IN THE COURT OF APPEALS OF TENNESSEE

AT KNOXVILLE

October 16, 2003 Session

CARL A. LINDBLAD, M.D., v. PARKRIDGE HEALTH SYSTEM, INC., ET

AL.

 Appeal from the Circuit Court for Hamilton County

No. 99C2383 W. Neil Thomas, III, Judge

No. E2003-00221-COA-R3-CV

The Plaintiffresigned his position as Director of the hospital’s emergency services. Parkridge Health

System, Inc. d/b/a East Ridge Hospital, [hereafter “the hospital” or “Defendant”] accepted his

resignation and terminated his staff privileges in accordance with an employment Agreement. The

hospital’s bylaws required notice and hearing, which were not followed. The Plaintiff filed this

action asserting that in failing to observe its bylaws the hospital breached its contract with him since

the bylaws were an integral part of the contract. The Chancellor granted the hospital’s motion for

summary judgment, holding that the Agreement, which provided for termination of staff privileges

controlled the issue. We affirm. 

Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Circuit Court Affirmed

WILLIAM H. INMAN, SR. J., delivered the opinion of the court, in which HERSCHEL P. FRANKS and

CHARLES D. SUSANO, JR., JJ, joined.

Larry L. Crain, Brentwood, Tennessee, attorney for appellant, Carl A. Lindblad.

Sue E. Scruggs and C. Eugene Shiles, Chattanooga, Tennessee, attorneys for appellee, Parkridge

Health Systems, Inc. d/b/a East Ridge Hospital.

OPINION

At relevant times the Plaintiff was a licensed physician, and the Director of the Defendant

hospital’s emergency room. He was the sole shareholder of a corporation styled Associates in

Emergency Medicine [hereafter “Associates”], chartered in 1995. His practice was limited to

providing emergency medical treatment at the hospital; he had no private patients, and he neither

sought nor obtained admitting or attending privileges at the hospital.

In July 1999, he ordered, apparently sub rosa, a quantity of narcotic drugs from Henry

Schein, Inc., a distributor of medical supplies and medications, which were delivered to him, by
1

 The drugs included 500 Xanax 200 mg. tablets, a Schedule IV drug, 500 hydrocodone ASAP tablets, a

Schedule II drug, one pint of hydrocodone syrup, and one pint of hydrocodone with homatropine syrup.

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parcel post, at the hospital.1 The package was discovered by hospital personnel who opened it, and

examined the contents which were later delivered to the Plaintiff.

Narcotic drugs are closely regulated by state and federal law, as well as by hospital policy

which prohibits the acquisition or dispensing of drugs except in strict compliance with the applicable

laws, regulations, and policies of the hospital.

For the purpose of ascertaining from the plaintiff the purpose and intended use of these drugs

a meeting was held, on August 13, 1999, with members of the hospital’s Pharmacy and Therapeutics

Committee in attendance. Present were Brenda Waltz, (CEO of the hospital); Dr. America Jones,

(Director of Pharmacy); Dr. Donald Hartsfield, who was the Chair of the Committee, and the

Plaintiff. The Plaintiff was informed that an explanation of the matter was necessary because, inter

alia, the quantity of the drugs delivered to him exceeded the amount of the same drugs in the

pharmacy’s inventory, and his acquisition of these drugs was violative of hospital policy.

The Plaintiff stated that he bought the drugs “to keep around the house for family, friends”,

as well as neighbors. Dr. Hartsfield testified that Dr. Lindblad said that he had obtained the drugs

to do his friends a favor. It developed that Dr. Lindblad had previously purchased drugs from the

same source. He admitted in his deposition that he did not establish a doctor-patient relationship

with family, friends or neighbors prior to dispensing drugs/medications and did not maintain any

documentation of his dispensation of drugs. According to Dr. Hartsfield, when the Plaintiff was

informed by the Director of Pharmacy that he could not take delivery of controlled substances at the

hospital, he became defensive and stated that “as a physician he could do what he wanted to with the

drugs.” Dr. Jones described Plaintiff’s response as “belligerent, very angry, defensive and [he]

threatened me.” Dr. Hartsfield testified that “[h]e didn’t give us a clear sense that he was not going

to cease getting controlled substances.” Dr. Jones was concerned because, as she testified, “. . . Joint

Commission for Accreditation of Hospitals makes me solely responsible for every medication that

flows through the hospital”, including samples brought by doctors from their offices.

