Williams v. the Columbus Clinic, P.C.

SECOND DIVISION
ANDREWS, P. J.,
MILLER and BRANCH, JJ.

NOTICE: Motions for reconsideration must be
physically received in our clerk’s office within ten
days of the date of decision to be deemed timely filed.
http://www.gaappeals.us/rules/

June 15, 2015

In the Court of Appeals of Georgia
A15A0559. WILLIAMS v. THE COLUMBUS CLINIC, P.C.

ANDREWS, Presiding Judge.

After the Columbus Clinic, P.C. (the “Clinic”) terminated Reginald A.

Williams’ employment as a physician, Williams filed a complaint in the trial court

asserting claims for breach of contract. The parties filed cross-motions for partial

summary judgment as to the Clinic’s liability on Count 1 of the complaint, which

alleged that the Clinic violated the termination provisions of Williams’ employment

agreement, and the trial court granted the Clinic’s motion and denied Williams’

motion. Williams appeals, arguing that the trial court erred in concluding that the

Clinic was authorized to terminate his employment for cause when a hospital

“restricted” his privileges by imposing a proctorship on him. As set forth below, we
conclude that a genuine issue of material fact remains as to whether the proctorship

was a restriction of privileges, and we therefore reverse.

On appeal from the grant of summary judgment this Court conducts a de
novo review of the evidence to determine whether there is a genuine
issue of material fact and whether the undisputed facts, viewed in the
light most favorable to the nonmoving party, warrant judgment as a
matter of law.

(Citation and punctuation omitted.) Del Lago Ventures v. QuikTrip Corp., 330 Ga.

App. 138, 139 (764 SE2d 595) (2014).

So viewed, the record shows that Williams and the Clinic entered into a

Physician Employment Agreement (the “Agreement”) on December 31, 2008 under

which Williams was to “provide professional medical and surgical services on behalf

of [the Clinic] as an exclusive employee of [the Clinic]” and receive a salary as set

forth in Exhibit A to the Agreement. The term of the Agreement was for one year

from its “Commencement Date” of January 15, 2009, and the Agreement provided

that “[u]nless terminated as provided herein, this Agreement shall automatically

renew for successive terms of one (1) year each upon the anniversary date of the

Commencement Date.” Section 7.1 of the Agreement sets forth the circumstances in

2
which the Clinic was entitled to terminate the Agreement for cause and provides in

relevant part:

[The Clinic] shall . . . have the right to terminate this Agreement
immediately, with cause, upon written notice to Physician if: . . . (ii)
Physician’s privileges or staff membership at any hospital are
terminated, revoked, suspended (other than for infrequent occurrences
due to the failure to complete medical records in a timely manner),
restricted, or terminated in any way (except for voluntary termination of
privileges undertaken at the request and with the consent of [the
Clinic]).

One of the Columbus hospitals where Williams had privileges was Doctors

Hospital (the “Hospital”). Williams was granted Medical Staff membership on the

Affiliate Staff at the Hospital in January 2009 and was granted Medical Staff

membership on the Active Staff in January 2010 with privileges to render certain

delineated professional services as approved by the Hospital’s Board of Directors. On

or about May 19, 2010, Williams was advised that the Medical Executive Committee

(“MEC”) of the Medical Staff of the Hospital was imposing a three-month

proctorship on him. On or about June 18, 2010, the Clinic notified Williams that it

was terminating his employment for cause under Section 7.1 (ii) of the Agreement,

effective June 25, 2010. The Clinic’s partners and board of directors believed that the

3
Clinic was authorized to terminate the Agreement for cause because the mandatory

proctorship imposed by the Hospital constituted a restriction of Williams’ privileges.

Article One of the Hospital’s Medical Staff Bylaws, which includes definitions,

states: “Clinical Proctoring is an objective evaluation of a Practitioner’s actual

clinical competence by a monitor or proctor who represents the Medical Staff and is

responsible to the Medical Staff.” Article Three of those bylaws subsequently states:

In most instances, proctors act as monitors to evaluate the technical and
cognitive skills of another Practitioner and do not directly participate in
patient care, have no physician/patient relationship with the patient
being treated, do not receive a fee from the patient, represent the
Medical Staff, and are responsible to the Medical Staff.

