Opinion
No. WD 51357
Opinion filed: January 27, 1998 Application for transfer denied February 26, 1998.
APPEAL FROM JACKSON COUNTY CIRCUIT COURT, THE HONORABLE DANIEL CZAMANSKE, JUDGE.
John R. Campbell Kansas City, Missouri, LOUGHLIN, JOHNSON CAMPBELL, for appellant[s].
Ronald R. McMillin, R. Max Humphreys, Charles J. McPheeters — for MCI CARSON COIL Jefferson City, Missouri, R. Don Boulware, Mark R. Woodbury — Health Midwest, Richard W. Brown, Elmer Kuhn, WATKINS, BOULWARE, LUCAS, MINER, MURPHY TAYLOR, St. Joseph, Missouri, for respondent[s].
Dr. Ronald Zipper and Independent Orthopedics and Sports Medicine, P.C., appeal from the trial court's order entering summary judgment in favor of respondents, the Medical Center of Independence, Inc. (MCI), Medical Center Park, Inc. (MCP), Health Midwest, twenty-four individuals and Orthopedic Associates of Kansas City, Inc. Appellants brought an action for breach of contract, civil conspiracy to violate Missouri antitrust laws, promissory estoppel and civil conspiracy to commit the tort of fraudulent misrepresentation. Appellants present three points on appeal arguing that the trial court erred in granting summary judgment in favor of the respondents because: (1) Dr. Zipper's failure to file a counterclaim in prior federal proceedings between the parties did not bar the appellants' claims resulting from MCI's breach of an agreement to sell Dr. Zipper an office building; (2) genuine issues of material fact exist as to whether MCI breached a contractual duty to Dr. Zipper by failing to follow its own bylaws in revoking his medical staff privileges; and (3) the petition stated a claim for civil conspiracy because the respondents conspired to unlawfully revoke Dr. Zipper's staff privileges at MCI.
The individuals named as defendants in appellants' petition were the successive chief executive officers of MCI, Harold Kaseff (1989-90) and David Christiansen (1990-present); ten members of MCI's Medical Executive Committee: Calvin H. Lentz, Jr., Janet Morgan, Robert Schwegler, Deborah Duello, William B. Magnum, Robert Meyer, Elizabeth D. Simpson, Marc Taormina, Thomas Stribling, and C. Robert Whetstone; eight members of MCI's Board of Directors: Jerrold M. Alyea, Richard Gutknecht, Frederick Hahn, Jr., Dahlia Saldana, Faye Thomas, Lenora Wyre, Richard Brown, also a director of Health Midwest, and Elmer Kuhn, also a director of Health Midwest; and the members of the Collins Group, an orthopedic practice in Independence that owned and controlled Orthopedics Associates of Kansas City, Inc.: John Collins, who was also the chair of MCI's Surgical Executive Committee, Harold West, Carl Jelley and Sol Dubin. Because not all plaintiffs and defendants are implicated in each of the four counts of the petition, the relevant parties will be identified within the discussion of each point. When the term "respondent" is used, it refers to the particular parties appellants sued pursuant to each count.
The judgment of the trial court is affirmed in part and reversed in part, and the cause is remanded for further proceedings.
Factual and Procedural Background
On appeal from an order granting summary judgment, this court reviews the record in the light most favorable to the party against whom judgment was entered. ITT Commercial Fin. Corp. v. Mid-America Marine Supply Corp. , 854 S.W.2d 371, 376 (Mo. banc 1993). The facts, in that light, are that Dr. Zipper is an orthopedic surgeon who has practiced medicine in Kansas City and Independence for over fifteen years. Dr. Zipper specializes in hand surgery and knee and shoulder arthroscopy. For a time he practiced medicine through a professional corporation, Independent Orthopedics and Sports Medicine, P.C. In 1987, Dr. Zipper successfully applied for staff privileges at MCI and exercised those privileges until 1992. In 1989, the MCI Surgical Executive Committee commenced a peer review of Dr. Zipper's performance as a surgeon after questions were raised concerning the number and timing of repeat surgeries. In particular, the peer review concentrated on reports that Dr. Zipper performed a number of questionable surgical procedures, did not work well with colleagues, and had mental problems. As a result of this peer review, the MCI Board of Directors revoked Dr. Zipper's staff privileges on February 19, 1992.
Arthroscopy involves the examination of the interior of a joint with a scope in order to carry out diagnostic and therapeutic procedures in the joint. Dorland's Illustrated Medical Dictionary 142 (28th ed. 1994).
In January 1989, while Dr. Zipper still possessed staff privileges at MCI, he entered into a lease with MCP, a wholly-owned subsidiary of MCI, to rent medical office space in the Parkway Medical Building for his practice. Subsequently, Mr. Kaseff, MCI's chief executive officer at the time, promised to sell the building to Dr. Zipper for its fair market value if he renovated and improved it. Relying on that promise, Dr. Zipper alleged that he spent approximately $125,000 renovating the building. Thereafter, MCI and MCP refused to sell him the building at its fair market value. As a result, Dr. Zipper stopped paying rent and in 1992 MCP filed a federal diversity action for rent and possession against Dr. Zipper. Thereafter, Dr. Zipper filed a bankruptcy petition which stayed the rent and possession action. MCP's claim against Dr. Zipper in his bankruptcy proceeding and its rent and possession action were subsequently settled by agreement. As a condition of the parties' stipulations in these federal cases, Dr. Zipper and MCP agreed that Dr. Zipper reserved any monetary claims against MCP and MCI. Sometime after the stipulation in the bankruptcy proceeding, MCP filed a motion for contempt to enforce the order entered upon stipulation. These federal proceedings became the basis for the trial court's entry of summary judgment as to Counts III and IV of Dr. Zipper's petition, which related to the alleged agreement between Dr. Zipper and MCI concerning the renovation and sale of the Parkway Medical Building.
As a result of these disputes, Dr. Zipper and Independent Orthopedics and Sports Medicine, P.C., filed this action. In count I of the petition, Dr. Zipper alleged that MCI breached his contract with MCI by revoking his medical staff privileges without following the provisions of the hospital bylaws and by acting in bad faith and with malice. In count II, appellants alleged that MCI, Health Midwest, the members of MCI's Medical Executive Committee as well as its Board of Directors, the members of the Collins Group, Mr. Kaseff and Mr. Christiansen illegally conspired to deprive Dr. Zipper of his staff privileges in violation of Missouri's antitrust laws. As their third count, appellants asserted a claim of promissory estoppel against MCI, MCP, Mr. Kaseff and the members of MCI's Board of Directors, because MCI and MCP breached the oral promise to sell appellants the Parkway Medical Building after appellants acted in reliance on that promise. Finally, in count IV of the petition, appellants claimed a conspiracy to commit the tort of fraudulent misrepresentation in that MCI, MCP, Mr. Kaseff and the members of MCI's Board of Directors conspired to induce Dr. Zipper to make improvements to MCP's office building while intending to defraud him by not paying him for those improvements and repairs.
Appellants' petition also contained counts V and VI, but these counts are not the subject of this appeal. Appellants voluntarily dismissed the fifth count of their petition, and the sixth count against Nicholas DiSette was severed by the trial court and is still pending.
The respondents filed various motions for summary judgment on counts I through IV and, after a hearing, the trial court sustained the motions. The trial court entered summary judgment in favor of the respondents on the breach of contract action contained in count I and the count II civil conspiracy and antitrust claims upon finding that appellants failed to state a cause of action. Counts III and IV, based on promissory estoppel and fraudulent misrepresentation, were summarily adjudicated due to Dr. Zipper's failure to file a compulsory counterclaim in the prior federal actions between Dr. Zipper and MCP. From these orders, appellants bring this appeal.
Standard of Review
Review of summary judgment is conducted in the same manner as review of a court-tried case and the judgment will be sustained if any theory supports it. AG Processing, Inc. v. South St. Joseph , 937 S.W.2d 319, 322 (Mo.App.W.D. 1996). "The criteria on appeal for testing the propriety of summary judgment are no different from those which should be employed by the trial court to determine the propriety of sustaining the motion initially." ITT , 854 S.W.2d at 376. It is a de novo review on the record submitted. Slankard v. Thomas , 912 S.W.2d 619, 622 (Mo.App.S.D. 1995). In conducting the review, this court determines "whether there is genuine dispute as to material facts and whether there is an undisputed right to judgment as a matter of law." Jamieson v. Jamieson , 912 S.W.2d 602, 604 (Mo.App.E.D. 1995). Here, MCI was the defending party. A defending party may establish a right to summary judgment by showing:
(1) facts that negate any one of the claimant's elements facts, (2) that the non-movant, after an adequate period of discovery, has not been able to produce, and will not be able to produce, evidence sufficient to allow the trier of fact to find the existence of any one of the claimant's elements, or (3) that there is no genuine dispute as to the existence of each of the facts necessary to support the movant's properly-pleaded affirmative defense.
ITT , 854 S.W.2d at 381 (emphasis in original). This court focuses on the first part of this test because in their motions for summary judgment, respondents introduced evidence of facts attempting to negate appellants' elements facts.
Once the movant has made a prima facie showing, non-movants may not rest upon mere allegations or denials contained in their pleadings to contradict the facts alleged by the movant, but must respond by affidavits, or as otherwise provided in Rule 74.04, and set forth specific facts showing that there is a genuine issue for trial. Id . Conclusory allegations are insufficient to defeat a motion for summary judgment. Weaver v. State Farm Mut. Auto. Ins. Co. , 936 S.W.2d 818, 822 (Mo. banc 1997); McDowell v. Waldron , 920 S.W.2d 555, 561 (Mo.App.E.D. 1996). Nor does opinion raise any issue of material fact that precludes summary judgment. Rice v. Hodapp , 919 S.W.2d 240, 244 (Mo. banc 1996). Non-movants must set forth specific facts, not mere allegations or denials, which demonstrate the existence of a genuine issue of material fact. ITT , 854 S.W.2d at 381.
Respondents argue that appellants failed to comply with Rule 74.04 in their responses to the motions for summary judgment and, as a result, appellants should be deemed to have admitted the facts alleged by respondents in their motions. Rule 74.04(c)(2) governs responses to motions for summary judgments and provides:
Within thirty days after a motion for summary judgment is served, the adverse party shall serve a response on all parties, and, if the adverse party is relying on affidavits, the response shall have attached thereto affidavits not previously filed. The response shall admit or deny each of movant's factual statements in numbered paragraphs that correspond to movant's numbered paragraphs, shall state the reason for each denial, shall set out each additional material fact that remains in dispute, and shall support each factual statement asserted in the response with specific references to where each such fact appears in the pleadings, discovery or affidavits. The response may also have attached thereto a legal memorandum explaining why summary judgment cannot be granted. If the party opposing a motion for summary judgment has not had sufficient time to conduct discovery on the issues to be decided in the motion for summary judgment, such party shall file an affidavit describing the additional discovery needed in order to respond to the motion for summary judgment and the efforts previously made to obtain such discovery. For good cause shown, the court may continue the motion for summary judgment for a reasonable time to allow the party to complete such discovery.
The respondents are correct that appellants' responses to the motions for summary judgment do not comply with Rule 74.04(c)(2) in that they do not admit or deny each of the movants' factual statements in numbered paragraphs which correspond to the movants' numbered paragraphs, they do not state the reason for each denial or set out each additional material fact which remains in dispute. Nor do the responses include factual statements with specific references to where each such fact appears in the pleadings, discovery or affidavits. However, respondents cite no authority for their argument that appellants' failure to comply with Rule 74.04(c)(2) should result in all facts asserted in respondents' motions for summary judgment being deemed admitted. The governing principle is that "[f]acts set forth in support of a motion for summary judgment are taken as true unless contradicted by the non-moving party." Hillside Dev. Co. v. Fields , 928 S.W.2d 886, 889 (Mo.App.W.D. 1996). Thus, appellants are deemed to have admitted those facts in respondents' motions which they did not contradict, but not all facts set out in the motions.
Point I
Turning now to the points on appeal, appellants contend in their first point that the trial court erred by granting summary judgment on counts III and IV of the petition in favor of MCI, MCP, Mr. Kaseff and eight members of MCI's Board of Directors. Counts III and IV of the second amended petition purport to state a claim for both Dr. Zipper and his corporation. However, all factual allegations pertaining to the elements of promissory estoppel and fraudulent misrepresentation refer to Dr. Zipper alone. Thus, the corporation is not a proper party to these counts, and therefore the trial court properly granted summary judgment against the corporation on Counts III and IV.
In count III, Dr. Zipper raised a promissory estoppel claim and in count IV, he alleged fraudulent misrepresentation. The respondents argued before the trial court that Dr. Zipper was precluded from raising these issues because he failed to file compulsory counterclaims in prior federal proceedings between the parties. The trial court agreed that the claims were barred and did not address the merits of these claims. Dr. Zipper contends that he was not compelled to file counterclaims and his claims were preserved through a stipulation entered into by the parties. Therefore, he argues that he is not precluded from bringing these claims in this case.