The Plaintiff’s response and the hospital’s concern about the large quantity of drugs ordered

by the Plaintiff and delivered to the hospital resulted in Ms. Waltz informing the Plaintiff that he

should find other physicians to take his shifts until the drug situation was clarified, but Associates

continued to provide exclusive services to the hospital’s emergency department. The Plaintiff did

not protest arrangements and agreed that he would not work. Apparently, this temporary

arrangement did not constitute disciplinary action under the bylaws but was taken pursuant to and

consistent with ¶ 1.4 of the Professional Services Agreement [“Agreement”], hereafter discussed.

On the same day of the Committee meeting, Ms. Waltz contacted Dr. Gary Olbrich, the

Medical Director of the Medical Foundation Physicians Health Program, more commonly known

as the “Tennessee Impaired Physician’s Program”, who agreed to confer with the Plaintiff, and did
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so, six days later. The initial assessment by Dr. Olbrich included a psychosocial evaluation, as well

as an addiction medicine evaluation, but with no actual drug screening. Dr. Olbrich testified that he

found the Plaintiff to be forthcoming and not an immediate risk to return to work; he testified that

he routinely asks hospitals to give physicians within the program “a medical leave of absence

pending review of the circumstances.” To form a reasoned opinion about the Plaintiff’s conduct and

perhaps facilitate his return to the hospital, Dr. Olbrich had the following discussion with the

Plaintiff:

Q. What did you tell Dr. Lindblad as far as your understanding

to get back to the hospital administration?

A. I asked him - well, we discussed several options. As I told

him, that based on the information that I had been able to

obtain from him, I saw no particular reason to tell that we had

any collating [sic] information to indicate that he might be a

substance abuser or have a chemical dependency. There was,

however, the allegation that he had received a large amount of

mood-altering drugs, for what purpose, we don’t know and

that it would be in his best interest to help resolve the

difficulty and preserve his reputation if we could establish

that beyond just my word and our interview that there was no

evidence of chemical dependency. I don’t know – I honestly

don’t remember specifically what I discussed with Dr.

Lindblad, but the options usually are to ask them – they –

someone like this who has a low level of suspicion, I would

offer them the opportunity to do random urine drug screens

over a period of time, usually a year, to determine – and

almost without question if someone is chemically-dependent,

we will catch them with the use of – an inappropriate use of

a mood-altering drug during that time. An extreme form

would be – you know, the ultimate form actually is to go into

a 3-5 day residential evaluation where you have a team of

assessors. And I’m certain based on the information I

received that I did not say he needed that unless he might

need that to satisfy people who were concerned about him.

Questions hovered nevertheless, not only about whether Dr. Lindblad might be a drug abuser,

but whether he might have improperly distributed drugs to others. In an earlier telephone

conversation secretly recorded by the Plaintiff between Dr. Olbrich and himself,DrOlbrich appeared

to be alarmed about the Plaintiff’s activities:

Plaintiff: First off, I wanted to let you know that I don’t have a

“problem”. I don’t take drugs, I don’t use alcohol,
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although I did have a toasted almond in the Bahamas

three weeks ago. People may consider that . . . 

Dr. Olbrich: Tell me why so many – such large amounts of drugs

were ordered.

Plaintiff: Well, you know, I ordered them because they were

cheaper to order them that way, that’s the only reason.

