Title: Cady v. Schroll

State: kansas

Issuer: Kansas Supreme Court

Document:

1 
 
IN THE SUPREME COURT OF THE STATE OF KANSAS 
 
No. 103,499 
 
ANGELA CADY, 
Appellant, 
 
v. 
 
JOHN SCHROLL, M.D.,  
Defendant, 
 
WOMEN'S CARE, P.A., 
Appellee, 
 
CRISTINE CARRIKER, M.D., MAUREEN KING, M.D., 
MICHAEL MAGEE, M.D., JULIE MARTIN, M.D., 
BRENDAN MITCHELL, M.D., ANGELA PIQUARD, M.D.,  
and ROBERT SUGAR, M.D., 
Defendants. 
 
 
SYLLABUS BY THE COURT 
 
 
1. 
 
By enacting K.S.A. 40-3403(h), which provides that a health care provider "shall 
have no vicarious liability or responsibility for any injury . . . arising out of the rendering 
of or the failure to render professional services . . . by any other health care provider," the 
Kansas Legislature clearly abrogated vicarious liability where both health care providers, 
as defined in K.S.A. 40-3401(f), are qualified for coverage under the Health Care 
Stabilization Fund created by the Health Care Provider Insurance Availability Act, 
K.S.A. 40-3401 et seq. 
 
2. 
K.S.A. 40-3403(h) absolves a health care provider not just from vicarious liability 
but from any responsibility, including independent liability, if the injured party's damages 
 
2 
 
are derivative of and dependent upon the rendering of or the failure to render professional 
services by another health care provider. 
 
3. 
 
K.S.A. 40-3403(h) bars a professional corporation's liability for negligent 
supervision of a health care provider employed by the corporation if the employee is 
qualified for coverage under the Health Care Stabilization Fund created by the Health 
Care Provider Insurance Availability Act, K.S.A. 40-3401 et seq., the plaintiff's injuries 
are derivative of and dependent upon the employee's actions in rendering professional 
services to the plaintiff, and no employee of the professional corporation who is not 
qualified for coverage provided negligent care and treatment to the plaintiff.  
 
 
Review of the judgment of the Court of Appeals in an unpublished opinion filed June 17, 2011. 
Appeal from Johnson District Court; JANICE D. RUSSELL and DAVID W. HAUBER, judges. Opinion filed 
January 24, 2014. Judgment of the Court of Appeals affirming the district court is affirmed. Judgment of 
the district court is affirmed.  
 
 
Roger P. Wright, of Wright, Green & Baughman, L.L.C., of Lee's Summit, Missouri, argued the 
cause, and Lance V. Baughman and Theodore M. Green, of the same firm, were with him on the briefs for 
appellant. 
 
 
BK Christopher, of Horn Aylward & Bandy, LLC, of Kansas City, Missouri, argued the cause, 
and Jessica J. Shaw and John B. McEntee, Jr., of the same firm, were with her on the briefs for appellee.  
 
The opinion of the court was delivered by 
 
 
LUCKERT, J.:  K.S.A. 40-3403(h) provides that a health care provider qualified for 
coverage under the Health Care Stabilization Fund created by the Health Care Provider 
Insurance Availability Act (HCPIAA), K.S.A. 40-3401 et seq., "shall have no vicarious 
liability or responsibility for any injury . . . arising out of the rendering of or the failure to 
render professional services . . . by any other health care provider who is also qualified 
 
3 
 
for coverage under the fund." Past decisions of this court have interpreted this provision 
broadly, concluding it bars a covered health care provider's vicarious liability and any 
other responsibility, including independent or direct liability, for claims caused by the 
professional services of another health care provider. Angela Cady argues these cases 
were wrongly decided, are distinguishable, or have been effectively overruled. 
Consequently, Cady contends the district court and Court of Appeals in Cady v. Schroll, 
No. 103,499, 2011 WL 2535004 (Kan. App. 2011) (unpublished opinion), erred in 
relying on those cases and holding that her action against Women's Care, P.A., the health 
care provider that employed her physician, was barred by K.S.A. 40-3403(h). We 
disagree and affirm the district court and the Court of Appeals.  
 
FACTS AND PROCEDURAL BACKGROUND 
 
 
Cady filed suit against her obstetrician, John Schroll, M.D., and Schroll's 
employer, Women's Care, P.A., after Schroll provided Cady's prenatal care during her 
pregnancy in 2004. Cady alleges that Schroll touched her inappropriately and made 
sexually charged comments during her office visits. Unbeknown to Cady, Schroll had 
previously been disciplined by the Kansas State Board of Healing Arts (Board) for his 
inappropriate and unprofessional behavior with two other patients. 
 
 
In Cady's petition, she named Schroll, Women's Care, and seven other physicians 
as defendants. Schroll and the other physicians were employed by and shareholders of 
Women's Care, a professional corporation. She asserted four claims against the 
defendants:  medical negligence, negligent infliction of emotional distress, negligent 
supervision, and intentional infliction of emotional distress. In her petition, Cady alleged 
Women's Care was (1) vicariously liable for the acts and omissions of Schroll and (2) 
independently liable because it failed to supervise Schroll, failed to prevent him from 
engaging in inappropriate conduct with her, failed to inform her of Schroll's prior 
disciplinary record, and failed to institute safeguards to prevent Schroll's conduct.  
 
4 
 
 
Cady made several factual allegations to support these claims. Specifically, she 
alleged that before she became Schroll's patient, Women's Care knew about Schroll's 
prior inappropriate conduct and knew he had been disciplined by the Board. Cady further 
alleged that Women's Care had documented this knowledge in a "letter of concern" sent 
to Schroll in which Women's Care indicated that Schroll's inappropriate conduct had 
continued despite Women's Care's concerns having been discussed with Schroll, 
suggested Schroll be evaluated by a psychologist, and requested that a nurse be present 
during all of Schroll's patient examinations. Despite these concerns and requests, Cady 
asserted that Schroll was the only Women's Care employee present when the 
inappropriate conduct occurred.  
 
As legal proceedings progressed, Cady entered into a separate settlement 
agreement with Schroll, and the district court dismissed the case against him with 
prejudice. The district court also dismissed with prejudice all of Cady's claims against the 
other physicians named in the lawsuit. Cady does not appeal any claims involving Schroll 
or the other physicians. Consequently, this appeal focuses solely on the liability, or lack 
thereof, of Women's Care.  
 
