Dorothy S. Nesmith, M.D., P.A. v. Valley Baptist Medical Center N/K/A VB Harlingen Holdings and VHS Harlingen Hospital Company, LLC

Court of Appeals of Texas·Decided September 30, 2015·No. 13-15-00207-CV·Published

Opinion

ACCEPTED

13-15-00207-CV

THIRTEENTH COURT OF APPEALS CORPUS CHRISTI, TEXAS

9/30/2015 9:44:07 AM

Dorian E. Ramirez

CLERK

No. 13-15-00207-CV

IDENTITY OF PARTIES AND COUNSEL Appellant Appellees

Dorothy S. Nesmith, M.D., P.A. Valley Baptist Medical Center n/k/a VB Harlingen Holdings and Appellant’s Trial Counsel VHS Harlingen Hospital Company, LLC

David Casso Appellees’ Trial and Appellate Counsel 108 N. Jackson Road Suite 2 Blaine A. Holbrook Edinburg, Texas 78541 Nikki K. Elgie 10101 Reunion Place

David Kithcart Suite 900 222 E. Van Buren Street San Antonio, Texas 78216 Suite 101 Harlingen, Texas 78551

Appellant’s Appellate Counsel

Chad M. Ruback 8117 Preston Road Suite 300 Dallas, Texas 75225

i

TABLE OF CONTENTS

INDEX OF AUTHORITIES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . iv

STATEMENT OF THE CASE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . vi

ISSUE ON APPEAL. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . vii

STATEMENT OF FACTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

SUMMARY OF THE ARGUMENT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

ARGUMENT.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

I. A summary judgment is reviewed de novo, so no deference should be given to the trial court’s decision to grant summary judgment. . . . . 12

II. If a court is unable to give effect to all provisions in a contract—as with the contract at issue here—the contract is ambiguous, and summary judgment is inappropriate. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

III. The federal regulations which were the basis for the contract are further justification for the contract at issue here being ambiguous. . . . . . . 16

IV. Also favoring Dr. Nesmith is the well-established principle that a contract must be construed against the drafter. . . . . . . . . . . . . . . . . . 19

V. Conclusion: Valley Baptist was not entitled to traditional summary judgment or no-evidence summary judgment. . . . . . . . . . . . . . . . . . 19

PRAYER. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21

CERTIFICATE OF COMPLIANCE.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21

CERTIFICATE OF SERVICE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

ii

APPENDIX A: the order granting summary judgment [CR vol. 5 pp. 273-274]

APPENDIX B: the contract at issue [CR vol. 1 pp. 381-403]

iii

INDEX OF AUTHORITIES

Coker v. Coker, 650 S.W.2d 391 (Tex. 1983).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

Columbia Gas Transp. Corp. v. New Ulm Gas, Ltd., 940 S.W.2d 587 (Tex. 1996).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

Henkel v. Norman, 441 S.W.3d 249 (Tex. 2014).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

Innovate Tech. Solutions, L.P. v. Youngsoft, Inc., 418 S.W.3d 148 (Tex. App.—Dallas 2013, no pet.). . . . . . . . . . . . . . . . . . 14

J.M. Davidson, Inc. v. Webster, 128 S.W.3d 223 (Tex. 2003).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13, 14

Killeen v. Lighthouse Elec. Contractors, L.P., 248 S.W.3d 343 (Tex. App.—San Antonio 2007, pet. denied). . . . . . . . . . 14

Lewis v. Davis, 199 S.W.2d 146 (Tex. 1947).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18

Progressive County Mut. Ins. Co. v. Kelley, 284 S.W.3d 805 (Tex. 2009).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

Quick v. City of Austin, 7 S.W.3d 109 (Tex. 1998).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

Reilly v. Rangers Mgmt., Inc., 727 S.W.2d 527 (Tex. 1987).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

Sage St. Associates v. Northdale Constr. Co., 863 S.W.2d 438 (Tex. 1993).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

Seaview Hosp., Inc. v. Medicenters of Am., Inc., 570 S.W.2d 35 (Tex. Civ. App.—Corpus Christi 1978, no writ).. . . . . . . . 18

iv

Solis v. Evins, 951 S.W.2d 44 (Tex. App.—Corpus Christ 1997, no writ). . . . . . . . . . . . . 19

Temple-Eastex, Inc. v. Addison Bank, 672 S.W.2d 793 (Tex. 1984).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19

White v. Moore, 760 S.W.2d 242 (Tex.1988). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

v

STATEMENT OF THE CASE

This suit involved a dispute over a contract by which a hospital hired a

physician to serve as its director of rehabilitation. [CR vol. 1 p. 142] The physician

filed suit against the hospital entities, and the hospital entities moved for summary

judgment on both traditional and no-evidence grounds. [CR vol. 1 pp. 141, 147, 160]

The trial court granted summary judgment. [CR vol. 5 pp. 273-274]

vi

ISSUE ON APPEAL

The trial court committed reversible error in granting Valley Baptist’s motion for summary judgment.