Dr. Olbrich: You ordered them for the Emergency Room:

Plaintiff: No, no, I just keep them around the use for my

neighbors, friends, things like that.

Dr. Olbrich: Well, I’ve got a problem with that, too, but we’ll talk

about that later.

Plaintiff: Yeah, okay. Yeah, okay. What – what I didn’t

understand was that the hospital had turned me in for

– for what? I mean, is it just the drugs or what? 

Dr. Olbrich: Well, apparently, they were concerned about you.

Plaintiff: Uh huh.

Dr. Orbrich: Well, it’s a long, complicated story.

Plaintiff: Right.

Dr. Orbrich: It’s not okay to be prescribing for friends, neighbors,

family and whatever.

Plaintiff: Uh huh.

Dr. Orbrich: That’s simply not okay.

Plaintiff: Right.

Dr. Orbrich: Particularly in this state. And that’s the antibiotics or

anything – certainly scheduled drugs.

Plaintiff: Right.
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Dr. Orbrich: And they were just real concerned about what was

going on.

Plaintiff: Right.

Dr. Orbrich: It looked like drug trafficking, it could look like there

was an addiction with you or some member of your

team.

Plaintiff: Right

Dr. Orbrich: They just felt a real – and I would confirm –

responsibility to investigate it.

Plaintiff: Well, I’m the one who went to the DEA. I don’t

know if they called or not, but I went to the DEA,

myself.

Dr. Orbrich: Okay.

Plaintiff: Because I wanted to know if there was some kind of

legal problem - you know, am I breaking some kind of

law or something? I mean, if I was . . . .

Dr. Orbrich: If the Court of Medical Examiners found out you were

ordering these and giving them to non-patients, your

license would be in real jeopardy.

Plaintiff: Right, well, I even told them that I would flush them

down the toilet for all I care. I mean, it’s not that

important for me. I don’t need them. I just keep them

around for the convenience of myself and other

people. And actually, I guess the reason I even order

any of that stuff, even the antibiotics and every thing

else that went with it, of course, was that nobody

details anything anymore. It used to be everybody

kept all this stuff around all the time, and now they

don’t even . . .

Dr. Orbrich: . . . . in all fairness, Doctor, not in large quantities like

that.

Plaintiff: Uh huh.
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Dr. Orbrich: You know, they might take some samples home from

work, or they might have a prescription for

Hydrocodone or might have a little bit of cough syrup,

but you know, you’ve got enough there to get a lot of

people pretty high.

Plaintiff: Well, you know, in retrospect, it was a lot, but it was

cheaper to buy them that way, so I got them that way,

you know, but . . . .

Dr. Orbrich: That’s showing me a lot of naivete.

The day after Dr. Olbrich met with Dr. Lindblad and discussed the hospital’s legitimate

concerns and how they might be alleviated, including the use of drug testing, the Plaintiff, on behalf

of his corporation voluntarily terminated the Agreement, including the Exclusive Provider

Agreement, for emergency services with the hospital. The effective termination date was August

24, 1999. Thereafter the Plaintiff secreted the drugs and then flushed them down the toilet. In

describing these actions, Dr. Lindblad in his deposition stated:

A: Yeah. So I took them home. And, to be perfectly honest with

you – I don’t want to be negative, too negative, about this;

but, to be perfectly honest with you, I didn’t know what HCA

would do, so I hid them. I hid them for about four months.

Then I wasn’t going to use them, so I threw them away.

Q: Threw them away. Where?

A: In the toilet.

In response to Plaintiff’s cancellation of the Agreements the hospital sent Plaintiff a letter

accepting the termination of the Agreement and, citing the Exclusive Provider Agreement,

(Addendum 1) advising him that his medical staff privileges were terminated. The Exclusive

Provider Agreement provided for the termination of staff membership and privileges of any of

Associates’ representative after the Agreement had been terminated for any reason.

