BRUCE B FEYZ V MERCY MEMORIAL HOSPAnnotate this Case
STATE OF MICHIGAN
COURT OF APPEALS
BRUCE B. FEYZ,
MERCY MEMORIAL HOSPITAL, RICHARD
HILTZ, JAMES MILLER, D.O., JOHN
KALENKIEWICZ, M.D., J. MARSHALL
NEWBERN, D.O., and ANTHONY SONGCO,
January 13, 2005
Monroe Circuit Court
LC No. 02-014174-CZ
Official Reported Version
MEDICAL STAFF OF MERCY MEMORIAL
Before: Murray, P.J., and Sawyer and Smolenski, JJ.
MURRAY, P.J. (concurring in part, dissenting in part).
I agree with the majority's conclusion that plaintiff 's statutory civil rights claims against
defendants are subject to judicial review and that the peer review statute does not provide the
hospital immunity to such claims. However, I disagree in part with the rationale underpinning
the immunity issue, and with the majority's conclusion that Hoffman v Garden City HospOsteopathic, 115 Mich App 773; 321 NW2d 810 (1982), and its progeny do not preclude judicial
review of contract and contract-related tort claims that encompass a challenge to a private
hospital's decision regarding a physician's staff privileges.
I. MCL 331.531
As the majority notes, MCL 331.531(3)(b) and (4) provide that a peer review entity is
immune from civil liability for "an act or communication within its scope as a review entity,"
unless done with malice. The majority then concludes that a discrimination claim is not barred
by the statute's grant of immunity because (1) an unlawful discriminatory act is not within the
scope of a peer review committee, and (2) an unlawful act of discrimination constitutes malice.
According to the established case law defining malice under this statute, I agree with the second
proposition. However, the majority's reading of MCL 331.531(3)(b) is too narrow.
In determining whether an act or communication is within the scope of a review
committee, we cannot examine the legal result of the act or communication; instead, we must
focus on the subject matter on which the initial act or communication complained of was made,
i.e., the decision not to retain a physician, to suspend a physician, etc. "Scope" in this context
means "range of operation." Webster's New Collegiate Dictionary (1980). See, also, Backus v
Kauffman (On Rehearing), 238 Mich App 402, 409; 605 NW2d 690 (1999) (defining scope of
authority in the context of the governmental immunity statute). Otherwise, every time there is a
potential for legal liability, there would be no immunity, which would defeat the purposes of the
statute. As a result, I disagree with that part of the majority's analysis of MCL 331.531(3)(b).
More importantly, the majority has overlooked the definition of malice applied by this
Court in both Regualos v Community Hosp, 140 Mich App 455, 463; 364 NW2d 723 (1985), and
Veldhuis v Allan, 164 Mich App 131, 136-137; 416 NW2d 347 (1987). In Veldhuis, we adopted
the defamation definition of malice to define the statutorily undefined "malice" found in MCL
We agree with defendant Davis Clinic that the definition of malice
applicable in defamation actions also seems appropriate in the context of MCL
331.531; MSA 14.57(21). See Regualos [supra at 463], citing Lins v Evening
News Ass'n, 129 Mich App 419; 342 NW2d 573 (1983). Applying that definition,
the statutory immunity does not apply only if the person supplying information or
data does so with the knowledge of its falsity or with reckless disregard of its
truth or falsity. 129 Mich App 432. Similarly, a review entity is not immune
from liability if it acts with knowledge of the falsity, or with reckless disregard of
the truth or falsity, of information or data which it communicates or upon which it
acts. [Veldhuis, supra at 136-137.]
See, also, Savas v William Beaumont Hosp, 216 F Supp 2d 660, 668-669 (ED Mich, 2002).
Admittedly, there is no discussion in either Regualos or Veldhuis regarding why the
defamation definition of malice applies to this statute's reference to malice. Nonetheless, since
that definition has been adopted and utilized in both our published and unpublished decisions, as
well as by the federal courts applying Michigan law, we must, at minimum, apply that definition.
If we do not, we must explain why.
Here, plaintiff alleges that the Medical Staff Executive Committee, in dealing with
plaintiff, failed to adhere to the hospital bylaws and procedures. These failures resulted,
according to the complaint, in violations of state and federal statutes, as well as common-law
claims for breach of contract and torts. There can be no dispute that the Executive Committee,
which oversees the medical staff and makes all decisions regarding the discipline of medical staff
members, is a review entity as defined by the statute. MCL 331.531(2)(a) and (b). Additionally,
the bylaws grant the Executive Committee the authority to create a "special committee," such as
the ad hoc committee, to investigate matters submitted to the Executive Committee.
