THE STATE OF SOUTH CAROLINA
In The Court of Appeals

APPEAL FROM RICHLAND COUNTY
Court of Common Pleas
G. Thomas Cooper, Jr., Circuit Court Judge

Case No. 2003-CP-40-2175

Frank w. Kerr, as personal representative
for the Estate of Marta Butler Kerr, deceased,........................... Appellant,

v.

Richland Memorial Hospital, ................................................... Respondent.

 

BRIEF OF APPELLANT

Table of Contents

Table of Cases, Statutes, Authorities............................................................................................................ 2

Statement of Issues on Appeal....................................................................................................................... 2

Statement of the Case..................................................................................................................................... 2

Argument........................................................................................................................................................... 2

Standard of Review............................................................................................................................... 2

Issue I...................................................................................................................................................... 2

Did the governmental hospital have a duty of care for which it could be liable in the presence of  acts or omissions of an independent contractor?.................................. 2

Issue II..................................................................................................................................................... 2

Is the six year statute of repose of S.C. Code Ann. § 15-3-545(A) applicable to a governmental hospital?.................................................................................................... 2

Conclusion........................................................................................................................................................ 2

Table of Cases, Statutes, Authorities

Cases

Baughman v. American Tel. and Tel. Co., 306 S.C. 101, 410 S.E.2d 537 (1991).................................. 9

Clark v. Cantrell, 339 S.C. 369, 378, 529 S.E.2d 528, 533 (2000)........................................................... 9

Harrison v. Bevilacqua, 354 S.C. 129, 580 S.E.2d 109 (2003)............................................ 15, 16, 17, 18

I'On, L.L.C. v. Town of Mt. Pleasant, 338 S.C. 406,  526 S.E.2d 716 (2000)............................................ 9

Madison v. Babcock Ctr., Inc., 371 S.C. 123 (2006)..................................................................... 11, 12, 13

Manning v. Quinn, 294 S.C. 383, 365 S.E.2d 24 (1988).............................................................................. 9

Osborne v. Adams, 346 S.C. 4 (2001).................................................................................................... 9, 11

Osprey, Inc. v. Cabana Ltd. Partnership, 340 S.C. 367, 532 S.E.2d 269 (2000)..................................... 9

Searcy v. S.C. Dep't of Educ., 303 S.C. 544, 402 S.E.2d 486 (Ct. App. 1991)..................................... 18

Shadwell v. Craigie, 361 S.C. 492, 605 S.E.2d 567 (Ct. App. 2004)...................................................... 17

Simmons v. Toumey Med. Center, 341 S.C. 32, 533 S.E.2d 312 (2000).................................. 10, 11, 13

Tupper v. Dorchester County, 326 S.C. 318, 487 S.E.2d 187 (1997)....................................................... 8

Williams v. Chesterfield Lumber Co., 267 S.C. 607, 230 S.E.2d 447 (1976).......................................... 9

Statutes

S.C. Code Ann § 14-8-200............................................................................................................................ 9

S.C. Code Ann. § 14-3-320........................................................................................................................... 9

S.C. Code Ann. § 15-3-40.................................................................................................................... 14, 18

S.C. Code Ann. § 15-3-545(a)...................................................................................................................... 8

S.C. Code Ann. § 15-78-100....................................................................................................................... 15

S.C. Code Ann. § 15-78-110............................................................................................................ 8, 14, 17

S.C. Code Ann. § 15-78-20......................................................................................................................... 18

S.C. Code Ann. § 15-78-200....................................................................................................................... 19

S.C. Code Ann. § 15-78-30......................................................................................................................... 14

S.C. Code Ann. § 15-78-30(c).................................................................................................................... 10

S.C. Code Ann. § 15-78-40......................................................................................................................... 12

S.C. Code Ann. § 15-78-60......................................................................................................................... 10

S.C. Code Ann. § 15-78-60(20).................................................................................................................. 13

South Carolina Tort Claims Act, S.C. Code Ann. §§ 15-78-10, et. seq......................................... passim

Other Authorities

Restatement (Second) of Torts: Employers of Contractors § 429 (1965)............................................. 11

Rules

Rule 56(c), SCRCP....................................................................................................................................... 8

Constitutional Provisions

S.C. Const. art. V, §§ 5 & 9.......................................................................................................................... 9

Statement of Issues on Appeal

III.              

