Salvagno v. Frew

KENNEY, Judge. Dr. Ralph T. Salvagno, Michael Fitzgerald, and the Altizer-Salvagno Center for Surgery at Robinwood appeal from an order of the Circuit Court for Washington County nullifying and vacating a decision of the Health Claims Arbitration Office (the “HCAO”). Appellants ask two questions, which we have slightly reworded: I. Did the circuit court err by denying appellants’ motion to dismiss?

II

Did the circuit court err by vacating the order of the HCAO? For the reasons below, we shall remand the case to the circuit court with instructions to remand the claim to the IICAO for arbitration. Overview of the Health Care Malpractice Claims Act The Health Care Malpractice Claims Act (the “Act”), embodied in Md.Code (1974, 2002 Repl.Vol.), §§ 3-2A-01 through 3-2A-09 of the Courts and Judicial Proceedings Article (“C.J.”), was enacted in 1976 in response to the malpractice insurance crisis. 1 Carrion v. Linzey, 342 Md. 266, 274-75 , 675 A.2d 527 (1996). The primary feature of the Act was to “ ‘require the submission of certain [medical malpractice] claims to an arbitration panel for initial ascertainment of liability and damages before resort [could] be had to a court of law for final determination.’ ” Id. at 276 , 675 A.2d 527 (quoting Attorney Gen. v. Johnson, 282 Md. 274, 277 , 385 A.2d 57 (1978)).

The purpose of the Act was to “screen malpractice claims, ferret out meritless ones, and, in theory, ... lower the cost of malpractice insurance and the overall costs of health care.” Adler v. Hyman, 334 Md. 568, 575 , 640 A.2d 1100 (1994). In short, medical malpractice claims are to be submitted to “mandatory arbitration as a pre-condition to any court ³²⁰ action.” Watts v. King, 143 Md.App. 293, 306 , 794 A.2d 723 (2002). 2 “All claims, suits and actions” in which damages of more than $5,000 are sought against a health care provider for medical injury allegedly suffered by a claimant are subject to the Act. C.J. § 3-2A-02(a)(l). Claims filed with the Director of the HCAO are referred to a panel of three arbitrators.

See C.J. § 3-2A-03. In any action for damages filed under the Act, the health care provider is not liable for the payment of damages unless it is established that the care given by the health care provider is not in accordance with the standards of practice among members of the same health care profession with similar training and experience situated in the same or similar communities at the time of the alleged act giving rise to the cause of action. C.J. § 3-2A-02(c). Except when the issue is solely the lack of informed consent, a claimant must file with the Director a certificate of a qualified expert “attesting to departure from standards of care” and that the departure was “the proximate cause of the alleged injury.” C.J. § 3-2A-04(b)(l)(i).

Failure to file such a certificate “shall” result in dismissal of the claim without prejudice. Id. To dispute liability, a defendant must file a certificate “attesting to compliance with standards of care,” or that the departure was not the proximate cause of the alleged injury, within one hundred twenty days from the date the claimant “served the certificate of a qualified expert ... on the defendant.” C.J. § 3-2A-04(b)(2). Ordinarily, the claimant’s certificate must be filed within ninety days from the date of the claim, but an extension of time to file a certificate of a qualified expert “shall be granted for good cause shown.” C.J. § 3-2A-04(b)(l)(i) and (5). ³²¹ The arbitration panel determines whether the health care provider is liable and, if so, “consider[s], itemizelsl, assess[es], and apportion[s]” the appropriate damages, and incorporates into the award an assessment of costs, including the arbitrators’ fees.

C.J. §§ 3-2A-05(e) and (f)(1). If no party rejects the award, it becomes “final and binding,” is filed in the appropriate circuit court, and constitutes a final judgment when confirmed by that court. C.J. § 3-2A-05(i). Any party, however, can reject the award “for any reason” by filing a “notice of rejection” with the Director of the HCAO and the arbitration panel and, also, an “action to nullify” the award in an appropriate circuit court within thirty days “after the award is served on the rejecting party.” C.J. § 3-2A-06(a) and (b).

