Opinion ID: 1058767
Heading Depth: 3
Heading Rank: 2

Heading: Decision to Close the Staff of the Imaging Department

Text: The parties in this case agree that they are contractually bound by the medical staff bylaws. See Lewisburg Cmty. Hosp., Inc. v. Alfredson, 805 S.W.2d 756, 759 (Tenn.1991) (holding that a hospital's bylaws are an integral part of its contractual relationship with the members of its medical staff). The defendants allege that the medical staff bylaws were violated because the Board decided to close the staff of the Imaging Department without first receiving input from the medical staff. This contention is without merit. When resolving disputes concerning contract interpretation, our task is to ascertain the intention of the parties based upon the usual, natural, and ordinary meaning of the contractual language. Guiliano v. Cleo, Inc., 995 S.W.2d 88, 95 (Tenn.1999). If a contract's language is clear and unambiguous, then the literal meaning of the language controls the outcome of the contract dispute. See Planters Gin Co. v. Fed. Compress & Warehouse Co., 78 S.W.3d 885, 890 (Tenn. 2002). Section 14.1D of the bylaws gives the medical staff a consultative role in exclusive contracting. The plain language of this provision states that [t]he Medical Staff, through the Medical Executive Committee, with medical staff approval, shall review and make recommendations to the Board regarding issues related to the exclusive arrangements for physician and/or professional services, prior to . . . the decision to execute an exclusive contract in a previously open department or service. (Emphasis added). The Board decided to seek proposals for an exclusive provider contract for the Imaging Department. An RFP was sent out prior to any feedback from the medical staff. The RFP specifically stated that it does not constitutes [sic] an offer and that the hospital is not obligated hereby or by any response to enter into any particular agreement or any agreement whatsoever. Each of the defendants was present when the medical staff, in accordance with section 14.1D, reviewed the RFP and gave its recommendation to the Board. The medical staff voted conditionally to approve the closure of the staff of the Imaging Department and to support Putnam as the contracting party. At the time of this appeal, the Board had not selected an exclusive provider nor negotiated a contract for exclusive services; thus, no decision to execute an exclusive contract has been made. Moreover, it is clear under the bylaws that the medical staff's input is advisory only and that the Board retains the ultimate decision-making authority. Therefore, we conclude that there was no violation of section 14.1D of the bylaws.