Private hospital liability post Bartolomucci

The Judgment has implications on how patient terms and conditions should be drafted, to ensure clarity regarding the lines of liability between treating consultants and the hospital.

Background

Bartolomucci belongs to a line of cases where a Claimant in the tort of negligence is presented with a potential defendant who cannot meet the compensation claimed. This usually occurs where the potential defendant has no effective insurance or indemnity cover. The Claimant is then forced to find ways of pursuing other parties for compensation through claims based, for example, in vicarious liability or non-delegable duty of care. Bartolomucci represents a variation on this theme and was pleaded in straight contract. The claim is specific to medical negligence in private hospital settings. 

A common way of organising private hospital care is for treating consultants (surgeons, anaesthetists and others) to act as independent contractors under practising privileges within the hospital. Under this arrangement, the consultants will have their own indemnity arrangements and it is expected that they will be liable for any mistakes they make in performing their services. The hospital, on the other hand, will be responsible for nursing and other care they provide. What the Claimant in Bartolomucci was arguing was that there was a contractual obligation on the private hospital defendant, Circle Health Group (Circle, also referred to as BMI in the Judgment and this article), that rendered them responsible for the treatment provided by the surgeon and the anaesthetist. Circle successfully rebutted the claim, but the Judgment highlights the need for clarity in contractual documentation with patients. 

Facts

On 12 May 2015, the Claimant underwent a hip resurfacing procedure. Surgery was performed by a consultant orthopaedic surgeon with anaesthesia being administered by a consultant anaesthetist (the Consultants). The Claimant suffered a catastrophic brain injury during the surgery. He has significant care needs. In the Judgment, it is noted that the Claimant alleges that the surgery and/or the anaesthesia were not carried out with reasonable care. He intends to seek damages as a result. 

The surgery was performed following agreement to contractual documentation sent to the Claimant by BMI under cover of a letter dated 23 April 2015, offering a self-paying fixed price package (the Contract). The extent of the contractual obligations set out in those documents formed the basis of the claim.

Although the anaesthetist had indemnity cover through a medical defence organisation (MDO), that MDO indicated that they were not representing the anaesthetist and had no interest in the claim intimated against him. The anaesthetist was, therefore, unindemnified in a claim for very significant damages.

The claim

Virtually all, if not all, medical negligence claims are pursued through what are known as Part 7 proceedings which plead a full claim potentially allowing for extensive written and oral evidence from lay witnesses and experts. The Claimant in this case issued Part 8 proceedings against Circle. Such Part 8 proceedings allow for only limited, if any, oral evidence. The Court's findings are to be based largely on an interpretation and analysis of limited documentation.

These Part 8 proceedings sought various declarations from the Court in contract, which, if successful, would then be applied in conventional Part 7 medical negligence proceedings. The Claimant sought declarations that the services provided pursuant to the Contract with BMI included all in-patient medical and surgical (to include anaesthetic) treatment and healthcare required as part of the hip resurfacing procedure. The Claimant also sought a declaration that Circle were liable in contract to him for the acts and omissions of the consultants.

In their Defence, Circle argued that they were only responsible for the hospital care provided by its nurses and other such items as listed in the contractual documentation that was provided to the Claimant, but not the care provided by the Consultants. 

Contractual documentation

Although other issues were aired within the Judgment, in essence, the argument revolved around the following documents and issues.

The covering letter sent by BMI to the Claimant's father in April 2015 stated "Following your consultation with [the surgeon], please find enclosed details of our self-pay fixed price package for your surgery. This offer is made subject to the Terms and Conditions set out in the enclosed ...."

There was a Quotation attached to the covering letter in the sum of £14,220.00 for the procedure. The items listed as included in the fixed price package were "Consultants' operating fees". Listed among the items not included in the package were "the Consultant's fee for the initial out-patient consultation".

The attached Terms and Conditions referred to in the covering letter ran to 25 clauses. Although the Judgment refers to other clauses, Clauses 18 to 20 are key to the Judgment as handed down by the Court. They read as follows:

18. All consultants are self-employed and provide their services direct to the patient.

19. Your quote will state whether the Consultant's fees for the procedure and the follow up (but not the initial consultation fee) are included in the quoted price. If the fees are included, the hospital will usually collect the consultant's fees as agent, but occasionally you will receive a separate invoice from the consultant for his portion of the procedure cost...

20. The initial consultation fee with the Consultant is a separate fee (outside the package price) which will be invoiced to you directly by the Consultant.

