Opinion ID: 2543369
Heading Depth: 2
Heading Rank: 5

Heading: Effect of Section 12-36-134(1)(g)

Text: Lastly, we address Pediatric Neurosurgery's argument that section 12-36-134(1)(g) precludes imposing vicarious liability upon a professional medical corporation if that corporation maintains the minimum levels of insurance required by that section. The plain language of subsection (1)(g) reveals the flaw in Pediatric Neurosugery's argument. Paragraph (g) begins, [A]ll shareholders of the corporation ... shall be jointly and severally liable for all acts, errors, and omissions of the employees of the corporation. § 12-36-134(1)(g) (emphasis added). The paragraph then provides two exceptions to when the shareholders will be jointly and severally liable. Both exceptions require the shareholder employee physicians or the corporation to carry a minimum amount of insurance. Each individual must be insured  by himself or the corporation  for $50,000 per claim and $150,000 per year. [4] Nowhere in subsection (1)(g) does the statute address liability of the corporate entity. Likewise, the statute does not indicate that the legislature intended to abrogate the law of corporations that a corporate entity is liable for the torts of its employees. In fact, as discussed above, under the law of corporations, shareholders are not typically held jointly and severally liable for the actions of corporate employees. This limitation on liability is one of the very reasons businesses choose to incorporate. Fletcher, supra, at § 33 (The shareholders of a corporation, unless they personally participate, are not liable individually for torts committed by the corporation.). Thus, we construe subsection (1)(g) to address only the manner by which shareholders may limit their personal liability for the torts of corporate employees. This subsection does not preclude the corporation from being held vicariously liable under the doctrine of respondeat superior.