Court Opinion

ID: 2965397
Source: CourtListenerOpinion
Date Created: 2015-09-21 21:39:35.65238+00
Date Added: 2024-06-11T11:21:36.355395
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<pre>                 United States Court of Appeals <br>                     For the First Circuit <br> <br> <br> <br> <br> <br>No. 97-2389 <br> <br> <br>                   INES TORRES VARGAS, ET AL., <br> <br>                     Plaintiffs, Appellants, <br> <br>                                v. <br> <br>              DR. MANUEL SANTIAGO CUMMINGS, ET AL., <br> <br>                      Defendants, Appellees. <br> <br> <br> <br>           APPEAL FROM THE UNITED STATES DISTRICT COURT <br> <br>                 FOR THE DISTRICT OF PUERTO RICO <br> <br>          [Hon. Jos Antonio Fust, U.S. District Judge] <br> <br> <br> <br>                              Before <br> <br>                      Selya, Circuit Judge, <br>                                 <br>           Coffin and Bownes, Senior Circuit Judges. <br>                                 <br>                                 <br> <br> <br>     Raul S. Mariani Franco, with whom Harry Anduze Montao was on <br>brief, for appellants. <br>     Jos Hector Vivas, with whom Rita M. Velez Gonzalez and Vivas <br>& Vivas were on brief, for appellees. <br> <br> <br> <br> <br> <br>July 10, 1998 <br> <br> <br> <br>                                 <br>                                 <br> <br>

  SELYA, Circuit Judge.  Plaintiffs-appellants Ines Torres <br>Vargas, Evelyn Torres Vargas, and Raul Torres Vargas are the adult <br>children of Raul Torres Arroyo.  After their father died, they <br>brought suit for medical malpractice against Dr. Manuel Santiago <br>Cummings (Santiago).  The district court granted summary judgment <br>for Santiago on the ground that he was an employee of the <br>Commonwealth of Puerto Rico and, as such, was entitled to immunity <br>under Puerto Rico law.  The plaintiffs now seek to set aside that <br>decision, claiming that Santiago was an independent contractor (not <br>covered by the immunity provision), or, at least, that discovery <br>should have been allowed before the court ruled.  We vacate the <br>summary judgment order. <br>I.  BACKGROUND <br>  We rehearse the material facts, stating them in the light <br>most favorable to the parties opposing summary judgment, seeGarside v. Osco Drug, Inc., 895 F.2d, 46, 48 (1st Cir. 1990), and <br>then recount the travel of the case. <br>                          A.  The Facts. <br>  In 1990, the Puerto Rico Department of Health (the <br>Department) hired Santiago, an anesthesiologist, to render services <br>at Ponce Regional Hospital (the Hospital), a government-owned <br>facility primarily serving indigent patients.  The parties' written <br>agreement (the Contract) covered a one-year term commencing on July <br>1, 1990.  It obligated Santiago to work in the Hospital's operating <br>rooms from 7:00 a.m. until 3:00 p.m., Monday through Friday, and to <br>remain "on call" every third weekend.  It also required him to <br>complete medical records for assigned patients, submit reports to <br>the Department when requested, and obtain malpractice insurance at <br>his own expense.  In return, the Department agreed to pay Santiago <br>a stipend of $10,000 per month, without any withholdings, and also <br>agreed that he could keep any additional fees that he might collect <br>for services rendered to solvent patients (e.g., those who were <br>covered by Medicare or private insurance).  The Contract stated <br>explicitly that Santiago would not be entitled to vacation, sick <br>leave, or other fringe benefits. <br>  On February 26, 1991, the Hospital admitted the <br>plaintiffs' decedent, Raul Torres Arroyo (an uninsured person), <br>with complaints of severe throat pain.  Dr. Pedro Vendrell, a <br>surgeon, scheduled a laryngoscopy and throat biopsy for the next <br>day.  The procedure went badly:  Santiago experienced difficulty in  <br>intubating Torres Arroyo and a tracheotomy was required.  Post- <br>operatively, the tracheotomy tube became dislodged and left the <br>patient without a sufficient airway.  As a result, he suffered <br>respiratory arrest, heart failure, and brain damage.  Within a <br>week, he died.  Torres Arroyo's children blamed a number of care <br>providers, including Santiago, for his demise. <br> <br> <br> <br>                     B.  