In count III of his petition, Dr. Zipper asserted a promissory estoppel claim based upon an alleged promise MCI made to him concerning the Parkway Medical Building he was leasing for his practice. Dr. Zipper contended that Mr. Kaseff promised to cause MCP to sell him the medical office building for its fair market value if he renovated and repaired the dilapidated structure. In addition, Dr. Zipper alleged that Mr. Kaseff promised him a credit towards the purchase price for the amount of money he spent on improvements. These promises were never reduced to writing. In reliance on this agreement, however, Dr. Zipper claimed to have spent about $125,000 improving the building. When Dr. Zipper later demanded to purchase the building for the agreed consideration, MCI and MCP refused.
As a result, Dr. Zipper refused to make his rent payments and MCP filed a rent and possession action against him in federal court to collect the unpaid rent and evict Dr. Zipper from his offices in the Parkway Medical Building. However, before the answer was due in this rent and possession action, Dr. Zipper filed a personal bankruptcy action in federal district court. This resulted in an automatic stay of the rent and possession action, effectively relieving Dr. Zipper from filing an answer. In other words, the bankruptcy stay stopped all action in the rent and possession action before Dr. Zipper was required to file an answer asserting any compulsory counterclaims.
In the bankruptcy proceeding, MCP filed a claim against Dr. Zipper. Thereafter, MCP and Dr. Zipper entered into a stipulation settling the claim and the rent and possession action. This stipulation provided that: "[t]he debtor [Dr. Zipper] reserves . . . any and all claims for monetary damages debtor may possess or alleged [sic] to possess against the Creditor, Medical Center Park, Incorporated, or any parent or affiliated corporation, including Medical Center of Independence." It is this language that Dr. Zipper asserts preserves his right to bring the present claims.
Stipulations are valid in Missouri. Pierson v. Allen , 409 S.W.2d 127, 130 (Mo. 1966). In Missouri, a stipulation is defined as "'an agreement between counsel with respect to business before a court, and is not one of the usual pleadings, but is a proceeding in the cause and as such is under the supervision of the court.'" Id . (citation omitted). Stipulations "are controlling and conclusive, and courts are bound to enforce them." Id . In Pierson , the parties stipulated that a pending counterclaim would not be affected by the dismissal of the petition. Id. at 128. The Supreme Court reversed the trial court's dismissal of the counterclaim, finding that in the stipulation, the defendant had "expressly reserved" the right to continue the counterclaim. Id. at 131.
Although the stipulation in Pierson reserved the right to continue with a pending counterclaim and not the right to bring a claim in the future, the Supreme Court in Pierson relied upon the case of Landers v. Smith , 379 S.W.2d 884, 888 (Mo.App. S.D. 1964), in reaching its decision. In Landers , the court upheld a stipulation similar to the one in this case. There, the parties stipulated that the dismissal of the action against Mr. Landers would not later bar his "rights and causes of action." Landers , 379 S.W.2d at 886. Mr. Landers later brought a compulsory counterclaim from the first action against the same party. Id . The court held that Mr. Landers was not barred from bringing the action because the stipulation expressly preserved his claim and because the action never proceeded to final judgment. Id. at 888. The court held that in the absence of general language indicating that all matters were settled, it was bound to enforce the stipulation despite the compulsory counterclaim rule. Id . See Keller v. Keklikian , 244 S.W.2d 1001 (Mo. 1951). The parties' court-approved stipulation took precedence over the compulsory counterclaim rule.
Likewise, the stipulation between Dr. Zipper and MCP preserved Dr. Zipper's right to bring claims for monetary damages in later proceedings. There was no language in the stipulation indicating that all claims or disputes were settled. Nor was there language to the effect that the entire matter was over. The specific language of the stipulation provided that Dr. Zipper reserved "any and all claims for monetary damages . . . against the Creditor, Medical Center Park, Incorporated, or any parent or affiliated corporation, including Medical Center of Independence." The stipulation was recognized and approved by the bankruptcy court and was the basis for the judgment in the rent and possession action.
The respondents argue that "there is no authority for the proposition that parties may waive compulsory counterclaims or other procedural matters which affect judicial economy . . .," based on their reading of Evergreen Nat'l Corp. v. Killian Constr. , 876 S.W.2d 633 (Mo.App.W.D. 1994). This reliance on Evergreen is misplaced. Evergreen involved a choice-of-forum clause in a contract rather than a stipulation. As noted previously, the Supreme Court approved the principle that stipulations reserving the right to file compulsory counterclaims in subsequent proceedings are binding on the court. See Pierson , 409 S.W.2d at 130. Therefore, the broad statement in Evergreen , 876 S.W.2d at 635, that "[a] court lacks jurisdiction if a later action is taken on a matter that should have been brought as a compulsory counterclaim," is not applicable to stipulations between parties in a prior action.
As a result of the stipulation, Dr. Zipper was not required to file a compulsory counterclaim in either the rent and possession action or the bankruptcy proceeding. First, as already noted, the bankruptcy filing occurred prior to the time Dr. Zipper was required to file an answer in the rent and possession action. The stay of the bankruptcy court relieved Dr. Zipper of the requirement to file a counterclaim and the rent and possession action was settled by stipulation prior to the stay being lifted. Second, the stipulation preserving Dr. Zipper's claims against MCP and MCI was entered in the bankruptcy proceeding prior to the filing of the motion for contempt which respondents claim compelled the filing of counterclaims. The motion to enforce the order entered by stipulation did not trigger any requirement to file compulsory counterclaims which had already been preserved by stipulation. Therefore, Dr. Zipper was not required to file the instant claims during the federal proceedings, so he is not barred from pursuing his promissory estoppel and fraudulent misrepresentation causes of action in a Missouri court. As a result, we proceed to the merits of his claims.
Before doing so, however, we must address the relationship between MCI and MCP for the purposes of Dr. Zipper's claim. MCP is a separate legal corporation from MCI. "'[O]rdinarily two separate corporations are to be regarded as wholly distinct legal entities, even though the stock of one is owned partly or entirely by the other.'" Liberty Fin. Management Corp. v. Beneficial Data Processing Corp. , 670 S.W.2d 40, 52 (Mo.App. E.D. 1984) (quoting Central Cooling Supply Co. v. Director of Revenue , 648 S.W.2d 546, 548 (Mo. 1982)). However, the law may ignore the existence of a corporate entity when it is created or used for an improper purpose or purposes. Id . The primary question is "'whether the corporations are being manipulated through their interrelationship to cause illegality, fraud, or injustice.'" Id. (quoting Camelot Carpets, Ltd. v. Metro Distrib. Co. , 607 S.W.2d 746, 750 (Mo.App.E.D. 1980)).
Although it is asserted that MCP is a wholly-owned subsidiary of MCI, this fact alone is not sufficient to authorize piercing MCP's corporate veil to hold MCI accountable on an unjust enrichment claim. Thomas Berkeley Consulting Eng'r. Inc. v. Zerman , 911 S.W.2d 692, 695 (Mo.App.E.D. 1995). In order to pierce the corporate veil and disregard corporate existence, two conditions must be met. First, the corporation must be completely controlled by another corporation; second, there must be evidence that the "corporate cloak was used as a subterfuge to defeat public convenience, to justify a wrong, or to perpetuate a fraud." Id. at 695-96. The control which is required is "'complete domination, not only of the finances, but of policy and business practice in respect to the transaction attacked so that the corporate entity as to this transaction had at the time no separate mind, will or existence of its own. . . .'" Id. at 695 (quoting Dave Kolb Grading, Inc. v. Lieberman Corp. , 837 S.W.2d 924, 936 (Mo.App.E.D. 1992)). The wrong done must also be the proximate cause of the injury to third persons who dealt with the corporations. Dave Kolb Grading, Inc. , 837 S.W.2d at 937.
Here, there is sufficient evidence to create a genuine issue of material fact as to whether MCI dominated MCP's finances and its business practices with respect to the transaction with Dr. Zipper in order to perpetuate a fraud. Dr. Zipper presented evidence that Mr. Kaseff represented to him that MCI controlled MCP because MCP was MCI's wholly-owned subsidiary and MCI could cause MCP to sell Dr. Zipper the medical building. Furthermore, there was evidence that MCI incurred a financial liability to finance the improvements when it co-signed the note with Dr. Zipper and that MCI's CEO, Mr. Kaseff, rather than an officer or director of MCP, actively participated in the negotiating and remodeling process with Dr. Zipper. In addition, there was evidence that MCI and MCP shared common directors and officers. This weighs in favor of piercing the corporate veil. Id . There was also evidence from which it could be inferred that MCI's control over MCP was used to induce Dr. Zipper to make improvements to MCP's building without compensation. Thus, there was evidence that MCI used MCP's corporate existence to achieve a "malevolent purpose." See Liberty Fin. Management Corp. , 670 S.W.2d at 52. MCI, through MCP, benefited from the improved condition of the building with no expense to either MCI or MCP because Dr. Zipper was not paid for his labors.
Finally, there was sufficient evidence that there was a causal connection between MCI's actions and Dr. Zipper's injury. MCI's actions caused Dr. Zipper to spend $125,000 improving the building with no compensation. Therefore, the evidence demonstrated a genuine issue of material fact whether MCP was the alter ego of MCI, so as to pierce the corporate veil and hold MCI liable for its misdeeds. If so, to the extent MCP is liable, MCI is liable as well.
Promissory Estoppel
With respect to count III, Dr. Zipper undertook to plead a cause of action for promissory estoppel against respondents because he detrimentally relied on Mr. Kaseff's promise to sell him the building if he made significant improvements. Missouri courts have adopted the Restatement (Second) of Contracts § 90 (1981), which recognizes promissory estoppel as a cause of action based on the detrimental reliance of one party on the promise of another. Geisinger v. A B Farms, Inc. , 820 S.W.2d 96, 98 (Mo.App.W.D. 1991). The first subpart of § 90 states:
A promise which the promisor should reasonably expect to induce action or forbearance on the part of the promisee or a third person and which does induce such action or forbearance is binding if injustice can be avoided only by enforcement of the promise. The remedy granted for breach may be limited as justice requires.
The elements of a claim of promissory estoppel are: (1) a promise; (2) detrimental reliance on the promise by the claimant; (3) the promisor should have or did in fact reasonably foresee the precise action the promisee took in that reliance; and (4) injustice can only be avoided by enforcing the promise. Prenger v. Baumhoer , 939 S.W.2d 23, 26 (Mo.App.W.D. 1997). The remedy for promissory estoppel is specific enforcement of the promise. Id .
Promissory estoppel is rarely a successful cause of action, however. See Geisinger , 820 S.W.2d at 98. The doctrine of promissory estoppel should "be used with caution, sparingly, and only in extreme cases to avoid unjust results." Id . This is particularly true when the promise sought to be enforced falls within the Statute of Frauds. Id. at 99. Only in the "most extraordinary situations" will promissory estoppel abrogate the Statute of Frauds. Id . "There is an understandable concern that to completely embrace the doctrine would be to totally abrogate the Statute. Consequently, the case law direction is to proceed with caution and to apply the doctrine only to avoid unjust results." Id .
Turning to the allegations in count III, the elements of a claim for promissory estoppel were adequately pled. Dr. Zipper alleged that Mr. Kaseff promised him that if he would renovate the Parkway Medical Building, MCI "would cause its wholly owned subsidiary, the Defendant, MCP, to sell and convey the Parkway Medical Building to the Plaintiff Zipper, for the current fair market value of the property and give [him] credit toward said purchase price for the actual expenses which he incurred in renovating said building." Dr. Zipper alleged that after he relied on this promise and spent $125,000 on improving the building, MCI and MCP refused to abide by the promise to sell him the building. Dr. Zipper further alleged that it would be unjust for MCI and MCP to derive the benefits of the improvements. Dr. Zipper requested the trial court to award him "actual contract damages" in the amount of $125,000. These allegations were sufficient to state a cause of action for promissory estoppel.
The next issue is whether there was sufficient evidence on each element of Dr. Zipper's claim to avoid summary judgment. The evidence regarding the first element included Dr. Zipper's statement in his affidavit that Mr. Kaseff promised him that MCP would sell the Parkway Medical Building to him if he improved it. As for the second element, Dr. Zipper affied that he spent approximately $125,000 renovating the Parkway Medical Center in detrimental reliance on MCI's promise. His statement was supported by numerous exhibits concerning the improvement and renovation of the building. Third, there was evidence that MCI reasonably should have or did, in fact, clearly foresee the precise action Dr. Zipper took in reliance on Mr. Kaseff's promise. MCI assisted Dr. Zipper in obtaining funds for the renovation by co-signing a note with him to finance the renovation. In addition, letters concerning the construction indicated that Mr. Kaseff was actively involved in the renovation process. This evidence was sufficient to allow the trier of fact to find the existence of the first three elements of Dr. Zipper's promissory estoppel claim.
