Schindler v. Reg’l Health Physicians, Inc. – Sept. 2015 (Summary)

BREACH OF CONTRACT

Schindler v. Reg’l Health Physicians, Inc., No. CIV. 13-5027-JLV (D.S.D. Sept. 23, 2015)

The United States District Court for the District of South Dakota granted partial summary judgment to defendant hospital on breach of contract claims made by a neurosurgeon.

When the neurosurgeon began to experience health problems, the hospital provided a number of measures to accommodate him while he worked. However, eventually, the hospital notified the neurosurgeon that it planned to suspend his surgical privileges to perform elective instrumental cervical and lumbar fusion procedures except those procedures in an emergency situation. The neurosurgeon took a voluntary leave of absence in lieu of the suspension. The hospital terminated the physician immediately “for cause,” due to a failure to maintain medical staff privileges necessary to perform surgery at the hospital, without notice and a period to cure.

The neurosurgeon filed a breach of contract action, based on lack of notice and opportunity to cure, among other things. The court ruled that the hospital was not obligated to give the neurosurgeon notice that he breached his employment contract and a 30-day right to cure, ruling that the voluntary leave of absence constituted a suspension or loss of appointment and privileges, which was subject to the “for cause” immediate termination under the employment agreement, with no notice or opportunity to cure.