Present: Carrico, C.J., Compton, Lacy, Hassell, Keenan, and 

Koontz, JJ., and Poff, Senior Justice 

DAVID T. SCHWARTZ, M.D., ET AL. 

 OPINION BY 

v. Record No. 960395 CHIEF JUSTICE HARRY L. CARRICO 

 February 28, 1997 

WILLIAM BROWNLEE 

 FROM THE CIRCUIT COURT OF THE CITY OF ALEXANDRIA 

Alfred D. Swersky, Judge 

 In this medical malpractice case, William Brownlee 

(Brownlee) was diagnosed as suffering from prostate cancer, and 

David T. Schwartz, M.D. (Dr. Schwartz), removed Brownlee's 

prostate gland in an operation which resulted in the successful 

excision of the cancer. Following this type of surgery, a 

patient normally suffers temporarily from incontinence, but 

Brownlee encountered serious difficulties during his postoperative treatment by Dr. Schwartz and became totally 

incontinent.1

 In an amended motion for judgment filed below, Brownlee 

sought damages from Dr. Schwartz, a licensed health care 

provider, and his wholly owned corporation, Metropolitan Medical 

Care, Inc. (MMC), a non-health care provider (the defendants). 

Brownlee alleged that he had sustained injuries as a result of 

Dr. Schwartz's post-operative negligence while acting as the 

agent of MMC. 

 

 1Both sides to this controversy recognize that a small 

percentage of prostatic surgery patients may suffer total 

incontinence despite the absence of negligence on the part of the 

physician in performing the surgery. Brownlee claims here, 

however, that his total incontinence resulted from the postoperative negligence of Dr. Schwartz and not as an incident of 

the surgery. 
 In a trial before a jury, the trial court ruled as a matter 

of law that Dr. Schwartz was the agent of MMC "during the 

relevant times" and instructed the jury accordingly. The jury 

returned a verdict in favor of Brownlee against Dr. Schwartz and 

MMC jointly and severally in the sum of $1,850,000. 

 The trial court ordered a remittitur of the verdict against 

Dr. Schwartz to $1 million, the medical malpractice cap 

established by Code § 8.01-581.15. However, the court refused to 

order a remittitur in favor of MMC and entered judgment against 

it in the full amount of the verdict. 

 The defendants filed a petition for appeal, which this Court 

refused. Later, this Court granted the defendants' petition for 

rehearing and awarded them this appeal. 

 In their petition for appeal, the defendants assigned three 

errors, the first alleging that Brownlee had "failed to prove a 

proximate cause relationship between the negligence alleged and 

his injury to a reasonable degree of medical certainty or 

probability." The gist of the defendants' argument on this point 

is that Brownlee's counsel failed to incorporate the phrase 

"reasonable degree of medical certainty" or "reasonable degree of 

medical probability" into the questions posed to Brownlee's 

expert witnesses. 

 However, in their petition for rehearing, the defendants 

made no mention of their first assignment of error or of any 

deficiency in the proof of causation, relying solely on the two 

remaining assignments of error in requesting that "this Court 

grant the Petition for Rehearing and grant a writ in this case." 
 In our opinion, the failure to include the first assignment of 

error in the petition for rehearing constitutes an abandonment of 

that assignment of error. We will consider, therefore, only the 

two remaining assignments of error. They are as follows: 

 2. The trial court erred when it denied defendant 

MMC's Motion to Dismiss as to it as a matter of law and 

instead directed a verdict for the plaintiff on the 

issue of whether Dr. Schwartz's performance of medical 

services was as an agent of MMC. 

 3. The trial court erred when it allowed a 

judgment in excess of the Virginia Medical Malpractice 

Cap to stand as to MMC, Dr. Schwartz's wholly owned 

corporation. 

 a. MMC's liability, which was 

predicated wholly on a theory of 

respondeat superior[,] cannot be 

greater than that of Dr. Schwartz, 

MMC's alleged agent. 

 b. Plaintiff is limited to the 

malpractice cap for damages arising 

from a single indivisible injury, 

even when there are multiple 

defendants jointly and severally 

liable for same, where at least one 

of the defendants is a "health care 

provider" as defined in the 

Virginia Code. 

 c. The trial court[']s refusal to 

remit as to MMC violates the 

mandate of Va. Code § 8.01-581.15. 

Agency. 

 The defendants argue that there was a conflict in the 

evidence concerning the agency question and, therefore, that the 

question should have been submitted to the jury for decision. 

The defendants' position is stated succinctly in their reply 

brief, as follows: 

 Dr. Schwartz and MMC maintained [that] Dr. Schwartz was 

not acting as MMC's agent at the time he rendered 

services to Brownlee. . . . There was admittedly 
significant evidence to the contrary. This issue 

should have been submitted to the jury. 

 However, while there may have been a conflict in the 

positions taken by the parties with respect to the agency 

question, there was no conflict in the facts with respect to that 

question. When "[t]here is no substantial conflict in the facts 

and circumstances disclosed by the evidence," it becomes "a 

question of law to be decided by the court whether [one party] 

was the agent of [another]." Creech v. Massachusetts Bonding 

Co., 160 Va. 567, 576, 169 S.E. 545, 548 (1933). 

