Present: Carrico, C.J., Compton, Stephenson, Lacy, Hassell, 

and Koontz, JJ., and Whiting, Senior Justice 

JAMES J. MCDONALD 

v. Record No. 961831 OPINION BY JUSTICE ELIZABETH B. LACY 

 June 6, 1997 

HAMPTON TRAINING SCHOOL 

FOR NURSES, d/b/a SENTARA 

HAMPTON GENERAL HOSPITAL 

 FROM THE CIRCUIT COURT OF THE CITY OF HAMPTON 

William C. Andrews, III, Judge 

 In this appeal in a medical malpractice case, we consider 

whether the trial court properly held that, because a physician 

exercised independent medical judgment in performing his 

duties, he was an independent contractor as a matter of law. 

 The plaintiff, James J. McDonald, sued Hampton Training 

School for Nurses, d/b/a Sentara Hampton General Hospital (the 

Hospital) alleging that Richard F. Clark, M.D., a pathologist 

at the Hospital, negligently interpreted McDonald's pathology 

specimens and failed to timely diagnose cancer. McDonald did 

not allege any independent acts of negligence by the Hospital, 

but asserted the Hospital was liable solely through the 

doctrine of respondeat superior. The trial court entered an 

order granting the Hospital's motion to strike McDonald's 

evidence and dismissing the case finding that, as a matter of 

law, Clark was an independent contractor rather than an 

employee of the Hospital. Because we conclude that the 

evidence presented a jury question on the issue of Clark's 

employment status, we will reverse the judgment of the trial 

court and remand the case. 

 The doctrine of respondeat superior imposes liability on 
an employer for the negligent acts of its employees. If, 

however, the negligent acts were performed by an independent 

contractor rather than an employee, no master-servant 

relationship exists between the contractor and employer, and 

the employer is not liable for the negligent acts. Norfolk and 

Western Ry. Co. v. Johnson, 207 Va. 980, 983, 154 S.E.2d 134, 

137 (1967). The factors which are to be considered when 

determining whether an individual is an employee or an 

independent contractor are well established: (1) selection and 

engagement; (2) payment of compensation; (3) power of 

dismissal; and (4) power to control the work of the individual. 

 The fourth factor, the power to control, is determinative. 

Hadeed v. Medic-24, Ltd., 237 Va. 277, 288, 377 S.E.2d 589, 

594-95 (1989). This factor refers to control over the means 

and method of performing the work. Baker v. Nussman & Cox, 152 

Va. 293, 304, 147 S.E. 246, 249 (1929). It is immaterial 

whether the employer exercises this control; the test is 

whether the employer has the power to exercise such control. 

Smith v. Grenadier, 203 Va. 740, 746, 127 S.E.2d 107, 111-12 

(1962). 

 The trial court's determination in this case turned upon 

the Hospital's lack of control over Dr. Clark's exercise of his 

professional judgment in carrying out his duties as a 

pathologist at the Hospital.1

 The trial court found that there 

 

 1 1The trial court also relied on its interpretation of 

Messina v. Burden, 228 Va. 301, 321 S.E.2d 657 (1984), in 

concluding that Dr. Clark was an independent contractor. The 

trial court referred to the language in Messina stating that 

the James doctors "were essentially independent contractors as 
was "nothing contractually or factually" to suggest that the 

Hospital controlled the way that Dr. Clark performed his duties 

but that he used "his independent professional judgment, based 

on his education and his training and his experience to do 

that." Thus, the trial court held, as a matter of law, that 

Clark was an independent contractor, not an employee, of the 

Hospital. 

 The Hospital asserts that the trial court was correct in 

relying on the Hospital's inability to control Dr. Clark's 

exercise of his professional judgment as conclusive in the 

determination of his independent contractor status. We do not 

agree. The proposition adopted by the trial court and argued 

by the Hospital here may have been a correct statement of the 

law at one time; however, it is inconsistent with current case 

law in this jurisdiction and with the methods of operation 

currently utilized by health care providers. 

 As early as 1920, this Court held in Virginia Iron, Coal 

 

far as their relationship with their patients was concerned," 

