      TEXAS COURT OF APPEALS, THIRD DISTRICT, AT AUSTIN


                                      NO. 03-10-00092-CV



                                   Rachel Rawlins, Appellant

                                                 v.

   Daughters of Charity Health Services of Austin d/b/a Seton Medical Center, Appellee


           FROM THE COUNTY COURT AT LAW NO. 1 OF TRAVIS COUNTY,
        NO. C-1-CV-07-013049, HONORABLE ERIC SHEPPERD, JUDGE PRESIDING



                            MEMORANDUM OPINION


               This is a malpractice case against a hospital. The trial court rendered a no-evidence

summary judgment in favor of the Appellee hospital and against Appellant on her claim that her

pathologist, an independent contractor, was the ostensible agent of the hospital. The only question

presented is whether under these facts a pathology report issued on the hospital’s pathology

department letterhead is sufficient to raise a fact issue as to whether the hospital can be held

vicariously liable, under the theory of ostensible agency, for the independent pathologist’s alleged

negligence. Agreeing with the trial court that it cannot, we will affirm the judgment.


                                        BACKGROUND

               Appellant Rachel Rawlins (“Rawlins”) filed a malpractice action against

Richard Hammer, M.D. (“Hammer”), a pathologist; against Hammer’s medical professional group,

Clinical Pathology Associates; and against Seton Healthcare (formerly Daughters of Charity
Health Services of Austin d/b/a Seton Medical Center) (“Seton”).              Rawlins alleged that

Hammer misdiagnosed her breast cancer as micrometastatic disease, thereby resulting in her

undergoing needless chemotherapy, an axillary node dissection, and other unnecessary treatment;

she further alleged that she suffered related sequelae, including symptoms consistent with premature

ovarian failure.

                At the time of the alleged misdiagnosis, Hammer was employed by Clinical Pathology

Associates. This independent entity contracted with Seton for its doctors to provide pathology

services at the hospital. Rawlins underwent surgery at the hospital. Her biopsy tissue was taken to

the hospital’s pathology department for diagnosis, where Hammer reviewed the slides and reported

his findings. Rawlins had never met Hammer and did not select him as her pathologist. Hammer

issued and signed his reports, which Rawlins received after her surgery, on letterhead entitled “Seton

Medical Center Department of Pathology.” Each page contains the words “SMC Surgical Path

Report” or “SMC pathology.” The reports contain no reference to Clinical Pathology Associates,

nor do the reports give any indication that Hammer is an independent contractor or that he is

affiliated with any entity other than Seton.1 Rawlins contends that, based upon these written reports,

she reasonably believed that Hammer was a Seton employee, which influenced her decisions not to

seek a second pathology opinion.2



       1
          Seton points out that Rawlins signed admission papers informing her that the hospital’s
pathologists were independent contractors and not hospital employees. Rawlins objected that
this evidence was attached to Seton’s no-evidence motion and, therefore, should not be considered
under Rule 166a(i). Without deciding the matter, we do not rely upon this evidence in making
our decision.
       2
           Rawlins’s claims against Hammer and his medical group were settled.

                                                  2
               Rawlins alleged that Dr. Hammer was the actual agent or employee of the hospital,

and she further alleged in the alternative that Hammer was the ostensible agent of the hospital. Seton

filed a traditional motion for summary judgment on Rawlins’s allegation that Hammer was Seton’s

actual agent or employee; Rawlins did not oppose this motion, and the trial court granted it. Seton

also filed a no-evidence motion for summary judgment, contending that Rawlins had produced no

evidence that Hammer was Seton’s ostensible agent. Rawlins filed a cross motion for partial

summary judgment, asking the trial court to hold as a matter of law that Hammer was Seton’s

ostensible agent. The trial court granted Seton’s motion and denied Rawlins’s motion. Rawlins

requests this Court to reverse the summary judgment, contending that the record contains more

than a scintilla of evidence on every element necessary to prove that Hammer was Seton’s

ostensible agent.


                                           DISCUSSION

Standard of Review

               To prevail on a no-evidence summary judgment motion, the movant must show that

“there is no evidence of one or more essential elements of a claim or defense on which an adverse

party would have the burden of proof at trial.” Tex. R. Civ. P. 166a(i). A defendant’s no-evidence

summary judgment motion asserts that the plaintiff has produced no evidence of one or more

essential elements of its claim. Duvall v. Texas Dep’t of Human Servs., 82 S.W.3d 474, 477 (Tex.

