Fortugno v. Trachtenberg

202 F. Supp. 177, 5 Fed. R. Serv. 2d 927, 1962 U.S. Dist. LEXIS 5365
CourtDistrict Court, E.D. Pennsylvania
DecidedFebruary 23, 1962
DocketCiv. A. No. 30261
StatusPublished
Cited by3 cases

This text of 202 F. Supp. 177 (Fortugno v. Trachtenberg) is published on Counsel Stack Legal Research, covering District Court, E.D. Pennsylvania primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Fortugno v. Trachtenberg, 202 F. Supp. 177, 5 Fed. R. Serv. 2d 927, 1962 U.S. Dist. LEXIS 5365 (E.D. Pa. 1962).

Opinion

CLARY, Chief Judge.

The matter is before the Court on a motion of defendant, Community Memorial Hospital, to dismiss for failure to state a claim upon which relief can be granted. Jurisdiction of the Court is based upon diversity of citizenship. The suit is one for personal injuries claimed to be sustained as a result of the negligence of the defendant, Community Memorial Hospital, and the operating surgeon during the performance of an operation upon the plaintiff.

The ground for the motion to dismiss is based upon the allegation that defendant, Community Memorial Hospital, is a charitable institution and under the law of Pennsylvania, the controlling law in this action, is immune from suits for negligence.

Both parties to this motion have adduced facts in support of their respective positions. The allegation . on behalf of the Community Memorial Hospital is that it is a charitable institution. This averment has been categorically denied by the plaintiff. It would appear, therefore, that the holding of the Court of Appeals for the Third Circuit in the case of Frederick Hart & Co., Inc. v. Recordgraph Corporation, 169 F.2d 580 (1948), and following cases, would present an insurmountable barrier to the granting of this motion which, in effect, under the present status of the record, is to be considered as a motion for summary judgment under Rule 56 of the Federal Rules of Civil Procedure, Title 28 U.S.C.A., Funk v. Peoples Natural Gas Co., 137 F.Supp. 625 (W.D.Pa.1956). However, at argument, counsel for the plaintiff conceded that every relevant fact, except the amount of liability insurance protecting the hospital at the time of the incidents complained of, has already been established of record, and the only additional facts which might be developed in the future would necessarily have to be the result of a “fishing expedition”, and that plaintiff had no present knowledge or conception that any further helpful facts would ever be available to him. It was further generally conceded by both plaintiff and defendant, Community Memorial Hospital, that a single question was involved in the disposition of this motion, to wit, whether the determination of the status of the hospital was a question of fact to be submitted to the jury or a question of law to be decided by the Court. The plaintiff argued that even admitting the existence of the doctrine of charitable immunity under Pennsylvania law, under the facts in the instant case, defendant does not qualify as a charity entitled to that immunity. The pleadings, affidavit and depositions established the following undisputed facts:

1. The defendant is a nonprofit corporation, incorporated under the NonProfit Corporation Law of Pennsylvania, on September 1, 1955. The defendant has no stockholders.

2. The defendant is a forty-six bed hospital serving seven townships in a rural section of Chester County.

3. The hospital was built at a cost of $1,200,000, of which $600,000. was raised by gifts from the public at large. The mortgage has since been reduced to approximately $207,000., again by public donations.

4. The hospital has continued to seek gifts from the public of money, equipment and food. The Community Chests of various communities served by the hospital aid it in its financial needs by donating money. The ladies in the community have conducted various activities in order to raise funds for the hospital.

5. All of the funds received by the hospital are used solely in the maintenance of the hospital.

6. Patients who are unable to pay are treated free of charge in both the accident ward and the hospital itself.

7. From the time it began operations on June 9, 1959, through the period ending September 30, 1961, the defendant admitted a total of 9,214 persons. Of this total, 158 were qualified as indigent patients, and the rest were admitted as either private, semiprivate, or ward full pay. For treating these indigent pa[179]*179tients, the hospital received from the State $10,410.32, and $162.40 from the patients themselves. The services rendered to the indigent patients were valued at $13,799.00.

8. The County gives the hospital $5,000 each year, in addition to State aid, regardless of the number of patients treated.

9. The defendant has a tax-exempt status under the Federal Income Tax law.

10. The hospital’s financial report for the fiscal period ending May 31, 1961, shows an accounting surplus of $75,-250.00 and a current assets to current liabilities ratio of almost 2.5 to 1.

11. The hospital’s financial statement also shows that its total income was $3,529.32, short of its cost of maintenance.

12. Only members of' the hospital staif are permitted to use the facilities, and nonmembers must surrender the care of a patient to a member of. the staff.

13. The members of the staff of the hospital have use of all of its services, which include: nursing services, supplies, X-ray equipment and operators, fluoroscopy, anesthesia, electrocardiograms, operating rooms and equipment, and an operating nursing staff. For these services the staff members pay nothing to the hospital.

14. Article 3 of the Articles of Incorporation provides that, “The purpose or purposes of the corporation are: To establish, maintain, operate and manage a general hospital for the reception and surgical and medical treatment of the injured and sick. Provided, however, that all such treatment be limited to properly qualified physicians' and surgeons and that this is' a corporation which does not contemplate pecuniary gain or profit incidental or otherwise, to its members.”

15. The hospital has liability insurance coverage.

As stated by Chief Judge Gourley in Allison v. Mennonite Publications Board, 123 F.Supp. 23 (W.D.Pa.1954), the mere fact that a defendant may be a nonprofit corporation does not necessarily mean that it is also charitable; although charitable corporations must be nonprofit, it does not follow that all corporations which are nonprofit must be charitable. He cites examples such as Blue Cross and Blue Shield, lodges and beneficial associations, and even country clubs which, in most cases, are nonprofit corporations but are not considered as charitable. The determining factor in this case, therefore, is whether under Pennsylvania law the Community' Memorial Hospital is a “charity.” 1 Fletcher Cyclopedia Corporations at page 270, defines, in part, a charitable corporation in the following language:

“One whose principal aim is to give of its material substance or time to benefit those who are in need of such assistance, or will be benefited by such gift or expenditure in some other way than simply by an improvement of morals or bringing them under the influence of the gospel. This need not be and is not always its sole aim. Subordinate^ and incidental to its main object, it may take pay for services or merchandise. It may even have stock, though it cannot be' a stock corporation for profit.

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Bluebook (online)
202 F. Supp. 177, 5 Fed. R. Serv. 2d 927, 1962 U.S. Dist. LEXIS 5365, Counsel Stack Legal Research, https://law.counselstack.com/opinion/fortugno-v-trachtenberg-paed-1962.