id. at 312-13, 321 S.E.2d at 663, as the Messina court's 

explanation that the doctors in James were denied sovereign 

immunity because they were independent contractors. Noting the 

similarity between Dr. Clark's situation and that of the 

doctors in James, the trial court concluded that Dr. Clark must 

also be an independent contractor. This is an incorrect 

application of the language in Messina. Neither James nor 

Messina involved the status of an individual for purposes of 

respondeat superior. The issues in these sovereign immunity 

cases were governed by the test for determining whether a 

governmental employee is entitled to sovereign immunity. This 

test involves four factors, one of which is the control 

exercised by the governmental employer; however, all four 

factors must be considered, and the control factor is not 

determinative of the result. Compare James v. Jane, 221 Va. at 

53, 282 S.E.2d at 869, with Hadeed, 237 Va. at 288, 377 S.E.2d 

at 594-95. 
& Coke Co. v. Odle's Administrator, 128 Va. 280, 105 S.E. 107 

(1920), that, although a mining company could be liable for the 

malpractice of a physician employed by it based on the 

company's agreement to furnish medical services to the 

employee, this liability could not be based upon the doctrine 

of respondeat superior. There could be no master-servant 

relationship between the company and the physician, the Court 

explained, because the doctor was employed "to render 

professional services requiring special education and training, 

and involving the exercise of skill and judgment, which could 

not, in the nature of things, be controlled by the will and 

direction of the company. . . . The position of the doctor was 

rather that of an independent contractor." Id. at 288-89, 105 

S.E. at 109. This was the prevailing rationale throughout the 

country at that time. See, e.g., Schloendorff v. Society of 

New York Hospital, 105 N.E. 92 (N.Y. 1914); Runyan v. Goodrum, 

228 S.W. 397 (Ark. 1921); Joel D. Cunningham, The HospitalPhysician Relationship: Hospital Responsibility for 

Malpractice of Physicians, 50 Wash. L. Rev. 385, 388-90 (1975). 

Weston's Administratrix v. Hospital of St. Vincent of 

Paul, 131 Va. 587, 107 S.E. 785 (1921), decided a year after 

Virginia Iron, reconfirmed that view in Virginia. In that 

case, a patient sought to impose liability on a charitable 

hospital based on the negligence of a nurse in its employ. 

Justice Burks, writing for the Court, stated that hospitals 

were not liable for the negligence of nurses and physicians 

because there can be no master-servant relationship between a 
hospital and a physician or nurse. 107 S.E. at 787.2

 A physician's status as an independent contractor rather 

than an employee of a hospital was again reiterated, albeit in 

dicta, in Stuart Circle Hospital Corp. v. Curry, 173 Va. 136, 3 

S.E.2d 153 (1939). There, a hospital was held liable to a 

patient for the negligent acts of an intern and a nurse based 

on an implied contract between the hospital and the patient to 

provide medical services. In the course of its opinion, the 

Court recited that it was "conceded" that a physician is an 

independent contractor and "alone is responsible for the 

exercise of professional skill and judgment, subject to no 

control by the hospital in the execution thereof." Id. at 149, 

3 S.E.2d at 158. 

 The proposition that a physician is an independent 

contractor solely because the nature of his profession prevents 

his employer from acquiring the requisite ability to control 

his medical activities has not been explicitly overruled in 

Virginia by case or statute. Subsequent cases, however, have 

reached directly contrary results. 

 In Ritholz v. Commonwealth, 184 Va. 339, 35 S.E.2d 210 

(1945), the Commonwealth sought a declaratory judgment and 

injunction against Ritholz and others claiming that they were 

practicing optometry without a license based on the doctrine of 

 

 2This portion of the opinion does not appear in the 

Virginia Reports; however, the version of the opinion which 

includes this discussion is the version on file in our Clerk's 

office and remains the official copy of the opinion. 
respondeat superior.3

 Ritholz operated stores in which 

licensed physicians examined each customer's eyes, wrote a 

prescription for eyeglasses, and collected a $2 fee. The 

prescription was given to an employee in the store to be 

filled. Ritholz claimed that his business was the filling of 

prescriptions by producing the prescribed eyeglasses. He 

argued that the physicians in his stores were independent 

contractors because he neither exercised, nor attempted to 

exercise, any supervision or control over the means and method 

used by these physicians in eye examinations. Id. at 355-57, 

35 S.E.2d at 219. The Court held that the physicians were 

employees, not independent contractors, referring specifically 

to the decisions of other jurisdictions holding that physicians 

in identical circumstances were employees "notwithstanding the 

fact that the defendants actually exercise no control over 'the 

mode, manner or result of the examination of the eyes of the 

customer and the doctor is left free to exercise his own will 

(and) judgment and to use his own professional skill and 

methods in making such examination.'" Id. at 358-59, 35 S.E.2d 

at 219 (citations omitted). 

