531
Chapter 33
Liability to Third Parties
and Termination
Case 33.1
C.A.3 (Pa.),2010.
Azur v. Chase Bank, USA, Nat. Ass’n
601 F.3d 212
United States Court of Appeals,
Third Circuit.
Francis H. AZUR, Appellant
v.
532 CASE PRINTOUTS TO ACCOMPANY BUSINESS LAW
Azur through the fraudulent use of a Chase credit card over the course of seven years. The District Court granted Chase’s motion
for summary judgment, and Azur appealed. We are presented here with three discrete issues for our review. First, we must
determine whether § 1643 of the TILA provides the cardholder with a right to reimbursement. Second, we must evaluate whether
FN1. Azur had never been to the P.O. Box and did not have a key to it.
From around November 1999 to March 2006, Vanek withdrew without authorization cash advances of between $200 and $700,
FN2. When the misappropriation began in 1999, the account was at First USA Bank, National Association (First USA),
FN3. Chase has possession of a letter dated July 20, 1999, and signed by Azur that authorizes First USA to “discuss
and/or release information with my assistant Michelle Vanek.” (App. at 1443A.)
Each fraudulent transaction included a fee of approximately $2.00 and a finance charge that corresponded to the amount
withdrawn, ranging from $4.00 for a $100 advance, to $21.06 for a $700 advance. The fraudulent charges were reflected on at
FN4. Chase employed a computerized fraud detection system known as FALCON, which Chase claimed was the best
FN5. Chase’s records indicate that the calls were not made from the telephone number listed on the account.
On or about March 7, 2006, Azur discovered a suspicious letter requesting a transfer of funds from his checking account. After
investigating, Azur and ATM discovered Vanek’s fraudulent scheme and terminated her employment. On March 8, 2006, Azur
notified Chase by telephone of the fraudulent use of the Chase account and closed the account. Thereafter, Azur sent Chase three
pieces of correspondence relevant to this appeal: (1) a letter dated April 7, 2006; (2) an executed Affirmation of Unauthorized Use
FN6. Azur filed his original complaint on August 16, 2006.
FN7. Azur’s requested relief included (a) “[d]amages in the amount of all payments collected by Chase for money
misappropriated and [fraudulent] purchases;” (b) “[a]n injunction restraining Chase from collecting or attempting to collect,
from Mr. Azur, amounts representing money misappropriated and [fraudulent] purchases;” (c) “[a]n order requiring Chase
to request the removal of the adverse credit reports that Chase made to credit reporting agencies concerning Mr. Azur’s
credit status, and restraining Chase from submitting any further adverse credit reports concerning Mr. Azur;” and (d)
economic loss doctrine. In light of this finding, the Magistrate Judge recommended that Chase’s motion for judgment on the
pleadings be dismissed as moot. On February 3, 2009, the United States District Court for the Western District of Pennsylvania
adopted the Supplemental R & R, granted Chase’s motion for summary judgment on all three counts, and dismissed Chase’s
motion for judgment on the pleadings as moot. Azur filed a timely notice of appeal.
II.
[1][2][3] The District Court had jurisdiction pursuant to 28 U.S.C. §§ 1331 and 1367, and we have jurisdiction pursuant to 28 U.S.C.
Azur appeals the District Court’s order granting Chase’s motion for summary judgment. Azur argues that the District Court erred in
dismissing (1) his § 1643 claim based on its conclusion that Vanek had apparent authority to make the credit card charges as a
534 CASE PRINTOUTS TO ACCOMPANY BUSINESS LAW
matter of law; (2) his § 1666 claim based on its determination that Azur failed to meet the section’s notice requirement; and (3) his
negligence claim as barred by Pennsylvania’s economic loss doctrine. Chase, in contrast, asks that we affirm the District Court’s
FN8. Chase also argues that Azur’s contributory negligence bars his negligence claim. Chase, however, likely waived this
defense by failing to raise it in front of the Magistrate Judge or District Court.