The Plaintiff had no further contact with the hospital after he terminated the Agreement. He

did not indicate that he considered the termination of his privileges or any other action/position of

the hospital as adverse or disciplinary, and did not request a hearing under the bylaws.

This action was filed December 27, 1999 as amended on March 25, 2002 to join Associates

in Emergency Medicine as a party Plaintiff, alleging that the Defendant (1) wrongfully revoked his

hospital privileges, (2) deliberately interfered with his livelihood, (3) defrauded him, and (4)
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breached his contract. He alleged that through his physician group (AEM), he entered into a

Professional Services Agreement to render professional emergency services at the hospital, effective

July 1, 1994, for a period of five years, and that he resigned August 24, 1999.

He further alleged that he did not forfeit or surrender his clinical privileges as a staff

physician at the hospital, because under the bylaws clinical privileges cannot be terminated without

due process, i.e., notice and hearing, which was not accorded him. He alleged that the Defendant

Waltz sent him a letter terminating his staff membership and clinical privileges effective August 24,

1999.

He alleged that on August 13, 1999 he was summoned to the office of CEO Baltz who, with

others, confronted him about a package addressed to him which “contained an order of common

medications of the type routinely ordered by physicians.” He was informed by Ms. Baltz that he

could no longer work at the hospital pending an investigation, and that at no time was he afforded

a hearing as required by the bylaws. He learned from Dr. Olbrich that the Defendants accused him

of suspected drug abuse, drug trafficking, and using the hospital’s DEA number to order drugs.

The Defendants filed an answer alleging that the Plaintiff resigned his position as of August

24, 1999 following which his medical staff privileges were terminated as contractually provided.

The answer was amended to assert that Ms. Waltz was immune from liability pursuant to a specific

provision of the hospital bylaws. Further, the hospital alleged that if its conduct was “adverse”,

within the meaning of its bylaws, the actions barred because the Plaintiff failed to exhaust his

administrative remedies afforded by the bylaws.

On March 5, 2002 the Defendants filed a joint motion for summary judgment alleging the

absence of any genuine issues of material fact and that the Defendants were entitled to judgment as

a matter of law.

The trial judge filed a memorandum opinion, which, as excerpted, found:

The plaintiff is a licensed practicing medical doctor who was

the physician director of the emergency room of East Ridge Hospital

(“East Ridge”). He limited his practice to providing emergency

medicine at East Ridge and had no private practice or patients of his

own. His privileges were limited to the practice of emergency

medicine. The plaintiff was the sole owner of Associates in

Emergency Medicine (“Associates”), a corporation which in 1995

contracted with the hospital to be the exclusive provider of

emergency room services at East Ridge. East Ridge and Associates

entered into a Professional Services Agreement to provide emergency

medicine on March 24, 1995, and an Addendum on January 10, 1996

(hereinafter both of which are referred to as the “Agreement”). The
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term of the Agreement was from July 1, 1994, to June 30, 1999, and

was not renewed. Section 3.2 of the Agreement provides as follows:

Either party may terminate this Agreement, without cause, by

providing no less than 60 (sixty) days’ prior written notice stating the

intended day of termination, which shall occur not sooner than the

first annual anniversary of Effective Date.

The Addendum to the Agreement provides in [S]ection 6 as follows:

Upon the termination of this Agreement for any

reason, Facility may terminate or other wise qualify or

limit the medical staff membership and/or clinical

privileges of any or all of Contractor’s

Representatives. Further, upon any severance of the

affiliation between Contractor and a Contractor’s

Representative, Facility may terminate or otherwise

qualify or limit the medical staff membership and/or

clinical privileges of such Contractor’s

Representative. The rights of Facility under this

Section shall supercede any contrary terms as may be

established in the Medical Staff Bylaws. Contractor

shall deliver to Facility a written statement form each

Contractor’s Representative acknowledging and

agreeing to these concurrent termination provisions.