 Forty years later, this Court held that the Virginia Beach 

S.P.C.A. was engaged in the illegal practice of veterinary 

medicine because it operated a full-service veterinary clinic 

through the services of its licensed veterinarian. Virginia 

 3In contrast, by statute, hospitals are deemed not to be 

engaged in the unlicensed practice of medicine when they 

provide medical services. Stuart Circle, 173 Va. at 146, 3 

S.E.2d at 156. 
Beach S.P.C.A., Inc. v. South Hampton Roads Veterinary Ass'n, 

229 Va. 349, 353, 329 S.E.2d 10, 12 (1985). The veterinarian 

was an employee, not an independent contractor, the Court 

concluded, because the employment contract showed that the 

S.P.C.A. retained substantial control over the doctor's 

performance.4 Id. Finally, in Hadeed v. Medic-24, Ltd., a 

case involving the negligent acts of several physicians, we 

concluded that the issue whether the doctors were independent 

contractors or employees was a matter for the jury to 

determine. 237 Va. at 288, 377 S.E.2d at 595. 

 Clearly, these cases have undermined the applicability of 

the principle set out in Virginia Iron, Weston's 

Administratrix, and Stuart Circle.5 This jurisprudential 

 

 4The contract provided that the doctor receive an annual 

salary, a percentage of the gross receipts, and a portion of 

the charges for spaying and neutering. The contract also 

provided that the doctor "accepted his employment 'subject to 

the general supervision and pursuant to the orders, advice and 

direction of' the S.P.C.A., and that he would perform his 

duties 'to the reasonable satisfaction of' the S.P.C.A." Id.

at 351, 329 S.E.2d at 11. 

 5

Other cases, although not addressing the independent 

contractor issue directly, are not consistent with the 

principle as originally stated in Virginia Iron. For example, 

in P.M. Palumbo, Jr., M.D., Inc. v. Bennett, 242 Va. 248, 251, 

409 S.E.2d 152, 153 (1991), we held that physicians cannot be 

independent contractors but must be employees or officers of 

professional corporations providing health care services. In 

Lohr v. Larsen, 246 Va. 81, 88, 431 S.E.2d 642, 646 (1993), a 

case involving a physician working for the state, we noted that 

"when a government employee is specially trained to make 

discretionary decisions, the government's control must 

necessarily be limited in order to make maximum use of the 

employee's special training and subsequent experience." 

Earlier this year, in Schwartz v. Brownlee, 253 Va. 159, 163-

64, 482 S.E.2d 827, 829 (1997), we held that a physician was an 

agent of a corporate non-health care provider when providing 

post-operative treatment to a patient. 
evolution is consistent with changes adopted in other 

jurisdictions. See, e.g., Beeck v. Tuscon General Hosp., 500 

P.2d 1153 (Ariz. App. 1972); Medi-Stat, Inc. v. Kusturin, 792 

S.W.2d 869 (Ark. 1990); Rice v. California Lutheran Hosp., 163 

P.2d 860 (Cal. 1945); Moeller v. Hauser, 54 N.W.2d 639 (Minn. 

1952); Bing v. Thunig, 143 N.E.2d 3 (N.Y. 1957); John D. 

Hodson, Annotation, Liability of Hospital or Sanitarium for 

Negligence of Physician or Surgeon, 51 A.L.R. 4th 235, 281-85 

§ 9[c] (1987).6

 The federal courts also recognize that the exercise of 

professional judgment in providing medical treatment alone 

cannot be determinative of the employment relationship between 

a physician and an employer for purposes of the Federal Tort 

Claims Act, 28 U.S.C. §§ 1346(b), 2671-2680 (1994 & Supp. 

1997). Some circuits have treated the contract terms as 

critical to the determination of the relationship, Robb v. 

United States, 80 F.3d 884, 891 (4th Cir. 1996), while others 

look to the intent of the parties, Lilly v. Fieldstone, 876 

F.2d 857, 859 (10th Cir. 1989). 

 Retention of the blanket rule articulated over 70 years 

ago in Virginia also does not reflect the changing 

circumstances surrounding the practice of medicine. "The 

 

 6Jurisdictions retaining the prohibition against the 

existence of a master-servant relationship generally subscribe 

to the view that if a such a relationship exists between a 

hospital and a physician, the hospital would be illegally 

practicing medicine without a license, a view rejected in this 

jurisdiction. Stuart Circle Hospital Corp. v. Curry, 173 Va. 

at 146, 3 S.E.2d at 156. 
conception that the hospital . . . undertakes . . . simply to 

procure [doctors] to act upon their own responsibility, no 

longer reflects the fact." Bing v. Thunig, 143 N.E.2d at 8. 

In addition to the staff privileges granted physicians with 

private practices, hospitals "regularly employ on a salary 

basis a large staff of physicians, nurses and internes, . . . 

and they charge patients for medical care and treatment." Id.

 "To an increasing extent" patients no longer select their 

physicians; they are often supplied by the hospital or clinic. 

 "Hospital and other corporate institutions that provide 

medical care have increased the number and the frequency of 

salaried arrangements for physicians. . . . [C]ontracts with 

hospital-based specialists have dramatically increased." 

