Schwaiger v. Avera Queen of Peace Health Services, 23679.

• Decision Date: 03 May 2006
• Docket Number: No. 23679.,23679.
• Citation: 2006 SD 44,714 N.W.2d 874
• Parties: Jim SCHWAIGER, M.D., Plaintiff and Appellant, v. AVERA QUEEN OF PEACE HEALTH SERVICES, Defendant and Appellee.
• Court: South Dakota Supreme Court

Page 874

714 N.W.2d 874

2006 SD 44

Jim SCHWAIGER, M.D., Plaintiff and Appellant, v. AVERA QUEEN OF PEACE HEALTH SERVICES, Defendant and Appellee.

No. 23679.

Supreme Court of South Dakota.

Argued March 22, 2006.

Decided May 3, 2006.

Appeal from the Circuit Court of the First Judicial Circuit, Davison County, South Dakota; Robert A. Amundson, Justice (Retired), sitting as a Circuit Court Judge.

Robert A. Christenson of Christenson Law Office, PC, Sioux Falls, South Dakota, Jonathan K. Van Patten, Vermillion, South Dakota, Attorneys for plaintiff and appellant.

Michael F. Tobin, Michael S. McKnight of Boyce, Greenfield, Pashby & Welk, LLP, Sioux Falls, South Dakota, Attorneys for defendant and appellee.

MEIERHENRY, Justice.

[¶ 1.] Dr. Jim Schwaiger (Schwaiger) brought this suit against Avera Queen of Peace Hospital (Avera) for negligence, defamation, breach of contract, and misrepresentation. The trial court granted summary judgment on all of Schwaiger's claims. He appeals the judgment on the defamation and breach of contract claims. We affirm.

FACTS

[¶ 2.] On April 27, 1998, Jim Schwaiger began a one-year employment contract with Mitchell Radiological Associates, P.C., (MRA) in Mitchell, South Dakota. While employed at MRA, Schwaiger had medical staff privileges at Avera, the hospital in Mitchell, and performed radiological services there pursuant to a contract between MRA and Avera. Allegations of inappropriate behavior by Schwaiger arose during the summer and fall of 1998. According to those allegations, Schwaiger made inappropriate comments to both staff and patients at Avera while performing radiological services.

[¶ 3.] Information concerning the allegations against Schwaiger were transmitted in a December 28, 1998 e-mail from Rod Kernes (Kernes), the director of Avera's radiology department, to K.C. De-Boer (DeBoer), Avera's Vice President of Professional Services. DeBoer then restated those allegations in a letter to Schwaiger's employer, MRA, on December 29, 1998. The letter was addressed to Dr. Carey Buhler (Buhler), a partner at MRA; Buhler also acted as the medical director of Avera's radiology department. DeBoer wrote:

I have now discussed with you on two occasions concerns being brought forward by employees related to the behavior of Jim Schwaiger, M.D., an employee of [MRA]. I regret the need to involve you in this situation, but since Dr. Schwaiger is an employee of your company, I feel it would be most appropriate for you to address these issues with him consistent with your contractual obligation as the President of [MRA].

The letter then detailed eight examples of alleged inappropriate behavior by Schwaiger.¹ Three of the reported incidents involved Avera patients. Of all the allegations, the seventh was the most serious allegation in the letter. It involved Schwaiger's behavior toward and comments concerning a male patient being prepped for an angiogram. The letter described the alleged incident as follows:

In August or September, a young male patient was being prepped for an angiogram. Dr. Schwaiger entered the control room area. He proceeded to inquire about the patient's physical attributes. He made comments about the patient being "a young, good looking, blonde boy." He entered the exam room and palpated the patient's femoral artery. Dr. Schwaiger was not the physician involved in the case.

A note at the top of DeBoer's letter indicated that it was "FOR DR. BUHLER'S EYES ONLY," however, the bottom of the letter shows copies were sent to three administrators at Avera.

[¶ 4.] Shortly after receiving DeBoer's letter, Buhler and his partner at MRA, Dr. Kundel, met privately with Schwaiger to discuss some of the incidents described in the letter. The "blonde boy" incident, however, was not discussed at the meeting. After the meeting, Kundel privately informed Schwaiger about the "blonde boy" allegation. Schwaiger then confronted Buhler and vigorously denied the allegation. A few days later, Buhler wrote a follow-up letter to Schwaiger detailing their meeting; Buhler wrote a similar letter to DeBoer. Thereafter, Avera received no further reports concerning questionable conduct by Schwaiger, and Avera took no disciplinary or personnel action against Schwaiger. Schwaiger continued to work at MRA and Avera until the completion of his contract.