See In re Ins. Brokerage Antitrust Litig.,
579
FN9. Because we find that Vanek’s apparent authority precludes both Azur’s § 1643 and § 1666 claims, we decline to
reach the issue of notice.
A. Right to Reimbursement
[4] Chase argues that Azur cannot recover the money already paid to Chase under § 1643 of the TILA. We agree. Section 1643
Id.
at 175. Faced here with the same issue in a new context, we arrive at the same outcome: § 1643 of the TILA does not provide
the cardholder with a right to reimbursement.FN10 Accordingly, to the extent that Azur requests reimbursement under § 1643 for
money already paid to Chase, his claim fails.
FN10. Although other federal courts of appeals have assumed that a right to reimbursement exists, they have done so
without analysis.
See Minskoff v. Am. Exp. Travel Related Servs. Co., Inc.,
98 F.3d 703, 707, 710 (2d Cir.1996) (holding
that the “appropriate resolution” on remand of a cardholder’s § 1643 reimbursement claim is that “[the card issuer] is liable
for [the user’s] fraudulent purchases … from the time the credit card was issued until [the cardholder] received the first
statement from [the card issuer] containing [the user’s] fraudulent charges plus a reasonable time to examine that
[5] Vanek’s alleged apparent authority is a more difficult issue. Relying on three cases,
Minskoff v. American Express Travel
Related Services. Co., Inc.,
98 F.3d 703 (2d Cir.1996),
DBI Architects, P.C. v. American Express Travel-Related Services. Co.,
CHAPTER 33: LIABILITY TO THIRD PARTIES AND TERMINATION 535
Inc.,
388 F.3d 886 (D.C.Cir.2004), and
Carrier v. Citibank (S.D.), N.A.,
383 F.Supp.2d 334 (D.Conn.2005), the Magistrate Judge
recommended that Azur’s § 1643 claim be dismissed because Azur vested Vanek with apparent authority to make charges to the
in certain circumstances. 15 U.S.C. § 1643(a). The term “unauthorized use” is defined as the “use of a credit card by a person
other than the cardholder who does not have actual, implied, or apparent authority for such use and from which the cardholder
receives no benefit.” 15 U.S.C. § 1602(
o
). Relatedly, § 1666(a) sets forth the procedures a creditor must follow to resolve alleged
billing errors. 15 U.S.C. § 1666(a). Like the phrase “unauthorized use,” the phrase “billing error” includes “[a] reflection on or with a
periodic statement of an extension of credit that is not made to the consumer or to a person who has actual, implied, or apparent
FN11. Pennsylvania agency law is comparable to general agency law principles. Restatement (Second) of Agency § 8
provides that “[a]pparent authority is the power to affect the legal relations of another person by transactions with third
persons, professedly as agent for the other, arising from and in accordance with the other’s manifestations to such third
persons,” and § 27 explains that the “apparent authority to do an act is created as to a third person by written or spoken
words or any other conduct of the principal which, reasonably interpreted, causes the third person to believe that the
executive officer of a real estate firm. 98 F.3d at 706. In 1988, the firm opened an American Express corporate credit card account
and issued one card in Minskoff’s name.
Id.
In 1992, Minskoff’s assistant, whom the firm had recently hired, applied for and
obtained an additional card to the account in her own name without Minskoff’s or the firm’s knowledge.
Id.
From April 1992 to
536 CASE PRINTOUTS TO ACCOMPANY BUSINESS LAW
March 1993, the assistant charged a total of $28,213.88 on the corporate card.
Id.
During this period, American Express sent
noting that “[n]othing in the TILA suggests that Congress intended to sanction intentional or negligent conduct by the cardholder
that furthers the fraud or theft of an unauthorized card user,” the court held that “the negligent acts or omissions of a cardholder
may create apparent authority to use the card in a person who obtained the card through theft or fraud.”
Id.
Applying that reasoning
to the facts before it, the Second Circuit found that Minskoff’s and the firm’s failure to examine any of the credit card or bank
statements created, as a matter of law, “apparent authority for [the assistant’s] continuing use of the cards, especially because it
enabled [the assistant] to pay all of the American Express statements with forged checks, thereby fortifying American Express’
continuing impression that nothing was amiss with the Corporate and Platinum Accounts.”
