Opinion ID: 2612734
Heading Depth: 2
Heading Rank: 1

Heading: standard of review applicable to public hospital decisions denying surgical privileges

Text: (1a) Holding that the independent judgment rule rather than the substantial evidence rule was applicable to judicial review of decisions denying reappointment to a hospital medical staff, we distinguished the case of a doctor who had not previously been admitted in Anton v. San Antonio Community Hosp. (1977) 19 Cal.3d 802, 820-825 [140 Cal. Rptr. 442, 567 P.2d 1162]. (See Lewin v. St. Joseph Hospital of Orange (1978) 82 Cal. App.3d 368, 383, fn. 12 [146 Cal. Rptr. 892].) We granted hearing in the instant case to reconsider whether the independent judgment rule should also be applicable to decisions denying initial applications for admission. For the following reasons, we have concluded that we should adhere to the prior cases. Code of Civil Procedure section 1094.5 provides: (a) Where the writ is issued for the purpose of inquiring into the validity of any final administrative order or decision made as the result of a proceeding in which by law a hearing is required to be given, evidence is required to be taken and discretion in the determination of facts is vested in the inferior tribunal, corporation, board or officer, the case shall be heard by the court sitting without a jury.... (b) The inquiry in such a case shall extend to the questions whether the respondent has proceeded without, or in excess of jurisdiction; whether there was a fair trial; and whether there was any prejudicial abuse of discretion. Abuse of discretion is established if the respondent has not proceeded in the manner required by law, the order or decision is not supported by the findings, or the findings are not supported by the evidence. (c) Where it is claimed that the findings are not supported by the evidence, in cases in which the court is authorized by law to exercise its independent judgment on the evidence, abuse of discretion is established if the court determines that the findings are not supported by the weight of the evidence; and in all other cases, abuse of discretion is established if the court determines that the findings are not supported by substantial evidence in the light of the whole record. (d) Notwithstanding the provisions of subdivision (c), in cases arising from private hospital boards, abuse of discretion is established if the court determines that the findings are not supported by substantial evidence in the light of the whole record.... (Italics added.) (2) In general, section 1094.5 leaves to the courts the establishment of standards to determine which cases require independent judgment review and which cases require substantial evidence review. ( Frink v. Prod (1982) 31 Cal.3d 166, 174 [181 Cal. Rptr. 893, 643 P.2d 476]; Tex-Cal Land Management, Inc. v. Agricultural Labor Relations Bd. (1979) 24 Cal.3d 335, 344 [156 Cal. Rptr. 1, 595 P.2d 579]; Bixby v. Pierno (1971) 4 Cal.3d 130, 140 [93 Cal. Rptr. 234, 481 P.2d 242].) In the former cases, an abuse of discretion is established if the trial court finds that the administrative findings are not supported by the weight of the evidence. In the latter, the trial court's inquiry is limited to a determination whether the findings are supported by substantial evidence in the light of the whole record. ( Strumsky v. San Diego County Employees Retirement Assn. (1974) 11 Cal.3d 28, 44-45 [112 Cal. Rptr. 805, 520 P.2d 29].) (1b) The courts must decide on a case-by-case basis whether an administrative decision or class of decisions substantially affects fundamental vested rights and thus requires independent judgment review.... In determining whether the right is fundamental the courts do not alone weigh the economic aspect of it, but the effect of it in human terms and the importance of it to the individual in the life situation. This approach finds its application in such an instance as the opportunity to continue the practice of one's trade or profession [12]  a right which induced this court's statement in 1939; `it necessarily follows that the court to which the application for mandate is made to secure the restoration of a professional license must exercise an independent judgment on the facts....' ( Bixby v. Pierno, supra, 4 Cal.3d 130, 144-145.) Bixby also pointed out that in determining whether the right is sufficiently basic and fundamental to justify independent judgment review, the courts have considered the degree to which the right is `vested,' that is, already possessed by the individual. ( McDonough v. Goodcell, supra, 13 Cal.2d 741, 753 [91 P.2d 1035, 123 A.L.R. 1205].) In cases involving applications for a license, the courts have largely deferred to the administrative expertise of the agency. (See So. Cal. Jockey Club. v. Cal. etc. Racing Bd. (1950) 36 Cal.2d 167, 174-178 [223 P.2d 1].) Courts are relatively ill-equipped to determine whether an individual would be qualified, for example, to practice a particular profession or trade. (See Savelli v. Board of Medical Examiners (1964) 229 Cal. App.2d 124, 129, 131-132 [40 Cal. Rptr. 171].) In a case involving the agency's initial determination whether an individual qualifies to enter a profession or trade the courts uphold the agency decision unless it lacks substantial evidentiary support or infringes upon the applicant's statutory or constitutional rights. Once the agency has initially exercised its expertise and determined that an individual fulfills the requirements to practice his profession, the agency's subsequent revocation of the license calls for an independent judgment review of the facts underlying any such administrative decision. (Fns. omitted.) (4 Cal.3d at p. 146.) The court further explained the fundamental vested-right test in Interstate Brands v. Unemployment Ins. Appeals Bd. (1980) 26 Cal.3d 770, 774 et seq. [163 Cal. Rptr. 619, 608 P.2d 707]: The relationship between `vestedness' in the traditional sense and `fundamentalness' in the Bixby sense is illuminated by a little-noted passage of the opinion which states: `[I]n determining whether the right is sufficiently basic and fundamental to justify independent judgment review, the courts have considered the degree to which that right is vested, that is, already possessed by the individual.' (4 Cal.3d at p. 146.) Thus it could truly be said that the search for `vestedness' and the search for `fundamentalness' are one and the same. The ultimate question in each case is whether the affected right is deemed to be of sufficient significance to preclude its extinction or abridgement by a body lacking judicial power. (See and cf. Strumsky v. San Diego County Employees Retirement Assn. (1974) 11 Cal.3d 28, 34-45 [112 Cal. Rptr. 805, 520 P.2d 29].) (26 Cal.3d at p. 779, fn. 5.) Recently, in Frink v. Prod, supra, 31 Cal.3d 166, 177, we pointed out:  Bixby and Interstate Brands establish that for purposes of determining applicability of independent judgment review the terms fundamental and vested are not used to establish absolutes but are used in a relative sense, and they show that it is the weighing of both the fundamental nature and the vested nature of the right which determines whether independent judgment review is required. Thus, both cases explaining the term fundamental refer to the effect of the right in economic and human terms and to the importance of it to the individual. (4 Cal.3d at p. 144; 26 Cal.3d at p. 779.) Effect and importance of rights may vary greatly, and by defining fundamental in terms of effect and importance, the cases reflect that the fundamental character of rights may vary significantly. Similarly, Bixby speaks of rights being `possessed' by the individual in discussing the vested requirement (4 Cal.3d at p. 144); Interstate Brands specifically recognizes independent judgment review may be applicable although the administrative decision does not involve `vested property rights in the traditional sense' (26 Cal.3d at p. 779). And both cases refer to the `degree to which that right is vested.' (4 Cal.3d at p. 146; 26 Cal.3d at p. 779, fn. 5.) Interstate Brands points out that under the Bixby formulation the effect and importance of rights and the degree to which they are possessed are to be weighed together, stating that the `search for vestedness and the search for fundamentalness are one and the same. The ultimate question in each case is whether the affected right is deemed to be of sufficient significance to preclude its extinction or abridgement by a body lacking judicial power.' (26 Cal.3d at p. 779, fn. 5.) (31 Cal.3d at pp. 177-178, fn. omitted.) In cases not involving licensing, independent judgment review has not been limited to decisions terminating or revoking benefits but has been applied to decisions on applications for benefits. (E.g., Strumsky v. San Diego County Employees Retirement Assn., supra, 11 Cal.3d 28, 45 [112 Cal.Rptr 805, 520 P.2d 29] [widow's service-connected death allowance]; Thomas v. California Empl. Stab. Com. (1952) 39 Cal.2d 501, 504 [247 P.2d 561] [unemployment insurance benefit]; Kerrigan v. Fair Employment Practice Com. (1979) 91 Cal. App.3d 43, 48-52 [154 Cal. Rptr. 29] [age discrimination against applicant for employment]; Quintana v. Board of Administration (1976) 54 Cal. App.3d 1018, 1021 et seq. [127 Cal. Rptr. 11] [disability pension application].) In Frink v. Prod, supra, 31 Cal.3d 166, 172 et seq., we held that an administrative decision denying a claim for public assistance by an alleged disabled person was subject to independent judgment review. It was reasoned that erroneous denial of aid deprives the eligible person of the very means for his survival and his situation becomes immediately desperate, that while the degree to which the right is vested may not be overwhelming the degree of fundamentalness was, and that weighing them together the independent judgment standard should be applied to decisions denying public assistance. The question of the standard of review to be applied to decisions denying physicians hospital privileges was addressed in Anton v. San Antonio Community