 Here, the following facts were undisputed. Dr. Schwartz was 

MMC's president and sole shareholder.2 MMC leased from landlords 

and paid the rent on and otherwise managed the three offices Dr. 

Schwartz occupied in his medical practice. MMC billed Dr. 

Schwartz's patients for services rendered and collected his fees 

for those services. All the income Dr. Schwartz earned from his 

medical practice was assigned to MMC. The only income Dr. 

Schwartz received was in the form of rent paid to him by MMC for 

one of the offices he occupied in his practice. MMC paid all the 

expenses of Dr. Schwartz's practice, including the cost of 

advertisements "designed to solicit patients for [his] medical 

 

 2MMC is an S corporation chartered in Delaware. "An S 

corporation is a small business corporation for which an election 

under Subchapter S of the Internal Revenue Code . . . is in 

effect. I.R.C. § 136(a)(1)." Durando v. United States, 70 F.3d 

548, 549 n.2 (9th Cir. 1995). An S corporation gives a small 

business the advantage of providing limited liability for 

shareholders without the disadvantage of corporate taxation. Id.

at 551. 
practice" as well as the cost of his medical supplies, 

automobile, legal work, licensing, continuing education, and 

membership in professional associations. MMC deducted all these 

expenses on its tax returns. 

 The defendants cite Hadeed v. Medic-24, Ltd., 237 Va. 277, 

288, 377 S.E.2d 589, 594-95 (1989), for the proposition that in 

the context of medical malpractice, the crucial factor for 

determining whether a physician is the agent of another is the 

power of control. The defendants then argue that MMC did not 

control Dr. Schwartz, he controlled MMC. Therefore, the 

defendants conclude, it was for the jury to say whether Dr. 

Schwartz was the agent of MMC, acting within the scope of the 

agency at the time he rendered post-operative treatment to 

Brownlee. 

 We disagree with the defendants. As the defendants 

themselves point out, it is the power of control that is crucial 

to the determination whether an agency relationship existed 

between Dr. Schwartz and MMC. The evidence shows that the 

extensive authority Dr. Schwartz indisputably granted to MMC over 

his affairs, including MMC's dominion over the purse strings, 

clearly vested MMC with the power of control sufficient to 

support the trial court's finding, as a matter of law, that an 

agency relationship did exist between Dr. Schwartz and MMC at the 

time Dr. Schwartz rendered post-operative treatment to Brownlee. 

 Hence, the trial court did not err in its finding. 

Remittitur. 

 The defendants argue that the trial court erred in refusing 
to order a remittitur of the verdict against MMC to $1 million, 

the medical malpractice cap established by Code § 8.01-581.15. 

That Code section reads as follows: 

 In any verdict returned against a health care provider 

in an action for malpractice where the act or acts of 

malpractice occurred on or after October 1, 1983, which 

is tried by a jury or in any judgment entered against a 

health care provider in such an action which is tried 

without a jury, the total amount recoverable for any 

injury to, or death of, a patient shall not exceed one 

million dollars. 

 In interpreting this section, the definitions found in 

 § 8.01-581.1 shall be applicable. 

 Code § 8.01-581.1 defines the term "health care provider" in 

pertinent part as 

 a person, corporation, facility or institution licensed 

by this Commonwealth to provide health care or 

professional services as a physician or hospital, 

dentist, pharmacist, registered or licensed practical 

nurse, optometrist, podiatrist, chiropractor, physical 

therapist, physical therapy assistant, clinical 

psychologist, [or a] health maintenance organization. 

 The defendants concede that MMC "did not fall within the 

definition of health care provider in § 8.01-581.1 effective at 

the time of Brownlee's injury."3

 Nevertheless, the defendants 

say, "because MMC was jointly and severally liable with Dr. 

Schwartz, a health care provider subject to protection of The 

Cap, for a single and indivisible injury, . . . Brownlee's total 

recovery against all defendants is limited to what he is allowed 

to recover against Dr. Schwartz." 

 

 3A 1994 amendment to Code § 8.01-581.1, effective subsequent 

to Brownlee's injury, added a definition of "health care 

provider" to include "a corporation, partnership, limited 

liability company or any other entity, except a state-operated 

facility, which employs or engages a licensed health care 

provider and which primarily renders health care services." 
 Quoting Bulala v. Boyd, 239 Va. 218, 389 S.E.2d 670 (1990), 

the defendants say that "'a single limit . . . applie[s] to an 

indivisible injury to a plaintiff, even though it was caused by 

the concurring negligence of two or more defendants.'" Id. at 

228, 389 S.E.2d at 675. However, unlike the present situation, 

where one defendant is a health care provider and the other is 

not, both the defendants in Bulala were health care providers. 

Therefore, Bulala is inapposite. 

 Further, quoting Fairfax Hospital System v. Nevitt, 249 Va. 