Id.
at 710.FN12
FN12. The Second Circuit relied in part on a New York law obligating consumers to exercise reasonable care and
promptness in examining bank statements for errors.
Minskoff,
98 F.3d at 709. According to the court, the law derived
from common law obligations.
Id.
FN13. “AMEX” is the abbreviation used by the
DBI Architects
court to refer to American Express Travel-Related Services
Company. 388 F.3d at 887.
Acquainted with the Second Circuit’s decision in
Minskoff,
the D.C. Circuit decided its case on narrower grounds. Rather than fault
Id.
at 891. The court later explained its reasoning as follows:
“By identifying apparent authority as a limit on the cardholder’s protection under § 1643, Congress recognized that a cardholder
Id.
at 893. Although the court acknowledged that payment might not always create apparent authority, it held that such authority
existed as a matter of law in that case:
“[T]his is not a case involving an occasional transgression buried in a welter of financial detail. [ ]Nor is this a case involving
Id.
at 893-94 (quotations and citation omitted). Ultimately, the court remanded the case to determine at what point the manager’s
apparent authority began.
Id.
at 894.
[6][7] We agree with the D.C. Circuit’s more nuanced analysis. “Apparent authority is power to bind a principal which the principal
has not actually granted but which he leads persons with whom his agent deals to believe that he has granted.”
Revere Press,
246
A.2d at 410. A cardholder may, in certain circumstances, vest a fraudulent user with the apparent authority to use a credit card by
FN14. First, Azur argues that Chase could not have reasonably believed that the charges were authorized because (1)
Vanek’s telephone calls were made from telephone numbers that did not match the number listed on the account, and (2)
Vanek was female, when the account indicated that the only cardholder was male. Second, Azur contends that Chase’s
fraud-detecting tools, including FALCON, were ineffective because only three out of hundreds of fraudulent transactions
triggered a response.
Townhome Cmtys., L.P.,
816 A.2d 301, 305 (Pa.Super.2003)). The doctrine “ ‘is concerned with two main factors: foreseeability
and limitation of liability.’ ”
Id.
(quoting
Adams,
816 A.2d at 307). The first Pennsylvania appellate court to discuss the doctrine
explained,
“To allow a cause of action for negligent cause of purely economic loss would be to open the door to every person in the
economic chain of the negligent person or business to bring a cause of action. Such an outstanding burden is clearly
context of a Section 552 claim would be nonsensical: it would allow a party to pursue an action only to hold that, once the elements
of the cause of action are shown, the party is unable to recover for its losses,”
id.
at 288.
The Pennsylvania Supreme Court emphasized the narrow scope of the
Bilt-Rite
exception in
Excavation Techs.,
where an
excavator filed a negligent misrepresentation claim against a utility company pursuant to § 552 after the excavator sustained
economic damages because the utility company erred in marking the locations of some of the gas lines. 985 A.2d at 841, 844. In
Azur’s main argument against the imposition of the economic loss doctrine focuses on Azur’s assertion that he does not have a
contractual remedy. However, we already rejected an identical argument in
Sovereign Bank,
where we applied the doctrine in a
case concerning a card issuer’s negligence claim against other financial institutions with which it had no contractual relationship.
We explained,
“
Bilt-Rite
did not hold that the economic loss doctrine may not apply where the plaintiff has no available contract remedy….
FN15. We decline to reach the issue of notice under § 1666.
See
note 9,
supra.
Case 33.2
CHAPTER 33: LIABILITY TO THIRD PARTIES AND TERMINATION 539
152 Cal.App.4th 475, 61 Cal.Rptr.3d 754, 07 Cal. Daily Op. Serv. 7448, 2007 Daily Journal D.A.R.
9496
Court of Appeal, Fourth District, Division 2, California.