Travel of the Case. <br>  After unsuccessfully endeavoring to serve Santiago in the <br>Puerto Rico courts, the plaintiffs voluntarily dismissed all <br>earlier actions against him and brought suit in federal district <br>court.  See 28 U.S.C.  1332(a) (1994) (diversity jurisdiction).  <br>Santiago answered the federal complaint on September 4, 1996, and <br>two weeks later moved for summary judgment, citing the immunity for <br>government-employed physicians conferred by the Puerto Rico Medico- <br>Hospital Professional Liability Insurance Act (the MHPLIA), P.R. <br>Laws Ann. tit. 26,  4105 (1997).  In their opposition, the <br>plaintiffs countered that the Contract established an independent <br>contractor relationship between Santiago and the Commonwealth, or, <br>alternatively, that his employment status was a question of fact <br>for trial.  In addition, they bemoaned the lack of "meaningful <br>discovery," advocated an adjudicative delay, and proclaimed their <br>intention to "supplement the instant request with a [Fed. R. Civ. <br>P.] 56(f) affidavit . . . within the next five (5) days."  Almost <br>a year elapsed, but the plaintiffs never filed either a Rule 56(f) <br>motion or an affidavit explaining the need for discovery. <br>  On October 15, 1997, the district court granted <br>Santiago's summary judgment motion.  This appeal ensued. <br>II.  DISCUSSION <br>  We begin, and end, with the plaintiffs' primary <br>contention:  that, contrary to the lower court's viewpoint, the <br>Contract does not compel the conclusion that the defendant was an <br>employee of the Commonwealth within the meaning of the immunity <br>statute.  We divide our analysis into three segments, first <br>describing the MHPLIA, then discussing other legal principles of <br>potential relevance to our inquiry, and finally, addressing the nub <br>of the appellants' asseveration.  Because the district court <br>terminated the suit at the summary judgment stage, our review is <br>plenary.  See Garside, 895 F.2d at 48. <br>                         A.  The MHPLIA. The MHPLIA provides: <br>  No health service professional may be included <br>  as a defendant in a civil suit for damages due <br>  to malpractice caused in the performance of <br>  his profession while said health service <br>  professional acts in compliance with his/her <br>  duties and functions as an employee of the <br>  Commonwealth of Puerto Rico, its dependencies, <br>  instrumentalities and municipalities. <br> <br>P.R. Laws Ann. tit. 26,  4105.  The Puerto Rico Supreme Court has <br>construed the MHPLIA as containing three fundamental requirements <br>for immunity: <br>  (1) [the person who furnishes the service] <br>  must be a health care professional; (2) the <br>  harm caused by his malpractice must have taken <br>  place in the practice of his profession; and, <br>  (3) he must have acted in compliance with his <br>  duties and functions as an employee of the <br>  Commonwealth of Puerto Rico, its agencies, <br>  instrumentalities, and municipalities. <br> <br>Flores Romn v. Ramos Gonzlez, 90 J.T.S. 132 (P.R. 1990) (official <br>translation, slip op. at 3-4). <br>  The third requirement   that an immunity-seeking health <br>care provider must be an employee of the Commonwealth   often <br>presents the crucial area of inquiry.  See id. at 5.  So it is <br>here:  Santiago is a licensed physician and the plaintiffs' <br>complaint alleges that he committed malpractice whilst practicing <br>his profession.  Thus, the critical question relates to his <br>employment status. <br>  One seemingly reasonable way of answering this question <br>would be simply to segregate full-time government physicians from <br>part-timers, designating the former "employees" and the later <br>"independent contractors."  This solution cannot be countenanced, <br>however, for the MHPLIA has been interpreted authoritatively to <br>protect not only physicians who hold full-time career positions <br>with agencies of the Commonwealth, but also physicians who, though <br>engaged in private practice, function part-time as government <br>employees and who, while acting in that capacity, commit alleged <br>malpractice.  See Lind Rodriguez v. E.L.A., 12 P.R. Offic. Trans. <br>85, 87, 112 P.R. Dec. 67, 68 (1982). <br>  In search of a principled approach to determining which <br>physicians are entitled to protection under section 4105, we <br>previously parsed Puerto Rico precedents and gleaned the factors to <br>be weighed in determining whether a physician is to be regarded as <br>an independent contractor (and, thus, beyond the prophylaxis <br>afforded by the statute).  