Women's Care's potential for liability was ruled upon by the district court after 
Women's Care filed a motion to dismiss and, subsequently, a motion for summary 
judgment. The district court, treating both motions as ones for summary judgment, held 
that Cady's claims against Women's Care were barred by K.S.A. 40-3403(h). The Court 
of Appeals affirmed the district court. Cady, 2011 WL 2535004, at *5. This court granted 
Cady's petition for review under K.S.A. 20-3018(b) and has jurisdiction under K.S.A. 
60-2101(b).  
 
 
 
 
 
5 
 
STANDARD OF REVIEW 
 
If a district court considers uncontroverted facts not contained in the pleadings 
when ruling on a motion to dismiss, the motion is treated as a motion for summary 
judgment. "Summary judgment is appropriate when the pleadings, depositions, answers 
to interrogatories, and admissions on file, together with the affidavits, show that there is 
no genuine issue as to any material fact and that the moving party is entitled to judgment 
as a matter of law." Law v. Law Company Building Assocs., 295 Kan. 551, 561, 289 P.3d 
1066 (2012). An appellate court reviewing a district court's ruling on a motion for 
summary judgment applies the same legal standard and, because the motion is considered 
on uncontroverted facts and under the same standard as the district court, reviews the 
matter de novo as a question of law, granting no deference to the district court's 
judgment. Law, 295 Kan. at 561; Adams v. Board of Sedgwick County Comm'rs, 289 
Kan. 577, 584, 214 P.3d 1173 (2009). 
 
In this case, resolution of the motions for summary judgment depends on an 
interpretation of K.S.A. 40-3403(h). Interpretation of a statute is also a question of law. 
As under the summary judgment standard, an appellate court exercises unlimited review 
and does not grant deference to the district court's interpretation of a statute. See Stewart 
Title of the Midwest v. Reece & Nichols Realtors, 294 Kan. 553, 557, 276 P.3d 188 
(2012).  
 
SUMMARY JUDGMENT APPROPRIATE ON CLAIM OF VICARIOUS LIABILITY 
 
 
Applying these standards to Cady's first claim that Women's Care is vicariously 
liable for Schroll's actions simply because Women's Care was Schroll's employer, the 
district court and the Court of Appeals concluded the claim was barred by K.S.A. 
40-3403(h). Cady, 2011 WL 2535004, at *5. Before us, Cady does not dispute that the 
legislature clearly "abrogate[d] vicarious liability where both health care providers, as 
 
6 
 
defined by K.S.A. 40-3401(f), are covered by the Health Care Stabilization Fund." 
Glassman v. Costello, 267 Kan. 509, 523, 986 P.2d 1050 (1999). And Cady does not 
dispute that both Schroll and Women's Care are health care providers who are qualified 
for coverage under the Health Care Stabilization Fund created by the HCPIAA.  
 
 
Cady did raise some alternative arguments before the Court of Appeals regarding 
whether K.S.A. 40-3403(h) applies under the facts of this case because of an exception 
provided for in K.S.A. 40-3403(q) (liability for claims relating to health care provider's 
sexual acts or activity). But those arguments have not been raised before this court, and, 
consequently, any argument that there was error in granting summary judgment to 
Women's Care on Cady's claim of vicarious liability based on K.S.A. 40-3403(q) has 
been waived. See Martin v. Naik, 297 Kan. 241, 245, 300 P.3d 625 (2013) (argument 
addressed by Court of Appeals but not raised in petition for review is waived).  
 
Exceptions placed aside, we have no qualms concluding that under K.S.A. 
40-3403(h) Women's Care has no vicarious liability simply because it was Schroll's 
employer. See Black's Law Dictionary 998 (9th ed. 2009) (defining "vicarious liability" 
as "[l]iability that a supervisory party [such as an employer] bears for the actionable 
conduct of a subordinate or associate [such as an employee] based on the relationship 
between the two parties"). 
 
INDEPENDENT LIABILITY 
 
Consequently, our focus is on Cady's contention that Women's Care is 
independently or directly liable for its own conduct, namely, failing to supervise Schroll 
in order to prevent him from engaging in inappropriate conduct with her. While Cady 
made broader claims in her petition against Women's Care, such as negligently failing to 
inform her of Schroll's prior disciplinary record, she limits the issue in her brief to this 
court to whether the Court of Appeals erred because "Kansas law and the facts support 
 
7 
 
plaintiff's claim that defendant had a duty to supervise its physician employee." Hence, 
any other claim is waived. See Miller v. Johnson, 295 Kan. 636, 688, 289 P.3d 1098 
(2012).  
 
In arguing that Women's Care should be independently liable because of its failure 
to supervise Schroll, Cady relies on Marquis v. State Farm Fire & Cas. Co., 265 Kan. 
317, 334-35, 961 P.2d 1213 (1998), and its holding that a Kansas employer who 
negligently hires, trains, and supervises employees can be directly liable because of the 
employer's negligence, as opposed to being vicariously liable on the theory that the 
employer, as the master of the negligent party, is responsible for an employee's 
negligence. See, e.g., Schmidt v. HTG, Inc., 265 Kan. 372, Syl. ¶ 10, 961 P.2d 677, cert. 
denied 525 U.S. 964 (1998); Kansas State Bank & Tr. Co. v. Specialized Transportation 
Services, Inc., 249 Kan. 348, Syl. ¶ 1, 819 P.2d 587 (1991); Plains Resources, Inc. v. 
Gable, 235 Kan. 580, 590, 682 P.2d 653 (1984). 
 
The Court of Appeals recognized the distinction between vicarious and direct 
liability. But the Court of Appeals also noted that "neither Marquis nor any other case has 
held that a claim for damages based on negligent supervision does not 'arise out of' the 
wrongful acts that weren't stopped by better supervision." Cady, 2011 WL 2535004, at 
*2. This point was significant, according to the Court of Appeals, because it was 
considering an issue of "statutory interpretation involving K.S.A. 40-3403(h), not 
whether Kansas law provides a separate claim for negligent supervision," and the statute 
could and did bar all responsibility for damages "aris[ing] out of the independent acts of 
another healthcare provider." 2011 WL 2535004, at *2, 5. In interpreting K.S.A. 
40-3403(h), the Court of Appeals viewed "the key terms" as "'responsibility' and 'arising 
out of.'" 2011 WL 2535004, at *2.  
 