FN1. In accordance with our standard of review, we summarize the evidence in the light most favorable to defendants, giving them
the benefit of every reasonable inference, and resolving any conflicts in the evidence in support of the judgment. (See
Aceves v.
Regal Pale Brewing Co.
(1979) 24 Cal.3d 502, 507, 156 Cal.Rptr. 41, 595 P.2d 619, overruled on another point in
Privette v.
FN2. According to Dr. Gubin, Dr. Ogata’s “corporation was employed by my corporation.”
In January 1994, Jackie Shahan (Shahan), Amanda’s mother, went to the Hospital emergency room because of cramping, hives,
headaches, and vomiting. Shahan did not have her own physician at that time. The emergency room physician informed Shahan
that she was pregnant and referred her to Drs. Gubin and Ogata.
On January 13, 1994, Shahan went to the clinic and met with Carol Cribbs, a comprehensive perinatal health worker. Shahan filled
out a questionnaire in which she answered “yes” to the question, “Do you want to continue this pregnancy?” In response to the
question, “What are your hopes for this pregnancy?” Shahan stated, “To have a healthy baby.” Nevertheless, she testified that she
FN3. These rights mirror the patient rights set forth in Medi-Cal regulations at California Code of Regulations, title 22, section
51348.2, subdivision (c), which provides: “The patient has the right to be treated with dignity and respect, to have her privacy and
confidentiality maintained, to review her medical treatment and record with her physician or practitioner, to be provided
explanations about tests and clinic procedures, to have her questions answered about procedures, to have her questions
FN4. According to the respondent’s brief, Shahan also signed a form titled “Conditions of Services at Desert Hospital,” which
purportedly provides that “physicians are independent contractors and not employees or agents of [the Hospital].” The brief cites to
an exhibit in the respondent’s appendix. The referenced exhibit is not included in the respondent’s appendix and the record does
not indicate that this document was admitted into evidence. If such a document exists, we agree with Amanda that we cannot
minus 1.4 weeks. The report does not indicate any abnormalities.
Dr. Ogata met with Shahan on February 22 and talked with her about the January 28 ultrasound. Dr. Ogata told Shahan that the
fetus was healthy. Shahan also spoke with Cribbs, who told her that everything was normal and that the baby was healthy. Cribbs
FN5. This conflicts with Shahan’s testimony. According to Shahan, Sterling told her that she was going to have another ultrasound
minus 1.8 weeks. It further states: “Scans of the fetal head show minimal prominence of the lateral ventricles with lateral ventricular
measurement of between 11 and 12mm (upper limits of normal 10mm). Follow-up ultrasound scanning is recommended to confirm
or exclude fetal hydrocephalus. No morphologic abnormalities are seen within the fetal axial skeleton or body.” Under the heading,
FN6. Neither Dr. Ogata nor the radiologist testified at trial. Other than the reference to the call to Dr. Ogata on the ultrasound
report, there was no direct evidence of what the radiologist told Dr. Ogata about the ultrasound.
FN7. Dr. Gubin stated that “viable” means a “baby that is alive and capable of surviving outside the uterus.”
The next day, March 22, Shahan was examined by Dr. Ogata at the clinic. As of that date, the clinic had not received the written
any problem with the fetus at that time.FN8 Sterling “opened up the chart and copied for [Shahan] exactly what the doctor told
her….” In her notes regarding her meeting with Shahan, Sterling indicated that she talked to Shahan about bed rest and the “signs
and symptoms of labor and pre-term labor.” According to Shahan, Sterling told her that “everything was fine” and that they would
let her know if there was any problem with the ultrasound. This was the last time Sterling saw Shahan in the clinic.
FN8. Sterling was never directly asked at trial if, on March 22, she was aware of the March 21 ultrasound or the ultrasound results.
There was, however, evidence from which the court could infer that she did not know of the ultrasound or the contents of the
ultrasound report. Dr. Gubin testified that even if the radiologist had called Dr. Ogata about the ultrasound, that “wouldn’t
necessarily mean that Miss Sterling knew that he had been contacted the day before.” Sterling stated that she talked with Dr.