The record reflects that on or about June 15, 2010, Williams’ counsel sent a letter to

the Hospital’s General Counsel and Senior Executive Officer stating as follows:

As you are aware, Dr. Williams has cooperatively been operating with
a proctor for nearly a month now, despite the fact that the MEC has not,
until now, actually formulated a concrete set of requirements for the
proposal. Dr. Williams is prepared and willing to continue his
cooperation with a reasonable proctorship program . . . The proposal
from the MEC, however, is not acceptable in several particulars.

4
Williams’s counsel stated that, among other issues, the proposal was unclear and

contradictory as to whether Williams must have the approval of the proctor before

performing elective surgical procedures. Williams’ counsel stated that Williams

would not agree to such a requirement, explaining: “Such a restriction adversely

affects Dr. Williams’ clinical privileges in a very concrete way and, therefore,

constitutes an adverse action that would entitle Dr. Williams to a fair hearing” under

the Medical Staff Bylaws. Williams’ counsel’s letter stated that it was including a

revised proctorship proposal. The Hospital’s outside counsel responded by letter

dated June 18, 2010, stating:

The role of the proctor is not to substitute his/her judgment for that of
Dr. Williams, but to assist, advise as requested, observe and report. The
proctor need not concur in the selection of the surgical procedure, but
the proctor’s concerns or disagreement should be noted and evaluated.
As such, the proctoring requirements are not reportable to the National
Practitioner Data Bank and do not constitute an adverse action that gives
rise to the right to request a hearing. The clarified criteria are enclosed
with this letter.

The Medical Staff Bylaws define an “adverse action” as “[a]n action that

adversely affects an individual’s Medical Staff membership or clinical privileges.”

Article Seven of the Medical Staff Bylaws provides that “[o]nly individuals who are

5
subject to an adverse recommendation or action are entitled to a hearing under these

Bylaws” and lists recommendations or actions that are deemed adverse; a proctorship

is not among them. The list, however, identifies as an adverse action the

“[i]nvoluntary imposition of significant consultation requirements where the

supervising Practitioner has the power to supervise, direct, or transfer care from the

Practitioner under review.” The Hospital did not report the proctorship to the National

Practitioner Data Bank (“NPDB”) or any Georgia licensing board. Under Article Six

of the Medical Staff Bylaws, the Hospital’s Chief of Staff, a Department Chairperson,

or the Chief Executive Officer may impose a summary suspension or restriction of the

clinical privileges of a physician in certain urgent circumstances, including where

“the conduct of an individual with clinical privileges appears to require that

immediate action be taken to protect the life or well-being of a patient(s).” Williams

was not subject to a summary suspension or restriction of privileges under Article Six

on or before June 25, 2010.

In granting partial summary judgment in the Clinic’s favor, the trial court

summarily concluded that Section 7.1 (ii) of the Agreement was clear, concise,

controlling, and unambiguous and that the Clinic was authorized to terminate the

Agreement when the Clinic imposed a proctorship on Williams. Williams argues that

6
the trial court erred, as the proctorship did not give the Clinic cause to terminate the

Agreement.

1. Construction of Section 7.1 (ii). “Construing the terms of an express contract

is generally a question of law for the court, unless an ambiguity is presented which

cannot be resolved by the ordinary rules of construction.” 4 G Properties v. GALS

Real Estate, 289 Ga. App. 315, 316 (656 SE2d 922) (2008). The cardinal rule of

contract construction is to ascertain the intent of the parties at the time they entered

the agreement. Gonzalez v. Crocket, 287 Ga. 430, 433 (696 SE2d 623) (2010). While

contractual terms generally carry their ordinary meanings, Lafarge Bldg. Materials

v. Thompson, 295 Ga. 637, 640 (763 SE2d 444) (2014), “technical words, or words

of art, or used in a particular trade or business, will be construed, generally, to be used

in reference to this peculiar meaning.” (Citation and punctuation omitted.) Pace

Constr. Corp. v. Houdaille-Duval-Wright Div., Houdaille Indus., 247 Ga. 367 (276

SE2d 568) (1981); see also OCGA § 13-2-2 (2). We must always consider the context

in which a contractual term appears in determining its meaning. Archer Western

Contractors v. Estate of Pitts, 292 Ga. 219, 224 (2) (735 SE2d 772) (2012).

