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Hernandez v. Overlook Hosp.

April 30, 1997

ALLYN HERNANDEZ, M.D., PLAINTIFF-RESPONDENT,
v.
OVERLOOK HOSPITAL, DEFENDANT-APPELLANT.



On certification to the Superior Court, Appellate Division, whose opinion is reported at: 293 N.J. Super. 260 (1996).

The opinion of the Court was delivered by Garibaldi, J. Chief Justice Poritz and Justices O'hern and Coleman join in Justice Garibaldi's opinion. Justice Pollock filed a separate Dissenting opinion in which Justice Handler and Justice Stein join.

(This syllabus is not part of the opinion of the Court. It has been prepared by the Office of the Clerk for the convenience of the reader. It has been neither reviewed nor approved by the Supreme Court. Please note that, in the interests of brevity, portions of any opinion may not have been summarized).

Allyn Hernandez, M.D. v. Overlook Hospital (A-114-96)

Argued January 22, 1997 -- Decided April 30, 1997

GARIBALDI, J., writing for a majority of the Court.

The issue in this appeal is whether a medical resident is entitled to counsel at an internal hearing regarding her academic termination from a private hospital's residency program and whether a court reporter may transcribe such proceedings.

Dr. Allyn Hernandez was a medical resident pursuing post-graduate training in the Internal Medicine Residency Program at Overlook Hospital, a private non-profit hospital in Summit, New Jersey. By contract, a resident is entitled to remain in the Program so long as his or her services are deemed "satisfactory" by the Program Director and the Hospital. The contract expressly provided that Overlook may terminate the resident's appointment "for just and sufficient academic cause" and that a terminated resident may use the Employee Appeal Procedure as outlined in the House Staff Manual. Any determination rendered by the Appeal Board, which is comprised of a Program Director and the Chairman of the Department of Medical Education, is final and binding on both the resident and the Hospital.

Dr. Hernandez was terminated for academic reasons in October 1994. Following her termination and pursuant to the Employee Appeal Procedure set forth in the House Staff Manual, Dr. Hernandez challenged the Program Director's decision on the grounds that the academic judgment was arbitrary, capricious, or a prejudicial judgment not based on documented evaluations. She demanded that her attorney be permitted to appear and participate in the appeal proceedings and demanded that various documents, including patient records, be disclosed to her and her attorney. Overlook denied both requests, maintaining that the appeal procedure was intended to provide a medical review by experienced physicians of a Program Director's academic judgment and was not a legal proceeding. Overlook further advised Dr. Hernandez that only she, and not counsel, could review certain relevant documents and patient files prior to the hearing.

Thereafter, in an effort to avoid legal proceedings, Overlook agreed to permit plaintiff's counsel to attend the hearing, to provide advice to Dr. Hernandez, and to make a brief opening and closing statement. Counsel was also given authority to review relevant documents, with the exception of patient records. Overlook refused, however, to allow counsel to present evidence or provide a shorthand reporter to transcribe the proceedings. Dr. Hernandez rejected Overlook's offer, insisting on the presence of counsel and a shorthand reporter at the proceeding, on the right to present evidence at the proceeding, and, finally, on counsel's unlimited access to relevant patient records.

Unable to reach an acceptable agreement, Dr. Hernandez sought injunctive relief. The trial court denied some of Dr. Hernandez's requests for injunctive relief, but held that she was entitled to the representation of counsel at the internal review of her dismissal. Specifically, the trial court directed that counsel be permitted to participate in the termination proceedings, offer evidence in the doctor's behalf, explain adverse data, and present arguments to the Appeal Board. The trial court further allowed the proceeding to be transcribed. The Appellate Division affirmed the trial court's determination.

At the subsequent appeals hearing, the Appeal Board of the Hospital rendered a decision to terminate Dr. Hernandez. Thereafter, the Hospital filed, and the Supreme Court granted, a petition for certification.

HELD: A medical resident does not have the right to counsel at a private academic hearing and any such hearing does not have to be transcribed.