591, 457 S.E.2d 10 (1995), which involved joint tortfeasors, the 

defendants state that "'in any judgment entered against a health 

care provider, the quantum of the recovery for a medical 

malpractice injury cannot exceed the aggregate amount capable of 

recovery.'" Id. at 598, 457 S.E.2d at 14. The defendants also 

quote from Nevitt to the effect that it is "'wholly immaterial'" 

that one of the tortfeasors was not a health care provider. Id.

 However, Nevitt presented a different issue. That case involved 

the interplay between Code § 8.01-581.15, which contains the 

medical malpractice cap, and Code § 8.01-35.1, which provides 

that the amount recovered against one tortfeasor shall be reduced 

by the amount paid in settlement by another tortfeasor. The 

issue in Nevitt was whether the amount paid in settlement by one 

tortfeasor should be deducted before or after the medical 

malpractice cap was applied to an excessive verdict against the 

other tortfeasor. It was in this context, differing 

substantially from the present situation, that we said it was 

"wholly immaterial" that the settling tortfeasor was not a health 
care provider. 

 The most analogous case is Taylor v. Mobil Corp., 248 Va. 

101, 444 S.E.2d 705 (1994). There, the negligent physician had 

allowed his license to lapse. Yet, he and his employer, a nonhealth care provider, both claimed entitlement to the protection 

of the medical malpractice cap from a $4 million verdict returned 

against them. The trial court ordered a remittitur of the 

verdict to $1 million with respect to both defendants. We said 

that "[s]ince [the physician] was not licensed in the 

Commonwealth when he rendered the services to [the patient], he 

was not a health care provider within the purview of the 

statute," id. at 109, 444 S.E.2d at 709, and we held that "the 

trial court erred in its application of the medical malpractice 

cap to the verdict," id. at 110, 444 S.E.2d at 710. 

Taylor is clear authority for the proposition that one who 

is unlicensed as a health care provider in this Commonwealth, 

whether principal or agent, is not entitled to the protection of 

the medical malpractice cap. MMC was not licensed as a health 

care provider in this Commonwealth. Hence, it is not entitled to 

the protection of the cap. 

 The defendants argue, however, that "the only theory on 

which MMC could conceivably have been held liable for any injury 

to Brownlee is upon the derivative liability arising from the 

respondeat superior doctrine." Under the common law, the 

defendants continue, the amount of a judgment against a principal 

cannot be greater than the amount of the judgment against the 

agent tortfeasor. Hence, the defendants conclude, the trial 
court erred in refusing to order a remittitur of the verdict 

against MMC to $1 million. We have no quarrel with the 

defendants' argument that, at common law, the liabilities of 

principals and agents are coterminous. That view has been 

recognized in Virginia. In Monumental Motor Tours v. Eaton, 184 

Va. 311, 35 S.E.2d 105 (1945), we said that when a master and 

servant are sued together and the master's liability rests solely 

upon the servant's negligence, "a verdict which in terms finds 

for the servant and against the master or is silent as to the 

servant and finds against the master, is . . . predicated upon a 

misapprehension of the law." Id. at 314-15, 35 S.E.2d at 106 

(quoting Barnes v. Ashworth, 154 Va. 218, 229, 153 S.E. 711, 713 

(1930)). 

 The common law continues in full force in Virginia except 

as altered by the General Assembly. Code § 1-10. The General 

Assembly may abrogate the common law, but its intent to do so 

must be plainly manifested. Wackwitz v. Roy, 244 Va. 60, 65, 418 

S.E.2d 861, 864 (1992). "Statutes in derogation of the common 

law are to be strictly construed and not to be enlarged in their 

operation by construction beyond their express terms." Blake 

Construction Co. v. Alley, 233 Va. 31, 34, 353 S.E.2d 724, 726 

(1987) (quoting C. & O. Railway Co. v. Kinzer, 206 Va. 175, 181, 

142 S.E.2d 514, 518 (1965)). 

 We are of opinion that in the enactment of Code § 8.01-

581.15, the General Assembly has abrogated the common law and 

that its intent to do so is plainly manifested. By making the 

medical malpractice cap applicable only to licensed health care 
providers and denying the protection of the cap to non-health 

care providers, the General Assembly has provided in medical 

malpractice cases an exception to the rule that the liabilities 

of principals and agents are coterminous. 

 In the medical malpractice context, the exception is a rule 

of reason. The General Assembly enacted the medical malpractice 

cap for the purpose of enabling licensed health care providers to 

secure medical malpractice insurance at affordable rates. See

Etheridge v. Medical Center Hospitals, 237 Va. 87, 93-94, 376 

S.E.2d 525, 527-28 (1989). It would not serve that purpose to 

extend the protection of the cap to non-health care providers, 

and we will not ascribe to the General Assembly an intent to make 

such an extension. Rather, as indicated supra, we think it was 

the legislative intent, clearly manifested, to except such nonhealth care providers from the protection of the cap. 

 For the reasons assigned, we will affirm the judgment of the 

trial court. 

Affirmed.