Case Title: Sanchez v. MediCorp Health System

Citation: 

Docket Number: 042741

State: virginia

Court: Virginia Supreme Court

Date: 2005-09-16T00:00:00Z

Document:
Present:  All the Justices 
 
LEASLY SANCHEZ 
 
v.  Record No. 042741  OPINION BY JUSTICE CYNTHIA D. KINSER 
 
 
 
 
 
 
        September 16, 2005 
MEDICORP HEALTH SYSTEM, d/b/a 
MARY WASHINGTON HOSPITAL, INC. 
 
FROM THE CIRCUIT COURT OF THE CITY OF FREDERICKSBURG 
William H. Ledbetter, Jr., Judge 
 
In this appeal, the question is whether the theory of 
apparent or ostensible agency applies to a hospital, 
thereby making the hospital vicariously liable for the 
alleged negligence of an emergency room physician who was 
an independent contractor.  Because we decline to adopt 
that theory in the context presented in this case, we will 
affirm the circuit court’s judgment sustaining a demurrer. 
FACTS AND PROCEEDINGS1 
 
The plaintiff, Leasly Sanchez, sought treatment for a 
head wound in the emergency room at Medicorp Health System, 
d/b/a Mary Washington Hospital, Inc. (Medicorp).  
Christopher Huesgen, M.D., treated Sanchez in the emergency 
room for his injuries.  Dr. Huesgen was an employee of 
Fredericksburg Emergency Medical Associates, Inc. 
(Fredericksburg EMA).  As a result of alleged negligent 
                     
1 This appeal comes to us from the circuit court’s 
decision sustaining a demurrer.  We therefore “recite as 
true the well-pleaded facts in the motion for judgment.”  
Thompson v. Skate America, Inc., 261 Va. 121, 124-25, 540 
S.E.2d 123, 124 (2001). 
 
2
care and treatment in the emergency room, Sanchez claimed 
that he developed permanent weakness on his left side.  
Consequently, Sanchez filed a medical malpractice action 
against Medicorp, Fredericksburg EMA, and Dr. Huesgen. 
In his motion for judgment, Sanchez alleged that Dr. 
Huesgen was an employee and agent of Fredericksburg EMA and 
was acting within the scope of his employment at all times 
relevant to the allegations of negligence.  Sanchez also 
alleged that Medicorp held out Dr. Huesgen as its employee 
and agent and that Medicorp was therefore vicariously 
liable for Dr. Huesgen’s alleged negligence under the 
theory of apparent or ostensible agency.2 
Medicorp filed a demurrer, asserting that a claim for 
vicarious liability based on the theory of apparent or 
ostensible agency is not cognizable under Virginia law.  
The circuit court agreed and sustained Medicorp’s demurrer.  
In a letter opinion, the court noted that the theory of 
apparent agency is not merely an extension of the doctrine 
of respondeat superior.  Instead, reasoned the court, it is 
different because in apparent agency – unlike the situation 
when the doctrine of respondeat superior applies – there is 
                     
2 Sanchez does not claim that Dr. Huesgen was an 
employee of Medicorp, rather than an independent 
contractor, based on the factors discussed in McDonald v. 
Hampton Training Sch. for Nurses, 254 Va. 79, 86-87, 486 
S.E.2d 299, 303-04 (1997). 
 
3
no actual master-servant relationship.  Continuing, the 
circuit court recognized that an employer could, however, 
be liable for the negligence of an independent contractor 
if the employer had a non-delegable duty to a third party, 
but the court concluded that Medicorp did not have a non-
delegable duty to provide competent medical treatment to 
emergency room patients.  Although the circuit court 
sustained the demurrer, it granted Sanchez leave to file an 
amended motion for judgment if he could allege specific 
conduct by Medicorp “tantamount to a fraudulent 
representation that Dr. Huesgen was an employee of Mary 
Washington Hospital.” 
Sanchez subsequently filed both a motion to reconsider 
and an amended motion for judgment.  The circuit court 
denied the motion to reconsider.  The court also dismissed 
the claim against Medicorp with prejudice, finding that 
Sanchez’s amended motion for judgment did not contain the 
specific allegations of fraudulent representations as 
required by its previous order.  Sanchez appeals.3 
ANALYSIS 
                     
3 The issue raised by Medicorp’s demurrer is appealable 
under the “severable” interest rule.  See Maitland v. 
Allen, 267 Va. 714, 718 n.2, 594 S.E.2d 918, 920 n.2 
(2004). 
 
