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Yarbrough v. Northwestern Memorial Hospital

Supreme Court of Illinois

December 29, 2017

CHRISTINA YARBROUGH et al., Appellees,
v.
NORTHWESTERN MEMORIAL HOSPITAL et al. Northwestern Memorial Hospital, Appellant.

          JUSTICE THEIS delivered the judgment of the court, with opinion. Chief Justice Karmeier and Justices Thomas and Garman concurred in the judgment and opinion.

          OPINION

          THEIS, JUSTICE

         ¶ 1 The circuit court of Cook County certified the following question pursuant to Illinois Supreme Court Rule 308 (eff. Feb. 26, 2010): "Can a hospital be held vicariously liable under the doctrine of apparent agency set forth in Gilbert v. Sycamore [Municipal Hospital], 156 Ill.2d 511 ([1993]), and its progeny for the acts of the employees of an unrelated, independent clinic that is not a party to the present litigation?" The appellate court answered this question in the affirmative. 2016 IL App (1st) 141585, ¶ 46. For the reasons that follow, we find that the appellate court answered the question incorrectly. Accordingly, we reverse the judgment of the appellate court and remand this cause to the circuit court for further proceedings consistent with this opinion.

         ¶ 2 BACKGROUND

         ¶ 3 On November 15, 2005, plaintiff Christina Yarbrough went to the Erie Family Health Center (Erie) located at 1701 West Superior Avenue in Chicago after searching online for a clinic that would administer a pregnancy test without requiring her to have insurance coverage.

         ¶ 4 Erie does not require medical insurance. Erie is a "Federally Qualified Health Center" (FQHC) that comprises several clinics in the Chicago area.[1] FQHCs are "community-based and patient-directed organizations that serve populations with limited access to health care. These include low income populations, the uninsured, those with limited English proficiency, *** individuals and families experiencing homelessness, and those living in public housing." (Internal quotation marks omitted.) Lyndsay Gunkel, Federally Qualified Health Centers: The Next Step in Cost-Effective Health Care, 20 Annals Health L. Advance Directive 31, 33 (2010); see also 42 U.S.C. § 254b (2012). FQHCs rely heavily on federal grants and Medicaid cost-based reimbursement to operate and provide the communities that they serve with primary and preventative care regardless of a patient's ability to pay. Gunkel, supra, at 32-33; see also 42 U.S.C. § 254b (2012).

         ¶ 5 Erie was originally founded as a project between Northwestern Memorial Hospital (NMH) and "Erie Neighborhood House" in 1957. NMH provides financial support, technological assistance, and strategic support. A representative of NMH may serve on Erie's board if requested by Erie's board chairperson. Erie-employed physicians seeking privileges to practice at NMH are required to apply for them, as would any physician.

         ¶ 6 At the time Yarbrough went to Erie in November 2005, she did not have a relationship with an obstetrician-gynecologist (OB-GYN) or a family physician. After receiving a positive pregnancy result during her initial visit, Yarbrough spoke with a staff member at Erie. She asked the unnamed staff person where she would deliver her baby. Yarbrough was informed that she would have her ultrasounds done at Northwestern Medicine Prentice Women's Hospital and would most likely deliver her baby at NMH. During this same visit, Yarbrough received informational materials regarding tours of NMH's birthing/delivery area, having the installation of an infant car seat inspected at NMH, and attending birthing classes at NMH. Based upon this information, Yarbrough believed that Erie and NMH were one and the same entity, particularly because she was told that she would give birth at NMH.

         ¶ 7 On November 30, 2005, Yarbrough began to experience vaginal bleeding and went to the emergency room at Advocate Illinois Masonic Medical Center (Advocate). She obtained an abdominal ultrasound there and was allegedly advised by a physician at Advocate that she had a bicornuate uterus.

         ¶ 8 On December 2, 2005, Yarbrough met at Erie with Betsy McKelvey, a certified nurse midwife, and Dr. Raymond Suarez, an OB-GYN. Both McKelvey and Dr. Suarez were employees of Erie. She underwent another abdominal ultrasound that day. Yarbrough was purportedly told that she did not have a bicornuate uterus but instead was diagnosed with a shortened cervix.