A party may elect to have the case tried by a jury. C.J. § 3-2A-06(b)(2). Prior to the trial, the circuit court may modify, correct, or vacate an award. C.J. § 3-2A-06(c).

If the circuit court finds, for example, that the “arbitrators exceeded their powers,” it “shall vacate the award, and trial of the case shall proceed as if there had been no award.” C.J. §§ 3-224(b)(3) and 3-2A-06(c). If not vacated, the award is admissible as evidence at trial. C.J. § 3-2A-06(d). It is presumed to be correct and the “burden is on the party rejecting it to prove that it is not correct.” Id.

FACTUAL AND PROCEDURAL BACKGROUND The complaint alleges that Dr. Ralph Salvagno, while performing surgery on William Frew’s right ankle on March 26, 1997, improperly applied a tourniquet. The result was an “injury to the right calf and lost sensation to the right foot.” In March 2000, William and his wife, Debra, (“claimants”), filed a two-count statement of claim with the HCAO, alleging negligence (“Count I”) and loss of consortium (“Count II”). On April 11, 2000, the claimants requested an extension of time for filing a certificate of a qualified expert (the “certificate”), which the Director granted, extending the time to September 17, 2000. On August 29, 2000, the claimants requested “an additional ninety (90) days within which to ³²² secure” the certificate.

The Director granted an extension to November 1, 2000. On October 31, 2000, the claimants filed an amended statement of claim, adding a count for lack of informed consent (“Count III”). They also requested another extension of time to file the certificate, averring: 1. Claimants have had this case reviewed by an expert. 2.

Claimants’ initially retained experts indicated that claimants’ claim [had] merit, but claimants’ specialist who has reviewed the case commented on the case in such a manner that claimants’ counsel was directed to file the Amended Complaint alleging lack of informed consent, a change in theory of the case. 3. Under such a theory, claimants would not need a certificate .... However, claimants did not wish to foreclose any theory of recovery. 4. Consequently, claimants will need additional time to secure an expert opinion to provide a second look at claimants’ Count One [negligence] cause of action. 5.

Claimants have been proceeding with due diligence in their quest to move this case along. Wherefore ..., claimants request an additional extension of time within which to file an expert’s certificate as to Count One. The Director extended the time to January 10, 2001. On December 7, 2000, appellants filed a motion to dismiss Count III, which the Director denied. 3 Appellants filed another motion to dismiss on May 7, 2001, requesting that Counts I and II be dismissed because the claimants had “failed to file [the] certificate ... on or before January 10, 2001.” On June 6, 2001, the Director dismissed Count I. The chairperson of the arbitration panel (the “chairperson”) issued the following scheduling order on December 3, 2001: ³²³ February 1, 2002 Claimants to name expert witnesses March 15, 2002 Appellants to name expert witnesses April 15, 2002 Claimants to name rebuttal witnesses June 21, 2002 Discovery cut-off June 24, 2002 Pretrial telephone conference July 22-24, 2002 Arbitration hearing On February 11, 2002, appellants filed a “Motion to Dismiss or, in the Alterative, Motion for Summary Judgment.” Relying on Sard v. Hardy, 281 Md. 432 , 379 A.2d 1014 (1977), appellants argued that Counts II and III should be “dismissed or judgment entered” because the claimants had not designated an expert witness and could not “make a prima facie case of lack of informed consent (nor the derivative claim of loss of consortium) without an expert witness.” The claimants responded that, because appellants had not provided “thorough!] and complete!]” answers to interrogatories, they had not “secured information necessary to ascertain whether an expert [was] needed.” The claimants averred: 4.