Statement of the Case

This is a medical malpractice case arising from alleged misdiagnosis of melanoma cancer at Richland Memorial Hospital in 1996.  Charles Lee Kerr commenced this lawsuit on April 29, 2003, on behalf of the estate of Marta Butler Kerr.  Richland Memorial Hospital was named as the sole defendant.  Charles Lee Kerr died while the lawsuit was pending, and Frank W. Kerr, was substituted as the estate’s personal representative on April 7, 2007.  Frank W. Kerr is the son of Marta Butler Kerr and Charles Lee Kerr.

The complaint alleged that Richland Memorial Hospital on January 25, 1996, undertook to render pathology laboratory services to Marta Kerr when the hospital’s pathologist analyzed a “mole” that had been removed from Mrs. Kerr’s skin.  The complaint further alleged that the Hospital through its agents, contractors, or employees interpreted the specimen to be benign and without evidence of cancer cells or other harmful properties.  According to the complaint, the specimen actually contained melanoma, which had been misdiagnosed.  See Complaint, ROA 7.

Allegedly, Mrs. Kerr was diagnosed on or about May 22, 2001, as suffering from wide-spread melanoma, which is commonly known as skin cancer, and sometime later she and her husband were informed that the pathology specimen examined in January 1996 had been reviewed and found to have evidence of melanoma.  Mrs. Kerr died on September 7, 2002, allegedly from melanoma.  See Complaint, ROA 7.

The parties agreed on the following facts:  (1) At the time of the alleged negligence in January 2006, Richland Memorial Hospital was a governmental entity subject to the South Carolina Tort Claims Act; (2) the pathologist who allegedly misdiagnosed the specimen was James C. Reynolds, M.D.; and (3) Dr. Reynolds was director of the hospital’s laboratory pursuant to a contract with the hospital.

The lawsuit was commenced on April 29, 2003, more than six years after the alleged act of negligence, but allegedly less than two years after Mrs. Kerr was diagnosed with the disease and less than one year after her Mrs. Kerr’s death.  See Complaint, ROA 7.

On July 1, 2004, Richland Memorial Hospital moved for summary judgment on two grounds:  (1) The action was barred by the statute of repose since the action was brought beyond the six year limits set forth in such statute; and (2) Richland Memorial Hospital, as a governmental entity under the terms of the Tort Claims Act, was not liable for the acts of independent contractors.  See Motion for Summary Judgment, ROA 16.

The motion for summary judgment was heard by the Hon. G. Thomas Cooper, Jr. on July 30, 2007.  On September 5, 2007, Judge Cooper granted summary judgment to Richland Memorial Hospital.  See Order, Sept. 5, 2007, ROA 2.  The order was mailed on September 7, 2007, and received by counsel on September 10, 2007.

On September 17, 2007, the Kerr estate moved for reconsideration of the summary judgment.  See Notice of Motion and Motion for Reconsideration, ROA 18.  The estate asserted that the court failed to address whether Richland Memorial Hospital could be held liable under the non-delegable duty rule despite the acts and omissions of the independent contractor.  Counsel further asserted that the court failed to address whether the two year statute of limitations of the South Carolina Tort Claims Act, S.C. Code Ann. § 15-78-110 permits reference to the statute of repose contained within S.C. Code Ann. § 15-3-545(a), which is not part of the Tort Claims Act.  See Motion for Reconsideration, ROA 18.

The court filed an order denying the motion for reconsideration on October 11, 2007.  See Order, Oct. 11, 2007, ROA 6.  The Kerr estate filed notice of appeal on November 8, 2007.

Argument

Standard of Review

A trial court may properly grant a motion for summary judgment when "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Rule 56(c), SCRCP; Tupper v. Dorchester County, 326 S.C. 318, 487 S.E.2d 187 (1997). In determining whether any triable issues of fact exist, the court must view the evidence and all reasonable inferences that may be drawn from the evidence in the light most favorable to the non-moving party.  Manning v. Quinn, 294 S.C. 383, 365 S.E.2d 24 (1988).  Summary judgment is a drastic remedy which should be cautiously invoked so that a litigant is not improperly deprived of a trial on disputed factual issues. Baughman v. American Tel. and Tel. Co., 306 S.C. 101, 112, 410 S.E.2d 537, 543 (1991).