4
A trial court’s decision sustaining a demurrer 
presents a question of law on appeal.  Glazebrook v. Board 
of Supervisors, 266 Va. 550, 554, 587 S.E.2d 589, 591 
(2003).  Thus, we review the circuit court’s judgment in 
this case de novo.  Id. 
A demurrer tests the legal sufficiency of facts 
alleged in a plaintiff’s pleading.  Id.  A trial court must 
consider the pleading in the light most favorable to the 
plaintiff and sustain the demurrer if the pleading fails to 
state a valid cause of action.  W.S. Carnes, Inc. v. Board 
of Supervisors, 252 Va. 377, 384, 478 S.E.2d 295, 300 
(1996). 
In the sole assignment of error, Sanchez asserts that 
the circuit court erred in “sustaining the . . . demurrer 
and holding that Virginia does not recognize vicarious 
liability in negligence cases, specifically, in the context 
of emergency physician-hospital relationships, based upon 
the theory of apparent or ostensible agency.”  Sanchez 
urges this Court to hold that a hospital can be vicariously 
liable for the alleged negligence of a doctor working in 
the hospital’s emergency room as an independent contractor 
on the theory of apparent or ostensible agency.  Sanchez 
relies, in part, on the decision in Walker v. Winchester 
Memorial Hospital, 585 F. Supp. 1328 (W.D. Va. 1984), and 
 
5
argues that there is a national trend to apply this theory 
to hospitals because today’s hospitals “are more than 
simply places for patients to eat and sleep while being 
attended by their own physicians.” 
Initially, we note the difference between the terms  
“apparent authority” and “apparent or ostensible agency.”  
The former concerns the “[a]uthority that a third party 
reasonably believes an agent has, based on the third 
party’s dealings with the principal, even though the 
principal did not confer or intend to confer the 
authority.”  Black’s Law Dictionary 142 (8th ed. 2004).  In 
Bardach Iron & Steel Co. v. Charleston Port Terminals, 143 
Va. 656, 673, 129 S.E. 687, 692 (1925), we stated: 
[A]s between the principal and agent and third 
persons, the mutual rights and liabilities are 
governed by the apparent scope of the agent’s 
authority, which is that authority which the 
principal has held the agent out as possessing, 
or which he has permitted the agent to represent 
that he possesses, in which event the principal 
is estopped to deny that the agent possessed the 
authority which he exercised. 
 
Accord Wright v. Shortridge, 194 Va. 346, 352-53, 73 S.E.2d 
360, 364 (1952).  The definition of the term “apparent 
authority” presupposes the existence of an agency 
relationship and concerns the authority of the agent.  See 
Morris v. Dame, 161 Va. 545, 572-73, 171 S.E. 662, 672 
(1933) (discussing whether a servant who is driving a 
 
6
vehicle for his master has ostensible authority by virtue 
of the employment to allow another person to ride in the 
vehicle for a purpose having no connection with the 
master’s business). 
In contrast, the term “apparent or ostensible agency” 
(sometimes also called “agency by estoppel,” see Chandler 
v. Kelley, 149 Va. 221, 232, 141 S.E. 389, 392 (1928)), 
means “[a]n agency created by operation of law and 
established by a principal’s actions that would reasonably 
lead a third person to conclude that an agency exists.”  
Black’s Law Dictionary 67 (8th ed. 2004); see also Title 
Ins. Co. of Richmond, Inc. v. Howell, 158 Va. 713, 724, 164 
S.E. 387, 391 (1932) (“[o]ne who permits another to hold 
himself out as agent and appears to acquiesce in that 
assumption of authority is bound thereby”); Hardin v. 
Alexandria Ins. Co., 90 Va. (15 Hans.) 413, 416-17, 18 S.E. 
911, 911-13 (1894) (insurance company held individual out 
to the public at large as the company’s agent through whom 
all transactions with the company had to pass); Gallagher 
v. Washington County Sav., Loan & Bldg. Co., 25 S.E.2d 914, 
919 (W. Va. 1943) (quoting Restatement (First) of Agency 
§ 8, cmt. a:  “ ‘[a]n apparent agent is a person who, 
whether or not authorized, reasonably appears to third 
persons, because of the manifestations of another, to be 
 
7
authorized to act as agent for such other’ ”).  In this 
case, we are concerned with the concept of apparent or 
ostensible agency.4 
In Virginia, the doctrine of respondeat superior 
imposes tort liability on an employer for the negligent 
acts of its employees, i.e., its servants, but not for the 
negligent acts of an independent contractor.  McDonald v. 
Hampton Training Sch. for Nurses, 254 Va. 79, 81, 486 
S.E.2d 299, 300-01 (1997); Norfolk & W. Ry. Co. v. Johnson, 
207 Va. 980, 983, 154 S.E.2d 134, 137 (1967); Smith v. 
Grenadier, 203 Va. 740, 747, 127 S.E.2d 107, 112 (1962); 
Griffith v. Electrolux Corp., 176 Va. 378, 387, 11 S.E.2d 
644, 648 (1940); see also Restatement (Second) of Torts 
§ 409 (“the employer of an independent contractor is not 
liable for physical harm caused to another by an act or 
omission of the contractor or his servants”); Restatement 
(Second) of Agency § 250 (liability does not pass to “[a] 
principal . . . for physical harm caused by the negligent 
physical conduct of a non-servant agent during the 
performance of the principal’s business, if he neither 
intended nor authorized the result nor the manner of 
                     