In June or July of 1999, the Plaintiff received a package of

drugs, which was addressed to the Plaintiff but which utilized the

hospital’s street address. The drugs purchased by the Plaintiff

included controlled substances such as xanax, benzodiazepine, and

hydrocodone. The delivery ticket for the package was addressed to

Dr. Carl Lindblad, not East Ridge, and at all times it was Dr.

Lindblad’s property. After the discovery of the drugs a meeting was

held among the hospital’s chief executive officer, the pharmacy

director, and the chairman of the Pharmacy and Therapeutic

Committee on August 13, 1999, after which the Plaintiff was placed

on leave. During this meeting the Plaintiff responded to all of the

questions put to him regarding the drugs and stated that the

medications were for his family, friends and neighbors. No records

were kept of medications dispensed to family, friends or neighbors in

need of such medications. After this meeting Brenda Waltz, the chief

executive officer of East Ridge, contacted Dr. Gary Olbhrich [sic] of

the medical foundation known as the “Tennessee Impaired

Physician’s Program,” to “clarify” the situation with Plaintiff’s use of
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drugs. The Plaintiff met with Dr. [Olbrich] on August 19, 1999, and

after this meeting Dr. [Olbrich] assured the Plaintiff that there was

nothing for him to worry about. Aside from his being naive, Dr.

Lindblad was advised that in Dr. [Olbrich’s] opinion there was no

problem which warranted any further action. Dr. [Olbrich] informed

Brenda Waltz of his conclusion on or about August 20, 1999. On

August 20, 1999, the Plaintiff submitted a notice of termination, the

effective date of which was August 24, 1999. That letter reads as

follows:

This is to inform you that as of 7 a.m. on Tuesday

August 24, 1999, Associates in Emergency Medicine,

will no longer be providing Emergency Physician

Services at East Ridge Hospital.

In response, the Hospital sent the Plaintiff a letter acknowledging the

receipt of his letter, and, citing the Agreement, advised the Plaintiff

that his medical staff privileges were terminated. That letter reads in

part as follows:

Please be advised that in accordance with the

provisions of Section 6 of Addendum 1 of the

Agreement, the Hospital has elected to terminate your

medical staff membership and clinical privileges

effective on the date of termination of the Agreement

as set forth above. The medical staff membership and

clinical privileges of the other members of the Group

will continue unaffected. Please note that it is our

position that termination as set forth here is not a

reportable action under the Health Care Quality

Improvement Act and its interpretive regulations.

The Plaintiff submitted the affidavit of Dr. James H. Creel,

the medical director for the emergency department at Erlanger

Hospital, in opposition to the motion. In his affidavit Dr. Creel states

that the conduct of East Ridge constituted a violation of the medical

staff Bylaws in effect at East Ridge in August of 1999. Dr. Creel

opines that the due process provision of Article 7 of the Bylaws

requires initiation by East Ridge of proceedings to terminate his

privileges. This opinion, however, begs the question of whether the

Bylaws apply to the situation presented in this lawsuit. 

* * * * *
2

In footnote 5 on page 12 of his brief the Plaintiff concedes the if “the Defendants had automatically extended

Dr. Lindblad’s contract then the bylaws would not have controlled the outcome.”

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The Plaintiff argues that the East Ridge Bylaws constitute the

contract, since the Agreement expired by its terms on June 30, 1999.

Under [S]ection 3 of the East Ridge Hospital Medical Staff Bylaws

each practitioner at East Ridge agreed to abide by the bylaws, rules,

and regulations and policies as amended and issued from time to

time.

The Plaintiff argues that once the formal contract between

East Ridge and Associates expired on June 30, 1999, the legal

relationship between the Plaintiff and East Ridge was governed

wholly under the terms of the East Ridge Bylaws.2 In his brief,

however, Dr. Lindblad cites no case to establish that the relationship

between two contracting parties is not governed by the contract where

the contract has expired.