Ogata only about the fetal heart tones and measurements. In response to a question about whether Sterling had asked Shahan if
FN9. Shahan testified that she met with Dr. Ogata on March 29. Dr. Gubin testified that, based upon his review of the records, he,
not Dr. Ogata, met with Shahan on that date. However, he could not recall the meeting. When Sterling was asked if Dr. Gubin saw
FN10. Although Shahan testified that she met with Dr. Ogata, she was not asked, and did not say, what transpired during the
meeting. Neither Dr. Ogata nor Cribbs testified at trial.
On April 11, Shahan called the clinic to complain of headaches, cramping, spotting, vomiting, and hallucinations. She was told to
get bed rest, and to come into the clinic on April 19. On April 19, she met with Dr. Ogata. Dr. Ogata told Shahan that she might be
going into premature labor and told Shahan to rest. Shahan testified that she asked about the March 21 ultrasound and was told
Shahan did not appear for a scheduled appointment at the clinic the next day, May 10. Nor did she otherwise contact the clinic
after the May 9 ultrasound.
On May 13, Shahan was admitted to the labor and delivery department of the Hospital with premature rupture of membranes. A
report by Dr. Ogata on that day makes no reference to any abnormalities or problems with the fetus. Two days later, Amanda was
born.
At the time of trial, Amanda was eight years old. She is microcephalic, mentally retarded, and, according to a pediatric neurologist,
“will always be a child under the age of one year.” She suffers from cerebral palsy involving both sides of her body, has diminished
vision, and is unable to walk, crawl, talk, communicate, or control elimination. She cannot chew, and is fed a liquid diet and
medicine through a bottle and a gastrostomy tube. She will be dependent upon others for her care for the rest of her life.
II. SUMMARY OF EXPERT TESTIMONY
Mary Dee Cutler, R.N. opined that Sterling’s conduct as Shahan’s case coordinator fell below the applicable standard of care in
several respects, including her failure to inform Shahan of the potential defects apparent in the March 21 ultrasound, the failure to
seek a referral to a specialist, the failure to ensure that a follow-up ultrasound was performed in a timely manner, and the failure to
CHAPTER 33: LIABILITY TO THIRD PARTIES AND TERMINATION 543
inform Shahan of her options. Cutler further opined that these failures and breaches of other duties owed to Shahan caused
On cross-examination, Dr. Sollman was questioned about Sterling’s March 22 “size vs dates” note. Dr. Sollman agreed that if
Sterling was told to obtain a repeat ultrasound for the purpose of resolving the size versus dates question, “there would be nothing
that would raise her eyebrows that there is a distinct problem.” Nor was there anything in the medical records to show that the
physician’s original diagnosis concerning the pregnancy had changed, and in that situation, it would be appropriate for the nurse to
continue to treat the patient under the original diagnosis. He further stated that the March 21 ultrasound indicated a potential
Dr. Porto testified that in 1994, viability of a fetus was considered to occur at approximately 24 weeks. With respect to a physician’s
treatment of a woman carrying a viable fetus during the third trimester of pregnancy, Dr. Porto stated that recommending or
performing an abortion falls below the standard of care unless the pregnancy threatened the life of the mother or the fetus was
certain to die. Specifically, the failure of a physician to give a patient the option of an abortion under such circumstances does not
fall below the applicable standard of care. Instead of informing a patient of the option of terminating the pregnancy, the standard of
birth.” Nor did the medical records indicate that Shahan had any physical or psychiatric condition that would support an abortion of
a viable fetus. Dr. Porto testified that it did not matter that the May 9 ultrasound was performed seven weeks after the March 21
ultrasound, rather than between four and six weeks as the radiologist had recommended; at any time after the March 21
ultrasound, the fetus was at a viable gestational age.
On cross-examination, Dr. Porto testified that a third trimester abortion was generally not available to Shahan in 1994. He knew of
FN11. Drs. Gubin and Ogata are not parties in this case. Amanda sued the physicians in a prior action, which settled before trial.
