interest of that employee, the termination must: (1) call into question the employee's good name; (2) impose a stigma upon the employee which forecloses the employee's freedom to pursue other employment opportunities; and, (3) fail to provide the employee with notice of the charges against that employee and a hearing in which the factual basis of those charges can be contested. It is more likely that a liberty interest will be found in cases where the terminated employee is working in a position that is uniquely governmental in nature.

5. 'Applicable standards for procedural due process, outside the criminal area, may depend upon the particular circumstances of a given case. However, there are certain fundamental principles in regard to procedural due process embodied in article III, § 10 of the W. Va. Const., which are: First, the more valuable the rights sought to be deprived, the more safeguards will be interposed. Second, due process must generally be given before the deprivation occurs unless a compelling public policy dictates otherwise. Third, a temporary deprivation of rights may not require as large a measure of procedural due process protection as a permanent deprivation.' Syl. Pt. 2, North v. W. Va. Board of Regents, 160 W.Va. 248, 233 S.E.2d 411 (1977).

Steptoe & Johnson, Herbert G. Underwood and William E. Galeota, Clarksburg, Robert W. Dinsmore, Morgantown, for appellant.

Franklin D. Cleckley, Robert B. Stone, Morgantown, for appellee.

NEELY, Justice:

Dr. Josefina M. Orteza is a Board-certified, anatomical pathologist. She was hired by the Monongalia General Hospital Company in October, 1977 as an associate pathologist. The terms of Dr. Orteza's employment were set forth in a written contract that resulted from negotiations between Dr. Orteza and the hospital during which both parties were represented by counsel. Under the terms of Dr. Orteza's employment contract both the hospital and Dr. Orteza could terminate her employment upon 120 days notice to the other party.

In October, 1979, Dr. Joseph F. Nataro, the Director of Laboratories for Monongalia General Hospital, notified Dr. Orteza by letter that her employment would be terminated 120 days hence, and her obligation to work between the date of notice and the date of termination was waived by the hospital. She was paid her salary and benefits up to the effective termination date of 14 February 1980.

On 12 June 1980 Dr. Orteza sued the Monongalia General Hospital and Dr. Nataro in the Circuit Court of Monongalia County alleging that her discharge was illegal because she had been denied due process under the United States Constitution and the West Virginia Constitution. Dr. Orteza also claimed that her contract had been breached and that she was entitled to damages on that count. After four days of trial the case went to the jury on 18 June 1982 with instructions from the court that the jury should return a verdict in favor of Dr. Orteza on the issue of denial of constitutional due process along with other instructions on Dr. Orteza's breach of contract claim. The next day the jury returned a general verdict in favor of Dr. Orteza awarding $180,000 in compensatory damages and $200,000 in punitive damages. Since there were no special interrogatories, it is unclear whether the jury based their verdict on the due process claim or the contract claim or both. On 26 January 1983 the trial court overruled the Hospital Company's motion for a new trial and sustained Dr. Orteza's post-trial motion for reinstatement and back pay in addition to the damages awarded, and entered final judgment. We reverse.

I

The arguments made by both the appellant Hospital Company and the appellee, Dr. Orteza, are complex, but this case is essentially a contract dispute. Although there is a potential issue of constitutional due process deprivation because it is argued that the hospital is an instrumentality of the State of West Virginia, the most important element in this entire case is paragraph 8 of Dr. Orteza's employment contract which governs the subject of termination and provides in its entirety as follows:

"This Agreement shall continue for one year from the date hereof and thereafter from year to year until terminated, but it may be terminated at any time by the HOSPITAL or the ASSOCIATE PATHOLOGIST by giving 120 days written notice to the other of the intention to terminate prior to the intended date of termination. If the ASSOCIATE PATHOLOGIST is terminated by the HOSPITAL, she shall automatically lose her privilege to practice in or at the HOSPITAL. As an employee of the HOSPITAL, the ASSOCIATE PATHOLOGIST will utilize the Hospital Grievance Procedure as outlined in the "Hospital Personnel Policies" for administrative, contractural [sic] and business procedure problems which are not of a medical nature and cannot otherwise be satisfactorily resolved. If problems arise which cannot be satisfactorily resolved and which are medical in nature, the ASSOCIATE PATHOLOGIST is to utilize the grievance procedure outlined in the Medical Staff By-Laws as presently exist or are hereafter adopted.

It has long been settled law that "It is the province of the court, and not of the jury, to interpret a written contract." Syl. Pt. 1, Stephens v. Bartlett, 118 W.Va. 421, 191 S.E. 550 (1937). We have also ruled that, "Where the terms of a contract are clear and unambiguous, they must be applied and not construed." Syl. Pt. 2, Bethlehem Mines Corporation v. Haden, 153 W.Va. 721, 172 S.E.2d 126 (1969). Paragraph 8 of Dr. Orteza's contract could not be clearer: it provides that either the hospital or the associate pathologist may terminate the contract after one year upon 120 days written notice. The parties stipulate that Dr. Orteza was given 120 days written notice and was paid her salary and benefits during the notice period although she was not required to work. The trial court erred in allowing the jury to construe a contractual provision that was unambiguous on its face.

Dr. Orteza points to the provisions in paragraph 8 that relate to the hospital grievance procedure for administrative grievances as outlined in the Hospital Personnel Policies and the grievance procedure for grievances that are medical in nature outlined in the Medical Staff By-laws. Dr. Orteza argues, and the circuit court held, that Dr. Orteza's discharge was for medical reasons and that the grievance procedure outlined in the Medical Staff By-laws had not been followed.

We find that the plain purport of paragraph 8 is that either the Hospital Company or Dr. Orteza can terminate employment upon 120 days written notice regardless of the reason for termination. In this regard, we are in accord with Judge Zacharis of the United States Court for the Eastern District of Virginia who recently ruled that "Agreements are not necessarily ambiguous because the parties disagree as to the meaning of the language of the agreement." Richardson v. Econo-Travel Motor Hotel Corp., 553 F.Supp. 320 (E.D.Va.1982).

The provisions in paragraph 8 that relate to grievances are designed to provide Dr. Orteza with a regular procedure for resolving any disputes that arise during her term of employment about either administrative or medical matters. If it had been the intention of the parties to provide that discharge could be effected only for good cause, they would have said so. Under the contract Dr. Orteza had a right to use either the administrative or medical grievance procedures of the hospital for all problems arising in the course of her employment, but her employment itself was entirely within the discretion of the Hospital Company. By giving written notice 120 days before termination the Hospital Company complied with its contractual obligations. There was no breach.

II

The circuit court directed a verdict for Dr. Orteza on her claim that the discharge was accomplished in violation of her due process rights. This claim is founded upon the arguable proposition that the Monongalia General Hospital is an instrumentality of the State of West Virginia and therefore any action that it takes constitutes "state action." The Hospital Company does, indeed, have numerous governmental attributes. In 1976 the Monongalia General Hospital Company was incorporated by private individuals. However, with the assent of the Monongalia County Commission, the predecessor Hospital Board of Trustees of a county owned and operated hospital was dissolved, and its assets transferred to a Building Commission and leased to the appellant private corporation.

The appellant hospital is housed in facilities that are owned by the Monongalia County Building Commission, a public body, and leased to the private hospital corporation. The hospital must make periodic financial reports to the county, which can then review them to insure proper management of the hospital. Moreover, the Monongalia County Building Commission exercises real and substantial power over the selection of members of the appellant's Board of Trustees. According to the Hospital's by-laws, the Board of Trustees submits three...