See Nieves v. University of Puerto Rico, <br>7 F.3d 270 (1st Cir. 1993).  It was indicative of independent <br>contractor status, we wrote, if the physician <br>  (1) earned compensation on a per-patient <br>  basis, rather than a flat salary; <br> <br>  (2) received no fringe benefits of a type <br>  given to the principal's employees (e.g., <br>  vacation or sick leave, pension benefits, tax <br>  withholding); <br> <br>  (3) personally owned, invested in, or paid for <br>  the medical equipment and supplies used to <br>  treat patients, or the facilities which formed <br>  the situs of that treatment, or personally <br>  hired and supervised her own administrative or <br>  subsidiary medical personnel; <br> <br>  (4) held and paid for her own medical <br>  malpractice insurance policy; or <br> <br>  (5) exercised final judgment as to the <br>  appropriate medical treatment to render to <br>  patients. <br> <br>Id. at 279.  By contrast, it would be indicative of employee status <br>if a health care provider (1) received a flat salary regardless of <br>the number of patients seen or procedures performed, (2) received <br>vacation time, sick leave, and other customary fringe benefits, (3) <br>used only the government's facilities, equipment, supplies, and <br>personnel in rendering services, (4) received protection against <br>malpractice suits at the employer's expense, and (5) enjoyed <br>relatively little autonomy in practice management.  See, e.g., <br>Rivera v. Hospital Universitario, 762 F. Supp. 15, 17-18 (D.P.R. <br>1991). <br>  Of course, these factors are merely signposts.  They are <br>not of equal import:  in performing the necessary triage, the <br>principal focus should be on "the level of control contractually <br>reserved to the governmental entity over the physician's provision <br>of patient services."  Nieves, 7 F.3d at 279.  Moreover, no single <br>factor possesses talismanic significance.  In the last analysis, a <br>status determination in a particular case inevitably hinges on the <br>totality of the circumstances.  See id.  Therefore, an inquiring <br>court must examine each physician's contract and the surrounding <br>circumstances to determine whether, according to the contract terms <br>and other relevant evidence, the particular physician ranks as an <br>employee of the government agency or other governmental <br>instrumentality.  See Flores Romn, slip op. at 5-6. <br>                 B.  The Interpretive Framework. <br>  We pause at this juncture to clarify a point of law.  The <br>parties in this case agree that the Contract plays a pivotal part <br>in determining the existence vel non of section 4105 immunity.  <br>They disagree, however, about whether their dispute over its <br>interpretation presents a question of law that may be decided by a <br>court on summary judgment, or, instead, presents a question of fact <br>that precludes the granting of a Rule 56 motion.  This disagreement <br>is couched in terms that are reminiscent of a familiar set of legal <br>rules   rules which provide, in general, that a contract can be <br>interpreted by the court on summary judgment if (a) the contract's <br>terms are clear, or (b) the evidence supports only one construction <br>of the controverted provision, notwithstanding some ambiguity.  SeeAllen v. Adage, Inc., 967 F.2d 695, 698 (1st Cir. 1992); Boston <br>Five Cents Sav. Bank v. Secretary of Dep't of HUD, 768 F.2d 5, 8 <br>(1st Cir. 1985). <br>  The initial step in this pavane   the question of whether <br>a contract is ambiguous   presents a question of law for the <br>judge.  See United States Liab. Ins. Co. v. Selman, 70 F.3d 684, <br>687 (1st Cir. 1995); Allen, 967 F.2d at 698.  If the court finds no <br>ambiguity, it should proceed to interpret the contract   and it may <br>do so at the summary judgment stage.  See, e.g., In re Newport <br>Plaza Assocs., 985 F.2d 640, 644 (1st Cir. 1993); J.I. Corp. v. <br>Federal Ins. Co., 920 F.2d 118, 119 (1st Cir. 1990).  If, however, <br>the court discerns an ambiguity, the next step   involving an <br>examination of extrinsic evidence   becomes essential. <br>     The taking of this second step does not automatically <br>preclude brevis disposition.  Summary judgment may be appropriate <br>even if ambiguity lurks as long as the extrinsic evidence presented <br>to the court supports only one of the conflicting interpretations.  <br>See Allen, 967 F.2d at 698; America First Inv. Corp. v. Goland, 925 <br>F.2d 1518, 1522 (D.C. Cir. 1991); see also Boston Five, 768 F.2d at <br>8 (approving summary judgment if "the evidence presented about the <br>parties' intended meaning [is] so one-sided that no reasonable <br>person could decide the contrary").  On the other hand, if "the <br>extrinsic evidence relevant to the interpretation of an ambiguous <br>contractual provision is contested or contradictory, summary <br>judgment will often be inappropriate."  Allen, 967 F.2d at 698 n.3. <br>     This analytic framework is useful when the parties to a <br>contract are dueling over its meaning and attempt to offer parol <br>evidence to clarify their intent.  See, e.g., id. at 698-99; Foster <br>Med. Corp. Employees' Pension Plan v. Healthco, Inc., 753 F.2d 194, <br>198 (1st Cir. 1985).  Here, however, the framework simply does not <br>fit, for the question is not what any particular provision of the <br>Contract means   indeed, one of the contracting parties (the <br>Department) is not involved in this lawsuit   but, rather, whether <br>the Contract as a whole establishes (or helps to establish) an <br>employer-employee relationship sufficient to confer immunity under <br>section 4105.  In such circumstances, the meaning of the contract <br>is for the court.  See, e.g., Williams v. United States, 50 F.3d <br>299, 305-07 (4th Cir. 1995) (appraising contract between the <br>government and a third party to determine the existence of an <br>employment relationship for purposes of the plaintiff's FTCA suit); <br>see also Nieves, 7 F.3d at 279 ("To determine whether a physician <br>claiming section 4105 immunity is an 'independent contractor,' or <br>merely a Commonwealth 'employee,' the court must consider the <br>totality of the circumstances, focusing principally on the level of <br>control contractually reserved to the governmental entity over the <br>physician's provision of patient services.") (emphasis supplied).  <br>We proceed accordingly. <br>                         C.  The Merits. <br>     The agreement between Santiago and the Department is <br>entitled "Contract for Individual Professional Services."  In <br>addition to its title, its compensation provisions appear <br>inconsistent with an employer-employee relationship.  The relevant <br>portion of the Contract not only entitles Santiago to a stipend <br>from the Department for covering the Hospital's operating rooms, <br>but also enables him to bill solvent patients separately for his <br>professional services and to retain all amounts that he collects <br>from such billings. This stands in stark contrast to the usual <br>employer-employee arrangement, under which the latter receives a <br>straight salary or fixed hourly wage from the former for all <br>services rendered during regular working hours.  Even more telling, <br>the Contract stipulates that the Department will make no deductions <br>from the physician's remuneration for taxes, social security, or <br>the like.  This circumstance undercuts the defendant's claim that <br>an employer-employee relationship existed.  See Flores Romn, slip <br>op. at 9 (mentioning, with regard to the conclusion that the <br>defendant-physicians were independent contractors, that "income <br>taxes were not withheld from their compensations"). <br>     The Contract is equally explicit in denying Santiago the <br>type of incremental benefits that are characteristic of a modern <br>employer-employee relationship.  It provides that he "will not be <br>entitled to regular or sick leave, nor to travel expenses, nor will <br>[he] be entitled to fringe benefits."  These benefices are staples <br>of conventional employment relationships, and thus, the incidence <br>of such benefits matters in determining whether a health care <br>professional is an employee entitled to immunity under section <br>4105.  See Flores Romn, slip op. at 6.  Conversely, their absence <br>constitutes significant evidence that the contracting parties <br>considered Santiago to be an independent contractor. <br>     The Department's insistence that the defendant furnish <br>his own malpractice insurance also suggests a level of autonomy <br>indicative of independent contractor status.  In Nieves, where we <br>found the physician-defendants to be employees, we took care to <br>point out that the University of Puerto Rico provided malpractice <br>insurance for them   a fact that "suggested, unless competently <br>rebutted, an employer-employee relationship."  