In July 1998, defendants filed a motion for summary judgment, or, alternatively, summary adjudication of each cause of action. In
FN12. Amanda filed with this court a petition for a writ of mandate to compel the trial court to set aside the order denying the
motion to deem facts admitted. In September 1998, we summarily denied the petition.
The case proceeded to trial on the sole remaining claim for wrongful life. Prior to trial, the court ruled on certain motions in limine.
Among these is a ruling, based upon Civil Code section 43.6, that Amanda was not required to produce evidence that Shahan
FN13. Civil Code section 43.6, subdivision (b), provides: “The failure or refusal of a parent to prevent the live birth of his or her
child shall not be a defense in any action against a third party, nor shall the failure or refusal be considered in awarding damages
FN14. Amanda filed with this court a petition for a writ of mandate to compel the trial court to vacate and set aside these rulings.
We summarily denied the petition in March 1999. In the present appeal, we granted Amanda’s request to take judicial notice of the
documents filed in connection with this petition.
FN15. At the time of Shahan’s pregnancy, the 1967 Therapeutic Abortion Act prohibited abortions after the 20th week of
pregnancy. (Former Health & Saf.Code, § 25953;
People v. Barksdale
(1972) 8 Cal.3d 320, 334-335, 105 Cal.Rptr. 1, 503 P.2d
257.) The statute did not include any exception for nonviable fetuses or pregnancies that endanger the life or health of the mother.
In 1972, the California Supreme Court indicated in dicta that this absolute proscription conflicted with the right of a pregnant
woman in California to terminate a pregnancy when the birth of the child would probably cause the woman’s death. (
Id.
at p. 335,
788.) In light of these and other authorities, the California Attorney General opined in 1982 that the absolute proscription of
abortions after the 20th week “exceeds constitutional limits”; however, the Attorney General concluded that the provision need not
be invalidated in its entirety, but should be construed as “constitutionally enforceable except as to abortions of nonviable fetuses
and abortions necessary to preserve the life or health of the mother.” (65 Ops.Cal.Atty.Gen. 261, 265 (1982); see also 74
Ops.Cal.Atty.Gen. 101, 104-106 (1991) [the provision should be construed to prohibit abortions after the fetus becomes viable,
(1982) 31 Cal.3d 220, 239, 182 Cal.Rptr. 337, 643 P.2d 954.) “The essence of the child’s claim is that the medical professional’s
breach of the applicable standard of care resulted in that child being
born
to experience the pain and suffering attributable to his or
FN20. Courts have distinguished the cause of action for “wrongful life” from a cause of action for “wrongful birth.” The former is
brought by the child, who alleges “that due to the negligence of the defendant, birth occurred [citation]”; the latter is brought by the
(1978) 83 A.L.R.3d 15, 19, fns. 3, 4.)
[4] Wrongful life is a form of a medical malpractice action. (
Galvez v. Frields
(2001) 88 Cal.App.4th 1410, 1420, 107 Cal.Rptr.2d
50.) “ ‘As in ordinary medical malpractice cases, the plaintiffs in a wrongful life … case must establish the following basic elements:
“(1) the duty of the professional to use such skill, prudence, and diligence as other members of his profession commonly possess
and exercise; (2) a breach of that duty; (3) a proximate causal connection between the negligent conduct and the resulting injury;
and (4) actual loss or damage resulting from the professional’s negligence.” [Citations.]’ ” (
Ibid.;
see also
Gami v. Mullikin Medical
FN21. BAJI No. 6.08 provides: “The essential elements of this claim are: [¶] 1. The defendant negligently [counseled] [tested] [and]
[treated] the [mother] [parents] [__________] of the [ (name of child) ] concerning genetic defects and disabilities; [¶] 2. The
negligent [counseling] [testing] [and] [treating] caused the [mother] [parents] to be unaware of the possibility of this [hereditary]
condition thereby depriving [her] [him] [them] [of the opportunity to choose not to conceive a child with a genetic or congenital
defect] [of the opportunity of making an informed decision on whether to have a eugenic abortion][;][¶] 3. The defendant’s
1.