Arthur F. Southwick, The Law of Hospital and Health Care 

Administration, 546 (2d ed. 1988). 

 Finally, consistent application of the proposition 

advanced by the Hospital here would require that virtually 

every professional who is expected to exercise independent 

judgment in the performance of the duties of the workplace 

would have to be deemed an independent contractor, regardless 

of the scope of his or her duties or the limitations on the 

employment. 

 Therefore, after reviewing our prior cases and considering 

the current manner in which medical services are provided, we 

conclude that, for purposes of determining employment status, 

the exercise of professional judgment by a physician in the 

performance of professional duties is a factor, but not the 
only factor, to be considered in evaluating the employer's 

power to control the means and method utilized to perform the 

work. Having resolved the nature of the test to be applied, we 

now consider whether the record supports the trial court's 

holding that Clark was an independent contractor as a matter of 

law. 

 Dr. Clark is the Director of Pathology at the Hospital. 

He is a licensed and board certified physician and has worked 

under a contract at the Hospital for thirty-three years. As 

Director of Pathology, Dr. Clark's general responsibilities 

include interpreting various specimens, performing autopsies, 

bone marrow aspirations and biopsies, and, to a lesser extent, 

consulting with patients who have problems related to 

hematology pathology, although he did not meet or consult with 

McDonald, the patient in this case. 

 The Hospital owns the pathology laboratory, and laboratory 

personnel are employees of the Hospital. Dr. Clark’s contract 

provides that he "shall provide all the administrative, 

professional, supervisory, quality assurance and educational 

services relating to the operation of the" laboratory, but he 

has no authority to hire or discharge employees of the 

laboratory. Although Dr. Clark has no authority to purchase 

supplies or equipment for the laboratory, he participates in 

the Hospital's annual budget process. 

 The Hospital pays Dr. Clark a set monthly fee for his 

services and reimburses him for all of the costs of his 

practice, including his business license tax, malpractice 
insurance, and professional dues. The Hospital does not 

withhold federal, F.I.C.A., state or local income or 

occupational taxes from his salary, and his income is reported 

on a 1099 federal tax form, not a W-2 form. The Hospital is 

not responsible for his unemployment compensation, workers' 

compensation contributions, vacation pay, sick leave, or 

retirement benefits. 

 Dr. Clark must interpret all slides that the Hospital 

presents for review, and his salary is not related to the 

number of slides he evaluates. He may render services to other 

entities and receive compensation for such work, but he must 

obtain the Hospital's written authorization before working 

elsewhere.7

 His contract requires that he maintain board 

certification, a requirement not otherwise necessary to perform 

pathology services. 

 The Hospital has no control over Dr. Clark's independent 

medical judgment nor has it influence over his diagnostic 

opinions about pathologic material. His contract provides, 

however, that he must satisfy the Hospital in the performance 

of his duties and that he will "comply with the bylaws, rules 

and regulations, policies and directives of the Hospital and 

 

 7During his tenure with the Hospital, Dr. Clark has 

performed services and has been compensated as a consultant at 

Kecoughtan Veteran's Hospital and McDonald Army Hospital and 

has served as Director of the Laboratory at Langley Air Force 

Base and the Director of Pathology at Mary Immaculate Hospital. 

 Dr. Clark currently performs services for the state medical 

examiner's office. Although he has never been refused 

permission to work for another entity, the Hospital did require 

him to choose between working for it or Mary Immaculate 

Hospital. 
its medical staff." 

 All laboratory reports are printed on Hospital letterhead 

and are the property of the Hospital. Additionally, the 

Hospital sets the fees charged patients, bills patients, and 

collects payments. Dr. Clark is required to keep time records 

for these billing purposes. The Hospital's contract explicitly 

refers to Dr. Clark as an independent contractor, but when 

asked whether he thought he was an employee of the Hospital, 

Dr. Clark responded "[w]ell, in some regards I think that might 

be the case, although this [contract] states differently." 

 Whether a person is an employee or an independent 

contractor is generally a question of fact for the jury. 

Hadeed, 237 Va. at 288, 377 S.E.2d at 594. Where the evidence 

admits of only one conclusion, the question is a matter of law. 

Stagg v. Taylor's Adm'r, 119 Va. 266, 270, 89 S.E. 237, 238 

(1916). Taking these facts and the inferences they raise in 

the light most favorable to McDonald, as we must do when 

reviewing a motion to strike, Hadeed, 237 Va. at 280-81, 377 

S.E.2d at 590, the facts do not lead to a single conclusion, 

and the issue should have been left to the jury for 

determination. 

 Accordingly, we will reverse the judgment of the trial 

court and remand the case for further proceedings. 

Reversed and remanded.