Hosp., supra, 19 Cal.3d 802, 820-825. We held that the right of a doctor to continue to practice in a hospital is a fundamental vested right and that a decision denying reappointment to the medical staff is reviewed under the independent judgment rule. The court pointed out; As the court said in Edwards v. Fresno Community Hosp. (1974) 38 Cal. App.3d 702, 705 [113 Cal. Rptr. 579], `[a]lthough the term hospital privileges connotes personal activity and personal rights may be incidentally involved in the exercise of these privileges, the essential nature of a qualified physician's right to use the facilities of a hospital is a property interest which directly relates to the pursuit of his livelihood.' (19 Cal.3d at p. 823.) Other cases have also recognized that refusal of access to a district hospital could, as a practical matter, have the effect of denying a licensed doctor the right to fully exercise his profession. ( Rosner v. Eden Township Hospital Dist. (1962) 58 Cal.2d 592, 598 [25 Cal. Rptr. 551, 375 P.2d 431]; Ascherman v. Saint Francis Memorial Hosp. (1975) 45 Cal. App.3d 507, 511 [119 Cal. Rptr. 507]; Wyatt v. Tahoe Forest Hospital Dist. (1959) 174 Cal. App.2d 709, 715 [345 P.2d 93].) These considerations apply to initial applications for hospital privileges, and the degree of fundamentalness is substantial. Turning to the vested factor, Anton indicated that an applicant for privileges did not have a vested right. The court drew a distinction between a physician who had been admitted to staff membership reflecting a necessary determination of his fitness and one who had not previously been admitted. (19 Cal.3d at p. 824; see also Lewin v. St. Joseph Hospital of Orange (1978) 82 Cal. App.3d 368, 383, fn. 12 [146 Cal. Rptr. 892].) A doctor who has been licensed by the state to practice medicine has a vested right to practice his profession, and it cannot be said that there are no elements of a right to be admitted to a hospital. On the other hand, so far as appears, the licensing of a doctor to practice medicine does not include a determination that he is qualified for surgical or other specialties, and when he seeks privileges for his specialty, his qualifications to engage in the specialty are not established by a licensing agency. [5] In addition, in Franz v. Board of Medical Quality Assurance (1982) 31 Cal.3d 124, 139, footnote 6 [181 Cal. Rptr. 732, 642 P.2d 792] we stated: Community standards of medical practice, and whether particular type of conduct departs grossly from those standards, are `legislative' facts. They inform the agency's judgment about what constitutes a violation of the Medical Practice Act. While we were there concerned with the Board of Medical Quality Assurance, boards of hospital districts who are charged with regulating the admission of doctors to their hospitals must make legislative determinations. (Health & Saf. Code, § 32128, subd. 2; Miller v. Eisenhower Medical Center (1980) 27 Cal.3d 614, 628, fn. 15 [166 Cal. Rptr. 826, 614 P.2d 258].) The independent judgment rule applies only to adjudicatory determinations and does not apply to actions undertaken by an agency in its legislative capacity. ( Strumsky v. San Diego County Employees Retirement Assn., supra, 11 Cal.3d 28, 34, fn. 2.) [6] Weighing the degree of vestedness and fundamentalness as required by Frink, Interstate Brands and Bixby, we are satisfied that we should continue to follow the Anton distinction and adhere to the rule that substantial evidence review applies to decisions denying initial applications for hospital privileges. Health and Safety Code section 32128, subdivision 2 provides that the hospital will impose requirements in addition to possession of a license to practice medicine as a condition to the grant of privileges. (See Miller v. Eisenhower Medical Center, supra, 27 Cal.3d 614, 628, fn. 15; Anton v. San Antonio Community Hosp., supra, 19 Cal.3d 802, 818-820.) The doctor's license thus does not determine qualification for hospital privileges or establish competence to engage in specialties in the hospital, particularly where the privilege sought will require close cooperation with other physicians and surgeons. The determination of the standards to be applied in granting privileges involves a legislative judgment ( Franz v. Board of Medical Quality Assurance, supra, 31 Cal.3d 124, 139, fn. 6), and just as courts have largely deferred to administrative expertise in determining whether an applicant is qualified to practice a profession in the first instance ( Bixby v. Pierno, supra, 4 Cal.3d 130, 146), they should defer to administrative expertise in determining whether the professional is qualified to take on the additional responsibilities involved in a grant of hospital privileges. While access to a hospital may be crucial to a doctor's livelihood in some cases, the licensed doctor seeking hospital privileges is not in a substantially different position than the medical school graduate seeking a license to practice medicine. In each case, the substantial evidence rule applies.