With these principles in mind, we turn to the language in Section 7.1 (ii) of the

Agreement authorizing the Clinic to terminate the Agreement for cause if Williams’

7
“privileges . . . at any hospital are . . .restricted.” The Clinic maintains that we need

look no further than the dictionary definition of “restrict” to determine the meaning

of “restricted” in Section 7.1 (ii). Those definitions include “to confine or keep within

limits, as of space, action, choice, or quantity.”

http://www.thefreedictionary.com/restrict (citing Random House Kernerman

Webster’s College Dictionary (2010)), or, similarly, “to confine or keep within certain

often specified limits or selected bounds.” Id. (citing Collins English Dictionary

(2003)). We conclude, however, that it is readily apparent from the context in which

“restricted” appears in this Agreement that we must look beyond a dictionary to

determine the intended meaning of the term.

The term “restricted” is used in Section 7.1 (ii) in relation to hospital

“privileges.” The privileges accorded to a physician to treat patients at a hospital are

by their very nature always “restricted” within the ordinary or dictionary definition

of the term. According to one medical dictionary, “privileges” refers to “authority

granted to a physician or dentist by a hospital governing board to provide patient care

in the hospital.” http://medical-dictionary.thefreedictionary.com/privileges (citing

Mosby’s Medical Dictionary (8th ed. 2009)). The same definition states: “Clinical

privileges are limited by the individual’s professional license, experience, and

8
competence.” Id. The Hospital’s Medical Staff Bylaws define “privileges,” in relevant

part, as: “Authorization granted by the Board to an individual to provide specific

patient care services in the Hospital within defined limits, based on the individual’s

license, education, training, experience, competence, health status, judgment and

individual character,” and further explain that clinical privileges granted to physicians

“shall be delineated on an individual basis.” Thus, privileges granted to physicians

are always restricted in the sense that they will not extend beyond the physician’s area

of expertise. Further, a physician’s privileges are always restricted in that they are

conditioned on or subject to the specific requirements of a hospital’s medical staff

bylaws and rules and regulations. See Stein v. Tri-City Hosp. Auth., 192 Ga. App. 289

(384 SE2d 430) (1989) (physician’s hospital privileges permissibly terminated when

he failed to comply with bylaw relating to liability insurance). The Hospital’s Medical

Staff Bylaws, for example, require every applicant for privileges to agree to various

requirements, including to “[a]bide by these Bylaws, the Rules and Regulations, and

all other rules, policies and procedures, guidelines, and other requirements of the

Medical Staff and the Hospital.” Given that every physician’s privileges are

necessarily “restricted,” interpreting “restricted” in its ordinary sense here would

9
mean that the Clinic essentially enjoyed an unfettered right of termination, a result

contrary to the parties’ clear intent to create a non-at-will employment relationship.

We agree with Williams that a “restriction” of privileges at a hospital is a word

or term of art that should be interpreted in accordance with its “peculiar meaning” in

this context. See Vineville Capital Group v. McCook, 329 Ga. App. 790, 795 (766

SE2d 156) (2014). The term “restricting” appears in the Health Care Quality

Improvement Act (“HCQIA”), 42 USC §§ 11101-11152. Under the HCQIA, a

hospital that “takes a professional review action that adversely affects the clinical

privileges of a physician for a period longer than 30 days; . . . shall report [the action]

to the [State] Board of Medical Examiners,” 42 USC § 11133 (a) (1) (A), and under

the HCQIA’s implementing regulations also must report the action to the NPDB. 45

CFR § 60.12 (a) (1). A “professional review action” is defined in pertinent part as “an

action or recommendation of a professional review body which is taken or made in

the conduct of professional review activity, which is based on the competence or

professional conduct of an individual physician . . . and which affects (or may affect)

adversely the clinical privileges . . . of the physician.” 42 USC § 11151 (9). “The term

‘adversely affecting’ includes reducing, restricting, suspending, revoking, denying,

10
or failing to renew clinical privileges or membership in a health care entity.”