Application of the Doctrine of Implied Findings
[7] [8] [9] [10] Ordinarily, when the court’s statement of decision is ambiguous or omits material factual findings, a reviewing court
is required to infer any factual findings necessary to support the judgment. (
In re Marriage of Arceneaux
(1990) 51 Cal.3d 1130,
1133, 275 Cal.Rptr. 797, 800 P.2d 1227 (
Arceneaux);
SFPP v. Burlington Northern & Santa Fe Ry. Co.
(2004) 121 Cal.App.4th
452, 462, 17 Cal.Rptr.3d 96.) This rule “is a natural and logical corollary to three fundamental principles of appellate review: (1) a
FN22. Our order for supplemental briefing requested briefing on these issues: (1) whether, for purposes of section 632 and the
doctrine of implied findings (see
Arceneaux, supra,
51 Cal.3d at pp. 1133-1134, 275 Cal.Rptr. 797, 800 P.2d 1227;
SFPP v.
Burlington Northern & Santa Fe Ry. Co., supra,
121 Cal.App.4th at p. 462, 17 Cal.Rptr.3d 96), plaintiff brought to the attention of
the trial court any omission or ambiguity in the trial court’s statement of decision; and (2) whether the document titled,
“PLAINTIFF’S PROPOSAL FOR STATEMENT OF DECISION AND OBJECTION TO DEFENDANTS’ PROPOSED STATEMENT
FN23. Concurrent with the filing of the supplemental letter brief, Amanda submitted a request to augment the record with (1) a
document filed in the Superior Court on July 12, 2004, titled, “DEFENDANTS’ RESPONSE TO PLAINTIFF’S PROPOSAL FOR
STATEMENT OF DECISION AND OBJECTION TO DEFENDANTS’ PROPOSED STATEMENT OF DECISION” (Defendants’
FN24. All further references to rules are to the California Rules of Court. Effective January 1, 2007, rule 4 has been renumbered
rule 8.130. We will refer to this rule by the former rule number.
Because the notice of appeal was filed before the entry of judgment, we dismissed Amanda’s appeal as premature, without
prejudice to reinstating the appeal upon proof of entry of judgment. Following the entry of judgment, we granted Amanda’s motion
to vacate the order of dismissal and reinstate the appeal.
(b)
Analysis
2006) ¶¶ 4:80 to 4:80.1, p. 4-19 (rev. # 1 2006).) There is nothing in the rule that suggests that the trial judge would ever see such
a notice, let alone be expected to take any action based upon it. Nor does Amanda request any relief or action from the trial court
in the document; she merely designates oral proceedings to be transcribed and points to be raised on appeal. Although the
document is filed with the superior court, this is so the court clerk can direct the document to the reporter and send a copy to the
reviewing court. (Rule 4(d).) Regardless of its content, therefore, Amanda’s Rule 4 Notice could not have brought to the attention of
the defect. (See
Arceneaux, supra,
51 Cal.3d at p. 1138, 275 Cal.Rptr. 797, 800 P.2d 1227.) “By filing specific objections to the
court’s statement of decision a party pinpoints alleged deficiencies in the statement and allows the court to focus on the facts or
issues the party contends were not resolved or whose resolution is ambiguous.” (
Golden Eagle Ins. Co. v. Foremost Ins. Co.,
supra,
at p. 1380, 25 Cal.Rptr.2d 242.)