First addressing the phrase "arising out of," the Court of Appeals stated: 
 
 
8 
 
"Certainly much narrower terms could have been used, such as 'caused by' or 'directly 
caused by' or 'solely caused by.' But the legislature chose 'arising out of.' Other courts 
have recognized that 'arising out of' is a broad term that should reasonably be interpreted 
broadly. [Citations omitted.] Even if, as Cady alleges, Women's Care might have 
prevented Schroll's improper conduct through better supervision, we think it clear that her 
claims arose out of his conduct." 2011 WL 2535004, at *2.  
 
Turning to the term "responsibility," the Court of Appeals acknowledged Cady's 
argument that the word "vicarious" modifies both the words "liability" and 
"responsibility" and that vicarious liability is distinct from independent or direct liability. 
But the Court of Appeals noted that this interpretation of K.S.A. 40-3403(h) was rejected 
in McVay v. Rich, 255 Kan. 371, 377-78, 874 P.2d 641 (1994), and Lemuz v. Fieser, 261 
Kan. 936, 940-41, 933 P.2d 134 (1997). In those cases, this court interpreted K.S.A. 
40-3403(h) as absolving a hospital from vicarious liability and any independent 
responsibility arising from the professional services of another health care provider 
covered by the HCPIAA.  
 
The Court of Appeals also rejected Cady's argument that this holding was altered 
in Aldoroty v. HCA Health Services of Kansas, Inc., 265 Kan. 666, 962 P.2d 501(1998). 
The Court of Appeals concluded the opinion in Aldoroty was not inconsistent with 
McVay or Lemuz but rather was distinguishable from those decisions because the 
defendant hospital in Aldoroty was held liable for "negligently render[ing] direct medical 
care to a patient," a duty that did not "'arise out of' another provider's conduct or 
treatment." Cady, 2011 WL 2535004, at *4.  
 
Finally, the Court of Appeals concluded: 
 
"We see no reason to modify the understanding of the word 'responsibility' that is 
consistently found in the two opinions of McVay and in Lemuz. First, when the legislature 
fails to modify a statute to avoid a standing judicial construction of the statute, we 
 
9 
 
presume the legislature intended the statute to be interpreted as we have done. [Citation 
omitted.] Second, this interpretation is in line with the broad purpose of the Health Care 
Provider Insurance Availability Act, K.S.A. 40-3401 et seq., which was designed to 
lessen a perceived crisis in medical-malpractice claims by placing some limits on claims 
while also providing adequate insurance coverage to pay when medical negligence 
caused injury. [Citations omitted.]" Cady, 2011 WL 2535004, at *4. 
 
In asking us to reverse the Court of Appeals' and district court's decisions, Cady 
presents several alternative arguments:  (1) McVay and Lemuz are contrary to the 
language of K.S.A. 40-3403(h) and should be overruled; (2) those decisions are 
distinguishable and should not be applied here; (3) the holding and rationale of those 
decisions was altered by this court's subsequent decisions in Aldoroty, which was 
discussed by the Court of Appeals, and Glassman, which was cited to the Court of 
Appeals but not discussed in its opinion; and (4) under Aldoroty and Glassman Women's 
Care is not entitled to summary judgment.  
 
1. Interpretation of K.S.A. 40-3403(h) 
 
First, we consider Cady's argument that this court erroneously interpreted K.S.A. 
40-3403(h) in the decisions in McVay and Lemuz. To address these arguments, we must 
examine the language of the statute and the reasoning behind the holdings in McVay and 
Lemuz. We begin with a discussion of the terms of K.S.A. 40-3403(h). For ease of 
reference, we will set it out again, this time in full. It states:   
 
"A health care provider who is qualified for coverage under the fund shall have 
no vicarious liability or responsibility for any injury or death arising out of the rendering 
of or the failure to render professional services inside or outside this state by any other 
health care provider who is also qualified for coverage under the fund. The provisions of 
this subsection shall apply to all claims filed on or after July 1, 1986." (Emphasis added.) 
 
 
10 
 
As we have noted, Cady does not dispute that both Women's Care and Schroll are 
health care providers qualified for coverage under the fund. See K.S.A. 40-3401(f) 
(definition of "health care provider"). Her arguments focus on other portions of K.S.A. 
40-3403(h), in particular the phrases "no vicarious liability or responsibility" and "for any 
injury or death arising out of the rendering of or the failure to render professional 
services . . . by any other health care provider." (Emphasis added.) 
 
A few fundamental rules govern our interpretation of these phrases. The most 
fundamental rule of statutory interpretation is that the intent of the legislature governs if 
that intent can be ascertained. This court must first attempt to ascertain legislative intent 
by reading the language of the statute and giving common words their ordinary meanings. 
When a statute is plain and unambiguous, this court does not speculate as to the 
legislative intent behind it and will not read into the statute something not readily found 
in it. Stewart Title, 294 Kan. at 557. But when the statute's language or text is unclear or 
ambiguous, this court employs "canons of construction, legislative history, or other 
background considerations to divine the legislature's intent and construe the statute 
accordingly. [Citation omitted.]" 294 Kan. at 564-65.  
 
K.S.A. 40-3403(h) falls under the category of a statute that is unclear and 
ambiguous. The ambiguity arises because both of the phrases on which we focus are 
susceptible to multiple meanings.  
 
As to the first phrase, as she did before the Court of Appeals, Cady contends the 
word "vicarious" modifies both "liability" and "responsibility." She urges the application 
of a general rule of syntax under which "an initial modifier 'will tend to govern all 
elements in the series unless it is repeated for each element.'" Washington Educ. Ass'n v. 
National Right to Work Legal Defense Foundation, Inc., 187 Fed. Appx. 681, 682 (9th 
Cir. 2006) (unpublished opinion) (quoting The American Heritage Book of English 
Usage 53 [1996]). This court has, on occasion, applied this rule when interpreting a 
 
11 
 
statute. E.g., Rounsavell v. Tipton, 209 Kan. 366, 367-68, 497 P.2d 108 (1972) (in statute 
requiring service by "'restricted registered or certified mail,'" the adjective "restricted" 
modified both "registered" and "certified mail"); Hulme v. Woleslagel, 208 Kan. 385, 
390, 395, 493 P.2d 541 (1972) (in statute requiring change of judge for "'personal bias, 
prejudice ,or interest of the judge,'" the word "personal" appeared "as an adjective 
modifying the nouns bias, prejudice, or interest"). 
  