However, three of four elements is insufficient. Dr. Zipper's case is wanting on the fourth element — whether the injustice can only be avoided by enforcing the promise. This element requires an additional analysis. According to the Restatement (Second) of Contracts § 139(2) (1981):
In determining whether injustice can be avoided only by enforcement of the promise, the following circumstances are significant:
(a) the availability and adequacy of other remedies, particularly cancellation and restitution;
(b) the definite and substantial character of the action or forbearance in relation to the remedy sought;
(c) the extent to which the action or forbearance corroborates evidence of the making and terms of the promise, or the making and terms are otherwise established by clear and convincing evidence;
(d) the reasonableness of the action or forbearance;
(e) the extent to which the action or forbearance was foreseeable by the promisor.
Davis v. Nelson , 880 S.W.2d 658, 667 (Mo.App.E.D. 1994).
Evaluating Dr. Zipper's evidence, in light of the foregoing circumstances, we conclude that the application of promissory estoppel is not necessary to avoid an unjust result. First, with respect to the availability and adequacy of other remedies, Dr. Zipper may seek restitution for the money he spent on the office building. As the discussion below will demonstrate, Dr. Zipper has a remedy via unjust enrichment for the improvements he made to the facility. In fact, Dr. Zipper is not seeking specific enforcement of the promise made to him by MCI, which is the remedy for a claim of promissory estoppel, Prenger , 939 S.W.2d at 26, but is essentially seeking restitution for the money he spent on the project. Next, Dr. Zipper's expenditure of $125,000 was definite and substantial in relation to the remedy sought. Third, Dr. Zipper's actions in making the improvements and taking out a loan for the same provides corroborating evidence of the existence of the promise, although, according to the loan document, the proceeds were to be used for leasehold improvements. As for the fourth element, there was evidence that it was reasonable for Dr. Zipper to improve Parkway Medical Building since the rehabilitation of the building would benefit both Dr. Zipper and MCP. It would also benefit MCI since its facility was located adjacent to the previously dilapidated building. However, the evidence would also support an inference that it was unreasonable for Dr. Zipper to spend $125,000 on the building without an agreement in writing guaranteeing the sale of the building on the terms he alleges, since the Statute of Frauds requires that contracts to sell real estate must be in writing. § 432.010. Finally, as previously noted, Dr. Zipper's actions should have been foreseeable to MCI and Mr. Kaseff.
All statutory references are to RSMo 1994 unless otherwise noted.
In considering the circumstances described in § 139(2) of the Restatement, we find most significant the fact that Dr. Zipper has available another remedy, the one he sought, in the form of restitution for the alleged wrongs. He does not pray for specific performance available under promissory estoppel. In fact, he waived his right to specific performance in the stipulation in the federal proceedings. In light of this fact and the reluctance of the courts to abrogate the Statute of Frauds, we find there is no injustice present in this case requiring the application of promissory estoppel. Therefore, as a matter of law, promissory estoppel is not appropriate in this case.
Unjust Enrichment
Although Dr. Zipper may not pursue a promissory estoppel cause of action under his count III, his allegations and evidence may still be sufficient to permit recovery under his alternative theory of unjust enrichment. Unjust enrichment is a non-contractual recovery based upon notions of equity frequently known as a quasi-contract or contract implied in law. Employers Ins. of Wausau v. Crane Co. , 904 S.W.2d 460, 462 (Mo.App.E.D. 1995). It occurs "'where a benefit is conferred upon a person in circumstances in which retention by him of that benefit without paying its reasonable value would be unjust . . . .'" Id. (quoting Erslon v. Vee-Jay Cement Contracting Co. , 728 S.W.2d 711, 713 (Mo.App.E.D. 1987)). An unjust enrichment claim must consist of facts showing the following elements: "(1) a benefit conferred upon the defendant by the plaintiff; (2) appreciation by the defendant of the fact of such benefit; and (3) acceptance and retention by the defendant of that benefit under circumstances in which retention without payment would be inequitable." Id . The remedy for unjust enrichment is based on quantum meruit. See Forry v. Department of Natural Resources , 889 S.W.2d 838, 847 (Mo.App.W.D. 1994). Quantum meruit literally means "as much as deserved." BLACK'S LAW DICTIONARY 1243 (6th ed. 1990).
Dr. Zipper adequately pleaded a cause of action for unjust enrichment. In his petition, Dr. Zipper alleged that he conferred a benefit upon MCI and MCP by renovating the building at a cost of approximately $125,000. He also alleged that respondents were aware of this benefit because they approved it and assisted him in obtaining financing for the project. Finally, Dr. Zipper contended that it would be inequitable to allow respondents to accept and retain the benefit of the improvements without payment or compensation.
Dr. Zipper also presented evidence that he spent a significant amount of money on improvements to the Parkway Medical Building. In support of his suggestions in opposition to the motion for summary judgment on counts III and IV, Dr. Zipper attached numerous exhibits concerning the improvement and renovation of the Parkway Medical Building. First, there was a letter from Schemata, an interior design company, advising Dr. Zipper that the total estimated costs for the renovation of the building were approximately $80,000. In addition, Dr. Zipper included detailed correspondence concerning the status of the renovation, clearly indicating that a significant amount of work had been completed on the interior and exterior of the dilapidated office building. These letters are evidence that Mr. Kaseff was actively involved in the reconstruction process. Dr. Zipper testified that he spent $125,000 on the construction. MCI co-signed a note with Dr. Zipper to borrow $85,000 to finance the renovations. Finally, there is evidence that the building was worth $150,000 before the improvements and between $230,000 and $270,000 after the improvements. Therefore, there was sufficient evidence that Dr. Zipper conferred a benefit upon MCP and MCI and that these parties were aware of this benefit and accepted and retained the benefit.
Because MCP and MCI refused to sell the building to Dr. Zipper, or compensate him in any manner, they stand to be unjustly enriched from Dr. Zipper's labors and expenditures. The cumulative effect of all this evidence is to create a genuine issue of material fact as to whether MCP and MCI were unjustly enriched by Dr. Zipper's improvements to the dilapidated office building. Therefore, the trial court erred by entering summary judgment on count III because there is a genuine issue of material fact as to whether MCP and MCI were unjustly enriched by Dr. Zipper's actions.
In count III, however, Dr. Zipper named as defendants MCI, MCP, Mr. Kaseff, and eight members of MCI's Board of Directors as defendants. As indicated, the evidence supports a claim against MCI and MCP. The issue then is whether Mr. Kaseff and the members of MCI's Board of Directors are personally liable for the unjust enrichment to MCP and MCI. Merely acting as a director or officer of a corporation does not subject an individual to personal liability for the misdeeds or tortious conduct of the corporation unless there is actual knowledge and acquiescence or action on the part of the individual. See Grothe v. Helterbrand , 946 S.W.2d 301, 304 (Mo.App.S.D. 1997); Contour Chair Lounge Co. v. Aljean Furniture Mfg. Co. , 403 S.W.2d 922, 930 (Mo.App.E.D. 1966); Boyd v. Wimes , 664 S.W.2d 596, 598 (Mo.App.W.D. 1984). In addition, corporate agents may be held liable if acting on behalf of an undisclosed principal. Fairbanks v. Chambers , 665 S.W.2d 33, 39 (Mo.App.W.D. 1984).
Here, Dr. Zipper made only conclusory allegations in the petition. He did not specifically allege or refer to any evidence that any members of the Board of Directors had actual (or even constructive) knowledge of Mr. Kaseff's actions or promises. Furthermore, the principle that officers and directors can be held liable for the tortious conduct of the corporation is inapplicable. There is no element of tortious conduct of the corporation in this claim of unjust enrichment, because an unjust enrichment claim lies in equity, not tort. Moreover, there is no claim that any of the Board members or even Mr. Kaseff received any individual benefit or enrichment, nor is there any evidence of an undisclosed principal. Therefore, there is no basis for liability against the MCI board members or Mr. Kaseff. Consequently, the judgment of the trial court with respect to count III is affirmed as to the MCI Board members and Mr. Kaseff, but is reversed as to MCI and MCP and is remanded for further proceedings consistent with this opinion.
Fraudulent Misrepresentation
In count IV, Dr. Zipper alleged that MCI, Mr. Kaseff, MCP, and eight members of MCI's Board of Directors wrongfully and fraudulently conspired to defraud him by inducing him to make extensive repairs and renovations to the Parkway Medical Building without compensation. He restated his allegations concerning Mr. Kaseff's misrepresentation that MCI would cause MCP to convey the Parkway Medical Building to him if he renovated it, and his reliance on it. Furthermore, he alleged that when he requested to purchase the building, as previously agreed, MCI denied that it possessed any power over MCP with respect to the conveyance of the building and turned down his request. MCP also refused to sell him the building. Dr. Zipper claims that the conduct of MCI, MCP and their agents amounts to fraudulent misrepresentation.
The elements of fraudulent misrepresentation are:
(1) a representation, (2) its falsity, (3) its materiality, (4) the speaker's knowledge of its falsity, or his ignorance of its truth, (5) the speaker's intent that it should be acted on by the person and in the manner reasonably contemplated, (6) the hearer's ignorance of the falsity of the representation, (7) the hearer's reliance on the representation being true, (8) his right to rely thereon, and (9) the hearer's consequent and proximately caused injury.
Reeves v. Keesler , 921 S.W.2d 16, 19 (Mo.App.W.D. 1996). Generally, to be actionable fraud, a representation must be false and relate to a material existing fact. Yerington v. Riss , 374 S.W.2d 52, 58 (Mo. 1964). An exception to the general rule requiring the representation to relate to an existing material fact exists for a promise of future performance, but only if the speaker has a present intent not to perform the promise. Sofka v. Thal , 662 S.W.2d 502, 507 (Mo. banc 1983); Dillard v. Earnhart , 457 S.W.2d 666, 670 (Mo. 1970). The plaintiff bears the burden of proving the defendant's fraudulent intention not to perform at the time the representation is made. Brennaman v. Andes Roberts Bros. Constr. Co. , 506 S.W.2d 462, 465 (Mo.App. W.D. 1973). The subsequent failure to perform, alone, is insufficient to establish the promisor's intent not to perform at the time of the representation. Id .
With respect to this count, Dr. Zipper merely made conclusory allegations that MCI and the named individuals induced him to make repairs to the building "with the intent to cheat and defraud [him] out of the cost and value of such repairs and renovations." These allegations are not supported by direct or circumstantial evidence. While intent can rarely be shown by direct evidence because the nature of intent is subjective and normally must be demonstrated by circumstantial evidence, to survive a motion for summary judgment in a fraudulent misrepresentation case, the plaintiff at the very least must adduce some circumstantial evidence of an intent to defraud at the time of the representation. Wagner v. Uffman , 885 S.W.2d 783, 786 (Mo.App.E.D. 1994). These allegations must be made with specificity, setting forth the particular circumstances constituting intent. Tri-County Human Dev. Corp. v. Tri-County Group XV, Inc. , 901 S.W.2d 308, 311 (Mo.App.S.D. 1995). Dr. Zipper does not refer to any facts or evidence of MCI and MCP's intent to defraud him at the time the promise was made to sell him the building.
Dr. Zipper failed to satisfy his burden of showing a dispute in the evidence as to fraudulent intention not to perform at the time the representation was made. There is no evidence in the record to support Dr. Zipper's allegation that MCI's representation to Dr. Zipper concerning a sale contingent on his improving the property was false at the time it was made in the summer of 1989 and that the speaker knew of the falsity of the representation. Dr. Zipper's own evidence negated this fact. The evidence before the trial court was that MCI presented Dr. Zipper with a proposed real estate contract, a proposed right of first offer agreement and a proposed option to purchase agreement in May and June of 1990. These documents create the reasonable inference that in May and June of 1990, MCI and MCP still intended to proceed with the sale. This is evidence that MCI and MCP did not decide not to sell Dr. Zipper the building until well after the alleged misrepresentation was made. In his petition, Dr. Zipper himself alleged that MCI decided not to go through with the sale after the peer review process started and desired to renegotiate the contract when an appraisal of the facility after renovation showed its greatly increased value. Without evidence of an intent to defraud at the time the representation was made, Dr. Zipper cannot survive a motion for summary judgment. Id . The trial court did not err in entering summary judgment on count IV.
Point II
In his second point on appeal, Dr. Zipper asserts the trial court erred in granting summary judgment in favor of MCI on count I because there are genuine issues of material fact concerning whether MCI breached its contract with Dr. Zipper. He claims genuine issues remain as to: 1) whether the peer review process was conducted in bad faith, 2) whether it was reasonable for MCI to revoke his staff privileges, and 3) whether MCI breached its contractual obligations to him by violating its own bylaws. Count I of the petition involves only plaintiff Dr. Zipper and defendant MCI. The trial court sustained MCI's motion for summary judgment on count I because Dr. Zipper failed to state a claim upon which relief could be granted.