Because the Executive Committee was a review entity, its decisions are immune unless
done with malice. In reviewing the detailed allegations within plaintiff 's 157-paragraph
complaint, plaintiff alleges that defendants referred him to the Health Professional Recovery
Program (HPRP) with full knowledge that he had no mental or physical limitations. This
allegation, which is the foundation for plaintiff 's disability discrimination claims, fits within the
definition of malice as articulated in Veldhuis. In other words, plaintiff 's claim alleges that the
Executive Committee sent him to the HPRP with knowledge that plaintiff had no impairment
that qualified him for a referral or was reckless in disregarding that information when acting.
This allegation falls squarely within the term "malice" as defined in Veldhuis. Moreover, to the
extent that plaintiff has alleged a viable civil rights claim through other allegations, this too
would fall within the definition of malice. Legal malice is defined as "[t]he intent, without
justification or excuse, to commit a wrongful act." Black's Law Dictionary (7th ed). As counsel
acknowledged during oral argument, discrimination claims may fall within the legal definition of
malice because of the falsity (or, in discrimination terms, pretext) of the offered reasons for an
act. It is also true that discrimination generally must be intentional to be actionable. See
Harville v State Plumbing & Heating, Inc, 218 Mich App 302, 315-319; 553 NW2d 377 (1996).
Finally, through the state's civil rights acts, the Legislature has specifically authorized these
claims to be brought against hospitals and their employees. Thus, the immunity under MCL
331.531 would not bar otherwise valid discrimination claims. Mack v Detroit, 467 Mich 186,
195 and n 9; 649 NW2d 47 (2002), citing Manning v Hazel Park, 202 Mich App 685, 699; 509
NW2d 874 (1993).
However, plaintiff 's remaining tort and contract claims, to the extent they do not rely
upon the referral to the HPRP, do not fall within the definition of malice and are barred under the
statute. MCL 331.351. And, as shown below, those torts that do allege an improper referral are
barred under the nonreviewability doctrine.
II. Nonreviewability Doctrine
In light of the obiter dictum in Long v Chelsea Community Hosp, 219 Mich App 578,
587; 557 NW2d 157 (1996),1 the majority is correct in its holding that courts can and will review
claims made by physicians that a private hospital has violated state statutory law, such as the
Persons with Disabilities Civil Rights Act, MCL 37.1101 et seq. See, e.g., Samuel v Herrick
Mem Hosp, 201 F3d 830, 834-835 (CA 6, 2000) (holding that district court properly reviewed
statutory antitrust and discrimination claims).
However, to the extent that the majority holds that a contract or certain contract-related
tort claims challenging a private hospital's staffing decision may be reviewed by the courts, I
respectfully disagree. That is because our case law has squarely held that any contract claim and
certain contract-related tort claims that require courts to inquire into the hospital's decision are
not subject to judicial review.
Long did not involve a civil rights claim, so any statements in the opinion regarding civil rights
claims and the nonreviewability doctrine were unnecessary to the resolution of the case.
The majority's analysis of the underpinnings for the nonreviewability doctrine is not
complete. It is certainly true that one of the issues decided by the foundational case of Shulman
v Washington Hosp Ctr, 222 F Supp 59 (D DC, 1963) was that a private hospital's decision was
not subject to the same constitutional prohibitions as the decision of a public hospital. However,
the Shulman Court provided an additional rationale to support its holding that courts should
refrain from reviewing staffing decisions of private hospitals, the rationale primarily being that
courts are ill-equipped to decide such issues:
There are sound reasons that lead the courts not to interfere in these
matters. Judicial tribunals are not equipped to review the action of hospital
authorities in selecting or refusing to appoint members of medical staffs,
declining to renew appointments previously made, or excluding physicians or
surgeons from hospital facilities. The authorities of a hospital necessarily and
naturally endeavor to their utmost to serve in the best possible manner the sick
and the afflicted who knock at their door. Not all professional men, be they
physicians, lawyers, or members of other professions, are of identical ability,
competence, or experience, or of equal reliability, character, and standards of
ethics. The mere fact that a person is admitted or licensed to practice his
profession does not justify any inference beyond the conclusion that he has met
the minimum requirements and possesses the minimum qualifications for that
purpose. Necessarily hospitals endeavor to secure the most competent and
experienced staff for their patients. Without regard to the absence of any legal
liability, the hospital in admitting a physician or surgeon to its facilities extends a
moral imprimatur to him in the eyes of the public. Moreover not all professional
men have a personality that enables them to work in harmony with others, and to
inspire confidence in their fellows and in patients. These factors are of
importance and here, too, there is room for selection. In matters such as these the
courts are not in a position to substitute their judgment for that of professional
groups. [Shulman, supra at 64 (emphasis added).]