On the other hand, a general rule of statutory construction provides that a court 
should not "read out" words in a statute. Unruh v. Purina Mills, 289 Kan. 1185, 1194, 
221 P.3d 1130 (2009). Under this rule, we must consider the import of the word 
"responsibility" following the word "liability." Black's Law Dictionary 1427 (9th ed. 
2009) defines "responsibility" as "liability." Thus, if Cady's interpretation of K.S.A. 
40-3403(h) is correct, the statute would be read to eliminate "vicarious liability" and then 
to repeat itself. This reading essentially renders meaningless the legislature's use of the 
word "responsibility." 
 
Although the McVay court did not discuss this rule of statutory construction, it 
opted to make the word "responsibility" meaningful. It determined the word "vicarious" 
modifies only the word "liability" and not the word "responsibility," making the 
legislature's use of the two terms significant because a different meaning is conveyed 
even though the two terms overlap in meaning. This conclusion was summarized in 
Lemuz, 261 Kan. at 940, when the court stated:  "McVay interpreted the [term 
"responsibility"] as absolving a hospital not just from vicarious liability but from any 
responsibility, including independent liability, for the acts of a physician."  
 
Clearly, there is enough uncertainty in the meaning of the phrase "vicarious 
liability or responsibility" that it can be considered ambiguous. Likewise, the phrase 
"arising out of" is ambiguous as demonstrated by decisions of this court that have applied 
the phrase in multiple ways.  
 
12 
 
 
One interpretation of the phrase "arising out of" that is favorable to Cady can be 
found in Marquis, 265 Kan. 317, the case Cady relies on to support the distinction 
between vicarious liability and liability for an employer's independent tort. In Marquis, 
this court was asked to determine whether a contractor's insurance policy provided 
coverage related to damages arising from an automobile accident when the claim was that 
the employer negligently hired, retained, or supervised the employee who was driving at 
the time of the accident. The contractor's policy contained an exclusion for "'bodily injury 
or property damage arising out of the ownership, maintenance, use or entrustment of 
others of any aircraft, auto, or watercraft owned or operated by or rented or loaned to any 
insured.'" (Emphasis added.) 265 Kan. at 328. The insurance company argued this 
provision excluded any claims for negligent hiring, retention, or supervision of the 
automobile driver because such claims arose out of an accident involving the use of an 
automobile owned by the insured. The Marquis court disagreed. The court determined 
"the theory of liability rather than the cause of the accident governs coverage." 265 Kan. 
at 328-29.  
 
In reaching this conclusion, the Marquis court noted it was adopting a minority 
reading of the phrase "arising out of." 265 Kan. at 329-30. The majority view of other 
state courts construing the same exclusion in contractors' policies focuses on causation, 
not on the theory of liability. The majority view is that "'the claim for negligent 
supervision is not independent of, but inextricably intertwined with, the employee's use 
of the truck, [and] any breach by the employer to supervise such use is necessarily 
deemed to have arisen therefrom.' [Citation omitted.]" 265 Kan. at 330.  
 
But the Marquis court felt compelled to reject the majority view because of rules 
governing the interpretation of exclusions in insurance contracts. One of these rules states 
that "[g]enerally, exceptions, limitations, and exclusions to insurance policies require 
narrow construction on the theory that the insurer, having affirmatively expressed 
 
13 
 
coverage through broad promises, assumes the duty to define any limitations on that 
coverage in clear and explicit terms." Marquis, 265 Kan. at 327. In applying this rule, the 
court noted that the contractor's insurance policy specifically excluded negligent 
entrustment but not negligent supervision. Yet, "Kansas law recognizes negligent 
supervision as a separate and distinct theory in addition to theories of negligent hiring and 
negligent retention," just as it recognizes the separate theory of negligent entrustment. 
265 Kan. at 331. Further, in a separate homeowner's policy held by the insured, the same 
insurance company specifically excluded negligent supervision. Based on these 
comparisons, the court concluded the insurance company had recognized the viability of 
negligent supervision as a theory of liability and had also recognized the need to exclude 
the theory from coverage in its homeowner's policy. Nevertheless, it had not specifically 
defined the limitation on coverage in its contractor's policy and therefore should not be 
allowed to claim the exclusion. 265 Kan. at 331. 
 
In Crist v. Hunan Palace, Inc., 277 Kan. 706, 714-16, 89 P.3d 573 (2004), this 
court questioned the reasoning in Marquis but applied stare decisis principles and decided 
its holding controlled the contract interpretation issue in that case. The discussion in Crist 
included references to Kansas cases in which the Marquis holding had not been extended. 
277 Kan. at 714. This line of other cases has more application in this case than does 
Marquis because the rules regarding insurance exclusions that controlled Marquis do not 
drive the interpretation of K.S.A. 40-3403(h). And in circumstances where an insurance 
exclusion is not at issue, Kansas has interpreted the phrase "arising out of" in a manner 
that is consistent with the majority rule of looking at causation rather than the theory of 
liability. Several of these cases arise in the context of determining insurance coverage 
rather than insurance exclusion.  
 
For example, the Court of Appeals has recognized the words "arising out of" are 
"very broad, general, and comprehensive terms . . . ordinarily understood to mean 
'originating from,' 'having its origin in,' 'growing out of' or 'flowing from.'" Garrison v. 
 
14 
 
State Farm Mut. Auto. Ins. Co., 20 Kan. App. 2d 918, 923, 894 P.2d 226 (quoting 
Cameron Mut. Ins. Co. v. Ward, 599 S.W.2d 13, 15 [Mo. App. 1980]), aff'd 258 Kan. 
547, 907 P.2d 891 (1995). In Garrison, the issue was whether an injury arose out of the 
use of an automobile when a hunter accidentally discharged his shotgun while exiting a 
car, injuring the car's driver. This court, in affirming the Court of Appeals' determination 
that the phrase "arising out of" conveyed a broad concept of causation, held the injury 
"was a natural and reasonable incident arising out of the use of the car for hunting." 258 
Kan. at 554. 
 