Dr. Zipper contends the trial court erred in entering summary judgment in favor of respondents because he pleaded and had evidence that a contractual relationship existed between him and the hospital which was breached by MCI. The elements of a contract are "'competent parties, proper subject matter, legal consideration, mutuality of agreement and mutuality of obligation.'" Cash v. Benward , 873 S.W.2d 913, 916 (Mo.App. W.D. 1994) (quoting Schlictig v. Reichel , 770 S.W.2d 493, 494 (Mo.App.E.D. 1989)). A valid contract must include an offer, an acceptance and consideration. Johnson v. McDonnell Douglas Corp. , 745 S.W.2d 661, 662 (Mo. banc 1988).
In the second amended petition, Dr. Zipper asserted that a contractual relationship existed between himself and MCI. In support of his position, Dr. Zipper alleged that he had applied for, was granted and exercised orthopedic staff privileges at MCI. Thereafter, MCI's Board of Directors adopted bylaws governing MCI's relationship with its medical staff. Dr. Zipper alleged that he had a contractual relationship with MCI which required both parties to abide by the bylaws regarding staff privileges, and that MCI violated the terms of the contract in numerous respects causing him substantial damage.
Missouri courts recognize the theory of unilateral contract:
A unilateral contract, by its very nature, is one where only one of the parties makes a promise; and the consideration for such a promise is not another promise, but performance. . . . A unilateral contract becomes enforceable upon performance, and the promisee is then entitled to his full bargain.
Garrity v. A.I. Processors , 850 S.W.2d 413, 417 (Mo.App.S.D. 1993) (quoting Garrett v. American Family Mut. Ins. Co. , 520 S.W.2d 102, 111 (Mo.App.W.D. 1974)). In a unilateral contract, the offer is a promise made by one party and the consideration consists of the other party's performance based on that promise. "'[T]he manifestation of acceptance of an offer need not be made by the spoken or written word; it may also come through the offeree's conduct or failure to act.'" E.A.U., Inc. v. R. Webbe Corp. , 794 S.W.2d 679, 686 (Mo.App.E.D. 1990) (quoting Moore v. Kuehn , 602 S.W.2d 713, 718 (Mo.App.E.D. 1980)).
The rules of construction that apply to statutes and contracts apply to the interpretation of hospital bylaws as well. State ex rel. Willman v. St. Joseph Hosp. , 684 S.W.2d 408, 410 (Mo.App. W.D. 1984). In interpreting contracts, courts look primarily to the plain and ordinary meaning of the document's language. Alack v. Vic Tanny Int'l of Missouri, Inc. , 923 S.W.2d 330, 343 (Mo. banc 1996). Therefore, the question whether a hospital's bylaws constitute a promise by the hospital depends on the language of the bylaws. Here, MCI's bylaws made an offer to any medical practitioner, including Dr. Zipper, who applied for orthopedic staff privileges at the hospital. The bylaw concerning staff privileges is found in § 14.2, entitled "Authorizations and Conditions," which states:
By applying for, or exercising, clinical privileges or providing specified patient care services within this Hospital, a practitioner:
A. authorizes representatives of the Hospital, and the Medical Staff to solicit, provide and act upon information bearing on his professional ability and qualifications;
B. agrees to be bound by the provisions of this ARTICLE and waives all legal claims against any representative who acts in accordance with the provisions of this ARTICLE; and
C. acknowledges that the provisions of this ARTICLE are express conditions to his application for, or acceptance of, staff membership, or his exercise of clinical privileges or provision of specified patient services at this Hospital.
It is undisputed that Dr. Zipper exercised staff privileges at MCI after the bylaws were adopted. In doing so, Dr. Zipper accepted MCI's offer, not by words, but by his conduct in exercising his staff privileges and practicing orthopedic medicine and surgery at MCI. Therefore, based on this uncontested evidence, a contract existed between MCI and Dr. Zipper as set out in the bylaws. As a result, the unilateral contract is enforceable because of Dr. Zipper's performance in acceptance of MCI's offer.
This finding is not contrary to prior case law "that the exclusion of a physician or surgeon from practicing in a private hospital is a matter which rests in the discretion of the managing authorities." Richardson v. St. John's Mercy Hosp. , 674 S.W.2d 200, 201 (Mo.App.E.D. 1984). In Richardson , there was no allegation that a contract existed between the physician and the hospital, and the court simply had to determine whether a private hospital could be enjoined from restraining staff privileges in the absence of a contractual relationship. Id. at 201. The existence of a contract between the physician and the hospital was not at issue. When there is no contract governing the relationship between a private hospital and a physician exercising hospital privileges, the relationship is analogous to that of an employer and an at-will employee. If the parties have entered into a contract, then general contract principles govern their relationship. See State ex rel. Willman , 684 S.W.2d at 410.
However, the existence of a contract is only the first hurdle Dr. Zipper must overcome. A party asserting an action for breach of contract must plead and prove the following elements: (1) the making and existence of a contract and its terms; (2) that the plaintiff performed or tendered performance; (3) that the defendant failed to perform; and (4) that the plaintiff suffered damages as a result of the defendant's failure to perform. Venable v. Hickerson, Phelps, Kirtley Assoc. , 903 S.W.2d 659, 664 (Mo.App.W.D. 1995). All four elements must be present before a breach of contract action may be maintained. Id . Because we have determined that a contract exists between MCI and Dr. Zipper and that Dr. Zipper tendered performance through the utilization of his staff privileges, we turn to whether there was evidence that MCI breached the contract and, if so, whether Dr. Zipper suffered any damages.
In count I, Dr. Zipper claimed that he shared a contractual relationship with MCI whereby MCI was obliged to abide by the provisions of its bylaws, and that MCI violated the bylaws in numerous respects. Dr. Zipper alleged that the bylaws were violated by: (1) MCI's failure to give him notice of regular meetings where his clinical course of treatment was discussed and failure to provide him with a statement of the issues involved; (2) MCI's dissemination of confidential information about Dr. Zipper to persons not involved in the peer review process; and (3) MCI's lack of good faith in performance of the peer review.
In support of its motion for summary judgment, MCI provided the trial court with a detailed account of the events which culminated in the revocation of Dr. Zipper's staff privileges at MCI. One of the exhibits filed was the "Written Statement Submitted by the Medical Executive Committee," which was presented to the hearing committee of the medical staff of MCI. The report recounted the pre-hearing chronology of events and the evidence at the review hearing requested by Dr. Zipper. The Medical Executive Committee's (MEC) evidence included the reports of Dr. Wertzberger and Dr. Allen, conducted at the MEC's request. In addition, MCI included the minutes of the Surgical Executive Committee's (SEC) and the MEC's meetings. MCI also attached notices it sent to Dr. Zipper and correspondence between MCI and Dr. Zipper's lawyers.
The evidence before the trial court in support of MCI's motion for summary judgment was that the initial inquiry into Dr. Zipper's arthroscopy practice at MCI began in 1989 during routine peer review and quality assurance activities performed by the SEC. Dr. Zipper was a member of the SEC during this time period, attended its meetings and was aware that his charts were being questioned. The matters discussed at the regular SEC meeting were the "indications for arthroscopic surgical procedures (particularly repeat arthroscopy) and laminectomy complications." Dr. Zipper was resistive to the suggestion that his indications for surgery were questionable, and he disputed the need for indication criteria for arthroscopic surgery.
In April, 1990, the SEC recommended to the MEC that an outside consultant be retained to review the knee surgeries of all orthopedic surgeons. The MEC then reviewed summary statistics of all orthopedic surgeons without identifying individual physicians. As a result of this review, the MEC hired Dr. Kenneth Wertzberger, an instructor in the Department of Surgery, Division of Sports Medicine at the University of Kansas School of Medicine, to conduct a blind review of all arthroscopic surgeries in 1989 by the twelve doctors performing such surgeries at MCI. These orthopedic surgeons were notified of the outside review by a memorandum dated June 7, 1990.
Dr. Wertzberger was provided with a statistical overview of all arthroscopic surgeries performed in 1989 and pertinent medical records of all the repeat arthroscopic surgeries which occurred within sixty days of the original surgery. He subsequently received the same information for the first six months of 1990. At the conclusion of his review, Dr. Wertzberger filed a report. His report identified "worrisome aspects" about Dr. Zipper's statistics. He criticized the inordinate number of plica resections, the number of repeat surgeries and particularly the time between surgeries. In his review of the individual repeat surgeries, he noted inadequate diagnostic testing and problems in clinical judgment. Dr. Wertzberger concluded that Dr. Zipper's care in repeat cases was "sub-par with regard to the current state of the art of arthroscopy and knee treatment."
A plica is a band of membrane or tissue in the knee, and is a common condition found in approximately 40% of individuals. Only rarely is it significantly problematic to require cutting, or resection, to relieve knee pain. However, in Dr. Zipper's cases, he performed plica resections on almost one-third of his patients, a "worrisome" statistic according to Dr. Wertzberger. Literature relied upon by Dr. Wertzberger indicated the incidence of a painful shelf being diagnosed and requiring surgery was generally 1% to 5%. While some surgeons resect the plica while doing other work on the knee, similar to surgeons removing an appendix while performing other abdominal surgery, the plica resection was the sole procedure in 21% of Dr. Zipper's arthroscopies. Dr. Wertzberger characterized this as "too high."
Following the receipt of Dr. Wertzberger's report in late June, 1990, Dr. Lentz, President of the Medical Staff, Dr. Magnam, Chair of the Department of Surgery, Mr. Christiansen, MCI's new CEO, and Ms. Resch, an officer with the risk management division of the hospital, met to discuss the potential for a full peer review into Dr. Zipper's practice at MCI. After this meeting, Dr. Magnum requested that the MEC undertake a further investigation or corrective action. On August 27, 1990, the MEC held a meeting to discuss the Wertzberger report and the request for further investigation and possible corrective action pursuant to the bylaws. The MEC also discussed the need to review all laminectomies due to a high incidence of dural tears, most of which were sustained by Dr. Zipper's patients. At the end of the meeting, an ad hoc committee was formed to conduct a full investigation of Dr. Zipper's medical staff and clinical activities at MCI, as well as his professional relationships with co-workers and any other complaints. The minutes of that meeting reflect that Dr. Zipper was referred to as "Dr. 446." On August 30, 1990, Dr. Zipper was given a "courtesy notice" of the impending internal investigation. As a result, Dr. Zipper retained legal counsel in order to respond to whatever action the committee might take due to its investigation.
A laminectomy involves the surgical excision of muscular tissue or membranes from the spine. Similar to the plica resections, Dr. Zipper's cases involved a relatively high number of laminectomies, considering that it is not normally a necessary procedure.
In its investigation, the ad hoc committee reevaluated the arthroscopy materials and records reviewed by Dr. Wertzberger. In addition, the ad hoc committee considered the complications in laminectomy surgeries, such as dural tears and inadvertent laminectomies, as well as the number and indications for multi-level laminectomies. The committee asked a member of its medical staff to review the laminectomy procedures, and that neurosurgeon recommended a formal peer review by the orthopedic surgeons performing spine surgery. At the MEC's next meeting, the ad hoc committee reported that it was not able to complete its investigation without additional information. It did report that interviews of a number of hospital employees and physicians revealed that some found Dr. Zipper easy to work with and cordial, while others found him to be demeaning, belittling and rude, and were very fearful of retaliation. The MEC determined to request information from Dr. Zipper. On October 3, 1990, Dr. Zipper was again notified by letter of the ongoing investigation and that the MEC was "gravely concerned" about several aspects of Dr. Zipper's practice at MCI. The letter requested that Dr. Zipper provide the MEC with information on certain arthroscopy and laminectomy surgeries performed at MCI, as well as current information on his physical and mental health. The MEC also welcomed whatever other information Dr. Zipper wished the MEC to consider during the investigation.
In response, Dr. Zipper's attorneys requested numerous documents and copies of correspondence, reports and medical records from the MEC and SEC. Dr. Zipper also requested an extension of time to respond to the MEC's request for information. The documents requested by Dr. Zipper were given to him in October of 1990, and he was granted several extensions of time until January 7, 1991 to respond to MEC's request for information. During this time, Dr. Zipper refused to submit to a confidential psychiatric exam and limited the MEC's access to the mental health information it had requested. Immediately prior to submission of the ad hoc committee's report, all quality assurance and peer review activities with respect to cases outside the investigation were suspended due to Dr. Zipper's disruptive and uncooperative behavior.
Dr. Michael Gross, an independent reviewer retained by Dr. Zipper, generally agreed with the analysis of Dr. Zipper's arthroscopic procedures by Dr. Wertzberger and the ad hoc committee. He concluded that Dr. Zipper's practice of diagnostically arthroscoping a patient's knee and then later performing surgery to repair the problem discovered by the arthroscopy resulted in unnecessary surgeries. He also believed Dr. Zipper's incidence of plica resection was high, but did not have follow-up information to determine if patients had benefited from the procedures.
