Summary
In Medi-Stat, the court concluded that a for-profit corporation can be held liable for the medical negligence of its physician employees, Id., 303 Ark. at 49, 792 S.W.2d at 872, but it is difficult to glean from the case on what basis that holding rests.
Summary of this case from Kenning v. St. Paul Fire and Marine Ins. Co.Opinion
[303 Ark. 53-A] C. Tab Turner, Little Rock, for appellants.
Charles Hicks, Little Rock, for appellees.
SAM ED GIBSON, Special Justice.
In its petition for rehearing Medi-Stat insists that our opinion of July 9, 1990, affirming the judgment awarded against the appellants, overlooks the appellees' failure to produce "any evidence at trial that Medi-Stat exercised control over the physicians in hiring and firing, the setting of work schedules and salary, the right to select the patients to be treated, or the method of treatment."
We recognize that the emphasis of our opinion was given to a discussion of the cases of Runyan v. Godrum, 147 Ark. 481, 228 S.W. 397 (1921), and Arkansas Midland R.R. Co. v. Pearson, 98 Ark. 399, 135 S.W. 917 (1911), but that was because the primary thrust of appellant's argument, in reliance on those cases, was that medical doctors cannot be employees as a matter of law so as to give rise to vicarious liability under the doctrine of respondeat superior. We examined that issue and considered it in depth in our earlier opinion. We will not reexamine it here.
[303 Ark. 53-B] Appellant did argue that appellees failed to meet their burden of proving that Dr. Eades was the agent or employee of Medi-Stat (citing AMI 207) and to directly answer that argument, we issue this supplemental opinion.
Appellant asserts that appellees' complaint alleged that Medi-Stat was the employer of, and vicariously responsible for, Dr. Eades and that Medi-Stat denied that Dr. Eades was the employee of Medi-Stat. We do not find that to be so. Paragraph one of the complaint alleges that, "The defendant, Dr. Michael Eades, at all times relevant hereto, was a licensed practicing physician working as an agent or employee for Medi-Stat Medical Clinic, Inc., an Arkansas Corporation." The answer nowhere specifically denies that allegation. The only relevant response reads, "The defendants admit that Dr. Michael Eades was a licensed practicing physician working at Medi-Stat Medical Clinic, Inc., an Arkansas Corporation." An allegation of a complaint not specifically denied is taken as admitted. Meek v. U.S. Rubber Tire Co., 244 Ark. 359, 425 S.W.2d 323 (1968). Rule 8(b) of the Arkansas Rules of Civil Procedure reads in part:
A party shall state in ordinary and concise language his defenses to each claim asserted and shall admit or deny the averments upon which the adverse party relies. If he is without knowledge or information sufficient to form a belief as to the truth of an averment, he shall so state and this has the effect of a denial. Denials shall fairly meet the substance of the averments denied. When a pleader intends in good faith to deny only a part or a qualification of an averment, he shall specify so much of it as is true and material and shall deny only the remainder.
Even if it could be said the agent/employee issue was joined by the pleadings, we think Ms. Kusturin's testimony that Timothy saw whichever doctor was on duty at the clinic at the time of his visit and that all of the records of Medi-Stat relative to Timothy Cowan bear only the Medi-Stat letterhead and all billing and payment were between Medi-Stat and the patient, brought the factual issue within the purview of Schuster's Inc. v. Whitehead, 291 Ark. 180, 722 S.W.2d 862 (1987):
[W]hen it is shown that the person causing the injury was, at the time, rendering a service for the defendant and being [303 Ark. 53-C] paid for that service, and the facts presented are as consistent with the master/servant relationship as with the independent contractor relationship, then the burden is on the one asserting the independence of the contract to show the true relationship of the parties. 722 S.W.2d at 864.
This disputed issue, it should be remembered, arises from the denial of Medi-Stat's motion for a directed verdict on the ground that there was no evidence that Eades was the agent or employee of Medi-Stat. In Phillips Cooperative Gin Co. v. Toll, 228 Ark. 891, 311 S.W.2d 171 (1958), we said:
The rule is well established that where fairminded men might honestly differ as to the conclusion to be drawn from facts, whether controverted or uncontroverted, the question should go to the jury. St. L.I.M.s&sS. Ry. Co. v. Fuqua, 114 Ark. 112, 169 S.W. 786. It is also well established that it is proper to direct a verdict for the defendant only when, under the evidence and all reasonable inferences deducible therefrom the plaintiff is not--under the law--entitled to recover. Wortz v. Ft. Smith Biscuit Co., 105 Ark. 526, 151 S.W. 691.
The petition for rehearing is denied.
TURNER, J., not participating.
GLAZE, Justice, dissenting.
The majority is mistaken when, in its opinion, it states the appellants failed to deny appellees' allegation that Dr. Eades was an agent or employee for Medi-Stat Medical Clinic, Inc. In fact, appellants worded their answer to appellees' complaint very carefully to say only that "Dr. Michael Eades was a licensed practicing physician working at Medi-Stat." Such language obviously is broad enough to include Dr. Eades as working in the capacity of an independent contractor. In paragraph 11 of their answer, they further denied "all remaining allegations"--a denial which clearly would have included the appellees' claims that Dr. Eades was an agent or employee of the clinic. In fact, to conclude otherwise would mean that a general denial is meaningless, and unless a defendant specifically denied each allegation of a complaint, he or she will be [303 Ark. 53-D] charged with having admitted them. In addition to the parties' pleadings, one need only review the pretrial discovery and the evidence and arguments at trial to know that the agency and employment issues were contested throughout this litigation.
I further should note that I parted from the majority's earlier opinion when it held Medi-Stat vicariously liable for Dr. Eades's negligence. The majority listed some six factors to support its view on this issue and now attempts to shore up its position by mentioning the parties' pleadings as discussed above.
In addition to disagreeing with its view of the pleadings, I take slight exception to how two of the six factors were described in the majority's earlier opinion. For example, the majority opinion concluded the clinic chose the physician who treated Mr. Cowan when, in fact, no evidence was offered by anyone as to how physicians were assigned to patients. The majority opinion also mentioned that none of the medical records contained a disclaimer or other indication that Medi-Stat is not the medical care provider or that its physicians were not employees of Medi-Stat. While it is clear that agency may not be proved by declarations, actions or inactions of a purported agent, here the lack of a disclaimer or the medical chart was never mentioned at trial; nor was there a law that required such a disclosure.
In sum, I wish to reiterate my earlier view that the appellees clearly failed to show a employee/employer relationship between Dr. Eades and Medi-Stat and to the extent vicarious liability was not shown, I believe the judgment obtained against Medi-Stat should be set aside.