Tavilla v. HealthSouth Valley of the Sun Rehab. Hosp. (Summary)

AGENCY

Tavilla v. HealthSouth Valley of the Sun Rehab. Hosp., No. 1 CA-CV 12-0768 (Ariz. Ct. App. Jan. 14, 2014)

The Court of Appeals of Arizona found that a genuine issue of material fact as to the alleged agency relationship between a hospital and a physician precluded the hospital from obtaining summary judgment.  The court analyzed the two different kinds of potential agency relationships that could have existed between the hospital and the physician, finding that one, ostensible agency, needed further review.

The hospital employed the physician as a program director or as an associate medical director.  The physician also independently treated patients in his own pain management practice; he practiced in office space leased from the hospital.  A pain management patient filed a medical malpractice claim against the physician, and also named the hospital, asserting that the hospital was vicariously liable for the physician’s conduct because he was either an actual agent or an ostensible agent of the hospital.

The court found that the hospital could not be held liable for the physician’s allegedly negligent treatment, as there was no evidence of an actual agency between the hospital and the physician with regard to the physician’s pain management patients. For example, the hospital’s lease agreement stated that the space was to be used only as an office for the physician’s outpatient patients, further requiring the physician to maintain a distinction between his private practice and his hospital duties.

The court further found that a reasonable jury could find that the hospital’s actions or inactions induced the patient into believing that the physician was the hospital’s agent with regard to the patient’s pain management treatment. The hospital did not make clear (through signs or otherwise) that the physician was not acting on behalf of the hospital.  Nor did the hospital require the physician to notify his patients that there was no agency relationship between him and the hospital. The hospital also allowed the physician to use the hospital facilities and personnel in a manner that could lead a patient to believe the physician was an agent of the hospital.