WILLIAMS V. DIMENSIONS HEALTH CORP.

The Supreme Court of Maryland[1] held that a Hospital Center was vicariously liable for one of its surgeon’s negligence because the surgeon was an apparent agent of the Hospital. Williams v. Dimensions Health Corp., 480 Md. 24, 56, 279 A.3d 954, 972 (2022). Especially within the context of medical services, the court broadened Maryland’s standard for assessing the subjective “reliance” element of apparent agency by allowing Emergency Medical Services (“EMS”) personnel acting in the patient’s interest to satisfy the requirement. Id. at 58, 279 A.3d at 973.

In May 2014, Terence Williams suffered severe injuries during a car crash and was dispatched via ambulance to the Prince George’s Hospital Center of Dimensions Health Corporation (“the Hospital”), a Level II Trauma Center. EMS personnel elected to transport Williams to this particular facility because its trauma center offered treatment specific to Williams’ needs. Although Williams was “dazed” and “verbally confused,” he was aware that he was being treated in a trauma center. Upon arrival, Williams was allegedly asked to sign a “Consent to Treatment” form, although there was no evidence indicating that Williams signed or viewed it. The first paragraph provided that the emergency staff were neither employees nor agents of the Hospital, while the second paragraph stated that treatment would be provided by “employees, agents, and independent contractors.” Dr. Montague Blundon, an independent contractor and the on-call Chief of Orthopedic Surgery, performed emergency surgery on Williams’ legs, which were later amputated above the knee due to irreparable damage.

Williams filed suit against the Hospital and Dr. Blundon in 2017, alleging that Dr. Blundon acted negligently while serving as an agent of the Hospital. In the Circuit Court for Prince George’s County, the jury determined that: (1) Dr. Blundon was directly liable to Williams for negligence, and (2) the Hospital was vicariously liable for Dr. Blundon’s negligence due to the physician’s apparent agency. In 2020, the circuit court granted the Hospital’s motion for judgment notwithstanding the verdict and found that the jury’s determination was unsupported by Maryland precedent. The Appellate Court of Maryland likewise concluded that there was insufficient evidence to support a finding that Williams subjectively believed that Dr. Blundon was an agent. Ultimately, the Supreme Court of Maryland granted certiorari to clarify the issue of the requisite evidence necessary to establish an apparent agency relationship.

Before examining the legal issue, the court laid the foundation for understanding the doctrine of common law agency and vicarious liability. See Williams, 480 Md. at 31-33, 279 A.3d at 958-59. Agency is a fiduciary relationship that results when a principal and an agent manifest mutual assent that the agent will act subject to the principal’s control and on behalf of the principal. Id. at 32, 279 A.3d at 958 (citing Restatement (Third) of Agency § 1.01 (Am. L. Inst. 2006)).

Specifically, the issue of whether a hospital is vicariously liable for the alleged negligence of an independent contractor (rather than a contractual employee) is evaluated under the doctrine of apparent agency. Williams, 480 Md. at 33, 279 A.3d at 959. From the perspective of the third-party receiving care, the alleged principal is liable for harm caused by one who appears to be his agent when the principal represents that the person is his agent and subsequently causes the third party to rely on the agent’s services. See id. at 37, 279 A.3d at 961 (citing Restatement (Second) of Agency § 267 (Am. L. Inst. 1958)).

The court evaluated three factors to aid in the apparent agency determination: (1) representation – the principal’s role in the manifestation of an agency relationship; (2) reliance – the plaintiff’s subjective belief that the care provider was an agent when selecting the agent’s service; and (3) the plaintiff’s reasonableness in doing so. Williams, 480 Md. at 37-38, 279 A.3d at 961-62 (citing Bradford v. Jai Medical Systems Managed Care Org., Inc., 439 Md. 2, 18, 93 A.3d 697, 707 (2014)).

