Piper v. Epstein

62 N.E.2d 139, 326 Ill. App. 400, 1945 Ill. App. LEXIS 370
CourtAppellate Court of Illinois
DecidedJune 25, 1945
DocketGen. No. 43,377
StatusPublished
Cited by16 cases

This text of 62 N.E.2d 139 (Piper v. Epstein) is published on Counsel Stack Legal Research, covering Appellate Court of Illinois primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Piper v. Epstein, 62 N.E.2d 139, 326 Ill. App. 400, 1945 Ill. App. LEXIS 370 (Ill. Ct. App. 1945).

Opinion

Mr. Justice Niemeyer

delivered the opinion of the court.

Plaintiff as administrator of the estate of his deceased wife, brought suit for her wrongful death re-suiting from infection caused by leaving a laparotomy sponge in her abdomen following an operation known as a Caesarean section, and recovered a judgment for $10,000 against the defendant hospital, a charitable institution, the operating surgeon and two nurses taking part in the operation. The operating surgeon settled with plaintiff by the payment of $4,500, and by stipulation the judgment as to her was vacated, her motion for new trial was granted and the cause dismissed as to her. The remaining defendants then moved for the vacation of the judgment entered on the verdict of the jury against all of the defendants, and for a new trial, or in the alternative and without abandoning the motion for a new trial that the judgment against the defendants be reduced $4,500. The court subsequently vacated and set aside the judgment for $10,000 entered on the verdict of the jury against all the defendants, and, the plaintiff remitting $4,500 from the amount of the verdict, judgment was entered against the hospital and the nurses for $5,680.55, being, according to plaintiff, the residue of the amount of the verdict and interest on the verdict from the date of its return to the entry of the judgment. Defendants appeal.

The principal contention of the hospital is that, being a charitable institution, the rule of respondeat superior does not apply to it, and therefore it is not liable for the negligence of its agents or servants. Plaintiff concedes that the hospital is a charitable in-' stitution and that under the law of Illinois it is exempt from liability for the negligence of its officers, agents and employees, but seeks to hold it liable because at tlfe time of the negligence charged there was in force and effect a policy of insurance issued by a solvent insurer insuring the hospital ‘ ‘ against loss from the liability imposed by law upon the assured for damages . . . respecting bodily injuries or death at any time resulting therefrom ... by reason of (a) all operations and work undertaken by the assured.” In addition the insurer was obligated “to investigate all accidents covered by this policy, and to defend in the name and on behalf of the Assured any claim or suit covered by this policy and brought against the Assured, whether groundless or not, for damages suffered or alleged to have been suffered on account of such bodily injuries or death.”

By the greater weight of authority, charitable organizations are exempt from liability for negligence of their officers, agents and employees. Various reasons are assigned for this exemption. Geiger v. Simpson M. E. Church of Minneapolis, 174 Minn. 389, 393. In Illinois it is based on the trust-fund doctrine. As said in Parks v. Northwestern University, 218 Ill. 381, 384, “. . . the exemption accorded to char! table institutions does not rest alone on the doctrine that the State or the sovereign is not liable for the acts of its servants. The doctrine of respondeat superior does not extend to charitable institutions for the reasons, ‘first, that if this liability were admitted the trust fund might be wholly destroyed and diverted from the purpose for which it was given, thus thwarting the donor’s intent, as the result of negligence for which he was in nowise responsible; second, that since the trustees cannot divert the funds by their direct act from the purposes for which they were donated, such funds cannot be indirectly diverted by the tortious or negligent acts of the managers of the funds or their agents or employees.’ (5 Am. & Eng. Ency. of Law,-2d ed.-923.) These reasons for exemption apply as well to private as to public charitable corporations.” In a few states recognizing the trust-fund doctrine charitable institutions have been held liable for negligence, but satisfaction of a judgment against it has been limited to property, if any, not directly connected with the charitable purposes of the organization or a part of the trust fund, Gamble v. Vanderbilt University, 138 Tenn. 616; St. Mary’s Academy v. Solomon, 77 Colo. 463; Fordyce v. Woman’s Christian Nat. Library Ass’n, 79 Ark. 550. The weight of authority supports defendant hospital’s contention that the fact that the charitable institution carries indemnity insurance indemnifying it from liability, does not create liability in instances where such charitable institutions are immune from liability. 10 Am. Jur., Charities, §152; Williams’ Administratrix v. Church Home for Females and Infirmary for Sick, 223 Ky. 355; McKay v. Morgan Memorial Co-op. Industries and Stores, Inc., 272 Mass. 121; Enman v. Trustees of Boston University, 270 Mass. 299; Herndon v. Massey, 217 N. C. 610; Susmann v. Y. M. C. A. of Seattle, 101 Wash. 487; Mississippi Baptist Hospital v. Moore, 156 Miss. 676; and the more recent cases of Schau v. Morgan, 241 Wis. 334, and Stedem v. Jewish Memorial Hospital Ass’n of Kansas City, 187 S. W. (2d) 469, decided by the Kansas City Court of Appeals of Missouri on April 30, 1945.

The only case in which a reviewing court of Illinois has considered the effect of liability insurance carried by a charitable institution upon its liability for negligence of its officers and agents is Myers v. Y. M. C. A. of Quincy, Ill., 316 Ill. App. 177. There the trial court struck the second count of the complaint alleging that the defendant carried public liability insurance to protect it from any loss which might occur or any liability which might accrue through the negligence charged in the complaint. This action was sustained on the ground that it was the well-settled doctrine of the courts of review of this State that it is improper to inform the jury either directly or indirectly that the defendant is insured against liability on a judgment that may be entered against him in the trial of a case. The same conclusion, based upon a similar reasoning, was reached in Greatrex v. Evangelical Deaconess Hospital, 261 Mich. 327. The cases relied upon in the Myers case (Kavanaygh v. Parret, 379 Ill. 273; Smithers v. Henriquez, 368 Ill. 588; Mithen v. Jeffery, 259 Ill. 372) are cases in which the fact that defendant was insured was brought to the notice of the jury in examination of jurors or by an inadvertent reference by counsel or witness to the matter of the defendant carrying indemnity insurance. In none of the cases was the question of insurance an issue affecting the right of plaintiff to recover or the liability of the defendant. It was an irrelevant matter prejudicing the defendant. If carrying insurance by a charitable institution creates a liability not otherwise existing, the fact that such insurance was carried and the nature and terms of the policy become material issues, and evidence relating thereto, although prejudicial to the defendant, is competent. People v. Durkin, 330 Ill. 394, 404. More substantial reasons for denying liability of a charitable institution carrying indemnity insurance are given in the cases cited above. In the Williams’ case (223 Ky. 355) the court answered the argument of plaintiff that procurement of indemnity insurance by a charitable institution is sufficient of itself to make the institution liable, on the ground that no diversion of trust funds would result, by quoting from Levy v. Superior Court, 74 Cal. App. 171, 239 Pac.

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Bluebook (online)
62 N.E.2d 139, 326 Ill. App. 400, 1945 Ill. App. LEXIS 370, Counsel Stack Legal Research, https://law.counselstack.com/opinion/piper-v-epstein-illappct-1945.