7 F.3d at 280.  <br>Here, no countervailing evidence appears in the summary judgment <br>record, and so the Contract's bare insurance mandate tilts toward <br>independent contractor status.  See id. at 279; see also Flores <br>Romn, slip op. at 8 (stating, en route to a finding of independent <br>contractor status, that "[s]ince the doctors had absolute control <br>over the type and quality of the treatment provided to their <br>patients," the state agency with which they had contracted required <br>them to provide their own malpractice insurance). <br>     Other provisions of the Contract seem incompatible with <br>the defendant's present assertion that he was a government employee <br>during the relevant time frame.  For example, section nine permits <br>the Department to terminate the Contract should Santiago perform <br>negligently or abandon his duties, and, in such event, requires him <br>to "liquidate any work that remains pending at the moment of <br>dissolution without . . . any additional payment or compensation."  <br>This insistence that the defendant complete his pending work <br>without extra compensation after the contractual relationship ends <br>smacks of an arrangement between principal and agent as opposed to <br>one between employer and employee.  Similarly, section eighteen of <br>the Contract states that the defendant's services are "non- <br>delegable."  Were Santiago an employee of the Department, this <br>provision would be entirely superfluous.  After all, persons who <br>are hired as employees generally do not have unilateral power to <br>delegate their tasks to others.  In the same vein, section sixteen <br>stipulates that if the defendant "renders services to the <br>Commonwealth" and is injured, he "may be covered" under the <br>Commonwealth's On-The-Job Accidents Compensation Act.  Because <br>employees of the Department are covered automatically under this <br>workers' compensation program, see P.R. Laws Ann. tit. 11,  2 <br>(1997), section sixteen is pleonastic unless the Contract <br>establishes an independent contractor relationship. <br>     To be sure, the Contract is a mixed bag, and some of its <br>features suggest employee status.  Santiago apparently used the <br>Hospital's facilities, equipment, staff, and supplies in the <br>performance of his duties.  See Flores Romn, slip op. at 7 <br>(positing that such usage weighs against independent contractor <br>status).  Moreover, the provisions fixing Santiago's duty hours and <br>"on call" schedule are distinctly reminiscent of the type of <br>hegemony that an employer exercises over an employee.  So, too, is <br>the Contract's intellectual property provision, section eleven, <br>which provides that any work product resulting from services <br>rendered by Santiago at the Hospital   such as research results   <br>will constitute property of the Department without specific <br>remuneration. <br>     Be that as it may, the Contract is conspicuously silent <br>on the most important factor in the decisional calculus:  the <br>amount of independence that the physician retains in dispensing his <br>professional services.  See Nieves, 7 F.3d at 279.  The Contract <br>makes no mention of specific medical functions or duties, other <br>than to state generally that the defendant "commits himself to <br>render anesthesiology services in the [Hospital's] Operating Rooms" <br>and that he "undertakes to perform in accordance with the standards <br>of excellence of the Department of Anesthesiology."  <br>Notwithstanding these fragmentary tendrils, the extent to which <br>Santiago is under the Department's control remains very much open <br>to debate. <br>     The lack of competent evidence on this point is <br>especially troubling because of the nature of Santiago's specialty.  <br>An anesthesiologist, of necessity, works primarily in operating <br>rooms, and is unlikely to have the same trappings of independence <br>as, say, a primary care physician.  Yet, while many <br>anesthesiologists are hospital-based, it does not follow that most <br>anesthesiologists are employed providers as opposed to independent <br>contractors.  See American Medical Ass'n, Physician Characteristics <br>and Distribution in the U.S., at Table A21 (1997).  In such a <br>situation, it seems eminently reasonable to require that an <br>anesthesiologist claiming section 4105 immunity on the ground that <br>he is a government employee proffer probative evidence of the facts <br>relating to the salient issues of independence and control.  