McLaughlin v. Nahata

298 A.3d 384

Alyssa MCLAUGHLIN and William McLaughlin

v.Amit NAHATA, M.D. ; Kathryn Simons, M.D. ; Anne F. Josiah, M.D.; Thomas Pirosko, D.O.; Jessie Ganjoo, M.D.; Ashley Berkley, D.O.; The Washington Hospital; and Washington Health System Washington Hospital

v.Dialysis Clinic, Inc.

Appeal of: Dialysis Clinic, Inc.

No. 7 WAP 2022

Supreme Court of Pennsylvania.

Argued: October 26, 2022

Decided: July 28, 2023

Peter Houghton LeVan Jr., Esq., for Amicus Curiae Hospital and Healthsystem Association of Pennsylvania.

Rebecca Johnson Barksdale, Esq., Pietragallo Gordon Alfano Bosick & Raspanti, LLP, Phillip Ray Earnest, Esq., Seth M. Weinberg, Esq., for Appellant.

Thomas M. Chairs, Esq., Gordon Rees Scully Mansukhani, LLP, for Apellee.

TODD, C.J., DONOHUE, DOUGHERTY, WECHT, MUNDY, BROBSON, JJ.

Justice Brobson delivers the Opinion of the Court with regard to Parts I, II, III.A, and III.C, and an opinion in support of a partial affirmance and a remand with instructions joined by Justices Dougherty and Mundy with respect to Parts III.B. and IV.

ORDER

PER CURIAM

AND NOW, this 28th day of July, 2023, we affirm the Superior Court's determination on the contribution issue for the reasons set forth in the Opinion of the Court. Because the Justices are unable to reach consensus regarding the Superior Court's determination on the indemnification issue, the Superior Court's determination is affirmed by operation of law.

OPINION

JUSTICE BROBSON

In this discretionary appeal, we must decide whether, as a matter of law, the Washington Hospital (the Hospital) is permitted to seek contribution and/or indemnity from Dialysis Clinic, Inc. (DCI), for negligence committed by DCI's employees, Jessie Ganjoo, M.D., and Amit Nahata, M.D. (collectively, the Doctors), while working as physicians with staff privileges at the Hospital.¹ The Court of Common Pleas of Washington County (trial court) and the Superior Court both concluded that, although traditional principles of contribution and indemnity did not apply cleanly to the particular circumstances at issue, those equitable principles of law, nevertheless, permit the Hospital to seek both contribution and indemnity from DCI. As a result, the trial court denied DCI's motion for summary relief, and the Superior Court affirmed. For the reasons stated in parts I, II, III.A, and III.C below, we hold unanimously that, if the Hospital and DCI are determined to be vicariously liable for the negligence of the Doctors, the law permits the Hospital to seek contribution from DCI. This Court, however, is evenly divided on the question of whether the Hospital may also be entitled to seek indemnification from DCI.² Given this Court's decision on contribution and inability to reach a decision on indemnity, the order of the Superior Court is affirmed on those questions.³ Furthermore, because additional factual findings in this matter are necessary, we remand this matter to the Superior Court with instructions to remand it to the trial court for further proceedings.

I. BACKGROUND⁴

A. Relevant Facts

As indicated above, during their employment with DCI, the Doctors maintained staff privileges and worked at the Hospital. In 2013, Alyssa McLaughlin was admitted to the Hospital and received treatment from, among other medical staff, the Doctors, Kathryn Simons, M.D., Anne F. Josiah, M.D., Thomas Pirosko, D.O., and Ashely Berkley, D.O. At some point during or after that treatment, Ms. McLaughlin sustained severe and permanent neurological injuries. Attributing those injuries to negligence in her treatment, Ms. McLaughlin and her husband, William McLaughlin (collectively, the McLaughlins), initiated an action against the Doctors, the Hospital, and the other physicians noted above who were responsible for her care.

Dr. Berkley subsequently filed a motion to join DCI to the action as an additional defendant on the ground that it was the Doctors’ actual employer. Thereafter, the Hospital filed a crossclaim against DCI seeking, inter alia , contribution and indemnity⁵ for any liability the Hospital incurred. (Reproduced Record (R.R.) at 2784a-87a.) The trial court denied DCI's subsequent efforts to gain dispositive relief and avoid trial on the ground that it was not vicariously liable as the employer of the Doctors, reasoning that it was "clear from the record that [the Doctors] are employees of" DCI.⁶ (See Trial Ct. Op., 7/15/2020, at 2; R.R. at 2a (emphasis omitted).) The ensuing litigation between DCI and the Hospital on issues of contribution and indemnity, however, soon overshadowed and delayed any progress on the McLaughlins’ claims.⁷ As a result, the trial court severed the Hospital's crossclaim for contribution and indemnity from the McLaughlins’ claims and ordered that the contribution and indemnity issues would be resolved at separate trials.