Thus, it was not just the legal significance between a public and private hospital that drove the
Shulman decision. It was also the court's policy choice to refrain from intervening in an area in
which it had no expertise, and in which the hospital officials had all the experience, duties, and
incentives to ensure a qualified medical staff.
Significantly, this rationale has been carried forward into Michigan case law. In
Hoffman, for example, our Court, citing and adopting Shulman, noted that the majority of
jurisdictions had held that "a private hospital has the power to appoint and remove members at
will without judicial intervention." Hoffman, supra at 778 (emphasis added). The rule is so
concrete that in Hoffman we quoted with approval the Shulman Court's pronouncement that
"[t]he decision of the hospital authorities in such matters is final." Id. at 779 (emphasis added).
To be more precise, Shulman and Hoffman both recognize that a public hospital is subject
to constitutional safeguards such as due process, while a private hospital is not. But that rather
obvious conclusion does not go hand-in-hand with the holding that "such matters," i.e., a
decision affecting a physician's staff privileges, are "final" and unreviewable. Indeed, if the
Shulman holding were based solely on the public/private hospital distinction, the holding would
merely be that courts will not review due process or other constitutional challenges to a private
hospital's decision. But Shulman and Hoffman went much further, stating that a hospital's
decisions are final, for which there should be no judicial interference. What explains that rather
broad holding is the previously quoted explanation from Shulman that courts have decided that
they are so ill-equipped to review such decisions that they will not do so absent an allegation that
the hospital violated a state or federal statutory provision.
With this in mind, our courts have rejected requests to review private hospital decisions
on physician staffing issues even when the challenges are brought as contract and contractrelated tort claims. We recently recognized this principle in Derderian v Genesys Health Care
Systems, 263 Mich App 364, 376-377; 689 NW2d 145 (2004):
Rather, these cases merely state that the staffing decisions of private
hospitals are not subject to judicial review. Hoffman [supra at 778-779];
Regualos [supra at 461]. This doctrine does not arise from a limitation on the
court's authority, but, in part, from the distinction between public and private
hospitals. In Hoffman, for example, the Court acknowledged that precedent
required public hospitals to afford due process to physicians, Milford v People's
Community Hosp Auth, 380 Mich 49; 155 NW2d 835 (1968); Touchton v River
Dist Community Hosp, 76 Mich App 251; 256 NW2d 455 (1977), but recognized
and chose to follow the majority position that private hospitals, on the other hand,
have "the power to appoint and remove [staff] members at will without judicial
intervention." Hoffman, supra at 778. Since Hoffman, this Court has refrained
from reviewing numerous claims, framed in various ways, that implicate the
hospital's decision and the basis for its decision, see e.g., Sarin v Samaritan
Health Ctr, 176 Mich App 790, 794; 440 NW2d 80 (1989); Veldhuis [supra at
247], while "declin[ing] to articulate a broad principle that a private hospital's
staffing decisions may never be judicially reviewed," Long [supra at 586].
[Emphasis altered in part.]
In point of fact, Sarin involved claims of breach of contract, tortious interference with a contract,
and tortious interference with advantageous business relationships, all based on the hospital's
decision to terminate the plaintiff 's staff privileges. Sarin, supra at 791-792. Yet, we rejected
the plaintiff 's request to review these claims because of the Hoffman nonreviewability rule:
Plaintiff 's various claims revolve around questions regarding who the
hospital review proceedings advanced, the composition of the board, its sources
of information, claimed inaccurate information, and the actual decision to suspend
and terminate his privileges. Moreover, plaintiff 's tort claims are based on
alleged violations of the bylaws. Thus, we believe the trial court properly
concluded that it could not review plaintiff 's claims without intervening in the
hospital's decision and interfering with the peer review process. In so ruling, we
repeat our adherence to and support of the rule that prohibits judicial review of
the action of a private hospital in denying staff privileges to a doctor. [Sarin,
supra at 795 (emphasis added).]
Likewise, in Long this Court upheld the trial court's decision refusing to review, on the basis of
Hoffman, Sarin, and other cases, the plaintiff 's breach of contract and promissory estoppel
claims. Long, supra at 586-588.2 See, also, Muzquiz v W A Foote Mem Hosp, Inc, 70 F3d 422,
430 (CA 6, 1995) (affirming district court's refusal to review physician's breach of contract
claims, but reviewing the federal antidiscrimination claims).
Federal courts applying Michigan law have come to the same conclusion. In Samuel, the
United States Court of Appeals for the Sixth Circuit held that the district court could not review
the plaintiff physician's claim of tortious interference with contractual relations and business
relationship because Michigan "follows an even more stringent rule that does not allow any
review, even to ensure that the methods put forth by hospital for peer review are followed."