1. The doctrine of exhaustion of remedies requires that parties pursue available internal proceedings to Conclusion before seeking judicial intervention and discourages premature judicial intervention in administrative proceedings. (pp. 6-7)

2. Assessing a student's academic performance must be left to the sound judgment of the individual academic institution. (pp. 7-12)

3. Residents facing termination proceedings are not entitled to an adversarial type of hearing prior to dismissal. Rather, all that is required is a "fair procedure." To hold otherwise would severely hinder expeditious review of academic judgments. (pp. 12-16)

4. There may be situations in which the employer's interest in academic freedom is outweighed by other considerations, such as claims that the termination was motivated by reasons that violated the resident's Civil Rights. (p. 16)

5. A "fair procedure" includes the right to adequate notice of the deficiencies, an opportunity to examine the evidence of those deficiencies used by the hospital to make its academic decision, and the right to present a case to the decision-making authority. (pp. 17-18)

Judgment of the Appellate Division is REVERSED.

JUSTICE POLLOCK filed a separate Dissenting opinion in which both JUSTICE HANDLER and JUSTICE STEIN join. Justice Pollock considered it fundamentally unfair to deny a medical resident the right to counsel at a proceeding to terminate his or her residency.

CHIEF JUSTICE PORITZ and JUSTICES O'HERN and COLEMAN join in JUSTICE GARIBALDI'S opinion. JUSTICE POLLOCK filed a separate Dissenting opinion in which JUSTICE HANDLER and JUSTICE STEIN join.

The opinion of the Court was delivered by

GARIBALDI, J.

The central issue presented in this case is whether a medical resident is entitled to counsel at an internal hearing regarding her academic termination from a private hospital's residency program. We also decide whether a court reporter may transcribe such proceedings. We hold that a medical resident does not have the right to counsel at a private academic hearing and that the hearing does not have to be transcribed.

I

Plaintiff, Dr. Allyn Hernandez, a graduate of the Universidad Central Del Caribe Medical School, was a medical resident (also known as "house staff") pursuing post-graduate training in the Internal Medicine Residency Program at Overlook Hospital, a private non-profit hospital in Summit, New Jersey. The Program consists of three years of training under the supervision of a Program Director, the Program Associate Director, various attending physicians from the hospital medical staff, and the residents, including the Chief Resident. The Program is accredited and reviewed by the Accreditation Council for Graduate Medical Education (ACGME).

By contract, a resident is entitled to remain in the Program so long as his or her services are deemed "satisfactory" by the Program Director and the Hospital. The contract expressly provides that Overlook may terminate the resident's appointment "for just and sufficient academic cause." The contract also states that a terminated resident may use the Employee Appeal Procedure as outlined in the House Staff Manual.

Plaintiff was a second-year resident when she entered into a one-year written contract with Overlook for appointment to the hospital's "House Staff" for the term of July 1, 1994, through June 30, 1995. As a second-year resident, plaintiff's right to practice medicine was very restricted. She was not a member of the medical staff, could not admit or discharge patients, and could not prescribe drugs for out-patients without the signature of a licensed physician.

Plaintiff was terminated for academic reasons in October 1994. A report prepared by the Chief Resident stated 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. The Chief Resident also addressed various incidents where plaintiff improperly treated or diagnosed patients.

In addition, the Program Director, Michael Bernstein, M.D., stated that plaintiff had been counseled previously about the deficiencies in her academic performance, but failed to improve to a satisfactory level. In fact, plaintiff had been rotated into the medicine service on July 1, 1994, as an intern rather than as a supervisor because of her weakness in clinical assessment, decisionmaking, and follow-up. Dr. Bernstein states that in the exercise of his academic judgment, he terminated Dr. Hernandez because she was deficient in her academic performance in several areas, including diagnosis and academic development.

Following her termination, plaintiff, pursuant to the contract for employment, invoked the Employee Appeal Procedure set forth in the House Staff Manual. The Manual allows residents, who are terminated for academic reasons, to challenge the Program Director's decision on the grounds that the academic judgment was arbitrary, capricious, or a prejudicial judgment not based on documented evaluations. The Appeal Board consists of a Program Director other than the terminated resident's Director and the Chairman of the ...


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