Before deciding whether the Agreement applies or the Bylaws

apply the Court will discuss a case relied on by both parties.

Lewisburg Community Hospital, Inc. v. Alfredson, 805 S.W.2d 756

(Tenn. 1991). In Lewisburg Hospital the Hospital terminated a

doctor’s privileges and denied him access. As here, the hospital

maintained that its bylaws did not constitute a contract with the

doctor and that he was not entitled to a hearing. The doctor argued

to the contrary. The Supreme Court held that the bylaws were an

integral part of the contract with the doctor. The facts, however,

depart from the facts of this case at that point. The doctor’s first

contract with Lewisburg Hospital expressly stated that either party

could cancel on ninety days’ notice, and, in the event of termination,

the clinical privileges would also terminate. The second contract,

however, deleted that provision, thereby kicking in the application of

the bylaws. The Supreme Court required the hospital to abide by its

bylaws and give the doctor a fair hearing. In rejecting the argument

of the hospital the Supreme Court held:

The Hospital’s argument ignores the fact that it made

a business decision when it agreed to delete the

automatic termination of Alfredson’s clinical

privileges from the 1984 exclusive radiology contract.

Had it not made that business decision, Alfredson

would have no claim for breach of contract.
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If, therefore, the Bylaws apply, the Plaintiff prevails. If they did not,

then, as Plaintiff concedes, the Defendants prevail.

It now must be determined whether the Agreement applies or

the Bylaws apply. In doing so the intention of the parties must be

determined. In that regard, the “ascertainment of the intention of the

parties to a written contract is a question of law rather than a question

of fact.” Doe v. HCA Health Services of Tennessee, 46 S.W.3d 191

(Tenn. 2001); see also, Allman v. Boner, 1993 Tennessee Appeals

LEXIS 793 (Ct. App.1993).

The next issue to be considered, therefore, is whether a

contract existed between the parties on August 20, 1999, and, if so,

its terms. Although the Agreement expired by its terms on June 30,

1999, that does not end the inquiry. If the parties to an expired

agreement with a definite term continue to perform as if the

agreement were still in effect, it is presumed that they are serving

under a new contract with the same terms as the old. Delzell v. Pope,

294 S.W.2d 690 (Tenn. 1956). In order to make this determination

the conduct of the parties will be examined. On July 7, 1999, the

Plaintiff applied for reappointment to East Ridge. Until August 13,

1999, the Plaintiff continued to provide services to East Ridge, and

East Ridge accepted those services on an exclusive basis. On August

20, 1999, it is significant that the Plaintiff gave notice to terminate the

Agreement between Associates and EastRidge. Finally, Dr. Lindblad

has testified that he believed the Agreement to be still in effect.

Accordingly, the Bylaws are not applicable to the termination, and the

Defendants are entitled to partial summary judgment on this issue.

* * * * * 

The Standard of Review

The standard of review on appeal of a grant of summary judgment is de novo upon the record

without a presumption of correctness to determine whether the absence of genuine and material

factual issues entitle the movant to a judgment as a matter law. Goodloe v. State, 36 S.W.3d 62, 65

(Tenn. 2001). The movant must either affirmatively negate an essential element of the non-movant’s

claim or conclusively establish an affirmative defense; mere conclusory assertions that the nonmovant has no evidence are insufficient; and if the movant does not negate a claimed basis for the

suit, the non-movant’s burden to produce evidence establishing the existence of a genuine issue for

trial is not triggered and the motion for summary judgment must fail, If, however, the movant

successfully negates a claimed basis for the suit, the non-movant may no longer simply rely upon

the pleadings, but must then establish the existence of the essential elements of the claim or the non-
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existence of the defense. Finister v. Humboldt General Hosp., Inc., 970 S.W.2d 435, 438 (Tenn.

1998).