         ¶ 9 On February 21, 2006, Erie referred Yarbrough to NMH for a 20-week ultrasound. This second ultrasound was interpreted by Dr. William Grobman, who is employed by Northwestern Medical Faculty Foundation (NMFF).

         ¶ 10 On April 8, 2006, Yarbrough delivered her daughter, Hayley Joe Goodpaster, prematurely by emergency caesarean section at NMH. Dr. Suarez purportedly told Yarbrough that she did, in fact, have a bicornuate uterus and an "incompetent cervix."

         ¶ 11 On December 28, 2009, Yarbrough and David Goodpaster, on behalf of their daughter Hayley, filed a two-count complaint against NMH and NMFF. Count I of the complaint alleged medical negligence by Dr. Grobman, as an actual or apparent agent of NMFF, in relation to his interpretation of the ultrasound on February 21, 2006.[2] In count II, as subsequently amended on August 22, 2013, plaintiffs alleged that Erie's employees were the actual or apparent agents of NMH.

         ¶ 12 They alleged that the medical staff who treated Yarbrough at Erie had negligently failed to identify and address issues surrounding her shortened cervix and bicornuate uterus, causing her to deliver her daughter prematurely at 26 weeks' gestation. Plaintiffs further alleged that Yarbrough was never told that the healthcare workers at Erie were not employees of NMH. Plaintiffs alleged that based on Yarbrough's knowledge of NMH's reputation and the information provided to her by Erie, she believed that if she received prenatal care from Erie, she would be receiving treatment from NMH health care workers.

         ¶ 13 NMH moved for partial summary judgment on the amended complaint as to all agency claims arising out of treatment that Yarbrough received by Erie employees. NMH asserted that it did not hold Erie out as its agent. Similarly, Erie and its employees did not hold themselves out as agents of NMH. NMH maintained that Erie was an independent, federally funded community health center and that the staff at Erie who treated Yarbrough on-site at Erie were working strictly within the scope of their employment with Erie.

         ¶ 14 The trial court denied NMH's motion for partial summary judgment. After NMH orally moved to certify a question under Rule 308, the trial court ordered the parties to draft a proposed certified question, which they subsequently filed, respectively, with the court. Thereafter, the trial court entered an order certifying the above-quoted question, which the court drafted.

         ¶ 15 The appellate court initially denied NMH's application for leave to appeal. We denied NMH's petition for leave to appeal but entered a supervisory order directing the appellate court to vacate its order and to consider the question certified by the circuit court. Yarbrough v. Northwestern Memorial Hospital, No. 118149 (Ill. Nov. 26, 2014) (supervisory order).

         ¶ 16 The appellate court in its subsequent opinion answered the certified question in the affirmative. 2016 IL App (1st) 141585, ¶ 46. The appellate court rejected NMH's argument that Gilbert is inapplicable in this case because the alleged negligent conduct did not occur at the hospital. Id. ¶¶ 36, 46. The appellate court held that nothing in Gilbert limits a plaintiff from recovering against a hospital " 'merely because the negligent conduct of the physician did not occur in the emergency room or some other area within the four walls of the hospital.' " Id. ¶ 40 (quoting Malanowski v. Jabamoni, 293 Ill.App.3d 720, 727 (1997)). The appellate court also held that a plaintiff is not required to name the individual physician or his or her employer as a defendant in order to hold the hospital vicariously liable as the principal. Id. ¶¶ 43-44, 46.

         ¶ 17 This court allowed NMH's petition for leave to appeal. Ill. S.Ct. R. 315 (eff. Mar. 15, 2016). In addition, we allowed the Illinois Association of Defense Trial Counsel to file an amicus curiae brief in support of NMH. We also allowed the University of Chicago Medical Center, Rush University Medical Center, Advocate Health Care, Northshore University Health System, Presence Health and Trinity Health to file a joint amicus curiae brief in support of NMH. We further allowed the Illinois Trial Lawyers Association to file an amicus curiae brief in support of plaintiffs. Ill. S.Ct. R. 345 (eff. Sept. 20, 2010).

         ¶ 18 ANALYSIS

         ¶ 19 The certified question asks:

"Can a hospital be held vicariously liable under the doctrine of apparent agency set forth in Gilbert v. Sycamore [Municipal Hospital], 156 Ill.2d 511 ([1993]), and its progeny for the acts of the employees of an unrelated, independent clinic that is not a party to the present litigation?"