(Emphasis supplied.) 42 USC § 11151 (1); see also 45 CFR § 60.3.

Although neither the HCQIA or the regulations thereunder provide a definition

of “restrict,” the 2001 National Practitioner Data Bank Guidebook (“2001 NPDB

Guidebook”), portions of which are included in the record, contains pertinent

guidance. The guidebook provides examples of actions that are reportable and non-

reportable, and states that it would not be reportable if “based on assessment of

professional competence, a proctor is assigned to supervise a physician . . . but the

proctor does not grant approval before medical care is provided by the practitioner.”

2001 NPDB Guidebook at E-21.1 Also instructive are cases addressing when a

1
The Health Resources and Services Administration of the U.S. Department of
Health and Human Services published a revised NPDB Guidebook this year (the
“2015 NPDB Guidebook”), with additional guidance on the meaning of “restriction”
and the circumstances under which a proctorship constitutes a restriction. It states that
“[w]hen used by the NPDB in the context of clinical privileges actions, a ‘restriction’
is the result of a professional review action based on clinical competence or
professional conduct that leads to the inability of a practitioner to exercise his or her
own independent judgment in a professional setting.” 2015 NPDB Guidebook at E-
32. The guidebook further explains that “[i]f, for a period lasting more than 30 days,
the physician . . . cannot perform certain procedures without proctor approval or
without the proctor being present and watching the physician, . . . the action
constitutes a restriction of clinical privileges.” Id. at E-37. We recognize, however,
that these specific statements are not germane to determining the intent of the parties
when they entered the Agreement in December 2008. See Gonzalez, supra, 287 Ga.
at 433.

11
hospital’s action rises to the level of a professional review action that does or may

adversely affect a physician’s privileges for purposes of the HCQIA. In Mathews v.

Lancaster Gen. Hosp., the Third Circuit concluded that a letter recommending

focused outside review of certain cases that had been identified by a hospital

committee as involving substandard care was not a “professional review action.” 87

F3d 624, 634 (3d Cir. 1996). The Third Circuit stated generally that a “decision or

recommendation to monitor the standard of care provided by a physician or

factfinding to ascertain whether a physician has provided adequate care” were

professional review activities,2 i.e., preliminary investigative measures taken in a

reasonable effort to obtain facts relevant to a possible change in privileges, not

professional review actions. Id. Courts, citing Mathews, have concluded that auditing

a physician is not a professional review action, Singh v. Blue Cross and Blue Shield

of Massachusetts, 182 FSupp2d 164, 171 (D. Mass.2001), nor is a recommendation

that a physician submit to an outside professional evaluation. Morgan v. PeaceHealth,

2
The term “professional review activity” is defined by the HCQIA as “an
activity of a health care entity with respect to an individual physician - (A) to
determine whether the physician may have clinical privileges with respect to, or
membership in, the entity, (B) to determine the scope or conditions of such privileges
or membership, or (C) to change or modify such privileges or membership.” 42 USC
§ 11151 (10).

12
14 P3d 773, 782 (Wash. App. 2000); see also Wood v. Archbold Med. Center, 738

FSupp2d 1298, 1363 (M.D. Ga. 2010) (recommendation that physician undergo

outside psychiatric evaluation not professional review action). If the actions or

recommendations discussed in Mathews, Morgan, and Wood did not constitute

reportable professional review actions, they necessarily did not adversely affect or

restrict physician privileges. By contrast, in Azmat v. Shalala, the court held that a

letter recommending that a surgeon obtain a second opinion on all procedures that

were not immediately life-threatening and acquire assistance from a second physician

on all major cases were recommended restrictions on his privileges reportable under

the HCQIA. 186 FSupp2d 744, 750 (W.D. Ky. 2001); see also Fobbs v. Holy Cross

Health System Corp., 789 FSupp 1054, 1064 (E.D. Cal. 1992), aff’d 29 F3d 1439 (9th

Cir. 1994) (monitoring constraints under which physician was required to have

second opinion on every admission and monitor was to be present during operations

and to participate in follow-up care constituted professional review action).