On appeal from an order granting summary judgment, the appellate court applies the same standard that governs the trial court. The appellate court will review all ambiguities, conclusions, and inferences arising in and from the evidence in a light most favorable to the appellant, the non-moving party below. Osborne v. Adams, 346 S.C. 4, 7,  550 S.E.2d 319, 321 (2001); Williams v. Chesterfield Lumber Co., 267 S.C. 607, 230 S.E.2d 447 (1976).

In a case raising a novel question of law, the appellate court is free to decide the question with no particular deference to the lower court. I'On, L.L.C. v. Town of Mt. Pleasant, 338 S.C. 406, 411, 526 S.E.2d 716, 719 (2000) (citing S.C. Const. art. V, §§ 5 & 9, S.C. Code Ann. § 14-3-320 and -330, and S.C. Code Ann § 14-8-200; Osprey, Inc. v. Cabana Ltd. Partnership, 340 S.C. 367, 372, 532 S.E.2d 269, 272 (2000); Clark v. Cantrell, 339 S.C. 369, 378, 529 S.E.2d 528, 533 (2000).

Issue I

Did the governmental hospital have a duty of care for which it could be liable in the presence of acts or omissions of an independent contractor?

The Kerr estate specifically asserted that Richland Memorial Hospital had a nondelegable duty to provide pathology services through its pathology department; and for purposes of the motion, that assertion was not contested.  See Complaint ¶ 4, ROA 4; Notice of Motion and Motion for Summary Judgment, ROA 16.  In its answer, Richland Memorial Hospital said that the allegation of nondelegable duty could neither be “admitted nor denied.”  See Answer ¶ 8, ROA 12.

The trial court found that Dr. Reynolds was an independent contractor of Richland Memorial Hospital in January 1996, and mischaracterized the estate’s claim against Richland Memorial as “solely for the acts of an independent contractor.”

Under the South Carolina Tort Claims Act, 15-78-60 and 15-78-30(c) it is clear that a governmental entity is liable solely for the acts of its employees and that the term "employee" does not include an independent contractor.

See Court Order, Sept. 5, 2007, ROA 3.

For both the motion for summary judgment and the motion for reconsideration, the court refused to consider the hospital’s alleged nondelegable duty as countervailing to Dr. Reynolds’s status as an independent contractor.  See Court Order, Sept. 5, 2007, ROA 2-5; Motion for Reconsideration, ROA 18-21; Court Order, Oct. 10, 2007, ROA 6.  In doing so, the court ignored Simmons v. Toumey Med. Center, 341 S.C. 32, 533 S.E.2d 312 (2000), and its progeny, in which the South Carolina Supreme Court pronounced that a hospital could be held liable for breach of the nondelegable duty, even when the acts and omissions were those of an independent contractor.

We adopt the approach expressed in Restatement (Second) of Torts: Employers of Contractors § 429 (1965). That section, sometimes described as ostensible agency, provides: One who employs an independent contractor to perform services for another which are accepted in the reasonable belief that the services are being rendered by the employer or by his servants, is subject to liability for physical harm caused by the negligence of the contractor in supplying such services, to the same extent as though the employer were supplying them himself or by his servants.

Simmons v. Tuomey Reg'l Med. Ctr., 341 S.C. at 50-51.

Although Simmons involved emergency room physicians, the Supreme Court said subsequently that its decision was not limited to such physicians. Rather, the decision was limited "to those situations in which a patient seeks services at the hospital as an institution, and is treated by a physician who reasonably appears to be a hospital employee." Osborne v. Adams, 346 S.C. 4, 8 (2001).  Consequently, Dr. Reynold’s role in the pathology department does not prevent the hospital from being liable.

Simmons and the subsequent nondelegable duty cases involved non-governmental hospitals.  The Supreme Court, however, held in Madison v. Babcock Ctr., Inc., 371 S.C. 123 (2006) a governmental entity can be subject to a common law duty.  The nondelegable duty recognized by Simmons is a common law duty.  See Simmons, 341 S.C. at 35.