This court adopted a similar focus on causation when interpreting two insurance 
statutes in Farmers Ins. Co. v. Southwestern Bell Tel. Co., 279 Kan. 976, 982, 113 P.3d 
258 (2005), stating:  "The legislature's use of the phrase 'arising out of' in K.S.A. 40-284 
and K.S.A. 40-3104(f) supports a broad definition" of the term "liability" when 
considering if a claim arises out of the use of an automobile. Likewise, in Pestock v. State 
Farm Auto. Ins. Co., 9 Kan. App. 2d 188, 189, 674 P.2d 1062 (1984), the Court of 
Appeals held "[t]he phrase 'arising out of the . . . use of' imparts a more liberal concept of 
causation than 'proximate cause.' [Citation omitted.]"  
 
This focus on causation is consistent with the approach adopted in McVay, 255 
Kan. 371. In that case, Anita McVay alleged that a hospital had negligently granted or 
continued a physician's privileges when it knew or should have known the physician was 
incompetent. In addition, McVay asserted that the hospital was negligent in not properly 
providing or performing a quality assurance program. Despite these claims of direct 
liability against the hospital for its own negligence, this court noted that McVay "would 
have [had] no claim against the hospital if she had not been injured" by the physician, her 
claim against the hospital was "derivative of and dependent upon her claim" against the 
physician, and her "injury arose out of the rendering of professional services" by the 
physician. 255 Kan. at 376-78.  
 
 
15 
 
This court in McVay did not expand on its reasoning but endorsed the analysis of 
the Court of Appeals in the decision under review, McVay v. Rich, 18 Kan. App. 2d 746, 
859 P.2d 399 (1993). The Court of Appeals had adopted the focus on causation after 
examining the legislative history of K.S.A. 40-3403(h). In determining the significance of 
that legislative history, the McVay Court of Appeals looked to this court's opinion in Bair 
v. Peck, 248 Kan. 824, 845, 811 P.2d 1176 (1991), in which this court held that K.S.A. 
40-3403(h) does not violate Sections 1, 5, or 18 of the Kansas Constitution Bill of Rights.  
 
The Bair court explained that K.S.A. 40-3403 "was originally enacted in 1976 to 
address the perceived medical malpractice crisis, including the problems of obtaining and 
maintaining affordable malpractice insurance and maintaining the availability of medical 
services in Kansas." 248 Kan. at 827. Ten years later, however, those goals had not been 
achieved. "In response to the continued increase in the cost of obtaining medical 
malpractice insurance and after recommendations of the Special Committee on Medical 
Malpractice [citation omitted], the legislature enacted additional major tort reforms in 
1986," including the provision that was codified as subsection (h) of K.S.A. 40-3403. 248 
Kan. at 828.  
 
The Special Committee explained its purpose in proposing K.S.A. 40-3403(h) in 
its report to the legislature, stating: 
 
 
"'The Committee notes that licensees in medicine and surgery are now required 
to pay medical malpractice premiums and surcharges as individuals and, additionally, 
must pay these costs for professional associations they may belong to (albeit at a reduced 
rate). The Committee believes this dual coverage requirement is not necessary to protect 
the public welfare and is aggravating a problem that already exists with high insurance 
costs.' [Proposal No. 47—Medical Malpractice,] Report on Kansas Legislative Interim 
Studies to the 1986 Legislature, p. 859 [(December 1985)]." Bair, 248 Kan. at 833. 
 
 
16 
 
The Special Committee also explained its intent regarding the function of K.S.A. 
40-3403(h), noting:  
 
 
"[Recommendation] Other Insurance Changes. The bill requires partnerships of 
persons who are health care providers to obtain the mandatory insurance coverages so 
that vicarious liability of one health care provider for another may be abolished if both 
are covered by the Fund. Further, insurers may exclude from coverage liability for those 
health care providers already required to maintain professional liability insurance.' 
[Report on Kansas Legislative Interim Studies to the 1986 Legislature,] p. 861." Bair, 
248 Kan. at 833. 
 
The first sentence of this recommendation is clearly limited to vicarious liability, 
but the second sentence can be read to express a broader intent to eliminate the need for 
double coverage. The McVay Court of Appeals read this broader intent as encompassing 
responsibilities that are not strictly vicarious liability, as long as the injury arose from the 
rendering of or failure to render professional services by another health care provider 
required to obtain insurance coverage as mandated by the HCPIAA. 18 Kan. App. 2d at 
752-53. Recognizing this legislative intent, the Court of Appeals in McVay concluded: 
 
"If a hospital's insurer knows the hospital will only be liable for the negligence of its 
employees and agents who are not qualified under the fund, malpractice insurance rates 
should be stabilized. 
"K.S.A. 1992 Supp. 40-3403(h) applies to all health care providers. Further, the 
statute eliminates not only vicarious liability but also responsibility for any injury arising 
out of the rendering of or failure to render professional services by another health care 
provider who is also covered by the fund. [Citation omitted.]" 18 Kan. App. 2d at 752. 
 
In endorsing this rationale on petition for review, this court's McVay decision 
essentially resolved the ambiguities in K.S.A. 40-3403(h) in a way that furthers the 
legislative intent of eliminating the need for a health care provider to obtain insurance 
 
17 
 
coverage for damages arising out of another health care provider's care and treatment of a 
patient even if a theory of direct or independent liability has been asserted. 
 
But Cady also argues the McVay interpretation violates the rule of statutory 
construction that restrains a court from reading words into a statute. See Bergstrom v. 
Spears Manufacturing Co., 289 Kan. 605, 609, 214 P.3d 676 (2009). According to her, 
the McVay holding, which was reiterated in Lemuz, 261 Kan. 936, requires adding the 
word "other" before the word "responsibility." We disagree. Rather than add a word, this 
court simply declined to modify the word "responsibility" with the word "vicarious" and 
gave the word "responsibility" its ordinary, unqualified meaning. An additional word, 
such as "other," might have made the statute clearer, but additional words did not have to 
be added to interpret the statute in a manner consistent with the apparent legislative 
intent.  
 