The information elicited or sought to be elicited from the answers to interrogatories is relevant for the purposes of determining whether [claimants] needed an expert or whether the [appellants’] admissions would be sufficient to provide the evidence needed to go forward. * * * 6. While cases have indicated expert testimony is needed, there is no indication that the experts need to be established at the cut-off of [claimants’] designation. 7. [Appellants’] admissions are sufficient and can be sufficient enough to establish the standard of care. 8. Until it is known to [claimants] that [claimants] will not be able to establish through [appellants’] admissions or through the course of discovery from other sources in this case as to the standard of care and the breach ³²⁴ thereof, then [claimants] would [not] need to address the issue of [claimants’] experts. The claimants again requested that the “designation period for supplying expert designation be extended thirty days.” Following a hearing on appellants’ motion, the chairperson filed an order dismissing without prejudice Counts II and III, finding: 1.

The claimants have been granted three extensions of time by the HCAO Director, and in essence, a fourth extension of time by the [chairperson’s] Scheduling Order requiring that an expert witness be designated on or before February 1, 2002. This claim was filed in March 2000, and claimants have had over two (2) years in which to name an expert witness. To date, no certificate has been filed. 3. In view of Sard , without an expert witness, the claimants cannot make a prima facie case for lack of informed consent.

I find no merit in the claimants’ argument that ... Dr. Salvagno should in essence be the claimants’ expert witness. The cases cited in claimants’ Memorandum ... would appear to indicate that an adverse party may be called as a witness and interrogated on cross-examination both as to facts and as to expert opinion — in addition to — and not instead of— their own expert witness. On June 13, 2002, the claimants filed in the circuit court a petition to nullify the award, arguing that, because it was permissible to rely on appellants’ “admissions as to the particulars of informed consent in order to satisfy the expert requirement of Sard,” the chairperson exceeded her authority by dismissing Counts II and III.

At the same time, the claimants filed a two-count complaint, seeking damages for lack of informed consent and loss of consortium. In response to the petition to nullify, appellants denied that the chairperson had exceeded her authority. Appellants also filed a ³²⁵ motion to dismiss the complaint, arguing that because the claimants had not filed a certificate, they had failed to arbitrate, which is a “pre-condition to any court action.” Following a hearing, the circuit court granted the claimants’ petition to nullify, vacated the chairperson’s order of dismissal, and denied appellants’ motion to dismiss the complaint, stating: 4 (a) After the dismissal of [Count I], [the claimants’] ... cause of action became one in which the sole issue was lack of informed consent, (the claim for loss of consortium being derivative of the lack of informed consent claim and in the nature of damages only). Under ... [C.J.] § 3-2A-04(b), the [claimants] were therefore not required to file a certificate of qualified expert on the matter of lack of informed consent.

The [chairperson’s] dismissal of ... [Counts II and III] exceeded her scope of authority in light of the language of ... [C.J.] § 3-2A-04(b); (b) Maryland law on informed consent, as set out in Sard v. Hardy, 281 Md. 432 , 379 A.2d 1014 (1977), does not impose a necessary requirement upon the [claimants] to present expert testimony in order to meet their burden of proof as to the materiality of the risk from [claimant] William Frew’s perspective. Sard at 447, 379 A.2d 1014 [sic] makes clear that Maryland has adopted a general or lay standard of reasonableness set by law and independent of medical custom, which standard imposes no requirement of expert testimony to establish scope or breach of a physi- ³²⁶ dan’s duty to disdose. However, at Sard 448 [sic], such expert testimony would be required to establish the nature of the risks inherent in a particular treatment, the probabilities of therapeutic success, the frequency of the occurrence of particular risks, the nature of available alternatives to treatment and whether or not disclosure would be detrimental to a patient. In light of Sard , the [chairperson’s] dismissal of [Counts II and III] with no opportunity to present the case, was premature; (c) State use of Miles v. Brainin, 224 Md. 156 , 167 A.2d 117 (1961), permits the [claimants] to elicit expert testimony from a defendant called as an adverse witness.