Madison involved alleged negligent care to a patient in a facility of the Department of Disabilities and Special Needs.  The Department had contracted with an independent contractor to provide the services to the patient.  Consequently, the Department sought and obtained summary judgment on grounds that it was not responsible for the conduct of the contractor, who was not an employee of the Department. See Madison, 371 S.C. at 132.  The Supreme Court reversed, holding that the common law duty to protect mentally retarded or disabled clients applied to a government entity, as well as, a private person or business entity.

[W]hen duty is based on common law, then its existence is analyzed as it would be with a private defendant which is not a government entity pursuant to Tort Claims Act.

See Madison, 371 S.C. at 142 (citing Arthurs ex rel. Estate of Munn v. Aiken County, 346 S.C. 97, 103-105, 551 S.E.2d 579, 582-83 (2001) (“when duty is based on common law, then its existence is analyzed as it would be with a private defendant which is not a government entity pursuant to Tort Claims Act”).

The Supreme Court reminded that pursuant to S.C. Code Ann. § 15-78-40 a governmental entity is liable for its torts "in the same manner and to the same extent as a private individual under like circumstances," subject to limitations upon and exemptions from liability and damages contained in the Tort Claims Act.  See Madison, 371 S.C. at 142.

When a governmental entity owes a duty of care to a plaintiff under the common law and other elements of negligence are shown, the next step is to analyze the applicability of exceptions to the waiver of immunity contained in S.C. Code Ann. § 15-78-60 (2005 & Supp. 2005) which are asserted by the governmental entity. The governmental entity claiming an exception to the waiver of immunity under the Tort Claims Act has the burden of establishing any limitation on liability.

See Madison, 371 S.C. at 143 (citations omitted).

As here, the governmental entity in Madison asserted that Department asserted it could not be liable for the torts of its independent contractor pursuant to S.C. Code Ann. § 15-78-60(20), which provides that a governmental entity is not liable for an "act or omission of a person other than an employee including but not limited to the criminal actions of third persons."  In Madison, the government also has asserted and the circuit court relied on S.C. Code Ann. § 15-78-30(c) (2005), which provided that the term "employee" "does not include an independent contractor doing business with the State."  See Madison, 371 S.C. at 143.  In each instance, the Supreme Court disagreed. 

We find this position unpersuasive because Department owes a common law duty of care directly to Appellant. The fact an independent contractor provided services to Appellant or the fact a third party may have committed a criminal act in harming Appellant does not affect the existence of Department's duty.

Madison, 371 S.C. at 143.

Under South Carolina’s common law, a hospital cannot escape liability by shifting its responsibilities for proper conduct to a contractor.  Rather, duties undertaken in the course of its performance to the public as a hospital are nondelegable.  See Simmons.  Richland Memorial Hospital had a nondelegable duty in the performance of its pathology laboratory.  It was not entitled to summary judgment as a matter of law simply on showing that Dr. Reynolds was an independent contractor.

Issue II

Is the six year statute of repose of S.C. Code Ann. § 15-3-545(A) applicable to a governmental hospital?

S.C. Code Ann. § 15-78-110 provides the following statute of limitations in regard to lawsuits against governmental entities:

Except as provided for in Section 15-3-40, any action brought pursuant to this chapter is forever barred unless an action is commenced within two years after the date the loss was or should have been discovered; provided, that if the claimant first filed a claim pursuant to this chapter then the action for damages based upon the same occurrence is forever barred unless the action is commenced within three years of the date the loss was or should have been discovered.

S.C. Code Ann. § 15-78-110.

S.C. Code Ann. § 15-3-40 relates to the tolling provisions allowed persons under disabilities.  By its express language, section 15-78-110 is the exclusive statute of limitations relating to claims against governmental entities.  As a matter of law, an action commenced within two years of when the “loss” could have been discovered would not be barred by the Tort Claims Act.  "Loss" means bodily injury, disease, death, or damage to tangible property, including lost wages and economic loss to the person who suffered the injury, disease, or death, pain and suffering, mental anguish, and any other element of actual damages recoverable in actions for negligence.  S.C. Code Ann. § 15-78-30(f).