The ad hoc committee report submitted to the MEC was "in general agreement with the findings" of Dr. Wertzberger. Following receipt of the report, the MEC elected to invite Dr. Zipper for an interview at the next MEC meeting in an effort to obtain necessary information to formulate a recommendation to the MCI Board of Directors. He made prepared remarks to the MEC at its March 4, 1991 meeting. After reviewing all of the materials compiled during the peer review process, the MEC recommended that substantial restrictions be imposed on Dr. Zipper's practice at MCI. Dr. Zipper was notified of the recommendations and timely submitted a request for a hearing pursuant to the "Medical Staff Fair Hearing Plan." Section V.H. of the Fair Hearing Plan provides that "the Practitioner who requested the hearing shall have the burden of proving by clear and convincing evidence either that the proposed adverse recommendation or action lacks substantial factual basis or was arbitrary, capricious or unreasonable." Under this provision, Dr. Zipper had the burden of proof at the hearing.
On July 17, 1991, a hearing committee heard extensive testimony and evidence presented by both the MEC and Dr. Zipper regarding Dr. Zipper's patient care at MCI, his mental health status, as well as his "disruptiveness and inability to work cooperatively with others." The MEC presented expert testimony on arthroscopic surgery by Dr. Jelley, an orthopedic surgeon on the medical staff of MCI and a member of the ad hoc committee of the Department of Surgery, and Dr. William C. Allen, Chairman of the Division of Orthopedics at the University of Missouri-Columbia, as well as the written reports of the ad hoc committee, Dr. Allen and Dr. Wertzberger. Dr. Zipper presented the testimony of Dr. George H. Woy, an orthopedic surgeon in private practice, and Dr. James Hamilton, Chairman of Orthopedic Surgery at the University of Missouri-Kansas City, as well as the written reports of Dr. Gross and Dr. Roger Hood.
The MEC's evidence was that, generally, ligament injury can be diagnosed with more than 90% accuracy by an experienced clinician performing a physical examination of a patient and relying on non-invasive tests. The clinician should use a manual examination, instrumented measurement and stress radiographs to aid the clinician's diagnosis. The MEC's experts found that Dr. Zipper did not perform appropriate pre-operative diagnostic examinations, but instead relied for diagnosis on the invasive, surgical arthroscopy which requires that the patient to be under a general anesthetic. His approach of performing a diagnostic arthroscopy, subsequently discussing the findings with the patient, and then operating at a later date to correct problems detected by the arthroscopy was found to result in multiple, unnecessary surgeries. The MEC's experts also criticized Dr. Zipper's repeat surgeries to address post-arthroscopic bleeding, failure to regain motion and post-operative synovitis because these complications or conditions should be resolved without additional surgery. Finally, Dr. Zipper's incidence of plica resections, 15.7% to 21%, was found to be too high. Of the twenty-one knee surgeries under review, there was evidence that at least eleven surgeries were unnecessary or should have been combined with other procedures.
On the issue of back surgeries, the MEC presented expert testimony by Dr. James A. Stuckmeyer, an orthopedic surgeon on the medical staff who served on the ad hoc Committee of the Department of Surgery, and Dr. Allen, as well as the written reports of the ad hoc committee and Dr. Allen. Dr. Zipper presented the testimony of Dr. Hamilton and Dr. W. Joseph Ketcherside, a neurosurgeon on staff at MCI. In addition, Dr. Zipper submitted the written reports of Dr. Ketcherside and Dr. Roger P. Jackson. These experts presented divergent views concerning the propriety of Dr. Zipper's back surgeries. The MEC's witnesses criticized the adequacy of Dr. Zipper's pre-operative work-up and indications for back surgery. The ad hoc committee's witnesses identified a trend or pattern that the extent of surgery performed by Dr. Zipper was greater than necessary. Medical literature shows that only 1% of patients afflicted with back symptoms respond favorably to surgical decompression of the nerve roots, so pre-operative indications for spine surgery must be strictly observed. Dr. Allen testified "that surgery is only indicated when radiographic abnormalities concur with abnormal physical findings and complaints, and conservative treatment fails." If surgical indications and technical execution are appropriate, the success rate for disc surgery should be 85% to 96%. Of the fourteen back cases under review by the MEC, Dr. Zipper had a success rate of, at best, 36%. Dr. Zipper's overall complication rate for back surgery was 26%, compared with 3% for other spine surgeons.
With regard to his mental health, Dr. Zipper's diagnosis was acute situational psychosis (atypical), totally resolved, borderline personality disorder with dependent and narcissistic features, high level, and possible atypical bipolar disorder. He had taken psychotropic medications for these conditions, and in 1987, was hospitalized after a brief incidence of reactive psychosis. Dr. Zipper also testified as to periods in which he was unable to practice due to his mental health problems. Under the policies of the State Board of Registration, a physician who has been hospitalized, is on medication for a psychiatric illness or who has been unable to function is subject to having the physician's license placed on probation and can be required to file quarterly reports. MCI relied upon this evidence to support its motion for summary judgment.
In response, Dr. Zipper filed Suggestions in Opposition to the motion. Attached to his suggestions were the reports of Drs. Ketcherside, Jackson, Hamilton and Eikermann, whose expert testimony at the hearing was favorable to him. The reports of the first three doctors pertained to the quality of medical services provided by Dr. Zipper, while Dr. Eikermann addressed Dr. Zipper's mental health status. Dr. Ketcherside reviewed thirty-six of Dr. Zipper's laminectomy cases with respect to whether the diagnostic evaluation was appropriate, the treatment was appropriate and performed to acceptable standards, and whether there was an excessive incidence of complications. He concluded that the cases did not fall outside the accepted standards of care; he found "appropriate preoperative evaluation, surgery for appropriate indications, surgery which was appropriately performed and outcomes which [were] as good as those which anyone can reasonably expect." Dr. Jackson reviewed the same thirty-six laminectomy cases. Dr. Jackson concluded that Dr. Zipper's diagnostic evaluations and his treatment, pre-operatively, intra-operatively and post-operatively, met medically acceptable standards. Dr. Hamilton disagreed with the opinion of Dr. Allen, who testified for the MEC that Dr. Zipper should not have performed arthroscopy procedures for the sole purpose of evaluation, but should have counseled his patients and obtained permission to proceed with reconstructive surgery if indicated by the arthroscopy. Dr. Hamilton's criticisms were based on Dr. Zipper's statement that his patients told him they did not want reconstructive surgery and Dr. Hamilton concluded that Dr. Zipper was properly responding to his patients' needs.
Finally, Dr. Eikermann prepared a psychiatric report with a detailed description of Dr. Zipper's mental health diagnosis and treatment. He did not think there was a mental disorder or impairment which might impact on Dr. Zipper's clinical judgment or his ability to provide safe and competent patient care. He declined to comment "on the surgical procedure in which Dr. Zipper 'deliberately directed the contaminated liquid irrigation stream from an arthroscope cannula into the face and eyes of a hospital staff member because [he] was not there and [he] also know[s] there [was] a large difference in opinion of what was observed in that sequence of events.'" He stated that Dr. Zipper was aware that his behavior was an inappropriate response to a situation, and Dr. Eikermann was sure that the occurrence would not be repeated. Dr. Eikermann did not find it surprising that Dr. Zipper had occasionally been observed verbally abusing hospital employees and medical staff members when the orders he requested were questioned. Dr. Eikermann also expressed his opinion that Dr. Zipper's mental disorder or impairment might hurt his "harmonious interactions with other professionals," but would not interfere with his patient care.
In addition, Dr. Zipper filed his own affidavit. The affidavit included information to which Dr. Zipper would not be qualified to testify at trial and which was not within his personal knowledge. There were also numerous conclusory statements without any reference to facts to support the conclusions. The facts within Dr. Zipper's knowledge were that he exercised regular medical staff privileges at MCI from 1987 until February 19, 1992, when his privileges were revoked. Prior to July of 1989, Dr. Zipper received an offer from Drs. Collins and West to become an employee of their medical group. He declined the offer. In July of 1989, Dr. Collins became Chair of the SEC at MCI. Shortly after Dr. Collins became Chair, there was a peer review investigation by the SEC concerning Dr. Zipper's practice of orthopedic surgery and medicine at MCI. Thereafter, the SEC and MEC instituted certain inquiries regarding Dr. Zipper's surgical practices and personal relationships with employees and staff at MCI, but did not provide him notice as required by § 13.7-3 of the bylaws. Dr. Zipper also affied that he had not received notice of regular department, service and committee meetings where he believed his clinical course of treatment was discussed.
Dr. Zipper stated that his cases had previously passed the quality assurance standards of MCI's bylaws. He believed that the knee arthroscopies and laminectomies performed by him at MCI were all necessary operations and were performed within the requisite standard of care of orthopedic physicians. No patient had ever filed a formal complaint against him. Nor had any staff member or hospital employee submitted a written complaint about him. He worked cooperatively with other members of the health care team and was never disruptive to hospital operations and in no way compromised quality patient care. He stated his belief that MCI was the largest and best equipped hospital in Independence, Missouri and that medical staff privileges at MCI were essential to the optimal provision of orthopedic surgical services and care to patients residing in Independence. His ability to practice orthopedic medicine and surgery and to earn a living was significantly impaired by the revocation of his privileges at MCI.
This evidence presented to the trial court in support of and opposition to the motion for summary judgment will be considered in light of each allegation of breach of contract. The first breach asserted is that MCI violated § 13.7-3 of the bylaws, entitled "special appearance," which provides that:
A practitioner whose patient's clinical course of treatment is scheduled for discussion at a regular department, service or committee meeting shall be so notified. The chairman of the meeting shall give the practitioner advance written notice of the time and place of the meeting. Whenever apparent or suspected deviation from standard clinical practice is involved, special notice shall be given and shall include a statement of the issue involved and that the practitioner's appearance is mandatory. Failure of a practitioner to appear at any meeting with respect to which he was given such special notice shall, unless excused by the Medical Executive Committee upon a showing of good cause, result in an automatic suspension of all or such portion of the practitioner's clinical privileges as the Medical Executive Committee shall direct. . . .
Dr. Zipper claims that MCI violated this section by "conducting a secretive investigation" into his cases and charts, and by discussing his clinical course of treatment "on numerous occasions at regular department, service and committee meetings," without providing him the "special notice" described in § 13.7-3.
The evidence set forth by Dr. Zipper and the other evidence in the record does not support the allegation that MCI conducted a secretive investigation into Dr. Zipper's practice at MCI. Dr. Zipper was a member of the SEC when the concerns over his surgeries were first articulated. He participated in discussions concerning whether indications for arthroscopic surgery should be adopted and, if so, what those indications should be. Because of a lack of agreement on these issues, a review of all knee arthroscopies by an independent consultant was requested by the SEC. The MEC initiated such a review. As a result of the report of the independent consultant, the MEC decided to undertake a peer review of Dr. Zipper's surgical practices and his relations with MCI staff and employees. Although there was a gap of two months between receipt of the report and action on the report at a meeting of the MEC, Dr. Zipper does not allege or present evidence of any activities of the MEC during this period. MCI's evidence indicates that the only meeting which occurred between the receipt of the report and the October 1st meeting of the MEC, was the meeting of Drs. Lentz and Magnam, Mr. Christiansen and Ms. Resch. There was no evidence that this was a regular department, service or committee meeting of which Dr. Zipper would be entitled to notice. When the MEC decided to conduct the review, Dr. Zipper was integrally involved in the review undertaken by the ad hoc committee, including the exchange of information on the subject of the review. The information he provided was utilized by the ad hoc committee's experts. Dr. Zipper was also involved in negotiations in an attempt to resolve the matter. This evidence does not support Dr. Zipper's claim that MCI conducted a secret investigation in violation of its bylaws.
With regard to the notice requirements, Dr. Zipper makes only the general allegation that he did not receive the "special notice" required by § 13.7-3 and that he was not notified of numerous occasions when his clinical course of treatment was discussed at regular department, service and committee meetings. The averments contained in Dr. Zipper's affidavit simply mirror the allegations in the petition and do not provide factual assertions in support of any violations of the bylaws. Nowhere in the petition, affidavits, or exhibits does Dr. Zipper point to a regular meeting within the definition of § 13.7-3 held without notice to him, or any detail beyond the allegations contained in the petition, such as who attended any such meeting or the subject of discussion.
MCI's evidence indicates that Dr. Zipper was given a written notice on October 3, 1990 which advised him of the MEC's decision to conduct an investigation into his clinical and medical staff activities. It advised him of the concerns underlying the investigation, requested information from him and gave him the opportunity to submit other information if he desired. In February, 1991, Dr. Zipper received an invitation to appear before the MEC for an interview on the matters under investigation. Dr. Zipper appeared before the MEC at its March 4, 1991 meeting and made prepared remarks. From this evidence, it is clear that MCI provided to Dr. Zipper all the due process protections intended by the "special notice" provision of § 13.7-3. While MCI may not have complied with the technical requirements of the bylaw because two steps occurred rather than the one contemplated by § 13.7-3, strict compliance with bylaws by hospitals is not required. State ex rel. Willman v. St. Joseph Hosp. , 684 S.W.2d 408, 411 (Mo.App.W.D. 1984). Dr. Zipper does not allege, and this court does not find, any prejudice to Dr. Zipper in the type of "special notice" given.