4 Some courts use the terms “apparent authority” and 
“apparent agency” interchangeably.  See Baptist Mem’l Hosp. 
Sys. v. Sampson, 969 S.W.2d 945, 947 n.2 (Tex. 1998).  We 
believe that there is a distinction between the terms that 
should not be blurred. 
 
8
performance, unless he was under a duty to have the act 
performed with due care”).  This is so because no master-
servant relationship exists between an employer and an 
independent contractor.  McDonald, 254 Va. at 81, 486 
S.E.2d at 300-01. 
Apparent or ostensible agency is sometimes described 
as an exception to the general principle that an employer 
is not vicariously liable for the negligence of an 
independent contractor.5  The Restatement (Second) of Torts 
§ 429 explains the exception in this manner: 
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. 
 
                     
5 In Virginia, we recognize certain exceptions to the 
general rule that an employer is not liable for injuries 
caused by the negligence of an independent contractor: 
“ ‘if the independent contractor’s torts arise directly out 
of his use of a dangerous instrumentality, arise out of 
work that is inherently dangerous, are wrongful per se, are 
a nuisance, or are such that it would in the natural course 
of events produce injury unless special precautions were 
taken.’ ”  Southern Floors & Acoustics, Inc. v. Max-Yeboah, 
267 Va. 682, 687 n.1, 594 S.E.2d 908, 911 n.1 (2004) 
(quoting Kesler v. Allen, 233 Va. 130, 134, 353 S.E.2d 777, 
780 (1987)).  Additionally, a landlord’s common law duty to 
maintain the premises in a reasonably safe condition cannot 
be delegated to an independent contractor.  Love v. 
Schmidt, 239 Va. 357, 360-61, 389 S.E.2d 707, 709-10 
(1990). 
 
9
Similarly, Restatement (Second) of Agency § 267 provides: 
One who represents that another is his servant or 
other agent and thereby causes a third person 
justifiably to rely upon the care or skill of 
such apparent agent is subject to liability to 
the third person for harm caused by the lack of 
care or skill of the one appearing to be a 
servant or other agent as if he were such. 
These two Restatement sections have one critical 
difference.  Under the stricter standard of § 267 of the 
Restatement (Second) of Agency, which embraces the theory 
of agency by estoppel, a showing of justifiable reliance by 
the injured person upon the representations of the 
principal is required; whereas, reliance is not a factor in 
§ 429 of the Restatement (Second) of Torts.6 
Sanchez acknowledges that this Court has never 
addressed the question whether a hospital can be 
vicariously liable, based on the theory of apparent or 
ostensible agency, for the negligence of its emergency room 
physician working as an independent contractor.  He, 
nevertheless, argues that the doctrine of apparent or 
ostensible agency is well-settled in Virginia 
jurisprudence.  The cases cited by Sanchez in support of 
that proposition, as well as the cases relied on by the 
federal district court in Walker, specifically Neff Trailer 
                     
6 See Jackson v. Power, 743 P.2d 1376, 1380 (Alaska 
1987) for a comparison of the two sections. 
 
10
Sales, Inc. v. Dellinger, 221 Va. 367, 370-71, 269 S.E.2d 
386, 388 (1980); Wright, 194 Va. at 352-53, 73 S.E.2d at 
364-65; Bardach Iron & Steel Co., 143 Va. at 673, 129 S.E. 
at 692; J.C. Lysle Milling Co. v. S.W. Holt & Co., 122 Va. 
565, 570-71, 95 S.E. 414, 416 (1918), all involved not only 
claims based on contract but also questions about the 
“apparent authority” of an agent.  None of the cases 
actually addressed the issue of “apparent or ostensible 
agency.” 
We have applied the theory of apparent or ostensible 
agency in cases involving contract claims.  See, e.g., 
American Sec. & Trust Co. v. John J. Juliano, Inc., 203 Va. 
827, 833-34, 127 S.E.2d 348, 352 (1962); Title Ins. Co. of 
Richmond, 158 Va. at 724, 164 S.E. at 391; Hardin, 90 Va. 
(15 Hans.) at 416-17, 18 S.E. at 911-13.  But, in the tort 
context, we have mentioned apparent agency only once, in 
Murphy v. Holiday Inns, Inc., 216 Va. 490, 491-92, 219 
S.E.2d 874, 875 (1975).  However, in that slip and fall 
case, we did not decide the issue of apparent agency 
because the plaintiff had not properly preserved the issue 
for appeal.  Id.  In Southern Floors & Acoustics, Inc. v. 
Max-Yeboah, 267 Va. 682, 687, 594 S.E.2d 908, 911 (2004), 
we discussed the possible theories of liability of a 
property owner for injuries to a third party resulting from 
 