In summary, none of Cady's arguments persuade us that this court erroneously 
interpreted K.S.A. 40-3403(h) in McVay and Lemuz. As our discussion has indicated, 
K.S.A. 40-3403(h) is obviously ambiguous. Compare Marquis v. State Farm Fire & Cas. 
Co., 265 Kan. 317, 328-29, 961 P.2d 1213 (1998) (interpreting phrase "arising out of" to 
require focus on "the theory of liability rather than the cause of the accident") with 
Garrison, 258 Kan. at 554 (interpreting phrase "arising out of" as incorporating broad 
concept of causation). Therefore, the McVay Court of Appeals had appropriately 
consulted legislative history to resolve the ambiguities in K.S.A. 40-3403(h). Further, as 
we have discussed, this court's interpretation of the phrase "arising out of" in McVay, 255 
Kan. 371, is consistent with the interpretation of that phrase by this court in contexts 
other than insurance exclusions and by a majority of other courts in all contexts. 
Consequently, we find no reason to overrule McVay and Lemuz as Cady asks us to do. 
See Miller v. Johnson, 295 Kan. 636, 653, 289 P.3d 1098 (2012) ("The doctrine of stare 
decisis maintains that once a point of law has been established . . . [a] court of last resort 
will follow that rule of law unless clearly convinced it was originally erroneous or is no 
 
18 
 
longer sound because of changing conditions and that more good than harm will come by 
departing from precedent."). 
 
Instead, we reaffirm the holding in those cases that K.S.A. 40-3403(h) absolves a 
health care provider not just from vicarious liability but from any responsibility, 
including independent liability, where the injured party's damages are derivative of and 
dependent upon the rendering of or the failure to render professional services by another 
health care provider. 
 
2. McVay and Lemuz Are Not Distinguishable 
 
Alternatively, Cady argues that McVay v. Rich, 255 Kan. 371, 874 P.2d 641 
(1994), and Lemuz v. Fieser, 261 Kan. 936, 933 P.2d 134 (1997), are factually 
distinguishable and should not be applied. She notes that those decisions involved claims 
where a plaintiff sued a hospital rather than a physician's group; involved independent 
contractors as opposed to employees; arose on claims based on the corporate negligence 
theory rather than on a failure to supervise theory; and were based in part on K.S.A. 
65-442(b), a statute that does not apply to Women's Care. 
  
Cady is correct that her claims are distinguishable from those in McVay and Lemuz 
because Schroll was an employee of Women's Care, which is a physician's group, as 
opposed to an independent contractor with a hospital, which was the situation in McVay 
and Lemuz. And the claims in McVay were based on a theory often referred to as 
corporate negligence, which relates, at least in part, to the duty to "'exercise reasonable 
care to employ a competent and careful contractor . . . .' Restatement (Second) of Torts § 
411 (1963)." McVay, 255 Kan. at 376-77. Nevertheless, these distinctions are not as 
meaningful as Cady suggests. The language of K.S.A. 40-3403(h) does not premise 
immunity on the type of health care providers involved, the nature of the relationship 
between the two health care providers, or the nature of the theory of liability.  
 
19 
 
 
Regarding the type of health care provider involved, while K.S.A. 40-3403(h) is 
ambiguous in many respects, the legislature clearly did not intend to distinguish between 
hospitals and medical practice groups formed by individual providers or any other health 
care provider. K.S.A. 40-3401(f) defines the term "health care provider" to include 
various licensed individuals, medical care facilities, professional corporations and limited 
liability companies organized by health care providers, and other entities.  
 
Likewise, there is no indication the legislature intended to distinguish between 
employee-employer, independent contractor, or even less formal relationships. For 
example, focusing on the term "vicarious liability," the term Cady admits is 
unambiguous, Kansas law historically recognized that a "physician may be vicariously 
liable for the negligence of other members of the health care team under the so-called 
'captain of the ship' theory." Glassman v. Costello, 267 Kan. 509, 523, 986 P.2d 1050 
(1999); see, e.g., Oberzan v. Smith, 254 Kan. 846, 850, 869 P.2d 682 (1994) (recognizing 
that as "captain of the ship" surgeon exercising staff privileges at hospital was liable for 
actions of hospital employees assisting with surgery); Voss v. Bridwell, 188 Kan. 643, 
Syl. ¶ 3, 364 P.2d 955 (1961) (surgeon exercising staff privileges had liability for 
anesthetist in hospital's residency program). The captain-of-the-ship theory applied even 
though the surgeon did not employ or contract with the other health care providers in the 
operating room. Yet in Glassman, one of the cases relied on by Cady, this court 
recognized that K.S.A. 40-3403(h) abrogated vicarious liability based on the captain-of-
the-ship theory. 267 Kan. at 523. Clearly, K.S.A. 40-3403(h) makes no distinction based 
on the nature of the relationship between the health care providers, and we find no basis 
to distinguish McVay or Lemuz on this basis.  
 
Nor does K.S.A. 40-3403(h) impose conditions relating to the theory of liability 
asserted in a petition. Instead, as we have discussed, the focus is on the source or cause of 
the plaintiff's injuries, not on the theory of liability. In addition, while McVay's claims 
 
20 
 
fell within the scope of the corporate negligence doctrine, this court explicitly declined to 
reach the question of whether Kansas should adopt the corporate negligence theory 
because the "unambiguous language of K.S.A. 65-442(b) and K.S.A. 40-3403(h) requires 
the conclusion that those statutes bar McVay's claim[s] against the hospital." McVay, 255 
Kan. at 377. As we have discussed, this decision was based, at least in part, on the court's 
focus on causation rather than the nature of the theory. Likewise, in this case we need not 
determine whether a duty to supervise theory applies in the situation of a licensed 
physician who is a shareholder of a corporation. Rather, assuming the theory is viable, we 
must determine if under the facts Women's Care can be liable as a matter of law. 
 
Also, there are obvious parallels between the claims made by McVay and those 
made by Cady. In McVay, this court recognized that the term "corporate negligence" was 
an umbrella term encompassing many "independent duties a hospital may owe to a 
patient," including such things as the duty to exercise reasonable care in granting and 
renewing staff privileges to independent-contractor physicians, "the duty to monitor and 
review patients' treatment and progress[,] and the duty to make and enforce rules." 255 
Kan. at 375. In many respects, these duties are similar to the duties Cady claims Women's 
Care owed to her—the duty to retain competent agents and to supervise.  
 