vii

STATEMENT OF FACTS

Pursuant to a merger, the interests of Appellee Valley Baptist Medical Center

were assumed by Appellee VHS Harlingen Hospital Company LLC d/b/a Valley

Baptist Medical Center. [CR vol. 1 pp. 141-142 n.1] In the trial court, for ease of

reference, these two entities referred to themselves collectively as if they were one

entity called “Valley Baptist.” [CR vol. 1 pp. 141-142 n.1]

Federal regulations require an inpatient rehabilitation unit—such as Valley

Baptist’s—to have a director of rehabilitation who provides at least eighty hours per

month of services in the unit. [CR vol. 1 pp. 141-142; CR vol. 3 p. 58]1 In fact,

compliance with these federal regulations is a prerequisite for a hospital to bill

Medicare and Medicaid for services provided. [CR vol. 3 p. 58] To ensure

compliance with these federal regulations, Valley Baptist entered into a contract

(effective May of 2009) with Appellant Dorothy S. Nesmith, M.D., P.A. to serve as

1 Valley Baptist asserted “One of the services that Valley Baptist provides . . . is an inpatient rehabilitation unit. . . . Federal regulations require that such a unit have a director of rehabilitation who provides services to the rehabilitation unit and to the unit’s patients . . . for at least eighty hours per month.” [CR vol. 1 pp. 141-142]

its director of rehabilitation. [CR vol. 1 pp. 142, 394]2 In the trial court, for ease of

reference, Valley Baptist referred to Appellant Dorothy S. Nesmith, M.D., P.A. as if

this entity were synonymous with its sole member, a rehabilitation physician named

Dorothy Nesmith.3 [CR vol. 1 pp. 142, 143-144 n.2] In doing so, Valley Baptist used

female pronouns and the name “Dr. Nesmith.” [CR vol. 1 pp. 143-144 n.2] For the

sake of consistency, this appellate brief will refer to the parties by using the same

references as were used in the trial court.4

The contract provides that Valley Baptist would pay Dr. Nesmith $130 per hour

(up to eighty hours per month). [CR vol. 1 p. 142] In light of the fact that Valley

2 Valley Baptist asserted “To maintain compliance with those federal requirements . . . Valley Baptist entered into a Medical Director Agreement . . . with the Plaintiff.” [CR vol. 1 p. 142]

Valley Baptist sometimes refers to this position as “director of rehabilitation” and sometimes as “medical director.” [CR vol. 1 p. 142] Dr. Nesmith, as director of rehabilitation / medical director, reported to someone whose title is “program director.” [CR vol. 3 pp. 33-34, 49, 58, 60, 64, 69, 71]

3 To be clear, the physician named Dorothy Nesmith is the sole member of Appellant Dorothy S. Nesmith, M.D., P.A. [CR vol. 1 pp. 143-144 n.2]

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Dorothy S. Nesmith, M.D., P.A. v. Valley Baptist Medical Center N/K/A VB Harlingen Holdings and VHS Harlingen Hospital Company, LLC, (Tex. Ct. App. 2015).

Dorothy S. Nesmith, M.D., P.A. v. Valley Baptist Medical Center N/K/A VB Harlingen Holdings and VHS Harlingen Hospital Company, LLC (Dorothy S. Nesmith, M.D., P.A. v. Valley Baptist Medical Center N/K/A VB Harlingen Holdings and VHS Harlingen Hospital Company, LLC) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

Related

J.M. Davidson, Inc. v. Webster
128 S.W.3d 223 (Texas Supreme Court, 2003)
Progressive County Mutual Insurance Co. v. Kelley
284 S.W.3d 805 (Texas Supreme Court, 2009)
Killeen v. Lighthouse Electrical Contractors, L.P.
248 S.W.3d 343 (Court of Appeals of Texas, 2007)
Coker v. Coker
650 S.W.2d 391 (Texas Supreme Court, 1983)
Temple-Eastex Inc. v. Addison Bank
672 S.W.2d 793 (Texas Supreme Court, 1984)
Columbia Gas Transmission Corp. v. New Ulm Gas, Ltd.
940 S.W.2d 587 (Texas Supreme Court, 1996)
Quick v. City of Austin
7 S.W.3d 109 (Texas Supreme Court, 1999)
Solis v. Evins
951 S.W.2d 44 (Court of Appeals of Texas, 1997)
White v. Moore
760 S.W.2d 242 (Texas Supreme Court, 1988)
Seaview Hospital, Inc. v. Medicenters of America, Inc.
570 S.W.2d 35 (Court of Appeals of Texas, 1978)
Sage Street Associates v. Northdale Construction Co.
863 S.W.2d 438 (Texas Supreme Court, 1993)
Reilly v. Rangers Management, Inc.
727 S.W.2d 527 (Texas Supreme Court, 1987)
Christopher Henkel and Lisa Henkel v. Christopher Norman
441 S.W.3d 249 (Texas Supreme Court, 2014)
Innovate Technology Solutions, L.P. v. Youngsoft, Inc.
418 S.W.3d 148 (Court of Appeals of Texas, 2013)
Lewis v. Davis
199 S.W.2d 146 (Texas Supreme Court, 1947)