St. Catherine Hospital of Garden City v. Rodriguez

971 P.2d 754, 25 Kan. App. 2d 763, 15 I.E.R. Cas. (BNA) 699, 1998 Kan. App. LEXIS 829
CourtCourt of Appeals of Kansas
DecidedDecember 24, 1998
Docket78,529
StatusPublished
Cited by20 cases

This text of 971 P.2d 754 (St. Catherine Hospital of Garden City v. Rodriguez) is published on Counsel Stack Legal Research, covering Court of Appeals of Kansas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
St. Catherine Hospital of Garden City v. Rodriguez, 971 P.2d 754, 25 Kan. App. 2d 763, 15 I.E.R. Cas. (BNA) 699, 1998 Kan. App. LEXIS 829 (kanctapp 1998).

Opinion

Lewis, J.:

This action began as a forcible detainer action filed by St. Catherine Hospital of Garden City (Hospital) to force defendant, Paul M. Rodriguez, M.D., to remove his medical equipment from the hospital. The Hospital was successful with its detainer action, and that action is not an issue on appeal.

During the course of the forcible detainer action, Dr. Rodriguez filed a number of counterclaims against the Hospital. The trial *764 court granted summary judgment on each counterclaim in favor of the Hospital. Dr. Rodriguez appeals.

There were three counterclaims raised against the Hospital: one for breach of contract or breach of an implied duty of good faith, one for misrepresentation, and one for defamation and business disparity. The question we must decide is whether the trial court erred by granting summary judgment in favor of the Hospital.

Dr. Rodriguez is a radiologist who began working for the Hospital in the early 1970’s. He was given the exclusive right to do all the radiology work for the Hospital and owned the MRI and CT scanners which were used by the Hospital. The parties entered into a written agreement relative to their respective rights and obligations.

In early 1994, the Hospital began to question whether it should replace the equipment of Dr. Rodriguez as well as replacing Dr. Rodriguez himself. The Hospital hired a company called ECRI to evaluate the situation with regard to the radiology department. ECRI did a study of the Hospital’s radiology department, and its report was not complimentary either of the department or Dr. Rodriguez. Generally speaking, ECRI found a number of complaints directed at the radiology department. The ECRI report also found Dr. Rodriguez’ equipment was aging and inadequate and concluded it was not viable as compared with new equipment.

Armed with the ECRI report as well as other information received from other employees and physicians, the Hospital gave Dr. Rodriguez written notice that it would terminate the radiology department on a date certain. The notice was given to Dr. Rodriguez considerably more than 90 days prior to the termination date. Dr. Rodriguez apparently refused to vacate the premises, and that resulted in the current action being filed as one for forcible detainer.

Our standard of review in a case where summary judgment has been granted and is appealed from is well known:

“Appellate review of a district court’s grant of summary judgment is governed by well-established rules. The burden on the party seeking summary judgment is a strict one. The trial court is required to resolve all facts and inferences which may reasonably be drawn from the evidence in favor of the party against whom the ruling is sought. Summary judgment is appropriate when the pleadings, dep *765 ositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. A defendant is entitled to summary judgment if the defendant can establish the absence of evidence necessary to support an essential element of the plaintiff’s case. [Citations omitted.]
“When opposing a motion for summary judgment, an adverse party must come forward with evidence to establish a dispute as to a material fact. [Citations omitted.] In order to preclude summary judgment, the facts subject to the dispute must be material to the conclusive issues in the case.
“To have evidentiary value, the particular document or testimony relied upon by the party opposing summary judgment must be probative of that party’s position on a material issue of fact. [Citation omitted.] Probative evidence is that which ‘furnishes, establishes or contributes toward proof.’ [Citation omitted.] On appeal we apply the same rules, and where we find reasonable minds could differ as to the conclusions drawn from the evidence, summary judgment must be denied. [Citation omitted.]” Saliba v. Union Pacific R.R. Co., 264 Kan. 128, 131-32, 955 P.2d 1189 (1998).

With that standard of review firmly in mind, we will examine the trial court’s decision on each of Dr. Rodriguez’ counterclaims.

BREACH OF CONTRACT

Dr. Rodriguez sets forth a breach of contract claim that is based on the premise that Kansas recognizes a duly of good faith and fair dealing in every contract. He argues that the Hospital did not terminate his agreement in good faith and that it contrived with ECRI to obtain a false and misleading report on the radiology department which it relied upon to terminate the agreement. He suggests that the question of good faith was a material question of fact in this case. We agree that whether the good faith standard was met is a question of fact. Hartford v. Tanner, 22 Kan. App. 2d 64, 69, 910 P.2d 872 (1996). We conclude that the trial court correctly resolved the issue in favor of the Hospital.

“Kansas courts imply a duty of good faith and fair dealing in every contract. [Kansas Baptist Convention v. Mesa Operating Limited Partnership, 253 Kan. 717, 726, 864 P.2d 204 (1993).] The Baptist court noted that ‘ “if one exacts a promise from another to perform an act, the law implies a counterpromise against arbitrary or unreasonable conduct on the part of the promisee.” ’ [Citation omitted.] Employment-at-will contracts are the only exception to the good faith obligation currently recognized in Kansas. [Citation omitted.]” 22 Kan. App. 2d at 71.

*766 The problem with Dr. Rodriguez’ breach of contract cause of action is that the Hospital terminated the agreement precisely within the terms of the parties’ agreement. That agreement read: “[T]his contract may be terminated by [appellee or appellant] at any time, without cause, by giving written notice of such termination to the other party not less than ninety (90) days prior to the selected termination date.” (Emphasis added.)

There are explicit clauses in some agreements that, in effect, eliminate any implication of good faith and fair dealing. For instance, when an agreement permits a termination, without cause, by the giving of 90 days’ notice, the parties ought to be bound by this agreement. From the date the agreement was signed to the date termination was given, Dr. Rodriguez was well aware that the Hospital could terminate his agreement at any time without cause by giving him 90 days’ notice. If no cause was necessary, then it is largely irrelevant whether the Hospital acted in good faith or bad faith. It was not required to have a valid or fair reason to terminate. The only requirement was the giving of 90 days’ written notice. To hold that the right to terminate without cause can only be exercised in good faith simply rewrites the agreement of the parties.

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Bluebook (online)
971 P.2d 754, 25 Kan. App. 2d 763, 15 I.E.R. Cas. (BNA) 699, 1998 Kan. App. LEXIS 829, Counsel Stack Legal Research, https://law.counselstack.com/opinion/st-catherine-hospital-of-garden-city-v-rodriguez-kanctapp-1998.