Further, regardless of whether the liability arises from the negligent hiring and 
supervision of an independent contractor or an employee-employer relationship, the 
policy behind imposing liability on the principal is the same:  making liable the entity or 
person who was in a position to protect the patient, who profited from the business 
relationship with the injured patient, and who is often best able to pay for the damages. 
See Marquis, 265 Kan. at 331 (discussing duty to supervise); McVay, 255 Kan. at 377 
(discussing corporate negligence); Plains Resources, Inc. v. Gable, 235 Kan. 580, 590, 
682 P.2d 653 (1984) (discussing duty to hire and retain competent employees); see also 
Gilbert v. Sycamore Municipal Hospital, 156 Ill. 2d 511, 523, 622 N.E.2d 788 (1993) 
(discussing policy reasons for recognizing vicarious liability of hospital for acts of 
 
21 
 
independent-contractor physician). We recognize that K.S.A. 40-3403(h) arguably 
undermines the public policy behind these theories of liability and diminishes the 
protections otherwise available to patients. But "courts 'are not free to act on . . . [their 
own] view of wise public policy' in matters governed by legislation. [Citation omitted.] 
Courts should instead 'leave the guidance of public policy through statutes to the 
legislature.' [Citations omitted.]" In re Marriage of Hall, 295 Kan. 776, 784, 286 P.3d 
210 (2012). Our task is to determine if there is any reason to discern a legislative intent to 
distinguish between employees and independent contractors or various theories of 
liability, and we can find none.  
 
The final distinction argued by Cady is that K.S.A. 65-442(b), which is discussed 
extensively in McVay and Lemuz, is not at issue in this case. K.S.A. 65-442(b) applies 
only to "licensed medical care facilit[ies]," and Women's Care does not fall within that 
term's definition. See K.S.A. 65-425(h) (defining "medical care facility" to generally 
mean "a hospital, ambulatory surgical center or recuperation center"). Cady makes a two-
fold argument:  (1) the application of K.S.A. 65-442(b) and its clear intent infected the 
McVay court's reading of K.S.A. 40-3403(h), and (2) K.S.A. 65-442(b) demonstrates that 
the legislature knew how to clearly provide for immunity from liability but did not do so 
in K.S.A. 40-3403(h). 
 
We agree with Cady that K.S.A. 65-442(b) is a clearer and less ambiguous statute. 
K.S.A. 65-442(b) states:   
 
"There shall be no liability on the part of and no action for damages shall arise 
against any licensed medical care facility because of the rendering of or failure to render 
professional services within such medical care facility by a person licensed to practice 
medicine and surgery if such person is not an employee or agent of such medical care 
facility." 
 
 
22 
 
As Cady indicates, the phrases "no liability" and "no action for damages" are crystal 
clear. And in interpreting statutes we frequently point to parallel statutes and note that the 
language in one statute may illustrate that the legislature knows how to state something 
that is omitted in another statute. See State v. Nambo, 295 Kan. 1, 4-5, 281 P.3d 525 
(2012). Nevertheless, using different language in two statutes does not necessarily mean 
that both cannot be interpreted in a manner consistent with legislative intent. And 
although the McVay court discussed both statutes, in large part it analyzed them 
separately and reached conclusions specific to K.S.A. 40-3403(h). Moreover, as we have 
discussed, the legislative history supporting the McVay court's interpretation of K.S.A. 
40-3403(h) is specific to that provision. Finally, as revealed in the decisions in Aldoroty 
v. HCA Health Services of Kansas, Inc., 265 Kan. 666, 962 P.2d 501 (1998), and 
Glassman, 267 Kan. 509, which we will discuss in more detail in the next section of this 
opinion, we do not believe K.S.A. 40-3403(h) was intended to have the same scope as 
K.S.A. 65-442(b). While K.S.A. 65-442(b) bars all of a medical care facility's liability for 
a physician's care and treatment of a patient if the physician is not an employee or agent 
of the medical care facility, K.S.A. 40-3403(h) limits the bar of liability only to damages 
arising out of the other health care provider's actions or inactions. As Aldoroty and 
Glassman demonstrate, through the causation requirement in K.S.A. 40-3403(h) the 
legislature left open the possibility of two health care providers having liability. Thus, 
there was a reason for the legislature to use different language in the two statutes.   
 
Simply put, K.S.A. 40-3403(h) does not premise its bar of responsibility based on 
any of the distinctions Cady attempts to make between the facts of this case and those 
involved in McVay or Lemuz.  
 
3. Aldoroty and Glassman Did Not Overrule McVay and Lemuz 
 
Cady further suggests that Aldoroty and Glassman changed the way this court 
interprets and applies K.S.A. 40-3403(h). We, therefore, next consider the impact of 
 
23 
 
those decisions and conclude that Cady's reading of the holdings in those cases is shaded 
by her attempt to impose the Marquis reading of "arising out of" on our interpretation of 
K.S.A. 40-3403(h).  
 
In Aldoroty, the plaintiff sued three radiologists and a hospital, alleging that 
negligence delayed his diagnosis of lymphoma. Aldoroty was an employee of the hospital 
and participated in annual health audits provided to employees. Aldoroty's theory of 
liability was that his illness had progressed because radiologists failed to detect changes 
in chest X-rays and that their failure was at least partially attributable to the hospital's 
failure to furnish the radiologists with previous films for comparison. Plaintiff's experts 
faulted the radiologists on several grounds, including reading X-rays without verifying 
whether there were previous films that could be compared. As to the hospital's liability, 
even the hospital did not dispute its duty to retrieve the records and make the previous X-
rays available to the radiologists.  
 
One argument advanced by the hospital was that it could not be held liable under 
McVay and K.S.A. 40-3403(h) unless it was 100 percent at fault because it could not be 
held liable for injuries arising out of the radiologists' negligence. And the hospital 
contended it could not be 100 percent at fault because the "'[p]laintiff's theory and the 
facts dictate that at least some negligent act by a physician was required for injury to 
result.'" Aldoroty, 265 Kan. at 680.  
 
The Aldoroty court was not persuaded by the hospital's arguments. The court 
distinguished McVay, noting that Aldoroty was not seeking to hold the hospital liable for 
the radiologists' actions but for the failure of hospital employees to retrieve prior X-rays 
from storage and furnish them to the radiologists. The court also noted that the hospital's 
"duty and the radiologists' duty were close links in the same small chain, and it was up to 
the jury to compare their fault." Aldoroty, 265 Kan. at 682.  
 
 
24 
 
 
The Court of Appeals in this case rejected Cady's arguments that Aldoroty 
effectively overruled McVay. The Court of Appeals reasoned: 
 
"There is no indication in Aldoroty that the court considered its opinion in that 
case in any way to be inconsistent with McVay or Lemuz. We see nothing inconsistent in 
finding the hospital could be sued when it negligently rendered direct medical care to a 
patient (by failing to provide the records of past X-rays when it had undertaken a duty to 
do so) even though it may not be sued for negligent supervision of another covered 
provider. Under Aldoroty, a healthcare provider may be liable for specific acts of 
negligence where the duty is separate from the services of another healthcare provider. 
That liability doesn't 'arise out of' another provider's conduct or treatment. [Citation 
omitted.]" Cady v. Schroll, No. 103,499, 2011 WL 2535004, at *4 (Kan. App. 2011) 
(unpublished opinion). 
 