Considering these authorities, we conclude that at the time of contracting the parties

would not have understood a hospital’s decision to appoint a proctor to monitor or

evaluate a physician or his or her standard of care as a restriction of privileges unless

13
the hospital imposed conditions or limitations that would impact the physician’s

independence or autonomy in providing care to patients.

2. Whether the proctorship is a restriction. Turning to the issue of whether the

proctorship imposed upon Williams constituted a restriction on his privileges under

the construction of the Agreement set forth in Division 1, we conclude that an issue

of material fact remains.

Determining whether the proctorship was a restriction on Williams’ privileges

requires examination of the specific terms and conditions of the proctorship. As set

forth above, the Hospital’s Medical Staff Bylaws provide that “[i]n most instances,

proctors act as monitors to evaluate the technical and cognitive skills of another

Practitioner and do not directly participate in patient care, have no physician/patient

relationship with the patient being treated, do not receive a fee from the patient,

represent the Medical Staff, and are responsible to the Medical Staff.” (Emphasis

supplied.) While this provision may suggest that a proctor’s role typically is solely

evaluative, it also leaves open the possibility that a proctor could assume different or

additional responsibilities. The record in this case contains scant evidence on the

terms of the proctorship under which Williams operated. The record establishes that

Williams learned of the proctorship in mid-May 2010, but it is silent as to what

14
proctorship terms the Hospital communicated to Williams at that time or what

information Williams or the Hospital conveyed to the Clinic about the proctorship.

The record also shows that although Williams began operating under a proctorship

in May, the Hospital and Williams were communicating in June 2010 about the

definitive terms of the proctorship. The draft proctorship proposals exchanged by the

parties are not in the record, and the record does not contain evidence as to the final

proctorship terms, if any, to which the parties agreed. The Hospital’s outside

counsel’s June 18, 2010 letter to Williams’ counsel states that the proctor would not

have to concur in Williams’ selection of surgical procedures, which, according to the

guidance in the 2001 NPDB Guidebook, would militate in favor of finding that the

proctorship was not a “restriction.” But even assuming that the parties reached an

agreement on that particular point, we cannot know whether there were any additional

terms associated with the proctorship that, similar to those in Azmat, supra, and

Fobbs, supra, would rise to the level of restricting Williams’ privileges. We

acknowledge that it is undisputed that the Hospital did not report the proctorship to

the NPDB as an adverse action. While certainly favorable to Williams’ position, we

cannot say that the Hospital’s assessment of the effect of the proctorship on Williams’

privileges is dispositive. The Clinic argues that Williams conceded that the

15
proctorship was a restriction because in pleadings he filed in federal and state actions

against the Hospital and other parties, he stated that a “proctorship was first imposed

on [his] privileges at [the] Hospital . . . in May, 2010.” The Clinic maintains that these

statements constitute evidentiary admissions. We disagree with the Clinic’s position,

as Williams did not characterize the proctorship as a “restriction” in these pleadings,

and his allegation that a proctorship was “imposed” on his privileges includes no

specific details about how the proctorship impacted his privileges. Under the

circumstances, a material issue of fact exists as to whether Williams’ proctorship

restricted his privileges under Article 7.1 (ii) of the Agreement.

Based on the foregoing, the trial court erred in concluding as a matter of law

that the Clinic was authorized to terminate the Agreement when the Hospital imposed

a proctorship on Williams, and we therefore reverse its order on the parties’ cross-

motions for partial summary judgment.

Judgment reversed. Miller and Branch, JJ., concur.

16