         ¶ 20 NMH asserts that the appellate court erred in answering this question in the affirmative. NMH contends that the doctrine of apparent authority, as set forth in Gilbert and subsequent cases, is inapplicable, as a matter of law, because the treatment at issue occurred at Erie and not at a hospital or hospital facility owned by NMH.

         ¶ 21 Rule 308(a) provides for interlocutory appeals of nonfinal orders that present "a question of law as to which there is substantial ground for difference of opinion." Ill. S.Ct. R. 308(a) (eff. Feb. 26, 2010). When the trial court finds that an answer to that question "may materially advance the ultimate termination of the litigation, " the court must identify the question in writing, and the appellate court may allow an appeal. Id. "Because an interlocutory appeal under Rule 308 necessarily involves a question of law, our review of the appellate court's decision in such an appeal is de novo." In re Marriage of Mathis, 2012 IL 113496, ¶ 19.

         ¶ 22 This court first applied the apparent authority doctrine in a medical malpractice context in Gilbert. There, we addressed whether a hospital may be held vicariously liable for the negligence of a physician who is not an employee of the hospital but, rather, an independent contractor. Gilbert, 156 Ill.2d at 514. The physician who treated the plaintiff's decedent in the hospital's emergency room was a staff physician practicing through an independent professional association. Id. at 515-16. The hospital did not advise emergency room patients that the physicians were independent contractors and not hospital employees. Id. at 516. The hospital argued that it could not be held vicariously liable for a physician's negligence where the physician was neither an employee nor agent of the hospital. Id. at 517. The appellate court agreed. Id.

         ¶ 23 In rejecting appellate court decisions that had refused to impose vicarious liability upon a hospital based upon an agency relationship unless the physician was an actual agent of the hospital, we held those decisions overlooked two realities of modern hospital care. Id. at 519-20. First, those appellate court decisions overlooked the "business of a modern hospital." Id. at 520. We recognized:

" '[H]ospitals increasingly hold themselves out to the public in expensive advertising campaigns as offering and rendering quality health services. One need only pick up a daily newspaper to see full and half page advertisements extolling the medical virtues of an individual hospital and the quality health care that the hospital is prepared to deliver in any number of medical areas. Modern hospitals have spent billions of dollars marketing themselves, nurturing the image with the consuming public that they are full-care modern health facilities. All of these expenditures have but one purpose: to persuade those in need of medical services to obtain those services at a specific hospital. In essence, hospitals have become big business, competing with each other for health care dollars.' " Id. (quoting Kashishian v. Port, 481 N.W.2d 277, 282 (Wis. 1992)).

         ¶ 24 The second reality of modern hospital care discussed by this court in Gilbert involved the "reasonable expectations of the public." Id. at 521. We stated:

" '[G]enerally people who seek medical help through the emergency room facilities of modern-day hospitals are unaware of the status of the various professionals working there. Absent a situation where the patient is directed by his own physician or where the patient makes an independent selection as to which physicians he will use while there, it is the reputation of the hospital itself upon which he would rely. Also, unless the patient is in some manner put on notice of the independent status of the professionals with whom [he] might be expected to come into contact, it would be natural for him to assume that these people are employees of the hospital.' " Id. (quoting Arthur v. St. Peters Hospital, 405 A.2d 443, 447 (N.J.Super. Ct. Law Div. 1979)).

         ¶ 25 This court also emphasized that " '[s]uch appearances speak much louder than the words of whatever private contractual arrangements the physicians and the hospital may have entered into, unbeknownst to the public, in an attempt to insulate the hospital from liability for the negligence, if any, of the physicians.' " Id. (quoting Brown v. Coastal Emergency Services, Inc., 354 S.E.2d 632, 637 (Ga.Ct.App. 1987)).

         ¶ 26 After considering these realities of modern hospital care, we held that a patient who is unaware that the person providing treatment is not the employee or agent of the hospital has the right to look to the hospital in seeking compensation for any negligence in providing emergency room care. Id. at 522. We stressed that liability attaches to the hospital in such cases only where the treating physician is the apparent or ostensible agent of the hospital. If a ...


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