No period of repose is stated by S.C. Code Ann. § 15-78-100, and no reference is made by the Tort Claims Act to any other provision within the code that would impose a period of repose.   The only time limitation for commencing lawsuits against governmental entities appears to be two years from when the loss was or should have been discovered.[1] 

The legislature had created a statute of repose for medical malpractice actions in S.C. Code Ann. § 15-3-545(A), which provides:

(A) In any action, other than actions controlled by subsection (B), to recover damages for injury to the person arising out of any medical, surgical, or dental treatment, omission, or operation by any licensed health care provider as defined in Article 5, Chapter 79, Title 38 acting within the scope of his profession must be commenced within three years from the date of the treatment, omission, or operation giving rise to the cause of action or three years from date of discovery or when it reasonably ought to have been discovered, not to exceed six years from date of occurrence, or as tolled by this section.

S.C. Code Ann. § 15-3-545(A) (emphasis added).

The trial court applied section 15-3-545 in this case based on an erroneous reading of Harrison v. Bevilacqua, 354 S.C. 129, 580 S.E.2d 109, 113 (2003).

The South Carolina Supreme Court has recognized the six year statute of repose provision is the absolute time limit beyond which a medical malpractice claim is barred, regardless of when it as or should have been discovery [sic].  [Citation omitted.]  The Supreme Court in the Harrison case noted that liability no longer exists beyond the time limit imposed by the statute of repose. Under the same reasoning, the South Carolina Tort Claims Act does not include a superseding statute of repose. The statue of repose in § 15-3-545(a) remains in effect for medical malpractice claims involving governmental entities such as Richland Memorial Hospital which clearly falls within the definition referenced in the body of § 15-3-545(a)

Court Order, Sept. 5, 2007.

Harrison v. Bevilacqua, however, did not address the issue of whether the statute of repose contained within S.C. Code Ann. § 15-3-545(a) is applicable to governmental entities covered by the Tort Claims Act.  The issue in Harrison v. Bevilacqua was whether the Supreme Court would adopt the “continuous treatment rule,” and allow a patient in a state mental institution to bring a lawsuit against the institution in 1995 for acts and omissions occurring from 1983.  See Harrison v. Bevilacqua, 354 S.C. at 133.

The mental institution maintained “that adoption of the rule would be "entirely inconsistent" with the six-year statute of repose for medical malpractice actions” of section 15-3-545.  See Harrison v. Bevilacqua, 354 S.C. at 137.   The patient apparently did not take exception to the assertion, and clearly did not present the issue of whether S.C. Code Ann. § 15-3-545 was applicable to governmental entities.  See Harrison v. Bevilacqua, 354 S.C. at 133 (statement of “Issues”).   Perhaps, the issue was not raised by the patient, because the South Carolina Tort Claims Act, S.C. Code Ann. §§ 15-78-10, et. seq., was not adopted until 1986, and the patient was hoping to establish liability for acts and omissions in 1983.

The Supreme Court noted in Harrison that the tolling provisions of S.C. Code Ann. § 14-3-540 were expressly included in the Tort Claims Act section 15-78-110, but emphasized that the disability for a mental condition could allow tolling of no more than five years.  See Harrison v. Bevilacqua, 354 S.C. at 134.  Consequently, the patient was allowed to offer evidence of negligence dating only from 1990 rather than 1983.  The court rejected adoption of the continuous treatment rule, which would have judicially tolled the commencement of the statute of limitations for the entire period that the patient was under the care of the mental institution.

So, in Harrison v. Bevilacqua, the patient was limited by the time period of the disability statute (five years), not by the time period of the statute of repose (6 years). See id at 135; cf. Shadwell v. Craigie, 361 S.C. 492, 605 S.E.2d 567 (Ct. App. 2004) (“the record in this case supports a finding that Shadwell's cause of action for failure to inform her of the test results was barred by the statute of repose.”).   Although the Supreme Court stated that Harrison “implicates” the general medical malpractice six-year repose statute, it did so really only as a policy consideration. In rejecting the continuous treatment rule, the Supreme Court said it would be improper to create judicial policy in an area so clearly occupied by the legislature.