Brainin does not, however, go so far as to permit the [claimants] to name a defendant as their sole expert witness and then to rely upon that defendant’s testimony alone to prove every aspect of their lack of informed consent claim. This timely appeal followed. DISCUSSION I. Motion to Dismiss Relying on Watts v. King, 143 Md.App. 293 , 794 A.2d 723 (2002), and Bailey v. Woel, 302 Md. 38 , 485 A.2d 265 (1984), appellants argue that the circuit court “exceeded its jurisdiction” by denying the motion to dismiss the complaint. Because a medical malpractice claim must be submitted to mandatory arbitration before the HCAO as a “condition precedent” to the filing of any court action, appellants contend that the claimants “failed” to arbitrate the claim by not designating an independent expert.

Therefore, they may not file the complaint in the circuit court. Appellees concede that “expert testimony is needed” to prove the claim for lack of informed consent, but, citing State use and Benefit of Miles v. Brainin, 224 Md. 156 , 167 A.2d 117 (1961), they argue that, instead of designating their own expert, they could rely on Dr. Salvagno’s testimony to establish the “material risks of the procedure, ... the alternatives, and ... the percentages of success ³²⁷ for each approach.” Therefore, they did not fail to arbitrate their claim. Under the doctrine of informed consent, “a physician, treating a mentally competent adult under non-emergency circumstances, cannot properly undertake to perform surgery or administer other therapy without the prior consent of his patient.” Sard, 281 Md. at 439 , 379 A.2d 1014 . Consent is “informed” if it is given after a physician has fairly and reasonably explained the proposed treatment or procedure.

Id,. It is the physician’s duty to explain the procedure to the patient and to warn him of any material risks or dangers inherent in or collateral to the therapy, so as to enable the patient to make an intelligent and informed choice about whether or not to undergo such treatment. This duty to disclose is said to require a physician to reveal to his patient the nature of the ailment, the nature of the proposed treatment, the probability of success of the contemplated therapy and its alternatives, and the risk of unfortunate consequences associated with such treatment. Id. at 439-40 , 379 A.2d 1014 .

In Maryland, the scope of a physician’s duty to inform is “measured by the materiality of the information to the decision of the patient.” Id. at 444 , 379 A.2d 1014 . Whether a physician has fulfilled that duty is determined by a “general standard of reasonable conduct,” focusing on the information that a patient needs to make an intelligent decision. Id. at 442, 444 , 379 A.2d 1014 . Expert medical testimony is not required to establish the “scope” or the “breach of the physician’s duty,” but it is required to establish the “nature of the risks inherent in a particular treatment, the probabilities of therapeutic success, the frequency of the occurrence of particular risks, the nature of available alternatives to treatment and whether or not disclosure would be detrimental to a patient.” Id. at 447-48 , 379 A.2d 1014 . ³²⁸ The two cases on which appellants rely do not address the issue presented in this case.

In Bailey, 302 Md. 38 , 485 A.2d 265 , the claimants filed a claim with the HCAO and conducted discovery. At the arbitration hearing, claimants’ counsel, without explanation, did not present any testimony. After the panel dismissed the claim, the claimants filed a petition to nullify the award in the circuit court, which was dismissed for failure to arbitrate. The Court of Appeals affirmed the dismissal, holding that “a plaintiff who presents no evidence before a medical malpractice arbitration panel has not satisfied the condition precedent of submitting his claim to arbitration prior to instituting court action.” Id. at 45 , 485 A.2d 265 .

In this case, claimants stood ready to present the evidence that they had, but were denied the opportunity to do so. Watts, 143 Md.App. 293 , 794 A.2d 723 , involved a dental malpractice claim in which the claimant filed an expert’s certificate that did not comply with C.J. § 3-2A-04(b)(l)(i). Specifically, the certificate did not attest to a departure from the standard of care by the dentist that had proximately caused the injuries. 5 The HCAO dismissed the claim, in part, because the certificate did not contain the required attestation. On appeal, we analogized the claimant’s “failure to file a certificate that meets the statutory requirements to the cases in which no certificate was filed.” Id. at 309, 794 A.2d 723 .

Because filing the required certificate was “an indispensable step in the arbitration process,” we held that the claim had not been arbitrated before the HCAO and, therefore, could not be considered by the circuit court. Id. at 310 , 794 A.2d 723 . Here, the