In reviewing the record to determine whether summary judgment requirements have been

met, this Court must view the evidence in the light most favorable to the nonmoving party and must

draw all reasonable inferences in the nonmoving party’s favor. Byrd v. Hall, 847 S.W.2d 208, 210-

11 (Tenn. 1993). A summary judgment may be proper, therefore, only “when there is no dispute

over the evidence establishing the facts that control the application of a rule of law.” Ib. at 214-15:

Tenn. R. Civ. P. 56.

The Issue

The restated issue is whether summary judgment was properly granted with respect to the

Plaintiff’s claim for breach of contract arising out of his summary suspension from the medical staff

of the Hospital.

Analysis

The issue is necessarily resolvable either by (1) the bylaws of the Hospital, or (2) the contract

between the parties.

The contract, described as a Professional Services Agreement, became effective July 1, 1994

and expired June 30, 1999. It provides that 

Either party may terminate this Agreement, without cause, by

providing not less than 60 days prior written notice stating the

intended date of termination, which shall occur not sooner than the

first a annual anniversary of the effective date.

It further provides that

Either party may terminate this Agreement at any time in the event

the other party engages in an act or omission constituting a material

breach of any term or condition of this Agreement . . . . and upon any

termination of this Agreement, neither party shall have further right

against, or obligations to, the other party, except . . . . this Agreement

. . . . supersedes all prior Agreements, contracts and understandings

. . . .between the parties.

Addendum One to the Agreement, Section 6, described as the Exclusive ProviderAgreement,

provides

Upon the termination of this Agreement for any reason, Facility may

terminate . . . the medical staff membership and/or clinical privileges
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of any or all of contractor’s representative. . . . the rights of Facility

. . . Shall supersede any contrary terms as may be established in the

Medical Staff By-laws . . .

The original Bylaws, adopted April 12, 1994 made no provision for a due process hearing,

but in April 1999 the Bylaws were amended to provide that:

Any practitioner whose contractual engagement by the Hospital

requires membership on the medical staff shall not have his/her

medical staff membership or admitting and clinical privileged

terminated without the right to hearing and appeal. . . .

Dr. Olbrich informed Ms. Waltz, the Hospital’s CEO, on August 20, 1999 that there was no

problem with the Plaintiff which warranted further action. On that same day, the Plaintiff tendered

his resignation effective August 24, 1999. He wrote

This is to inform you that as of 7 a.m. on Tuesday, August 24, 1999,

Associates in Emergency Medicine will no longer be providing

Emergency Physician Services at East Ridge Hospital.

The Hospital responded by citing the Agreement and informing the Plaintiff that his medical

staff privileges were terminated in accordance with Section 6 of Addendum 1 of the Agreement.

The Plaintiff argues that the Agreement expired June 30, 1999 and thus his legal relationship

with the Hospital was governed by its bylaws which required notice and hearing by virtue of the

April 1999 amendment. The Defendant argues that although the formal Agreement expired by its

own terms on June 30, 1999, both parties continued to perform as though the Agreement was still

in effect, thereby giving rise to the presumption that they are performing under a new contract with

the same terms as the old. This is the rule in Tennessee. Delzell v. Pope, 294 S.W.2d 690 (Tenn.

1956); Ward v. Berry and Associates, 614 S.W.2d 372 (Tenn. Ct. App. 1981); McCall v. Oldenburg

382 S.W.2d 537 (Tenn. 1964). We note that the Plaintiff cannot, as is sometimes said, have it both

ways; if he had been instructed to vacate the premises when his Agreement expired, he would have

no justiciable reason whatever to maintain this action. But with the consent of the Hospital he

continued to work, thereby implicating the rule announced in Delzell. The Agreement remained in

effect and was not invalidated by the April 1999 Amendment to the Bylaws. It follow that the

Hospital acted within its contractual rights when it terminated the Plaintiff’s staff privileges. The

judgment is affirmed at the costs of the Appellant.

___________________________________ 

WILLIAM H. INMAN, SENIOR JUDGE