With regard to the other notice required by § 13.7-3, MCI's evidence indicates that the ad hoc committee met during the course of its investigation, and there is no evidence that Dr. Zipper was given notice of these meetings. The ad hoc committee was a special committee, however, and its meetings would not be "regular" committee meetings as contemplated by the bylaws. There would be no violation of the bylaws by the lack of notice of the ad hoc committee meetings.
There was one regular committee meeting, however, about which Dr. Zipper was entitled to receive notice. On August 27, 1990, the MEC met to consider the report of Dr. Wertzberger and Dr. Magnam's recommendation that a full peer review should be conducted into Dr. Zipper's surgical practices. The MEC also discussed incidents of Dr. Zipper's disruptiveness and his inability to work cooperatively with others. The decision was made at this meeting to appoint an ad hoc committee to conduct a full investigation into Dr. Zipper's medical staff and clinical activities at MCI and his working relationships with others. This meeting qualifies as a regular meeting of a committee where Dr. Zipper's clinical course of treatment was scheduled to be discussed. Therefore, Dr. Zipper should have been given advance written notice of the time and place of this meeting. There was no indication that such notice was provided. Therefore, the evidence would support a finding that MCI violated its bylaws in failing to give such notice.
Although a hospital is not required to strictly comply with its bylaws, the nature of this meeting would compel the finding that the failure to give notice was more than a technical violation. The question then is whether Dr. Zipper's evidence of the failure to give notice was sufficient to support all the elements of a cause of action for breach of contract. As noted previously, there was evidence that Dr. Zipper had a contract with MCI under which he had tendered performance. Dr. Zipper also had evidence that MCI breached that contract by its failure to give notice as required by § 13.7-3. The remaining element is causation. To avoid summary judgment, Dr. Zipper must have evidence that he suffered damages as a result of MCI's failure to give him notice of the MEC's August 27, 1990 meeting. The evidence must demonstrate that "but for" the failure to give notice of the August 27th meeting, Dr. Zipper would not have suffered the revocation of his hospital privileges. Callahan v. Cardinal Glennon Hosp. , 863 S.W.2d 852, 862-63 (Mo. banc 1993).
Dr. Zipper did not identify the August 27th meeting in his petition, his response to MCI's motion for summary judgment or his affidavit, so he did not make any claim that he suffered any particular prejudice by the failure to give notice of this meeting. In fact, his allegation of causation is the general statement that all the alleged violations of the bylaws resulted in the revocation of his hospital privileges. He made no allegations and offered no evidence supporting a finding that the failure to give notice had a direct causal effect on the outcome of the peer review. While the significance of the meeting of the MEC on August 27, 1990, is apparent, there is no evidence, or reasonable inference from the evidence, that if Dr. Zipper had been given notice the outcome of that meeting would have been different. In addition, the recommendation of the ad hoc committee appointed by the MEC at the August 27th meeting was only that Dr. Zipper's medical practice at MCI be closely monitored, not that his privileges be revoked. The peer review proceedings after the receipt of the report from the ad hoc committee were extensive, and Dr. Zipper was integrally involved in all of these proceedings. There were many intervening events between the August 27th meeting of the MEC of which Dr. Zipper did not receive notice and the ultimate revocation of his hospital privileges. From the foregoing, we conclude, as a matter of law, that there was insufficient evidence to demonstrate that "but for" the failure to give notice of the August 27th meeting, Dr. Zipper would not have suffered the loss of his hospital privileges.
Next, Dr. Zipper alleged that MCI violated § 14.3 of the bylaws pertaining to the confidentiality of information. That section provides in pertinent part:
Information with respect to any practitioner submitted, collected or prepared by any representative of this or any other health care facility or organization or medical staff for the purpose of achieving and maintaining quality patient care, reducing morbidity and mortality, or contributing to clinical research shall, to the fullest extent permitted by law, be confidential and shall not be disseminated to anyone other than a representative nor used in any way except as provided herein. Such confidentiality shall also extend to information of like kind that may be provided by third parties. This information shall not become part of any particular patient's file or of the general Hospital records.
Dr. Zipper claims that MCI violated this section by "publicly disseminating confidential information" about the peer review of his practice, the investigation into his suspected deviations from clinical standards, and information relative to his past psychiatric care.
In its motion for summary judgment concerning this claim, MCI stated that the evidence did not support the allegation that it had wrongfully disseminated confidential information concerning Dr. Zipper. In support, it cited the bylaw permitting outside review of cases where there is a concern regarding the appropriateness of procedures. According to MCI's evidence, the only persons with access to the confidential information concerning Dr. Zipper were individuals involved in the peer review process, such as the independent reviewers. In response to MCI's motion for summary judgment, Dr. Zipper simply restated his allegation that MCI had disclosed confidential information concerning him.
Dr. Zipper's evidence does not demonstrate a genuine issue of fact concerning whether MCI violated § 14.3 of the bylaws. Dr. Zipper did not provide the trial court with factual assertions regarding what information was dispersed, who received it, or why the dissemination of such information was in violation of the bylaws. He merely alleged that confidential information was disseminated in violation of § 14.3. Furthermore, § 14.3 provides for protection of information "to the fullest extent provided by law," but allows for use of information "as provided herein." Because the full text of the bylaws is not in the record, it is unknown what was "provided herein." But, § 14.3 allows for dissemination of information to a representative, which § 14.1D of the bylaws defines as "any director of committee of the Board; a Chief Executive Officer; a Medical Staff organization and any member, officer, department or committee thereof; and any individual authorized by any of the foregoing to perform specific information gathering or disseminating functions[.]" These categories would cover the individuals participating in the peer review process. Dr. Zipper has failed to demonstrate that confidential information was provided to someone who does not meet the above definition. There is no evidence in the record suggesting that anyone other than a representative of MCI received confidential peer review information, or that the internal investigation was not conducted within the confines of § 14.3. The evidence does not show that confidential information regarding Dr. Zipper's psychiatric care was disseminated to any unauthorized personnel.
The third bylaw MCI allegedly violated is § 14.4-1, which provides civil immunity for actions taken by a representative of the hospital in the performance of their duties, and provides in pertinent part:
14.4 Immunity From Liability
14.4-1 For Action Taken. No representative of the Hospital or Medical Staff shall be liable in any judicial or other proceeding for damages or other relief for any action taken or statement or recommendation made within the scope of his duties as a representative, if such representative acts in good faith and without malice after a reasonable effort under the circumstances to ascertain the truthfulness of the facts and in the reasonable belief that the action, statement, or recommendation is warranted by such facts. Regardless of any provisions of state law, truth shall be an absolute defense in all circumstances.
Dr. Zipper claims that MCI, acting through its agents, violated this section by conducting the peer review in bad faith, acting with malice and reckless disregard for whether the information received and disseminated was true, and revoking his staff privileges when such revocation was not warranted based on the evidence and information received. As further evidence of bad faith and malice, Dr. Zipper alleged that MCI obstructed his right to a fair hearing; failed to timely produce important documents and singled out Dr. Zipper for "intense focused peer review without any reasonable basis or justification;" initiated the peer review despite the fact that all of Dr. Zipper's cases passed quality assurance standards, and no patient, staff member or hospital employee ever complained about him; and, provided the outside consultant with select and edited information causing faulty conclusions and meritless opinions.
Dr. Zipper argues that he has a cause of action for "bad faith" as a violation of § 537.035.3, or as a breach of contract in violation of the bylaws. Section 537.035.3, like § 14.4-1 of the bylaws, provides immunity from civil liability to members of peer review committees for actions taken in good faith that are related to the peer review, except that § 537.035.3 applies specifically to participants in the peer review process. That section reads:
3. Each member of a peer review committee and each person, hospital governing board, and chief executive officer of a licensed hospital or other hospital operating under constitutional or statutory authority who testifies before, or provides information to, acts upon the recommendation of, or otherwise participates in the operation of, such a committee shall be immune from civil liability for such acts so long as the acts are performed in good faith, without malice and are reasonably related to the scope of inquiry of the peer review committee.
The statute is not specifically alleged in the petition. However, Dr. Zipper's brief on appeal is clear on the issue: "It is certainly implicit in said statute, based upon the above wording, that there will be civil liability in the event that Defendants do not act in good faith or in the event that they act with malice."
Even assuming MCI conducted the peer review process in bad faith and with malice, Dr. Zipper cites no authority for the proposition that such conduct provides him with a cause of action against MCI pursuant to § 537.035.3, and no authority for that proposition exists. Although courts have recognized causes of action implied from constitutional and statutory provisions, Shurn v. Monteleone , 769 S.W.2d 188, 190 (Mo.App.E.D. 1989), "[t]he creation of a private right of action by implication is not favored and the general trend under Missouri law is away from judicial inferences that a violation of a statute is personally actionable." Bradley v. Ray , 904 S.W.2d 302, 313 (Mo.App.W.D. 1995). In Shurn , the plaintiff relied on the language of an immunity section, § 210.135, to argue the creation of a statutory cause of action for the filing of an intentional false report. Shurn , 769 S.W.2d at 190. The court, however, found that the statute did not create a cause of action, concluding that "[t]he legislature could have but did not expressly create a new cause of action." Id. at 190-91.
Likewise, this court finds that § 537.035 does not expressly or implicitly provide Dr. Zipper with a statutory cause of action against MCI for the conduct of MCI's agents in performance of the peer review. Rather, § 537.035.3 grants a qualified immunity from civil liability for actions taken while performing a peer review. If the peer review is conducted in bad faith or maliciously, then the blanket of immunity provided by § 537.035.3 is removed, and the participant is subject to liability for existing civil causes of action. However, § 537.035 does not provide a statutory cause of action.
Neither does § 14.4-1 of the bylaws grant Dr. Zipper a claim against the peer review committee for acting in bad faith. This bylaw simply states that members of the peer review committee are immune from acts performed in their official capacity so long as the acts they perform are in good faith, without malice and reasonably related to the scope of the peer review committee's inquiry. Thus, the analysis of the bylaw is the same as § 537.035. It merely provides that in certain situations the blanket of civil immunity is no longer available. Nowhere does the bylaw grant Dr. Zipper a contractual right of action for actions taken contrary to the provisions of § 14.4-1.
Nevertheless, there is a general common law duty of good faith and fair dealing in the performance of contracts. See Wulfing v. Kansas City S. Indus. , 842 S.W.2d 133, 157 (Mo.App.W.D. 1992). "That duty prevents one party to the contract from exercising a judgment conferred by the express terms of agreement in such a manner as to evade the spirit of the transaction or so as to deny the other party the expected benefit of the contract." Id . In other words, "[i]t is the duty of one party to a contract to cooperate with the other to enable performance and achievement of the expected benefits." Slone v. Purina Mills, Inc. , 927 S.W.2d 358, 368 (Mo.App.W.D. 1996). The question is whether Dr. Zipper presented evidence to support a cause of action for breach of the contractual duty of good faith under the Wulfing standard.
Dr. Zipper alleged that MCI's bad faith was evidenced by a number of actions by MCI's agents. First, he asserts that:
Members of the surgical executive committee and medical executive committee and other agents of MCI collectively and individually did not act in good faith during the subject peer review process and in fact acted with malice and with reckless disregard for whether or not information received and disseminated was true or false and in that the action taken by them was not warranted based upon the credible evidence and information received.
MCI claimed in its motion for summary judgment that there was a sufficient basis for the revocation of Dr. Zipper's staff privileges. As previously mentioned, it filed voluminous exhibits including the very detailed report of Dr. Wertzberger concerning Dr. Zipper's surgical performance and the written statement submitted by the MEC outlining the prehearing activities and the evidence presented at the hearing. Both documents demonstrate that there was substantial evidence that Dr. Zipper's diagnostic evaluations and his treatment of patients were not within accepted standards of care. There was also evidence that his behavior was disruptive and uncooperative, and that his mental health impacted his practice of medicine, as well as his relationships with MCI staff and employees.
In response, Dr. Zipper alleged that he was in possession of considerable evidence in his favor which would be presented at trial. He argued that it was not "appropriate" for the trial court to weigh the evidence. Dr. Zipper cited the previously mentioned favorable opinions of Drs. Ketcherside, Jackson, Hamilton and Eikermann and stated that respondents did not have the right to take as the "gospel every word uttered by a few chosen witnesses" and disregard the evidence in his favor. Dr. Zipper also set forth the reports of three mental health professionals who he claims testified that his current mental health status would not impair his ability to perform surgery or diagnose his patients. He also noted the testimony of a nurse that she "always had a good working relationship with Dr. Zipper." Dr. Zipper argued that the ultimate issue was whether it was reasonable for MCI to revoke Dr. Zipper's staff privileges in light of all of the evidence. Since Dr. Zipper believed his witnesses were more credible, he concluded that respondents acted in bad faith. While Dr. Zipper's response to the motion for summary judgment emphasizes the different opinions of the witnesses, there was significant evidence in the record to support the decision of MCI. The fact that the conflicts in evidence were resolved against Dr. Zipper is not sufficient evidence of bad faith on MCI's behalf.