 [U]nder the peculiar facts of this case, application of the continuous treatment rule would infringe upon two areas which the Legislature has spoken on regarding absolute limitations: (1) medical malpractice; and (2) delay of commencement of action due to disability.

Put simply, we find judicial adoption of the continuous treatment rule would run afoul of the absolute limitations policy the Legislature has clearly set via the statutes discussed above.

Harrison v. Bevilacqua, 354 S.C. at 138 (emphasis in italic ours; emphasis in bold theirs).

The issue is clearly before this court: Is the six year statute of repose of S.C. Code Ann. § 15-3-545(A) applicable to a governmental hospital?  By the language of the statute, there is no limitation or period of repose on when a governmental tort claim can be asserted after a loss is discovered.

The remedy provided by the Tort Claims Act is “the exclusive civil remedy available for any tort committed by a governmental entity, its employees, or its agents.”  S.C. Code Ann. § 15-78-20.  Where the legislature has covered the manner and timing for commencing a lawsuit, no other provision should be considered unless expressly allowed by the statute itself.  In Searcy v. S.C. Dep't of Educ., 303 S.C. 544, 402 S.E.2d 486 (Ct. App. 1991), for example, the tolling provisions of S.C. Code Ann. § 15-3-40 were held not to apply to the Tort Claims Act until both statutes were expressly amended to allow for minority tolling.  See Searcy, 303 S.C. at 549.  See also Act No. 352 § § 1, 9, 1988 S.C. Acts 2638, 2644.

Where the General Assembly wants the Tort Claims Act to be affected by another provision of the code, it has done so expressly.  In section 15-78-110, the legislature provided express reference to the tolling provisions of S.C. Code Ann. § 15-3-40.  It made no reference to S.C. Code Ann. 15-3-545(A).  If it had incorporated section 15-3-545(A), then not only would the statute of repose be applicable, but so would the three year statute of limitations rather than the two allowed by the Tort Claims Act.  See S.C. Code Ann. § 15-3-545(A).  The provisions of S.C. Code Ann. § 15-78-110 are specific to all claims brought pursuant to the Tort Claims Act, whether medical or otherwise.  The repose portion of S.C. Code Ann. § 15-3-545(A) is specific only to medical malpractice claims in which the three year statute of limitations applies.

When it comes to lawsuits against the governmental entities, the legislature has insisted on strict adherence to its language.  To “clarify any ambiguity” that “the government is only liable for torts as expressly prescribed and authorized in the 'South Carolina Tort Claims Act'," the General Assembly adopted S.C. Code Ann. § 15-78-200.

Notwithstanding any provision of law, this chapter, the "South Carolina Tort Claims Act", is the exclusive and sole remedy for any tort committed by an employee of a governmental entity while acting within the scope of the employee's official duty. The provisions of this chapter establish limitations on and exemptions to the liability of the governmental entity and must be liberally construed in favor of limiting the liability of the governmental entity.

S.C. Code Ann. § 15-78-200 (emphasis added).  See also 1997 Act No. 155, Part II, § 55B.  While liberal construction to limit liability is favored, note that the legislature has directed the courts to the “provisions of this chapter.”  There is no provision in the chapter relating to S.C. Code Ann. § 15-3-545(A).

Consequently, if the survival action and wrongful death claims of the Kerr Estate were commenced with two years of when Mrs. Kerr’s cancer was discovered and her subsequent death, the statute of repose contained with § 15-3-545(A) should not be a bar to the estate’s lawsuit.

Conclusion

The summary judgment should be reversed and the case remanded.

September 4, 2008

CERTIFICATE OF SERVICE

I hereby certify that on this date I caused to be served a copy of the foregoing BRIEF OF APPELLANT upon the individual whose name and address are listed below by placing a copy of it in the United States Mail with proper first-class postage affixed thereon.

September 4, 2008

[1] S.C. Code Ann. § 15-78-100 provides that the lawsuit may be commenced within three years if a pre-suit, verified claim is first submitted to the governmental entity pursuant S.C. Code Ann. § 15-78-80.  Such a pre-suit claim was not submitted in this case, and only the two year limitation period would be applicable.