[¶ 5.] Schwaiger brought this suit against Avera and originally asserted claims of negligence, defamation, and tortious interference. He then amended his complaint so as to eliminate the claim of tortious interference and added claims of breach of contract and misrepresentation. Avera moved for summary judgment, and the trial court ruled in Avera's favor on all of Schwaiger's claims.

[¶ 6.] Schwaiger appeals the adverse ruling on his claims of defamation and breach of contract. Schwaiger claims that DeBoer's letter—specifically, the details of the alleged "blonde boy" incident—constitutes a defamatory communication. Schwaiger admits that the letter is a communication between interested parties, but he argues that the qualified privilege applicable to such communications does not apply because the allegation was malicious. Schwaiger also alleges that Avera breached its contract with Schwaiger by failing to follow procedure established by the medical staff bylaws when investigating the alleged "blonde boy" incident. According to Schwaiger, the trial court erred in granting summary judgment for Avera, and he asks us to consider the following issues:

ISSUES

1. Whether the trial court erred in concluding that there was no genuine issue of material fact regarding the existence of malice, which would negate the qualified privilege defense to defamation for communications between interested persons.

2. Whether the trial court erred in concluding that there was no genuine issue of material fact as to whether Avera breached the medical staff bylaws.

STANDARD OF REVIEW

[¶ 7.] Our review of a trial court's decision on summary judgment is well established:

Summary judgment is authorized if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact, and that the moving party is entitled to judgment as a matter of law. We will affirm only when there are no genuine issues of material fact and the legal questions have been correctly decided. All reasonable inferences drawn from the facts must be viewed in favor of the non-moving party. The burden is on the moving party to clearly show an absence of any genuine issue of material fact and an entitlement to judgment as a matter of law. Summary judgment will be affirmed if there exists any basis which would support the trial court's ruling.

Cleveland v. BDL Enters., Inc., 2003 SD 54, ¶ 11, 663 N.W.2d 212, 216-17 (citations and quotation marks omitted) (emphasis in original). The non-moving party, however, cannot merely rest on its pleadings; it must point to specific facts which establish a genuine, material issue for trial. Wulf v. Senst, 2003 SD 105, ¶ 18, 669 N.W.2d 135, 141-42. Mere allegations are not sufficient to avoid summary judgment. Id. ¶ 18, 669 N.W.2d at 142.

Decision

Defamation

[¶ 8.] We first review Schwaiger's contention that genuine issues of material fact precluded summary judgment on his defamation claim. In South Dakota, defamation is defined by statute. SDCL 20-11-2. Defamation includes both libel² and slander.³ SDCL 20-11-2. By definition, both libel and slander are "unprivileged" communications. SDCL 20-11-3; SDCL 20-11-4. Therefore, a defamation action may not survive if the alleged defamatory communication was privileged. Peterson v. City of Mitchell, 499 N.W.2d 911, 915 (S.D.1993). The existence of privilege is a question of law. Sparagon v. Native Am. Publishers, Inc., 1996 SD 3, ¶ 26, 542 N.W.2d 125, 132.

[¶ 9.] What constitutes a privileged communication is set forth by statute. SDCL 20-11-5. If a communication is made "without malice, to a person interested therein, by one who is also interested, or by one who stands in such relation to the person interested as to afford a reasonable ground for supposing the motive for the communication innocent, or who is requested by the person interested to give the information," it is privileged. SDCL 20-11-5 (emphasis added). Consequently, communications between interested parties are protected unless those communications are made with malice.

[¶ 10.] In this case, Schwaiger bases his defamation claim on DeBoer's letter to Buhler concerning Schwaiger's conduct. Schwaiger admits that the letter is a communication between interested parties, but he contends that the qualified privilege applicable to such communications does not apply because of the existence of malice. However, malice cannot be inferred from the defamatory communication alone. SDCL 20-11-5. Rather, Schwaiger must present evidence that the communication was made with "reckless disregard of the truth or actual malice." Kieser v. Se. Props., 1997 SD 87, ¶ 15, 566 N.W.2d 833, 837-38. The test for whether DeBoer's communication is reckless depends on whether he had "serious doubts" about its truthfulness at the time he sent the letter. Id. ¶ 15, 566 N.W.2d at 838. As we have stated The real test of whether a defendant's conduct is reckless so as to constitute actual malice is whether he in fact entertained serious doubts as to the truth of his publications. Reckless conduct is not measured by whether a reasonably prudent man would have published, or would have investigated before publishing.

Petersen v. Dacy, 1996 SD 72, ¶ 8, 550 N.W.2d 91, 93 (citations and quotation marks omitted); see also Kieser, 1997 SD 87, ¶ 21, 566 N.W.2d at 839 ("Kiesers have offered no proof that Southeast Properties did not believe, at the time it communicated the allegations, that Kiesers stole the listed property."); Petersen, 1996 SD 72, ¶ 14, 550 N.W.2d at 94 ("Petersen...