G&S OBTAINS A DISMISSAL AFTER REVERSAL OF A MEDICAL MALPRACTICE CLAIM AGAINST IT CLIENT ON THE GROUNDS THAT PLAINTIFF’S RELEASE TO CODEFENDANT ALSO RELEASED OUR CLIENT DESPITE THE ABSENCE OF CONSIDERATION – 2013
Plaintiff visited the emergency room presenting with finger pain, bruising and loss of range of motion. After a negative x-ray, he was discharged without a diagnosis of fracture, with an instruction to follow up with the hand clinic. At the clinic our client, a general surgeon, saw the plaintiff for continued pain and sent him for a repeat x ray which was again negative. Plaintiff claims he was ultimately diagnosed with a mal-united fracture which lead to a significant finger deformity with claimed loss of future earnings capacity. Plaintiff claimed our client failed to refer him to a specialist and failed to diagnose the fracture.
After the case was on the trial calendar, it became stayed due to the bankruptcy of the codefendant hospital. While the case was still stayed, the plaintiff reached a settlement with the debtor. Plaintiff exchanged a release in exchange for an allowed bankruptcy claim which plaintiff ultimately only received 10 cents on the dollar for. A so-ordered stipulation of settlement was entered by the bankruptcy court, which noted that plaintiff intended to resume prosecution of the state court action against our client and another co-defendant doctor. Neither our office nor co-defendant’s attorneys participated in the bankruptcy settlement which included a general release that listed the debtor as “releasee.” The release however, further stated that it released the employees of the releasee. This was significant because our client was an employee of the debtor at the time of the alleged malpractice. Further included in the release was language which provided for the release of joint tortfeasors.
Upon inspecting the release, we moved to amend our answer to include the affirmative defense of release and moved to dismiss the action. Plaintiff opposed the motion on the ground that the bankruptcy court had exclusive jurisdiction over the motion. The trial judge allowed the amendment, but denied the motion to dismiss finding that the release should be read in conjunction with the bankruptcy stipulation which made it clear that plaintiff did not intend to release the non-settling codefendants.
On appeal, we argued that it was inappropriate to look outside the four corners of the release where its language was clear and unambiguous. Plaintiff took the position adopted by the trial court and also opposed the appeal by submitting an amended release executed by his client without the language releasing our client. The Appellate court unanimously reversed, finding that it was inappropriate for the lower court to have resorted to parole evidence extrinsic to the document. The Court also rejected plaintiff’s argument that the amended release made the appeal moot since plaintiff never obtained an order from the lower court reforming the release. The Court also rejected plaintiff’s argument based on mutual mistake on the grounds that no evidence was submitted by the hospital as to any mistake and because plaintiff failed to make this argument below.