Samuel, supra at 835. The court did note, however, that Michigan has an exception to the
nonreviewability doctrine when hospitals are accused of violating state or federal laws, such as
antidiscrimination laws. Id.
Similarly, in Savas, the plaintiff brought numerous statutory civil rights claims as well as
tort claims for tortious interference with an advantageous business relationship and intentional
infliction of emotional distress. These claims were based on the hospital's decision to suspend
the plaintiff 's clinical privileges. The district court granted summary judgment for the hospital,
holding that the tort claims could not be reviewed because to do so would necessarily involve a
review of the hospital's decision regarding the plaintiff 's staff privileges:
Michigan law states that there can be no judicial review in the form of a
tort claim of a private hospital's decision to terminate medical staff privileges,
even to ensure that it was not arbitrary, capricious or unreasonable. [Citations
omitted.] This doctrine was recently examined and upheld by the Sixth Circuit in
Plaintiff cannot avoid the rule of judicial nonreviewability by
characterizing her claims as "tortious interference" or "intentional infliction of
emotional distress." This would "necessarily involve a review of the decision to
terminate and the methods behind that decision, thus making a mockery of the
rule that prohibits judicial review of such decisions by private hospitals." [Savas,
supra at 668.]
Hence, unlike the majority, I do not believe that post-Hoffman Courts, such as Long and
Sarin, went beyond Hoffman's public/private hospital ruling when they refused to review
contract and certain tort claims that necessitated interfering with the hospital's decision regarding
Although "promissory estoppel is akin to a contract claim," Long, supra at 588, tortious
interference with contract and tortious interference with advantageous business relations are
clearly distinct torts. Winiemko v Valenti, 203 Mich App 411, 418 n 2; 513 NW2d 181 (1994);
Feaheny v Caldwell, 175 Mich App 291, 300-301; 437 NW2d 358 (1989). These torts
nonetheless fell within the Hoffman rule because they were so closely enmeshed with the
contract claims that court review would still necessitate interfering with the hospital's decision.
Sarin, supra at 795.
a physician's staff privileges. Rather, those courts utilized one part of the Hoffman and Shulman
rationales in coming to their respective conclusions.
In my view, the majority cannot reach the conclusions that it has without reversing
Sarin, and ignoring some aspects of Long. The Long Court specifically held that the
nonreviewability doctrine applies "to disputes that are contractual in nature," Long, supra at 586,
and that the breach of contract and promissory estoppel claims brought in that case would not be
reviewed under that doctrine. Id. at 587-588. What the Court could not conclude, because of
insufficient evidence, was whether the facts of that case might fall within the exception to the
doctrine. Id. at 588. Thus, it is quite clear that Long does preclude breach of contract claims in
cases such as this, and that Sarin bars tort claims that are "contractual in nature" and that
challenge the hospital's staffing decision. Long, supra at 587 n 4; Sarin, supra at 791-792.
Hence, without overruling Sarin and parts of Long (which cannot be done under MCR
7.215[J]), the majority cannot reach the legal conclusions that it has reached today.
In the present case, plaintiff 's invasion of privacy, breach of fiduciary and public duties,
and breach of contract claims all revolve around the decisions of, and statements made by,
members of the peer review entity during their examination of plaintiff 's case. According to his
complaint, plaintiff 's invasion of privacy claim is based on defendant's "conditioning resolution
of his disciplinary actions . . . on the outcome of the HPRP process . . . ." Similarly, plaintiff 's
claims of breach of fiduciary and public duties and breach of contract are based on the actions
and decisions of the peer review entity regarding plaintiff 's situation. Thus, as in Sarin, I would
hold that "the trial court properly concluded that it could not review plaintiff 's claims without
intervening in the hospital's decision and interfering with the peer review process. In so ruling,
we [should] repeat our adherence to and support of the rule that prohibits judicial review of the
action of a private hospital" in disciplining plaintiff, a staff physician. Sarin, supra at 795.
I would affirm the dismissal of plaintiff 's tort and contract claims. Otherwise, and with
the one noted exception regarding the majority's analysis of MCL 331.531, I join in the majority
/s/ Christopher M. Murray
Although Sarin was decided before 1990, it should still be followed under stare decisis
principles unless it is distinguishable or overruled.
As defendants point out, there may be other reasons why plaintiff 's civil rights claims cannot
be maintained. For example, claims under 42 USC 1983 generally must be brought against
governmental entities or individuals acting under color of law. See, e.g., Wyatt v Cole, 504 US
158, 161; 112 S Ct 1827; 118 L Ed 2d 504 (1992). However, the trial court did not address these
many issues, and should do so in the first instance.