Dr. Zipper alleged in the petition that MCI's bad faith was further evidenced by the fact that its agents obstructed Dr. Zipper's right to a fair hearing by instructing certain MCI employees and staff not to discuss or cooperate with Dr. Zipper or his attorneys and failed to timely produce important documents he requested. He further alleged that MCI singled Dr. Zipper out for an intense focused peer review without any reasonable basis, and provided its independent consultant with select and edited information which caused the consultant to arrive at faulty conclusions. We first consider Dr. Zipper's claim that MCI acted with bad faith by instructing employees and staff not to cooperate with Dr. Zipper and his attorneys and by failing to timely produce important documents.
In support of its motion for summary judgment, MCI presented evidence that, after the hearing was scheduled, Dr. Zipper was given special notice of the date, time and place of the hearing, a list of the hearing committee members, the MEC's witness list, a summary of Dr. Zipper's rights, a concise statement of the alleged actions or omissions, a list of patient charts, and other matters forming the basis for the recommendation. There was evidence that Dr. Zipper then began contacting employees and members of the medical staff in an intimidating manner which interfered with hospital operations, so Dr. Zipper was requested to work through legal counsel to set up necessary interviews. His attorney objected to this procedure. MCI also presented evidence that numerous requests for information by Dr. Zipper were complied with, but others were objected to. For example, Dr. Zipper requested incident reports which MCI considered confidential hospital records. These records were not relied upon in the peer review process, so they were not disclosed. MCI noted that "[n]umerous challenges to the peer review procedures, composition of the hearing committee, document production and other issues were raised by Dr. Zipper."
In Dr. Zipper's response, he did not cite evidence supporting his claim that any employee or staff member of MCI was instructed not to cooperate with him or his attorneys. He did not identify any particular employee or staff member who did not cooperate with him. Nor does he refer to any document which he claims was not produced in a timely manner. His failure to present evidence disputing MCI's evidence causes MCI's evidence to be deemed admitted. Hillside Dev. Co. v. Fields , 928 S.W.2d 886, 889 (Mo.App.W.D. 1996). Therefore, Dr. Zipper admitted that he received all the information to which he was entitled, without any unreasonable delays. Other information which was not provided was reasonably withheld, because Dr. Zipper did not demonstrate his entitlement to this evidence.
Dr. Zipper next alleged MCI's bad faith was evidenced by the fact that all of his cases passed quality assurance standards and the independent consultant was provided select and edited information which skewed his results against Dr. Zipper. In MCI's documentation supporting its motion for summary judgment, there was evidence that a routine peer review by the SEC revealed that Dr. Zipper had a high incidence of repeat arthroscopic surgery. When discussion occurred regarding the standards or indications for repeat surgery, Dr. Zipper resisted any efforts to quantify the indications criteria. The SEC then recommended to the MEC that all arthroscopic knee surgeries performed in 1989 by the twelve surgeons be independently reviewed. The MEC accepted this recommendation and engaged Dr. Wertzberger to conduct a blind review of all arthroscopic surgeries. He was directed to review the arthroscopic procedures performed with special attention to the types of procedures, possible overuse, and the number of repeat procedures. Dr. Wertzberger was provided with a comprehensive spread sheet, as well as the spread sheet on each doctor. He also received "pertinent medical records" of all repeat surgeries occurring within sixty days of the original surgery. The doctors were listed A through L, so the consultant would not know whose records he was considering.
This blind review resulted in the focus on Dr. Zipper when Dr. Wertzberger found that Dr. "K" had 15% repeat surgeries when the average for the other doctors was less than 5%. Dr. K's percentage of plica resections was 21%, which was also considered by Dr. Wertzberger as "too high." Dr. Wertzberger concluded that Dr. K had a disproportionate number of plica resections, more repeat arthroscopies than most, and there was an "inappropriate" interval time to the repeat surgeries. He further stated that, "[o]f the repeat cases studied, many of them were very sub-par with regard to the current state of the art of arthroscopy and knee treatment."
In Dr. Zipper's response, he asserted that few files of other surgeons were presented to Dr. Wertzberger for his review; "the vast majority of information presented to Dr. Wertzberger related to surgeries performed by Dr. Zipper." He then argued that it was a "sham" to deny that Dr. Zipper was not the target of the review, even though all his surgeries "had passed all previous quality assurance screening of the hospital." Dr. Wertzberger admitted in writing and verbally to Dr. Zipper's attorney that he understood he was undertaking "a confidential peer review." In Dr. Zipper's affidavit he reiterated that his cases had passed all previous peer reviews under the MCI bylaws and stated that no patient had filed a complaint against him and no staff member or employee of MCI had filed a written complaint about him. He further stated that, to his knowledge, no other physician had been subjected to the same type of focused peer review in the history of MCI.
Dr. Zipper's evidence in response to the motion for summary judgment did not dispute MCI's evidence. He did not contest that the same information was presented to Dr. Wertzberger for each doctor and each repeat procedure. Since Dr. Zipper had 11 repeat surgeries out of 35 for all twelve doctors and Dr. Wertzberger received the medical records on each repeat surgery, it is reasonable that more files pertaining to Dr. Zipper were given to Dr. Wertzberger than for the other doctors. In addition, there is no significance to Dr. Wertzberger's statement that he was aware he was conducting a confidential peer review. That is what he was engaged to do. Since it was a blind review, however, there is no support for Dr. Zipper's claim that the review was evidence of bad faith. The MEC's seeking an independent, unbiased assessment of the surgical practices in arthroscopic surgeries to resolve the conflict between the SEC's belief that indications for repeat surgeries should be adopted and Dr. Zipper's position that no indications were necessary, evidences the MEC's good faith, not bad. There is also a reasonable inference from the evidence that Dr. Zipper's decision not to concede to the positions of the SEC and the MEC caused his peer review process to be unlike any conducted in the history of MCI.
In addition, peer review is undertaken as a mechanism to self-assess the performance of medical professionals and the quality of care provided to patients. See State ex rel. Lester E. Cox Med. Ctrs. v. Darnold , 944 S.W.2d 213, 215 (Mo. banc 1997); State ex rel. Chandra v. Sprinkle , 678 S.W.2d 804, 807 (Mo. banc 1984). The peer review system is "intended to provide benefit for those presently receiving health care whose care may thereafter be scrutinized by peer review as well as those patients who thereafter come for treatment and whose care may be enhanced by the earlier peer review activity." Chandra , 678 S.W.2d at 807. Dr. Zipper's argument that MCI undertook a peer review of his cases when no complaints of patients had occurred does not demonstrate bad faith on the part of MCI. Nor does the fact that no "written" complaints had been received from MCI employees and staff indicate bad faith. Complaints about Dr. Zipper's behavior had previously required intervention by the hospital administration; it was not significant that the complaints were not in writing.
In summary, MCI presented evidence to the trial court in support of its motion for summary judgment that the peer review of Dr. Zipper was undertaken in substantial compliance with MCI's bylaws and without bad faith. MCI's failure to give notice of the MEC's August 27th, 1990, meeting in violation of the bylaws was not sufficiently causally linked to Dr. Zipper's damages to make a submissible case. Dr. Zipper's response to the MCI's summary judgment motion did not provide evidence that any other bylaws were violated or that his peer review was conducted in bad faith in violation of the Wulfing duty. He attempted to link the alleged desire of other doctors to eliminate competition with the conduct of the peer review. Other than his conclusory allegations that the peer review was conducted in bad faith and malice, Dr. Zipper referred to no facts supporting his position. No evidence supports the inference that MCI conducted the peer review to eliminate Dr. Zipper from competition for the benefit of other arthroscopic surgeons. There was significant evidence that there was a reasonable basis for MCI's actions and, at the least, there was room for two opinions on the matter of whether Dr. Zipper's performance as an orthopedic surgeon was substandard. These facts do not evidence bad faith or malice in breach of MCI's duty of good faith. See Morton v. Hearst Corp. , 779 S.W.2d 268, 273 (Mo.App.W.D. 1989).
The trial court did not err in sustaining MCI's motion for summary judgment on count I of the petition. Dr. Zipper failed to set forth specific facts to show that a genuine issue exists for trial regarding a breach of contract by MCI. Point II is denied.
Point III
As the final point on appeal, appellants contend that the trial court erred by entering summary judgment in favor of respondents on the claim for civil conspiracy in count II because they successfully stated a claim based upon civil conspiracy and there were genuine issues of material fact concerning whether there was a conspiracy to revoke Dr. Zipper's staff privileges at the hospital.
Civil Conspiracy
In count II, appellants alleged that MCI, eight members of MCI's Board of Directors, ten members of its MEC, Mr. Kaseff, Mr. Christiansen, Health Midwest, the Collins Group, and Orthopedics Associates of Kansas City, Inc., conspired to revoke Dr. Zipper's staff privileges at the hospital. Appellants alleged that "[t]he aforesaid combination and conspiracy . . . constituted an unreasonable and illegal combination in restraint of trade in violation of the Missouri anti-trust laws. . . ." Appellants also requested treble damages, which are available only under the antitrust statute. However, in appellants' brief before this court, they argue that the petition also stated a cause of action for conspiracy to tortiously interfere with Dr. Zipper's business expectancies.
To state a claim for civil conspiracy, a party must allege: (1) an agreement or understanding; (2) between two or more people; (3) to do an unlawful act, or to do a lawful act by unlawful means. Macke Laundry Serv. Ltd. v. Jetz Serv. Co. , 931 S.W.2d 166, 175 (Mo.App.W.D. 1996). Civil conspiracy is not actionable by itself because "'some wrongful act must have been done by one or more of the alleged conspirators and the fact of a conspiracy merely bears on the liability of the various defendants as joint tortfeasors.'" Id. (quoting Bockover v. Stemmerman , 708 S.W.2d 179, 182 (Mo.App.W.D. 1986)). If the underlying claim does not state a cause of action, there can be no claim for civil conspiracy. Rice v. Hodapp , 919 S.W.2d 240, 245 (Mo. banc 1996). Under Missouri's system of pleading, a court views the facts alleged, along with the relief sought, to determine the nature of the claim. The label the pleader gives a cause of action is not dispositive. Temple v. McCaughen Burr, Inc. , 839 S.W.2d 322, 326 (Mo.App.E.D. 1992); Alarcon v. Dickerson , 719 S.W.2d 458, 461 (Mo.App.W.D. 1986). Therefore, in determining the propriety of summary judgment on this count, we must consider both the antitrust claim and the tortious interference claim as the underlying wrongful act for the civil conspiracy. See Asaro v. Cardinal Glennon Memorial Hosp. , 799 S.W.2d 595, 597 (Mo. banc 1990).
Antitrust Violation
In Count II, appellants undertook to allege a violation of Missouri's Antitrust Law, §§ 416.011 to 416.161. An adequate claim under the antitrust statute must include these allegations: (1) defendants contracted, conspired or combined with one another; (2) this conspiracy produced anticompetitive effects within the relevant geographic and product markets; (3) the goals of the conspiracy or combination as well as the conduct in furtherance of those goals were illegal; and (4) the plaintiff suffered injury as a result of the conspiracy. Johnston v. Norrell Health Care Inc. , 835 S.W.2d 565, 568 (Mo.App.E.D. 1992). "Without a showing of actual adverse effect on competition, [appellants] cannot make out a case under the antitrust laws. . . ." Jefferson Parish Hosp. Dist. No. 2 v. Hyde , 466 U.S. 2, 31, 104 S. Ct. 1551, 1568, 80 L. Ed. 2d 2 (1984). Under this test, appellants have failed to state a claim for an antitrust violation.
Section 416.141 provides that Missouri's statutory antitrust provisions are to be construed in harmony with judicial interpretations of comparable federal antitrust statutes. See Fischer, Spuhl, Herzwurm Assoc. v. Forrest T. Jones Co. , 586 S.W.2d 310, 313 (Mo. banc 1979) (in enacting § 416.141, the legislature "intended to provide a ready body of precedent for interpreting the law"). Chapter 416 closely parallels the federal provisions found in the Sherman Antitrust Act. Johnston , 835 S.W.2d at 568. Therefore, under § 416.141, this court must construe Missouri's antitrust laws in light of federal case law dealing with the Sherman Antitrust Act.