11
conditions caused by the negligence of an independent 
contractor but did not include apparent agency as a theory 
of recovery against the property owner.  See also Harbour 
Enters., Inc. v. Ferro, 231 Va. 71, 74, 340 S.E.2d 818, 819 
(1986) (holding that a landlord was not vicariously liable 
to a tenant’s business invitee for personal injuries where 
the landlord allowed its liquor license to remain posted on 
the premises, knowing that the tenant did not have a liquor 
license in its own name). 
 
Nevertheless, Sanchez points out that the majority of 
jurisdictions that have addressed the issue presently 
before us have decided, on the basis of apparent agency or 
agency by estoppel, to impose vicarious liability on 
hospitals for the negligence of emergency room physicians 
who were not employees of the hospitals but independent 
contractors.  See, e.g., Jackson v. Power, 743 P.2d 1376, 
1380-81 (Alaska 1987); Paintsville Hosp. Co. v. Rose, 683 
S.W.2d 255, 256-58 (Ky. 1985); Mehlman v. Powell, 378 A.2d 
1121, 1124 (Md. 1977); Houghland v. Grant, 891 P.2d 563, 
569 (N.M. Ct. App. 1995); Clark v. Southview Hosp. & Family 
Health Ctr., 628 N.E.2d 46, 53 (Ohio 1994); Smith v. St. 
Francis Hosp., Inc., 676 P.2d 279, 282 (Okla. Ct. App. 
1983); Baptist Mem’l Hosp. Sys. v. Sampson, 969 S.W.2d 945, 
949 (Tex. 1998); Torrence v. Kusminsky, 408 S.E.2d 684, 692 
 
12
(W. Va. 1991); Pamperin v. Trinity Mem’l Hosp., 423 N.W.2d 
848, 855 (Wis. 1988); but see Tolman v. IHC Hosps. Inc., 
637 F. Supp. 682, 684 (D. Utah 1986) (hospital not liable 
for the negligence of a radiologist working in the 
hospital’s emergency room); Austin v. Litvak, 682 P.2d 41, 
53-54 (Colo. 1984) (hospital not liable for the negligence 
of a treating physician after patient was admitted to the 
hospital). 
 
In virtually all these cases imposing vicarious 
liability, the particular jurisdiction involved had already 
adopted the theory of apparent agency or agency by estoppel 
as a basis of tort liability when the jurisdiction used the 
theory to hold a hospital vicariously liable for negligent 
medical care rendered by an emergency room physician 
working as an independent contractor.  See, e.g., Middleton 
v. Frances, 77 S.W.2d 425 (Ky. 1934); B.P. Oil Corp. v. 
Mabe, 370 A.2d 554 (Md. 1977); Chevron Oil Co. v. Sutton, 
515 P.2d 1283 (N.M. 1973); Stephens v. Yamaha Motor Co., 
Ltd., 627 P.2d 439 (Okla. 1981); Wyndham Hotel Co. v. Self, 
893 S.W.2d 630 (Tex. Ct. App. 1994); Iowa Nat’l Mutual Ins. 
Co. v. Backens, 186 N.W.2d 196 (Wis. 1971).  Unlike these 
jurisdictions, in Virginia, we have not previously imposed 
vicarious liability on an employer for the negligence of an 
independent contractor on the basis of apparent or 
 
13
ostensible agency, or agency by estoppel.  We find no 
reason to do so in the specific context presented in this 
case. 
CONCLUSION 
 
The theory of apparent or ostensible agency, or agency 
by estoppel, has never been used in Virginia to impose 
vicarious liability on an employer for the negligent acts 
of an independent contractor.  In light of that fact, we 
are unwilling to apply that theory in order to hold 
Medicorp vicariously liable for the alleged negligence of 
its independent contractor, Dr. Huesgen.  Thus, we will 
affirm the judgment of the circuit court.7 
Affirmed. 
                     
7 Sanchez also argues that the circuit court erred by 
finding that Medicorp had a non-delegable duty to provide 
competent care and treatment in its emergency room and was 
thus vicariously liable for Dr. Huesgen’s alleged 
negligence on that basis.  That separate finding of the 
circuit court, however, is not the subject of an assignment 
of error.  Thus, we do not address it.  Rule 5:17(c).