Method to be adopted in the interpretation of the Contract – Summary of arguments

Both the Defendant and the Claimant agreed that the appropriate way of interpreting the contractual documentation was by reference to the Judgments in Lamesa Investments Limited -v- Cynergy Bank Limited and Network Rail Infrastructure Limited -v- ABC Electrification Limited.

The Judge considered his role was to identify the intention of the parties by reference to what a reasonable person having all the background knowledge which would have been available to the parties would have understood the language used in the Contract to mean. The departure point for the interpretation of the language is the natural and ordinary meaning of the contractual terms used.

The Claimant laid great weight on the wording in the covering letter from BMI which offered the fixed price package for "your surgery". This, they argued, indicated that the Contract covered all aspects of the procedure including the surgery and anaesthesia. 

In contrast, BMI relied heavily on Clauses 18 to 20 of the Terms and Conditions attached. The hospital argued that the Consultants' services were not included within the Contract as between BMI and the Claimant. 

The judgment

The Judge acknowledged that the covering letter stated that the fixed price package was for "your surgery". However, this covering letter made mention to the Terms and Conditions and the attached Quotation. The Quotation described the procedure as "The Birmingham Hip resurfacing procedure". This description describes the subject of the Contract as being the procedure, but the inclusion in the Quotation of a text box listing what is and what is not included within "your package" makes clear that not all matters are covered. The initial consultation with the Consultant was not included. The Consultant's operating fees were included in the total sum charged by BMI. 

The reference in Clause 18 of the Terms and Conditions to the Consultants being self-employed does not give any indication whether the services of surgeons or anaesthetists should be excluded from the scope of the obligation. After all, terms can be included within any contract for services to be performed by a third party. However, the second half of Clause 18 stipulates that the Consultants provide their services direct to the patient. A reasonable person would consider that Clause 18 stipulates that the Consultant rather than BMI would provide their services to the patient. Furthermore, these words are preceded by "all Consultants are self-employed". This allows the reader to understand that the Consultants do not work for BMI. 

Clause 19 stipulates that the fees of the Consultants in this case were collected by BMI acting as agent for the Consultants. This is consistent with the Contract not including the provision of the Consultants' services.

Accordingly, the Court concluded that the ordinary and natural meaning of the words in Clauses 18 and 19 would have conveyed to the reasonable reader that the surgical services of the Consultants were to be provided by them rather than BMI. Reading the Contract as a whole, the purpose of the Contract was to provide a fixed price package for the Claimant's hip resurfacing procedure that included within the fixed price fees charged by the Consultants. 

The Court, therefore, accepted the Defendant's arguments and dismissed the Claimant's request for declaratory relief. 

Other matters in the judgment

Amongst other matters dealt with in the Judgment, the Court considered the following:

• It was not much argued by the parties, but commercial common sense is an important factor in the interpretation of contracts. The Judge concluded that the Defendant's interpretation of the Contract was consistent with commercial common sense.

• Documents that post-date contract formation or are not shared with the patient cannot form part of the factual matrix relevant to interpretation of a contract. For example, the practising privileges as between BMI and the Consultants would not lie within the knowledge of the Claimant and were, therefore, disregarded. The Registration Form that was signed by the Claimant after the formation of the Contract was also disregarded.

• There were no formal written contracts as such between the Claimant and the Consultants and the Claimant had specifically pleaded that no contracts were formed. In its Defence, the Defendant made no admissions as to the existence of such contracts. On the evidence available, the Court concluded that there were contracts between the Claimant and the Consultants. It should be noted that the Court accepted that the consent process in private medical healthcare formed a part of the contractual process as between consultant and patient. 

• The Part 8 proceedings made no claim for damages in personal injury. Accordingly, Qualified One way Cost Shifting (QOCS) does not apply. Circle is, therefore, as successful party in the claim, entitled to claim and enforce its costs as against the Claimant.

Summary and next steps

This claim required careful consideration of the specific contractual terms and the detail of the judgment provides guidelines for private hospital operators to consider when drafting their patient terms and conditions, and wider suite of documents for patients.

Given the profile of this case, and the issues raised, we recommend that private hospital operators re-visit their patient terms and conditions to ensure they clearly demarcate the lines of liability as between the private hospital operator and the patient, as well as the consultant and the patient.

Should you require support in reviewing and updating your patient terms and conditions in light of this judgment, please contact Jonathan Bonser, Legal Director or Louise Kane, Senior Associate. Jonathan led the successful defence in this case and Louise Kane is a commercial lawyer who has supported on reviewing patient terms and conditions for private hospitals.