App.—Austin 2002, no pet.). In response to a defendant’s no-evidence motion, the plaintiff must

produce summary judgment evidence raising a genuine issue of material fact on each challenged

element in order to defeat the motion. If the plaintiff fails to produce more than a scintilla of

                                                  3
evidence of the challenged fact, the motion must be granted. Tex. R. Civ. P. 166a(i); see Mack

Trucks, Inc. v. Tamez, 206 S.W.3d 572, 581-82 (Tex. 2006).

               If more than a scintilla of evidence of the necessary element exists, it is legally

sufficient to raise a fact issue. Ford Motor Co. v. Ridgway, 135 S.W.3d 598, 600 (Tex. 2004). The

nonmovant produces more than a scintilla of evidence on an element if the evidence “rises to a level

that would enable reasonable and fair-minded people to differ in their conclusions.” Id.; Merrell

Dow Pharm., Inc. v Havner, 953 S.W.2d 706, 711 (Tex. 1997). A nonmovant produces less than

a scintilla of evidence when the evidence is “so weak as to do no more than create a mere surmise

or suspicion of fact.” See Kindred v. Con/Chem, Inc., 650 S.W.2d 61, 63 (Tex. 1983).

               When the trial court has granted a no-evidence motion for summary judgment, the

appellate court should affirm the summary judgment if (1) there is no evidence to prove one or more

necessary elements; (2) the evidence offered to prove the challenged element is no more than a

scintilla; (3) the evidence establishes the opposite of the challenged element; or (4) the court is

barred from considering the only evidence offered to prove the challenged element. City of Keller

v. Wilson, 168 S.W.3d 802, 810 (Tex. 2005). The appellate court should review the evidence in the

light most favorable to the appellant, crediting evidence favorable to the appellant if reasonable

jurors could and disregarding unfavorable evidence unless reasonable jurors could not. Timpte

Indus. v. Gish, 286 S.W.3d 306, 310 (Tex. 2009). Review of a no-evidence motion for summary

judgment is restricted to the evidence contrary to the motion. City of Keller, 168 S.W.3d at 825.




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Elements Necessary to Prove Ostensible Agency

                In general, doctors are considered independent contractors with respect to the

hospitals where they practice and have staff privileges; therefore, a hospital ordinarily cannot be held

liable for the negligent acts or omissions of independent physicians who practice in its facilities.

Baptist Mem’l Hosp. Sys. v. Sampson, 969 S.W.2d 945, 948 (Tex. 1998). However, a hospital can

be held vicariously liable in a medical malpractice context if a plaintiff can establish all the elements

of ostensible agency. Id. In order for Seton to be held liable for Hammer’s alleged negligence,

Rawlins must prove Hammer was the ostensible agent of Seton. To prove ostensible agency,

Rawlins has the burden to prove (1) that she held a reasonable belief that Hammer was the agent or

employee of Seton; (2) that Rawlins’s belief was generated by some affirmative conduct on the part

of Seton holding Hammer out as its employee or agent or knowingly allowing Hammer to hold

himself out as such; and (3) that Rawlins justifiably relied upon the appearance and representation

of authority that Hammer was Seton’s employee or agent. Id. at 949. By its ruling, the trial court

held that Rawlins failed to produce more than a scintilla of evidence on one or more of these

necessary elements. Rawlins contends that the record contains more than a scintilla of evidence

supporting each element necessary to prove ostensible agency. Her position turns primarily upon

the written reports Hammer signed.

                Rawlins asserts that the record contains evidence showing that she held a reasonable

belief that Hammer was Seton’s employee or agent. She did not choose Hammer as her pathologist;

in effect, the hospital chose him for her. Hammer’s pathology reports purport to be issued by Seton’s

pathology department, with no indication that the reports were issued by Hammer on behalf of any



                                                   5
other entity not affiliated with Seton. Hammer signed the reports, with no indication that he signed

on behalf of any entity other than Seton. Rawlins’s belief that Hammer was Seton’s employee or

agent relies primarily upon the fact that Hammer issued and signed Rawlins’s pathology reports on