Amanda’s Proposal and Objection consists of two paragraphs. The first paragraph states: “Plaintiff objects to the proposed
The second paragraph of the Proposal and Objection states: “Pursuant to … Section 632, Plaintiff respectfully proposes that this
Court reject Defendants’ proposed Statement of Decision in its entirety, and that the Court issue its own
Statement of Decision
that
is drafted entirely by the Court, with respect to this Court’s Minute Order of March 26, 2004, granting a Verdict for Defendants,
Desert Hospital and Maria Sterling and against Plaintiff. Plaintiff respectfully proposes that the Court’s Statement of Decision be
drafted entirely by the Court,
and that the Court’s Statement specifically
‘ explain’ the ‘factual and legal basis for its decision as to
1227;
Fladeboe, supra,
150 Cal.App.4th at pp. 59-60, 58 Cal.Rptr.3d 225.) By requesting that the court prepare a statement of
CHAPTER 33: LIABILITY TO THIRD PARTIES AND TERMINATION 549
decision that explains each of her previously identified “controverted issues,” Amanda is simply reiterating her initial request for a
statement of decision. Taking the first step in the process a second time does not mean that you have completed the second step.
Read in its entirety, Amanda’s Proposal and Objection asserts general, nonspecific objections to defendants’ proposed statement
FN25. Defendants’ Response to Proposal and Objection (see
ante,
fn. 23) does nothing to alter our interpretation of Amanda’s
Proposal and Objection or affect our analysis.
[15] [16] Even if we construe the Proposal and Objection as an assertion that the 92 paragraphs of issues in Amanda’s initial
request for statement of decision are omissions or ambiguities in the statement of decision, the Proposal and Objection is still
686-687, 226 Cal.Rptr. 485 [trial court’s statement of decision is required only to state ultimate rather than evidentiary facts].)” (
In
re Marriage of Burkle
(2006) 139 Cal.App.4th 712, 736-737, fn. 15, 43 Cal.Rptr.3d 181.) Thus, the proposed statement of decision
is not necessarily deficient merely because it does not address each of the issues identified in Amanda’s 92 paragraphs.
Here (in addition to the causation and damages issues), the ultimate issues were: (1) whether Sterling or hospital staff owed a duty
2.
Standard of Review
[17] [18] [19] Amanda argues that we must review the court’s findings concerning negligence and causation de novo. We reject
633.) Here, however, essential facts were controverted or permitted conflicting inferences. Sterling’s March 22 note to “repeat
ultrasound next visit,” for example, is viewed by Amanda as an order by Dr. Ogata to Sterling to obtain an ultrasound, which
Sterling then negligently failed to perform; Sterling, however, explained that the note reflects a recommendation, and that the
treating physician on March 29 did not require, and did not order, the ultrasound in light of the information about the gestational
3.
Vicarious Liability of the Hospital for Negligence by Drs. Gubin or Ogata
[23] The Hospital, as an entity that is not a natural person, cannot practice medicine. (Bus. & Prof.Code, §§ 2032, 2022;
Lathrop v.
HealthCare Partners Medical Group
(2004) 114 Cal.App.4th 1412, 1420, 8 Cal.Rptr.3d 668.) Its liability for medical malpractice
(including malpractice resulting in a plaintiff’s wrongful life), therefore, must be based upon a theory of vicarious liability. (
Quintal v.
Laurel Grove Hospital
(1964) 62 Cal.2d 154, 166, 41 Cal.Rptr. 577, 397 P.2d 161 (
Quintal
).) Amanda contends, as she did below,
Hospital and Dr. Gubin’s corporation (which employed Dr. Ogata) describes Dr. Gubin and his corporation as “independent
contractors with, and not as employees of, [the] Hospital.” Sterling testified that Drs. Gubin and Ogata,
not the Hospital,
provided
the obstetric services to the clinic’s patients. Donna McCloudy, a director of nursing at the Hospital, testified that while the Hospital
provided some aspects of the CPSP services, “independent physicians came in and provided the obstetrical care….” Based upon
such evidence, the court reasonably concluded that the physicians were not the employees or actual agents of the Hospital for
853.) Relative to the relationship between a hospital and doctor, the elements of ostensible agency were first addressed in
California in
Stanhope, supra,
54 Cal.App.2d 141, 128 P.2d 705. There, plaintiff sustained a broken back while moving a water
heater at home. A friend transported him to the Los Angeles College of Chiropractic. (
Id.
at pp. 142-143, 128 P.2d 705.) Plaintiff