Prior to trial on the McLaughlins’ claims, the McLaughlins entered a stipulation to dismiss their claims of negligence against all of the named physicians apart from the Doctors. (See Trial Ct. Op., 9/10/2019, at 2.) The McLaughlins also agreed to dismiss all of their claims against the Hospital apart from "claims of ostensible agency" for liability arising from the conduct of the Doctors.⁸ (Id . at 2-3.) In an opinion and order, the trial court accepted those stipulations as binding. (See id. at 3-5 (quoting Longenecker v. Matway , 315 Pa.Super. 411, 462 A.2d 261, 263 (1983) ("It is well established that the parties, by stipulation, are free to bind themselves on all matters not affecting jurisdiction and prerogatives of the court and that the court has the power to enforce stipulations.")).)

The case between the McLaughlins, the Doctors, and the Hospital then proceeded to a bench trial, after which the trial court concluded that the Doctors were negligent in their treatment of Ms. McLaughlin. The trial court's findings also noted that the McLaughlins had discontinued their claims of negligence against the Hospital but that the parties agreed that the Doctors were the ostensible agents of the Hospital. The trial court then entered a verdict against the Doctors and the Hospital, finding that the Doctors were negligent in their treatment of Ms. McLaughlin and that the Doctors were the ostensible agents of the Hospital and awarding the McLaughlins approximately $15 million in damages. The McLaughlins filed an uncontested post-trial motion, which the trial court granted, adding delay damages for a total verdict award of approximately $17 million. The Hospital subsequently filed a motion seeking indemnity from the Doctors, which the trial court granted without objection.⁹ DCI was not permitted to participate at the bench trial, and it was not a party to the stipulations.

B. Trial Court Disposition

The Hospital's crossclaim for indemnity and contribution against DCI, meanwhile, remained scheduled for trial. Within a month of jury selection, however, the Hospital filed a motion for summary judgment, arguing that the Doctors were operating within the course and scope of their employment with DCI at the time they negligently treated Ms. McLaughlin and "that[,] through no fault of its own[, the Hospital had] been required to pay [the] liabilities of DCI's employees." (Trial Ct. Op., 2/5/2020, at 3.) DCI responded by filing its own motion for summary judgment, wherein it contended, inter alia , that the Hospital could not prove its right to indemnity or contribution from DCI under the law.

Specifically, DCI noted that indemnity is a "fault-shifting mechanism" that did not permit a secondarily liable party to shift its blame to another secondarily liable party. (R.R. at 130a (quoting Bird Hill Farms, Inc. v. U.S. Cargo & Courier Serv., Inc. , 845 A.2d 900, 908 (Pa. Super. 2004) ).) Further, DCI explained that the Uniform Contribution Among Tort-feasors Act (UCATA)¹⁰ governs contribution rules in Pennsylvania, and, under that statute, DCI was not a "joint tort-feasor" subject to contribution. (Id. at 135a-36a (quoting 42 Pa. C.S. § 8322 (defining "joint tort-feasors" as "two or more persons jointly or severally liable in tort for the same injury to persons or property"), and Mattia v. Sears, Roebuck & Co. , 366 Pa.Super. 504, 531 A.2d 789, 791 (1987) ("Two actors are jointly liable for an injury if their conduct causes a single harm which cannot be apportioned, even though the actors may have acted independently.") (internal quotations and alterations omitted), appeal denied , 519 Pa. 660, 546 A.2d 622 (1988)).) Accordingly, DCI requested that the trial court grant its motion for summary judgment and dismiss the Hospital's crossclaim with prejudice.

On February 5, 2020, the trial court issued an order denying both motions for summary judgment. In an accompanying opinion, the trial court reasoned that, contrary to DCI's contentions, the law supported the Hospital's right to seek indemnity and contribution from DCI as the Doctors’ actual employer, but questions of material fact remained as to whether either or both of the parties exercised control over the Doctors. (See Trial Ct. Op., 2/5/2020, at 6-11 (citing, inter alia , Burch v. Sears, Roebuck & Co. , 320 Pa.Super. 444, 467 A.2d 615, 622 (1983) (noting that contribution and indemnity "are available even against defendants whom the plaintiff does not sue"), and Yorston v. Pennell , 397 Pa. 28, 153 A.2d 255, 259-60 (1959) ("In determining whether a person is the servant of another[,] it is necessary that he not only be subject to the latter's control or right of control with regard to the work to be done and the manner of performing it[,] but that this work is to be performed on the business of the master or for his benefit.")).) Accordingly, the trial court concluded that summary judgment was inappropriate as to either party, and it directed that the matter would proceed to trial.

DCI subsequently filed a motion requesting that the trial court amend its order so that DCI could file an interlocutory appeal by permission pursuant to Section 702(b...