 
Cady, in suggesting the Court of Appeals' reading of Aldoroty was in error, notes 
that the Aldoroty court distinguished McVay and Lemuz because they were "confined to 
application to the corporate negligence theory." Aldoroty, 265 Kan. at 682. But Cady 
ignores the reason the Aldoroty court felt the distinction was important.  
 
 
The Aldoroty court noted that the duty alleged in McVay was "to select and retain 
only competent and careful physicians" and "[t]hat duty arose in a function completely 
separate from the surgical services provided by the hospital." Aldoroty, 265 Kan. at 682. 
In contrast, Aldoroty "did not seek to hold [the hospital] liable for his physical harm 
caused by the hospital's negligence in selecting and retaining the radiologists" or even its 
own employees. 265 Kan. at 682. Rather, Aldoroty alleged hospital employees, who were 
not medical providers required to obtain insurance under the HCPIAA, owed him a duty 
related to his care and treatment that was independent of the duty owed by the 
radiologists. And Aldoroty's injuries arose at least in part because the hospital's 
employees were negligent in caring for him, not just in failing to appropriately retain or 
supervise an employee or independent contractor. 265 Kan. at 682; see Culp v. Sifers, 550 
 
25 
 
F. Supp. 2d 1276, 1285 (D. Kan. 2008) (granting summary judgment in favor of 
professional association appropriate where plaintiff failed to direct the court to "any 
particular duty owed to plaintiff" related to the course of treatment and the "plaintiff 
would have no claim against the professional association if [the surgeon] had not 
negligently injured her").  
 
The same distinction can be made between McVay and the other decision on 
which Cady relies, Glassman, 267 Kan. 509, a case not specifically discussed by the 
Court of Appeals. As in Aldoroty, Glassman arose after two health care providers were 
negligent in the care and treatment of a patient. The case involved an anesthesia-related 
death of a patient during a cesarean section delivery of her healthy child. The patient's 
heirs-at-law sued the certified registered nurse anesthetist and the obstetrician. The heirs-
at-law claimed the obstetrician was negligent in (1) failing to direct and monitor the nurse 
anesthetist as required by K.S.A. 65-1158(b) (stating "[a] registered nurse anesthetist 
shall perform duties and functions in an interdependent role as a member of a 
physician . . . directed health care team"); (2) beginning surgery after the failure of a 
spinal anesthesia; (3) ignoring the nurse anesthetist's report that the patient was not 
intubated; and (4) continuing with surgery when he knew or should have known the 
patient was inappropriately intubated.  
 
The heirs-at-law conceded that the adoption of K.S.A. 40-3403(h) meant the 
obstetrician could not be vicariously liable as he historically would have been under the 
captain-of-the-ship doctrine. Nevertheless, the survivors contended they were seeking to 
hold the obstetrician liable for his individual actions and inactions in the operating room, 
not just for vicarious liability. This court agreed, noting that the abrogation of liability in 
K.S.A. 40-3403(h) did not mean, as the obstetrician had argued, that there was no 
possible liability. Rather, the obstetrician could be liable "in light of the individual 
technical duties of the different health care providers." 267 Kan. at 526.  
 
 
26 
 
The court explained that the patient "died due to hypoxia brought about by 
inadequate anesthetic induction and a failure to intubate prior to initiation of the cesarean 
section" and, while the induction and intubation were tasks performed by the nurse 
anesthetist, the obstetrician had a statutorily imposed "duty of direction." Glassman, 267 
Kan. at 513, 526. Rather than communicating with the anesthetist to assure the induction 
was adequate and the patient had been intubated before initiating the surgery, the surgeon 
conducted the cesarean section. There was evidence the obstetrician had been told the 
patient was not intubated and that the obstetrician should have known from the tones 
emitted by the oximeter that the patient's level of oxygen was decreasing. These factual 
issues suggested a jury should determine the comparative fault of the two health care 
providers, both of whom had some active role in causing the mother's death. See 267 
Kan. at 523-24, 526. 
 
Thus, the obstetrician's liability did not arise from the nurse anesthetist's 
negligence but from his own negligent care and treatment of the patient. In other words, 
the heirs' claim against the obstetrician did not arise out of the nurse anesthetist's actions 
but out of the obstetrician's own actions, and K.S.A. 40-3403(h) did not apply.  
 
Because both Aldoroty and Glassman dealt with situations where two health care 
providers were negligent in providing care and treatment to a patient and the patient's 
injuries arose from the actions of each provider, those cases present a different situation 
than McVay or Lemuz. In McVay and Lemuz, the injuries arose out of the actions of the 
physician, and the hospital's liability would have arisen only from the failure to supervise 
the physician. Given these differences, we reject Cady's argument that Aldoroty and 
Glassman altered the holdings in McVay and Lemuz. 
 
 
 
 
 
27 
 
4. Aldoroty and Glassman Do Not Prevent Summary Judgment 
 
Finally, Cady argues that Aldoroty and Glassman prevent summary judgment in 
favor of Women's Care. We disagree.  
 
Cady's claims against Women's Care are more akin to those in McVay and Lemuz 
than those in Aldoroty and Glassman. Cady makes no claim that any employee of 
Women's Care who was not covered by the HCPIAA negligently treated her, so we do 
not have a factual situation like Aldoroty and Glassman. Instead, her claims against 
Women's Care for negligent supervision are like those asserted in McVay, and all of her 
claimed damages derive from the alleged wrongful acts of Schroll. Paraphrasing what 
this court said in McVay, Cady "would have [had] no claim against [Women's Care] if 
she had not been injured" by Schroll, her claim against Women's Care was "derivative of 
and dependent upon her claim" against Schroll, and her "injury arose out of the rendering 
of professional services" by Schroll. See McVay, 255 Kan. at 376-78. Consequently, 
K.S.A. 40-3403(h) bars Women's Care's liability, and the district court did not err in 
granting summary judgment.  
 
 
Judgment of the Court of Appeals affirming the district court is affirmed. 
Judgment of the district court is affirmed. 
 
 
JOHNSON, J., concurs in result.