A federal district court dealt with a nearly identical factual situation in Robles v. Humana Hosp. of Cartersville , 785 F. Supp. 989 (N.D. Ga. 1992). In Robles , a doctor brought an antitrust action against a hospital and several physicians on the basis that they had conspired to drive him out of the health care provider market. Id. at 998. The court entered summary judgment in favor of the hospital and physicians. Id. at 1003. In so doing, it noted that "the harm alleged in the complaint is really only harm to the individual doctor and not to competition within the marketplace." Id. at 999. The court continued, finding that Dr. Robles' claim was not based on the required showing of anticompetitive effects but on the fact that he had to go elsewhere to provide his services. Id . "Without the necessary ingredient of antitrust injury, a plaintiff cannot merely recite the mantra of antitrust jurisprudence and expect his allegations to magically establish a sufficient . . . case." Id .
Like the plaintiff in Robles , appellants failed to introduce any evidence of any anticompetitive effects in the relevant geographic and product markets. The evidence and allegations rest on a claim of personal injury to Dr. Zipper and his professional corporation, not on anticompetitive effects. In order to prove anticompetitive effects, there must be evidence of adverse effects on the consumer, such as a decrease in the quality of care, an increase in cost to patients, or an anticompetitive change in the hospital's behavior. Robles , 785 F. Supp. at 998. Appellants introduced no such evidence of actual adverse effects on competition or health care consumers in the Independence area.
In support of their claim, appellants pleaded conclusions rather than ultimate facts: "[T]he aforesaid combination and conspiracy of Defendants . . . constituted an unreasonable and illegal combination in restraint of trade. . . ." This is insufficient to state a claim. Mackey v. Mackey , 914 S.W.2d 48, 50 (Mo.App.W.D. 1996). Neither the allegations nor the broad scope of the pleadings support a finding that any of the alleged agreements between MCI and numerous physicians adversely affected the quality of service or the consumer's ability to procure health services in the Independence area. This deficiency is fatal to appellants' antitrust allegation. See Johnston , 835 S.W.2d at 568. Even a liberal construction of the claim does not remedy its flaws because appellants simply failed to introduce any of the requisite evidence for an antitrust claim. The only evidence referred to in response to the motions for summary judgment was Dr. Zipper's statement in his affidavit that the revocation of his staff privileges at MCI substantially reduced and deterred business competition in the field of orthopedic surgery in the Independence area and at MCI. While this statement may reflect Dr. Zipper's opinion, there was no showing that Dr. Zipper had personal knowledge of any facts to support such a conclusion. As a result, Dr. Zipper is not competent to testify on this issue. Rule 74.04(e); See also Terry v. McIntosh , 941 S.W.2d 595, 598 (Mo.App.W.D. 1997). Therefore, appellants have failed to show genuine issues of material fact concerning a conspiracy or combination in restraint of trade in violation of § 416.031.1.
Tortious Interference With a Contract or Business Expectancy
The alternative tort asserted by appellants as underlying their claim of civil conspiracy is tortious interference with a contract or business expectancy. Its elements are: "(1) a contract or valid business expectancy; (2) defendant's knowledge of the contract or relationship; (3) a breach induced or caused by defendant's intentional interference; (4) absence of justification; and (5) damages." Nazeri v. Missouri Valley College , 860 S.W.2d 303, 316 (Mo. banc 1993). Before turning to the elements, we must first determine whether tortious interference with a contract or business expectancy is an appropriate remedy in this case.
"[A] claim for tortious interference with contractual relations contemplates interference from a third party, not from a party to the contract itself." Fields v. R.S.C.D.B., Inc. , 865 S.W.2d 877, 879 (Mo.App.E.D. 1993). See also Gill v. Farm Bureau Life Ins. Co. of Missouri , 856 S.W.2d 96, 100 (Mo.App.S.D. 1993). To hold a party to the contract responsible for inducing himself to breach a contract would impermissibly allow recovery of punitive damages in contract actions. White v. Land Clearance for Redevelopment Auth. , 841 S.W.2d 691, 695 (Mo.App. W.D. 1992). This rule is equally applicable when the individual being sued is an officer or agent of the defendant corporation because "[a]n officer or agent acting for the corporation is the corporation for purposes of the tort alleged here." Fields , 865 S.W.2d at 879.
Here, appellants brought their cause of action against MCI, eight members of MCI's Board of Directors, ten members of the MEC, Mr. Kaseff and Mr. Christiansen, in their capacities as chief executive officers of MCI, and the members of the Collins Group, as well as their corporation, Orthopedics Associates of Kansas City, Inc. In addition, appellants named Health Midwest as a defendant. Dr. Kuhn and Richard Brown were sued not only in their capacity as directors of MCI, but also in their capacity as directors of Health Midwest. In their petition, appellants contended that MCI's Board of Directors, the MEC and both Mr. Kaseff and Mr. Christiansen acted as agents of MCI in interfering with Dr. Zipper's contract with the hospital. Dr. Jelley, a member of the Collins group, was alleged to have acted as MCI's agent, and there was evidence that he testified as a witness on behalf of the MEC at the hearing. Because we have already determined that a contractual relationship existed between Dr. Zipper and MCI, and there is no evidence that these defendants acted for their own personal benefit, neither MCI nor its officers and agents can be liable for tortious interference with a contract or business expectancy under the Fields doctrine. Therefore, there is no material issue of fact relating to this tort with regard to MCI, the members of MCI's Board of Directors, the members of its MEC, Dr. Jelley, Mr. Kaseff and Mr. Christiansen, all of whom were acting as agents or officers of MCI.
In addition, appellants failed to meet their burden of introducing sufficient evidence concerning Dr. Kuhn and Mr. Brown. In the petition, appellants alleged that Dr. Kuhn and Mr. Brown served dual roles as members on the boards of Health Midwest and MCI and were acting as agents of both MCI and Health Midwest in acting to revoke Dr. Zipper's hospital privileges. In their motions for summary judgment and suggestions in support thereof, Dr. Kuhn and Mr. Brown presented evidence contrary to this claim. Dr. Kuhn and Mr. Brown averred that their only information concerning Dr. Zipper was received in their capacity as Board members of MCI. Dr. Kuhn's and Mr. Brown's involvement with Dr. Zipper was limited to their participation in MCI's consideration and ultimate revocation of Dr. Zipper's medical staff privileges. Neither individual was involved in any discussion concerning Dr. Zipper outside of Board deliberations at MCI. Dr. Zipper was never a topic of discussion or vote at any Board meeting of Health Midwest in which either individual participated. These allegations are within the personal knowledge of Dr. Kuhn and Mr. Brown, and each would be competent to testify to these facts at trial.
In response, appellants did not present evidence contrary to the facts asserted by Dr. Kuhn and Mr. Brown. Appellants responded by saying that "[t]he listed Defendants apparently believe that by filing general affidavits simply denying the allegations set forth in the Plaintiffs' Petition, they can oblige the Plaintiffs to prove up their case even prior to the initiation of discovery. However, the Affidavit of Dr. Ron Zipper[ ] effectively raises and preserves material and substantial issues of fact counter to the contentions raised in the affidavits presented by the Defendants." The remainder of appellants' suggestions in opposition to the motions for summary judgment merely reiterated their claims that there was insufficient evidence to support a revocation of Dr. Zipper's hospital privileges and sufficient evidence to support the claim of an antitrust violation. There were no specific facts averred with reference to Dr. Kuhn or Mr. Brown. In Dr. Zipper's affidavit, he asserted that Dr. Kuhn and Mr. Brown, while acting as agents for and on behalf of MCI and Health Midwest, were "actively involved in the illegal peer review and wrongful revocation" of Dr. Zipper's medical staff privileges at MCI.
Contrary to their belief, appellants were compelled to prove up their case against the defendants, including Dr. Kuhn and Mr. Brown, in response to the motions for summary judgment. Failure to dispute the facts alleged by these defendants in their motions and suggestions resulted in admission of their facts. "Facts set forth in support of a motion for summary judgment are taken as true unless contradicted by the non-moving party." Hillside Dev. Co. v. Fields , 928 S.W.2d 886, 889 (Mo.App.W.D. 1996). The conclusory assertions of Dr. Zipper's affidavit and appellants' responses to Dr. Kuhn's and Mr. Brown's summary judgment motions did not refute the facts asserted by Dr. Kuhn and Mr. Brown. Therefore, their statements of fact that they were acting solely in their capacity as Board members of MCI were deemed admitted.See Klein v. Boatmen's Nat'l Bank of St. Louis , 851 S.W.2d 116, 117 (Mo.App.E.D. 1993). Inasmuch as both Dr. Kuhn and Mr. Brown were acting in their capacity as agents for MCI, they were also legally incapable of tortiously interfering with appellants' contract or business expectancy with MCI. See Fields v. R.S.C.D.B., Inc. , 865 S.W.2d 877, 879 Mo. App. E.D. 1993).
There still remain the corporate defendants, Health Midwest and Orthopedics Associates of Kansas City, Inc., as well as the remaining members of the Collins Group, none of whom would have been acting exclusively as officers and agents of MCI for purposes of the Fields doctrine. As for Health Midwest, in its motion for summary judgment, it stated that Dr. Zipper's staff privileges had never been the discussion of any Board meeting at Health Midwest and that Health Midwest had no connection with the revocation of his staff privileges. In response, appellants merely stated that there was "no legitimate basis for revocation of [his] staff privileges . . .," but offered no evidence concerning Health Midwest's alleged involvement with the revocation of Dr. Zipper's staff privileges to contradict Health Midwest's evidence. The only specific statements pertaining to Health Midwest were in Dr. Zipper's affidavit. He attached a copy of a memorandum, as Exhibit "D", which he asserted described the purposes and ramifications of a proposed merger between MCI and Research Hospital in March of 1991 that resulted in the entity known as "Health Midwest." Exhibit "D" is an announcement of the Board of Directors of Research Hospital's intent to merge with MCI. This exhibit does not evidence a conspiracy concerning Dr. Zipper. Dr. Zipper further averred that "the entity, Health Midwest, joined and continued the conspiracy which began in 1989, described in detail in my petition," but he stated no facts to support this conclusion. As a result, the statements in Health Midwest's motion and affidavits are deemed admitted because of appellants' insufficient response to the motions for summary judgment. See Klein , 851 S.W.2d at 117.
With regard to the remaining members of the Collins group and their corporation, Orthopedics Associates of Kansas City, Inc., appellants alleged that Drs. Collins and West offered Dr. Zipper employment with the Collins group, which Dr. Zipper refused. Thereafter, Dr. Collins became the chair of MCI's SEC. Appellants assert that, without Dr. Zipper's knowledge, Dr. Collins then initiated secretive peer review by the SEC and MEC into Dr. Zipper's surgical practices, as well as his personal relationships with MCI's employees and staff. Dr. Zipper stated in his affidavit that this was done for the sole purpose of attempting to eliminate him as a competitor and to make him an example to other doctors who considered undertaking an independent practice.
With respect to Drs. West and Dubin, two of Dr. Collins' partners in the Collins Group, there is no evidence in the record to support the allegation that these men were acting as agents of MCI or any evidence that these men took any actions which might have contributed to MCI's revocation of those privileges. The same can be said for Orthopedics Associates of Kansas City, Inc. The appellants simply alleged that Orthopedics Associates of Kansas City, Inc. was a Missouri corporation owned and controlled by the Collins Group which was engaged in the practice of orthopedic medicine and surgery in Independence, Missouri. Although it was asserted that Dr. Zipper was in competition with these individuals and their corporation, that is not evidence that they were engaged in a conspiracy against him.
Finally, with regard to Dr. Collins, there was evidence that Dr. Collins, in his capacity as chairman of MCI's SEC, was acting as MCI's agent. Barring evidence that he was also acting in his own personal interest, he would be an inappropriate defendant under the Fields rule. Appellants' primary allegation against Dr. Collins is that he initiated the peer review as chairman of the SEC. Since Dr. Zipper affied that Dr. Collins' activities in initiating the peer review were conducted without his knowledge, Dr. Zipper would be incompetent to testify to those activities. Yet, appellants' response to the motions for summary judgment and Dr. Zipper's affidavit do not reveal any evidence or any statements from any other witnesses which would support their claim that Dr. Collins acted to initiate the peer review for his own personal benefit.
Therefore, there is insufficient evidence in the record of tortious interference with a contract or business expectancy or for an antitrust violation to create a genuine issue of material fact for such claims. Appellants' failure to introduce genuine issues of material fact regarding an underlying wrongful act is fatal to their claim for civil conspiracy. Rice v. Hodapp , 919 S.W.2d 240, 245 (Mo. banc 1996). The trial court did not err in entering summary judgment in favor of respondents on count II. Point III is denied.
Conclusion
The judgment of the trial court on counts I, II and IV is affirmed. The judgment of the trial court with respect to count III is affirmed as to the MCI Board members and Mr. Kaseff, but is reversed as to MCI and MCP, and the cause is remanded for further proceedings consistent with this opinion.
Smith, P.J. Concurs.
After submission this case was assigned to Judge Breckenridge for opinion. While the case was under submission, Judge Breckenridge was appointed to the Board of the University of Health Sciences. Thereafter, she discovered that her service on the Board created a conflict of interest for her in this case. Consequently, Judge Breckenridge recently recused herself and the case was re-assigned to Judge Ellis for opinion.