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Hernandez v. Overlook Hosp.

May 17, 1995


Kentz, J.s.c. (retired and temporarily assigned on recall).

The opinion of the court was delivered by: Kentz

Civil Action

KENTZ, J.S.C. (retired and temporarily assigned on recall)

Plaintiff, Allyn Hernandez (hereinafter plaintiff or Hernandez), a former second year resident at defendant, Overlook Hospital (hereinafter defendant or Overlook) comes before this court by way of an order to show cause seeking a preliminary injunction enjoining Overlook from depriving Hernandez of the right to have counsel present and participate at a hearing regarding plaintiff's termination from Overlook's residency program. *fn1 In addition, plaintiff seeks an order from this court permitting a certified shorthand reporter to transcribe the proceedings at plaintiff's expense and an order allowing plaintiff and her counsel to inspect and copy all documents relevant to plaintiff's termination including relevant patient files, prior to the hearing.

The following facts are undisputed. Hernandez, a medical school graduate of the Universidad Central Del Caribe, was a second year resident in the Internal Medicine Residency Program (hereinafter Program) at Overlook, a non-profit private hospital, located in Summit, New Jersey. The Program, accredited by the Accreditation Council for Graduate Medical Education, consists of three years of training under the supervision of the Director of the Program, Michael Bernstein (hereinafter Program Director), Associate Directors, the Chief Resident, Kathleen Galantro (hereinafter Chief Resident) and various attending physicians on the staff of Overlook.

On or about December 6, 1993, plaintiff, as a second year resident, entered into a written contract with Overlook for appointment to the "House Staff" of Overlook for a one year term running from July 1, 1994 through June 30, 1995. Pursuant to the contract, Hernandez, a "House Officer" was entitled to a $35,000 stipend, four weeks vacation, and professional liability and life insurance. "House Officer" is merely another title for a resident. The contract also entitled Hernandez to remain for the hill term of the contract provided her services were satisfactory to the Program Director and to Overlook. However, the agreement expressly provided that Overlook may terminate a House Officer's appointment "for just and sufficient academic cause upon the recommendation of the Program Director and the Chairman of the Department." The contract further stated that the remedy for a terminated resident was the Employee Appeals Procedure as outlined in the House Staff Manual.

A report prepared by the Chief Resident indicated that Hernandez as a second year resident supervised first year interns. The report further indicated that it was the Chief Resident's opinion that plaintiff lacked the clinical judgment necessary for a second year resident, failed to offer adequate leadership or guidance to her interns and had difficulty with professionalism and decorum when dealing with other staff members. In this report, the Chief Resident also addressed in detail various incidents where plaintiff improperly treated or diagnosed patients.

Effective October 28, 1994, Hernandez was terminated from her position as House Officer at Overlook. Subsequently, pursuant to the House Staff Manual, Hernandez invoked her right to a hearing regarding the decision to terminate her on the ground the decision was arbitrary and capricious. By letter dated January 5, 1995, Overlook notified plaintiff that an Appeal Board hearing had been scheduled for January 24, 1995, but that plaintiff was not entitled to have counsel present at the hearing. The following reason for the exclusion of counsel at this hearing was given:

The Appeals' procedure is intended to provide a medical review by experienced physicians of a Program Director's academic judgment. It is not a legal proceeding and, therefore, no attorney (either for the hospital or the resident) will be permitted to participate or attend the meeting with the Appeal Board.

In the letter Overlook also advised Hernandez that only she, and not counsel, could review certain relevant documents and patient files at least five days prior to the Appeal Board hearing. Subsequently, in a letter dated January 19, 1995, Overlook in an effort to avoid legal proceedings and to settle the dispute amicably agreed to permit plaintiff's counsel to attend the Appeal Board hearing in order to provide advice to Hernandez and to make a brief opening and closing statement. However, Overlook refused to allow plaintiff's counsel to present evidence and likewise refused to permit a shorthand reporter to transcribe the proceedings. The letter further provided that plaintiff's counsel could review relevant documents, with the exception of patient records. Finally, the letter stated that Overlook's offer was withdrawn if plaintiff sought an order to show cause.

By letter dated January 20, 1995, Hernandez rejected Overlook's offer contained in its January 19, 1995 letter by insisting on having counsel present evidence at the hearing with a shorthand reporter recording the hearing. In addition, Hernandez asserted in the letter that because her termination was based upon the handling of certain patients as set forth in the report prepared by the Chief Resident, it was necessary that Hernandez and her counsel be given the opportunity to review these patient records to adequately prepare for the defense of the charges against her. Finally, the letter provided that Hernandez and her counsel would have no objection to entering into a confidentiality agreement in light of Overlook's privacy concerns.

In the proceeding now before this court the plaintiff raises issues of first impression, namely whether fundamental fairness requires that a resident be entitled to have counsel participate at a hospital hearing regarding the resident's termination from a private hospital's residency program and have a right to discovery of relevant documents including patient files, prior to the hearing.

However, before addressing these novel issues, this court must decide as a threshold matter whether plaintiff must exhaust administrative remedies prior to seeking interlocutory judicial intervention thereby rendering judicial review at this stage premature. In general, a plaintiff cannot pursue judicial review if she or he has failed to exhaust all available administrative remedies. Campione v. Adamar of N.J., Inc., 274 N.J. Super. 63, 72, 643 A.2d 42 (Law Div. 1993). The doctrine of exhaustion of administrative remedies serves the following goals:

(1) the rule ensures that claims will be heard, as a preliminary matter, by a body possessing expertise in the area; (2) administrative exhaustion allows the parties to create a factual record necessary for meaningful appellate review; and (3) the agency decision may satisfy ...

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