First, the Hospital represented that Dr. Blundon was an apparent agent of the trauma center for several reasons: (1) the Hospital held out to treat patients in critical circumstances, (2) the Hospital publicly represented that it was designated as a Level II Trauma Center, and (3) Dr. Blundon was the orthopedic and on-call surgeon who fulfilled the Hospital’s designation criteria. Williams, 480 Md. at 51, 279 A.3d at 969.

Second, in instances where a patient’s condition is critical, the patient–or medical personnel acting on behalf of the patient–rely on the facility’s representation that its staff will provide the necessary treatment. Williams, 480 Md. at 52, 279 A.3d at 970. An individual acting in the interest of the patient retains the ability, at least in part, to satisfy the reliance element because the distressed patient neither has the time to discern the contractual relationship of each facility member nor select a specific physician. Id. Here, EMS personnel followed their protocol of ensuring patients are transported to the correct facility to receive the appropriate care by selecting the Hospital’s trauma center, rather than a facility that was closer to the scene of the accident. Id. Furthermore, Williams testified that he was cognizant of the fact that he was in a trauma center and relied on the staff to provide treatment. Id. at 52-53, 279 A.3d at 970. Therefore, the court concluded that Williams and the EMS personnel relied on the Hospital’s representation that the appropriate medical staff would provide the requisite care for Williams. Id. at 54, 279 A.3d at 970.

Finally, the court concluded that even if Williams saw the consent form, it was hardly a “model[] of clarity” in providing its intended notice that the staff members were classified as independent contractors. Williams, 480 Md. at 54-55, 279 A.3d at 971. To a lay reader, the paragraph asserting that hospital personnel were not considered agents would be understood as explaining that the patient would receive multiple bills (one from the Hospital and one from the doctor). Id. Furthermore, the consent form would not be reasonably understood as a disclaimer of liability for the actions of the staff because it did not explain the nuanced distinction between employees and independent contractors. Id.

In the dissenting opinion, Chief Justice Getty and Justice Biran took issue with the majority’s revision of the reliance element. Williams, 480 Md. at 56-57, 279 A.3d at 972 (Getty, J., dissenting). Now, for the first time, Maryland jurisprudence will allow the reliance element to be satisfied by someone acting on behalf of the patient, rather than the patient alone. See id. at 58, 279 A.3d at 973 (Getty, J., dissenting). To the dissent, this deviation “creates a strict liability scenario” by holding the Hospital liable simply because of the EMS personnel’s reliance on the Hospital’s designation when choosing the facility. Id. at 62-63, 279 A.3d at 975-76 (Getty, J., dissenting). Under the new “broadened standard,” medical providers are left in the dark on how to best shield themselves from vicarious liability when critically injured patients are brought in for treatment. Id. at 62, 279 A.3d at 976 (Getty, J., dissenting).

The majority’s modification of the evidentiary standard sufficient to satisfy the reliance element will likely result in an increase in plaintiffs’ recovery in vicarious liability actions. While Williams is a 5-2 decision, the dissent provides a compelling argument regarding the future implications of the holding within the medical realm. In efforts to avoid the repercussions of the Williams decision, hospitals may begin asking EMS personnel to sign special forms that waive their ability to act on the patient’s behalf. Nonetheless, future decisions will clarify the application of the new standard and provide insight as to whether the majority wrongfully brought Maryland’s apparent agency doctrine one step closer to strict liability.

[1] At the November 8, 2022, general election, the voters of Maryland ratified a constitutional amendment changing the name of the Court of Appeals of Maryland to the Supreme Court of Maryland and the Court of Special Appeals of Maryland to the Appellate Court of Maryland. The name change took effect on December 14, 2022.

Anastacia Topaltzas is a 3L at the University of Baltimore and is interested in practicing litigation. Anastacia received her BA in Government and Politics and a minor in Business from the University of Maryland, College Park. During her 2L summer, Anastacia worked as a summer associate at Pessin Katz Law and is now a part-time law clerk at the firm.