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Caglioti v. Dist. Hospital Partners

August 30, 2007

MICHAEL CAGLIOTI, APPELLANT,
v.
DISTRICT HOSPITAL PARTNERS, LP ET AL., APPELLEES.



Appeal from the Superior Court of the District of Columbia (CA 8019-03) (Hon. Geoffrey M. Alprin, Trial Judge).

The opinion of the court was delivered by: Blackburne-rigsby, Associate Judge

Argued December 18, 2006

Before FISHER, BLACKBURNE-RIGSBY, and THOMPSON, Associate Judges.

This appeal raises an issue of first impression in this jurisdiction. In this case, which arose from a medical negligence and products liability claim, appellant Michael Caglioti claimed injuries resulting from his malfunctioning wheelchair and the subsequent medical treatment he received. As part of his monetary settlement with the wheelchair manufacturer, Graham-Field Health Products, Inc. ("Graham-Field"), Mr. Caglioti was assigned the wheelchair manufacturer's equitable indemnification claim against his medical providers. He sought to pursue the equitable indemnification claim, in lieu of the medical negligence claim, against the medical providers. The medical providers challenge his right to do so. We conclude that an equitable indemnification claim may be assigned as part of a settlement, that such an assignment may be enforced, and that the trial court erred in dismissing the case with prejudice. We therefore reverse and remand to the trial court for proceedings consistent with this opinion.

There are three issues that we must address in this case: (1) whether Graham-Field obtained a right to pursue an equitable indemnification claim against the medical providers by virtue of the Settlement Agreement; (2) whether Graham-Field could assign the right to pursue an equitable indemnification claim, if in fact it obtained that right; and (3) whether Graham-Field could assign to appellant any such equitable indemnification claim as part of the Settlement Agreement, to pursue against the non-settling tortfeasors. We answer each of these questions in the affirmative, and discuss each issue in turn, following a discussion of the relevant factual and procedural background.

I. Factual and Procedural Background

Appellant, Mr. Caglioti, has been wheelchair bound since childhood. On July 13, 2000, Mr. Caglioti, a partner at the law firm of Arnold & Porter, LLP in Washington, D.C., left his office in his electromechanical wheelchair. That day his wheelchair malfunctioned, throwing him to the ground and causing him to break both of his femur bones as well as suffer other injuries. He was taken by ambulance to George Washington University Hospital ("GWU"), where he claims that his medical providers, Universal Health Services, Inc. ("UHS"), District Hospital Partners, LP ("DHP"), Medical Faculty Associates ("MFA"), and GWU, aggravated his injuries, causing him to sustain significant brain and pulmonary damage.

A. Federal Litigation and Settlement Agreement

On November 28, 2001, Mr. Caglioti filed a lawsuit in the United States District Court for the District of Columbia against Graham-Field, the manufacturer of Mr. Caglioti's wheelchair, and Everest & Jennings, the distributor of the wheelchair. On November 11, 2003, a confidential Settlement Agreement, General Release and Assignment of Claims ("Settlement Agreement") was entered into between Mr. Caglioti, Graham-Field, and its insurers. The Settlement Agreement provided that in full settlement and discharge of all of Mr. Caglioti's claims against it, Graham-Field promised to pay a lump sum of money, periodic payments, and assign any and all claims that Graham-Field and the other released parties*fn1 might have for contribution and/or indemnification against the medical providers. The relevant language from the Settlement Agreement regarding the release and assignment of claims stated:

1. General Release and Discharge/Indemnification

In consideration [for monies to be paid] the plaintiff hereby completely releases and forever discharges [the released parties] as well as any other person, company, organization or entity whatsoever, including but not limited to District Hospital Partners, LP, Universal Health Services, Inc., Medical Faculty Associates and any other physicians, nurses, hospitals, medical facilities or medical personnel that provided care to Plaintiff after his accident, that may be claimed as responsible in part or in whole for Plaintiff's injuries or current condition, from any and all past, present or future claims . . . which the Plaintiff ever had, now has, or which may hereafter accrue or otherwise be acquired, on account of, or in anyway growing out of . the Complaint including without limitation [any damages known or unknown] or for increased damages due to aggravating circumstances as a result of the wheelchair accident.

8. Released Parties' Assignment of Claims to Plaintiff

As additional consideration for the general release referred to in Paragraph 1 of the Settlement Agreement, the Released Parties are hereby assigning to the Plaintiff any and all claims that the Released Parties may have for contribution and/or indemnification. This assignment of claims specifically relates to any and all claims that the Released Parties may have against District Hospital Partners, LP, Universal Health Services, Inc., Medical Faculty Associates and/or any other physicians, nurses, hospitals or medical faculties or medical personnel that provided care to Plaintiff after his accident. It is the intention of the parties in entering into this assignment, that any and all claims that the Released Parties would have against any of the Plaintiff's medical providers, including but not limited to the medical providers referenced in this paragraph, shall be assigned to the Plaintiff. This assignment includes any claims for contribution, indemnification, equitable indemnification, or any other similar claims that the Released Parties may have against any health care providers who may have provided negligent medical care and treatment to the Plaintiff and thereby exacerbated his injuries and damages from the July 13, 2000 accident.

Plaintiff understands and agrees that any claim brought by Plaintiff against District Hospital Partners, LP, Universal Health Services, Inc., Medical Faculty Associates and/ or any other physicians, nurses, hospitals or medical faculties or medial personnel that provided care to the Plaintiff after his accident triggers his indemnification obligation under paragraph 1. Plaintiff agrees that twenty-five percent (25 %) of any money he may recover as a result of the assignment referred to in this paragraph 8, after deduction for reasonable attorney's fees and costs, shall be remitted to the Released Parties . . . All parties understand and agree that any money required to be paid under this paragraph shall first reimburse Westchester [Graham-Field's liability insurer] up to the amount it paid in this Settlement, then to Markel [Graham-Field's liability insurer] to reimburse the amount it paid in this Settlement, and lastly, including any amount in excess of the amounts paid by Insurers, to the Company. (emphasis added)

After the Settlement Agreement was executed, Mr. Caglioti dismissed his claims in federal court.

B. Superior Court Litigation

On September 30, 2003, while his federal case was still pending, appellant filed his complaint in the Superior Court of the District of Columbia. He alleged medical malpractice against DHP, UHS*fn2 and MFA for the complications he suffered after his fall that resulted in brain and pulmonary damage. After entering into the Settlement Agreement in the federal case, appellant amended his Superior Court complaint, substituting a claim for equitable indemnification for the medical malpractice cause of action.*fn3

On January 15, 2005, appellant filed a second amended complaint in his Superior Court action adding GWU as a defendant. DHP and MFA filed Motions to Dismiss or in the Alternative for Summary Judgment asserting that Mr. Caglioti was precluded from recovering for an equitable indemnity claim because it could not legally be assigned to him. On May 19, 2005, GWU filed its Motion to Dismiss or in the Alternative for Summary Judgment asserting the same arguments as DHP and MFA, and also arguing that any claims Mr. Caglioti had against it were barred by the three-year statute of ...


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