Seton letterhead and, therefore, on their face, the reports purport to be issued from Seton’s pathology

department by a Seton pathologist.3

               Rawlins further asserts that the record contains evidence that her reasonable belief

that Hammer was Seton’s employee or agent was generated by Seton’s actions or conduct. Hammer

shares an office located at Seton. There, he does his work in the pathology department with

laboratory personnel employed by Seton. He dictates his pathology reports and passes them to Seton

transcriptionists, who type his reports into Seton’s computers and issue the paper copies such as the

ones Rawlins received.4 Rawlins’s biopsy specimens were delivered to Hammer for him to review,

analyze, and issue reports on her medical condition. Seton employees typed Hammer’s pathology

reports concerning Rawlins on Seton letterhead, and he signed them. Rawlins contends that this

process demonstrates that her reasonable belief was generated as a result of Seton’s actions, because

Seton affirmatively held Hammer out as its employee or agent, or knowingly allowed Hammer to




       3
           Seton argues that there are legal reasons related to its accreditation and certification that
require the reports to be issued in this manner. Rawlins disputes Seton’s position, arguing that Seton
elects whether to seek accreditation and, in any event, it could easily produce the reports in a form
that would satisfy accreditation and still inform the patient. Regardless, the question is not why the
reports are issued in this manner but whether the reports produce in the patient a reasonable belief
that the reports are issued by a Seton pathology department agent or employee.
       4
          We note that there is no evidence that Rawlins knew these facts at the time of the events
in question or that these facts in any way influenced her belief that Hammer was Seton’s employee
or agent.

                                                   6
hold himself out as representing Seton, by preparing and issuing his reports on Seton pathology

department letterhead, without limitation or qualification as to his position.

               Finally, Rawlins argues that the record contains evidence that she justifiably relied

upon her belief that Hammer was a Seton agent or employee and that this influenced her not to

obtain a second pathology opinion. Rawlins’s affidavit is the only evidence in the record on this

third element of ostensible agency. Rawlins states in her affidavit:


        I called a friend’s husband who is a doctor and asked him whether I should get a
       second opinion on the pathology. He asked me where I’d received my care and I
       told him it was at Seton; he responded that I probably didn’t need to worry about it.
       I took that to mean that he trusted the quality of care being provided at Seton.
       My belief that this was a Seton pathologist played into my decision not to seek a
       second opinion.5


Rawlins’s affidavit reflects that she sought a doctor friend’s advice on whether to get a second

pathology opinion. When she informed her friend that she received her care at Seton, the friend

advised Rawlins that “[she] probably didn’t need to worry about it,” which Rawlins “took to mean”

that [her doctor friend] “trusted the quality of care” Seton provides. Rawlins interpreted her friend’s

comment to mean that he held a positive opinion of the quality of care generally rendered at Seton,

and thereafter Rawlins chose not to seek another opinion. Rawlins contends that her affidavit

evidences the fact that she justifiably relied upon her belief that Hammer was Seton’s employee in

deciding not to obtain a second pathology opinion. Nothing about these facts, however, raises that




       5
         Seton objected at trial to these statements as being hearsay and, therefore, inadmissible.
The record contains no other evidence on the issue of justifiable reliance. For purposes of this
opinion, we will assume, without deciding, that the statements in the affidavit are admissible.

                                                  7
issue. The evidence does not suggest that the quality of care rendered at Seton depended upon the

services being provided by a hospital agent or employee, as opposed to another health care

provider—such as an independent contractor—providing services at the hospital. Neither the

friend’s comments to her nor Rawlins’s affidavit assertions bear on Hammer’s employment

relationship with Seton. Further, Rawlins’s belief that Hammer was a Seton pathologist only “played

into” her decision not to seek a second opinion and does not raise a genuine issue of a material fact.

The record does not contain evidence that Rawlins justifiably relied on her belief that Hammer was

Seton’s agent or employee in deciding not to seek a second opinion.

               Rawlins contends that the record contains evidence that she believed Hammer to be

a Seton agent or employee, that Seton’s conduct generated this belief, and that she justifiably relied

upon that belief in making decisions about her medical care. We disagree. We agree with the trial

court that the evidence constitutes at best only a scintilla of evidence, not more, as to the elements

necessary to prove ostensible agency. Applying the correct standard of review, we overrule

Rawlins’s complaint on appeal.


                                          CONCLUSION

               Having overruled the issue on appeal, we affirm the trial court’s judgment.




                                                  8
                                             __________________________________________

                                             Marilyn Aboussie, Justice

Before Chief Justice Jones, Justices Pemberton and Aboussie*

Affirmed

Filed: August 26, 2011

* Before Marilyn Aboussie, Chief Justice (retired), Third Court of Appeals, sitting by assignment.
See Tex. Gov’t Code Ann. § 74.003(b) (West 2005).




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