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Zoneraich v. Overlook Hospital

Decided: July 21, 1986.


On appeal from the Superior Court, Chancery Division, Union County.

Petrella, Cohen and Skillman. The opinion of the court was delivered by Cohen, J.A.D.


Plaintiff Gizella Zoneraich is a physician. This appeal is the culmination of almost a decade of controversy, including numerous hospital hearings and four law suits,*fn1 concerning her membership and privileges on the medical staff of Overlook Hospital, and concerning the liability of Overlook, its trustees and certain other physicians for damages. The Chancery Division found defendants' handling of matters involving plaintiff's medical staff membership to be lawful. It also granted defendants' motion for summary judgment dismissing plaintiff's antitrust and tort damage claims. Plaintiff appealed, and we now affirm.

Plaintiff is a 1960 graduate of the Medical College, Bucharest, Rumania. She came to the United States in 1964 and worked at various hospitals in New York. From 1968 to 1971, she did a residency in obstetrics and gynecology (ob-gyn). She was licensed in New York in 1971 and New Jersey in 1973. In 1974, she received a provisional appointment to the medical staff of Overlook Hospital with limited supervised privileges in ob-gyn.

In 1975, plaintiff was given unsupervised privileges for minor gynecological procedures but was continued under supervision for major procedures. In 1976, she requested advancement to full privileges. The ob-gyn department initially recommended approval, as did the Medical Staff Executive Committee (MSEC). Defendant Jerome A. Cantor, president of the medical staff, then reviewed plaintiff's file and expressed reservations about her application based on criticisms he said he found of plaintiff's professional performance. The Joint Advisory Committee, which had medical staff and trustee representation, was next to pass on such matters. It tabled plaintiff's application. The MSEC then asked for further investigation by the ob-gyn department, the pathology department and an ad-hoc committee. The ob-gyn department and the ad-hoc committee were for continuation of supervision. The MSEC recommended to the Board of Trustees that supervision continue for a maximum of one year. The Joint Advisory Committee concurred and suggested additional monitoring and counselling. The Board of Trustees adopted the two recommendations.

Plaintiff asked for a hearing on the Board decision. It was denied, because not provided for in the hospital by-laws. She then filed her first Chancery Division complaint, demanding an injunction against denial of full privileges and seeking compensatory and punitive damages from the hospital; defendant Robert Heinlein, its president; defendant Robert Staub, chair of the ob-gyn department, and defendant Cantor. She charged that she was denied her right to a hearing and that defendants' actions were arbitrary and capricious, interfered with her occupation and damaged her, personally and professionally.*fn2 The Chancery Division declined to order that plaintiff be given full privileges, but ordered that she be given a hearing on the matter by the hospital.

Hearings were held in January 1978 before the Medical Staff Review Committee (MSRC), which recommended withholding full privileges and continuing supervision. In February, the Board of Trustees so determined.

In March, the MSEC recommended that plaintiff's membership on the medical staff be terminated. Plaintiff was advised of the recommendation and met with the MSEC in May. In June, plaintiff was told that the Joint Advisory Committee would also recommend termination, and she sought and was granted a hearing before the MSRC.

After a number of hearing sessions, plaintiff filed a second Chancery Division complaint in September 1978.*fn3 In it, she complained that improper ex parte communications had taken place between MSRC members, MSRC's medical advisors and witnesses before it. She demanded an order granting her full staff privileges, an injunction against continued hearings, an independent hearing officer, an order for discovery, a declaration that the hearings were maliciously commenced and conducted, and finally, compensatory damages. The Chancery Division ordered the on-going hearings terminated and resumed after a complete replacement of members of the MSRC.

The hearings resumed. The MSRC ultimately adopted factual findings, and concluded with a recommendation that plaintiff's medical staff membership should be terminated. In July 1979, the Board of Trustees adopted the recommendation and terminated plaintiff.

Plaintiff filed her third Chancery Division complaint, also in July 1979. It rehearsed the history of the matter in 65 paragraphs. It charged individual defendants with intentionally frustrating plaintiff's application for full privileges and engineering the continuation of limitations and ultimately the termination of her staff membership. The complaint alleged wrongdoing from 1977 on, and encompassed all of the internal hospital

proceedings and their alleged wrongful use by defendants. It sought an injunction against denial of full privileges, an injunction against defendants' monopolization of ob-gyn services, and compensatory and punitive damages for defendants' tortious interference with plaintiff's exercise of her profession, slander and defamation, defendants' arbitrary, unreasonable and capricious actions, deprivation of plaintiff's rights to procedural and substantive due process, and conspiracy.

In 1980, all of the complaints were consolidated. The court also ruled on the threshold issue whether it should proceed by reviewing the record of the hospital proceedings or by way of de novo hearings. Relying on Garrow v. Elizabeth Gen. Hospital and Dispensary, 79 N.J. 549 (1979), it determined to proceed on the record exclusively.

In late 1982, the Chancery Division upheld the decision of the Board of Trustees terminating plaintiff as a medical staff member. In 1984, it granted defendants' motion for summary judgment on all of the remaining claims.

We will not attempt to summarize the evidence presented at the various hearings held by hospital committees and considered by the Board of Trustees. The evidence was voluminous and its presentation was protracted. Much of it had to do with defects asserted to have been found in plaintiff's professional performance in a number of cases. It dealt with hospital events over a number of years. As to each event, the evidence typically included divergent testimony over what had occurred and expert testimony either criticizing or justifying plaintiff's performance. Some of the evidence had to do with allegations that plaintiff took unkindly to criticism and uncooperatively to supervision. Plaintiff denied those allegations. There were explorations of colleagues' motivations for their charges against plaintiff and for their hospital behavior relating to her. There were frequent procedural disagreements at the hearings. From the very beginning, plaintiff was represented by counsel in her presentations before hospital bodies. On two occasions,

when plaintiff believed she was not being afforded due process, she had access to the Chancery Division, which intervened at her instance, at one time to order a hearing and, at another, to order a hearing stopped and resumed before a committee with new members and advisors.*fn4


Judicial review of hospital decisions regarding admission to medical staff, extent of privileges and termination is very limited. Hospital officials are vested with wide managerial discretion, to be used to elevate hospital standards and to better medical care. Greisman v. Newcomb Hospital, 40 N.J. 389, 403 (1963). A hospital's primary purpose is to serve the public. So long as hospital decisions concerning medical staff are reasonable, are consistent with the public interest, and further the health care mission of the hospital, the courts will not interfere. Desai v. St. Barnabas Medical Center, 103 N.J. 79 (1986); Belmar v. Cipolla, 96 N.J. 199, 208 (1984).

A non-profit hospital, even though not governmental, is hardly private. It exists to furnish vital health care; its funds come in good part from public and charitable sources; its activities are closely regulated. Hospital boards manage quasi-public trusts, and have a fiduciary relationship with the public. Berman v. Valley Hospital, 103 N.J. 100 (1986); Doe v. Bridgeton Hosp. ...

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