And <br>the desirability of such a proffer is heightened where, as may be <br>the case here, the anesthesiologist works less than full time for <br>the government, and, thus, the pivotal inquiry   which must in all <br>events be restricted to his government work   is narrowly focused. <br>     We summarize succinctly.  On balance, the Contract seems <br>more indicative of an independent contractor than an employee. But <br>the call is not free from doubt, especially since the Puerto Rico <br>Supreme Court interprets section 4105 expansively.  See Vzquez <br>Negrn v. E.L.A., 13 P.R. Offic. Trans. 192, 196-97, 113 P.R. Dec. <br>148, 151 (1982).  Bearing in mind that control and the opportunity <br>for the exercise of independent judgment are the key integers in <br>the status equation, see Nieves, 7 F.3d at 279, and that the <br>Contract is considerably less than pellucid in this regard, we <br>conclude that the Contract, by itself, does not support the <br>district court's finding that as a matter of law the defendant was <br>an employee of the Commonwealth entitled to immunity under section <br>4105.  This conclusion requires us to vacate the judgment below. <br>     Our rationale is straightforward.  Section 4105 immunity <br>is an affirmative defense, see Flores Romn, slip op. at 2, and, <br>accordingly, the defendant bears the burden of establishing its <br>applicability.  See Selman, 70 F.3d at 691 (noting the "usual <br>rule" that "place[s] the burden of proving affirmative defenses on <br>the party asserting them").  The party who has the burden of proof <br>on a dispositive issue cannot attain summary judgment unless the <br>evidence that he provides on that issue is conclusive.  See, e.g., <br>Calderone v. United States, 799 F.2d 254, 258 (6th Cir. 1986) <br>(explaining that if a summary judgment movant has the burden of <br>proof, "his showing must be sufficient for the court to hold that <br>no reasonable trier of fact could find other than for the moving <br>party") (citation and emphasis omitted); Fontenot v. Upjohn Co., <br>780 F.2d 1190, 1194 (5th Cir. 1986) ("[I]f the movant bears the <br>burden of proof on an issue, either because he is the plaintiff or <br>as a defendant he is asserting an affirmative defense, he must <br>establish beyond peradventure all of the essential elements of the <br>claim or defense to warrant judgment in his favor.") (emphasis in <br>original).  Measured by this yardstick, the defendant's proffered <br>evidence   the Contract   falls short. <br>     Where, as here, an employment agreement, in itself, does <br>not provide sufficiently strong proof of a defendant's employment <br>status to warrant summary judgment, other evidence sometimes may <br>cure the defect.  To this end, Santiago posits that he must be <br>deemed an employee of the Commonwealth even if the Contract, read <br>as a whole, fails to carry the day "because he was complying with <br>the year of public service . . . in order to comply with the <br>requisites to obtain [a] license to practice medicine in Puerto <br>Rico."  Appellee's Brief at 3.  This argument is unconvincing.  The <br>Contract says nothing about the public service requirement, and the <br>documentation that the defendant submitted to the district court on <br>this point   two affidavits signed months prior to the execution of <br>the Contract   are far from self-elucidating.  Without better <br>evidence, the existing record does not establish either that <br>Santiago toiled at the Hospital, under contract, for a probationary <br>public service year (during which he treated Torres Arroyo) or that <br>the conditions attached to such service rendered him an employee <br>for purposes of section 4105. <br>     We need go no further.  A trial court may grant summary <br>judgment only if the record defoliates all genuine issues of <br>material fact.  See Fed. R. Civ. P. 56(c).  Here, the assembled <br>facts, taken in the light most flattering to the plaintiffs' theory <br>of the case, simply do not dictate a conclusion that the defendant <br>functioned as an employee of the Department during the period in <br>question.  Consequently, we vacate the order granting summary <br>judgment and remand the matter.  The employment status issue <br>requires further development. <br> <br>     Vacated and remanded.  Costs to appellants.</pre>

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