FBMJ attorneys Judith Sherman and Carole Empey recently returned a victory for client Oakwood Healthcare at the Michigan Court of Appeals (COA) in Janice Brown vs. Oakwood Healthcare Inc. The central issue on appeal was whether the Trial Court erred in denying Oakwood’s motion for summary disposition because it was not liable for the alleged negligence of defendant Dr. Sham Gupta under a theory of ostensible agency. The COA unanimously agreed.

This case arose from an incident in which the plaintiff was admitted to the hospital for a pulmonary condition and treated by her primary care physician (PCP). While admitted, she was referred to another physician by her PCP for treatment of another unrelated condition, and surgery was subsequently performed. Complications from the surgery developed, and the plaintiff sued the doctor who performed the surgery as well as Oakwood Healthcare. Oakwood argued that it was not liable for the doctor’s negligence under the theory of ostensible agency. Ostensible agency is a legal doctrine that is used to hold someone (the “principal”) liable for the acts of a third party (the “agent”) because the third party looks like the agent of that person. The COA unanimously agreed that Michigan case law establishes the mere fact that a plaintiff patient initially goes to the hospital for treatment is insufficient, standing alone, to establish ostensible agency. There must be evidence to show that the hospital has taken action or made representations to lead a plaintiff to believe in an ostensible agency relationship. In this case, the COA agreed with FBMJ’s position that the plaintiff offered no evidence of any acts by the hospital holding the defendant doctor out as its agent or employee. The COA reversed and remanded for entry of judgment in favor of Oakwood and determined that Oakwood could tax costs for bringing the appeal.

For additional information on this case or other appeals work contact Judith Sherman @ jsherman@fbmjlaw.com or 734.742.1820.