G.R. No. 126297 - Professional Services, Inc. vs. Court of Appeals

On April 4, 1984, Natividad Agana was admitted to Medical City General Hospital due to difficulty in bowel movement and bloody anal discharge.
Dr. Miguel Ampil diagnosed her with cancer of the sigmoid, prompting immediate surgical intervention.

On April 11, 1984, Dr. Ampil, with assistance from the hospital’s medical staff (including residents, interns, and nurses), performed an anterior resection surgery.
During the procedure, Dr. Ampil discovered that the malignancy had spread to Natividad’s left ovary, necessitating additional surgical action.
Consent was obtained from Natividad’s husband, Atty. Enrique Agana, for Dr. Juan Fuentes to perform a hysterectomy to address the expanding spread.
After completing the hysterectomy, Dr. Ampil resumed and finalized the operation; however, the procedure was later found to be flawed.
The operating record noted a missing count of surgical sponges (“sponge count lacking 2”), indicating a possible lapse in operative technique.

Following the surgery, Natividad experienced excruciating anal pain and consulted both Dr. Ampil and Dr. Fuentes, who attributed the pain to normal post-operative effects.
On May 9, 1984, Natividad, accompanied by her husband, sought further cancer treatment in the United States, where after four months she was declared free of cancer.
Returning to the Philippines on August 31, 1984, she continued to suffer from severe pain.
Approximately two weeks after her return, her daughter discovered a piece of gauze protruding from Natividad’s vagina, which led to immediate notification of Dr. Ampil.
Dr. Ampil manually extracted a piece of gauze measuring approximately 1.5 inches in width, and assured that the pain would subside.
Despite this assurance, the pain intensified, resulting in Natividad seeking treatment at Polymedic General Hospital where further examination revealed:

A foul-smelling gauze embedded in her vagina.
An infection of the vaginal vault.
The formation of a recto-vaginal fistula, which forced stool to pass through the vagina.

A subsequent surgical intervention was required in October 1984 to remedy the complications.

On November 12, 1984, Natividad and her husband filed a complaint for damages against Professional Services, Inc. (PSI), Dr. Ampil, and Dr. Fuentes before the Regional Trial Court, Branch 96, Quezon City.
Natividad died on February 16, 1986; her case was thereafter substituted by her children (the Aganas).
The trial court rendered judgment on March 17, 1993 in favor of the Agana spouses, holding PSI, Dr. Ampil, and Dr. Fuentes jointly and severally liable.
On appeal, the Court of Appeals, in its Decision dated September 6, 1996, affirmed the judgment but dismissed the complaint against Dr. Fuentes.
Separate petitions for review on certiorari were subsequently filed by PSI, Dr. Ampil, and the Aganas, resulting in a Supreme Court decision rendered on January 31, 2007.

The Court found that PSI and Dr. Ampil were jointly and severally liable for medical negligence.
The decision examined the hospital’s control over its medical staff and the nature of the relationship between the hospital and its consultant physicians.
The Court referenced established jurisprudence (notably Ramos) to assert that for liability purposes, there exists an employer-employee relationship between hospitals and their attending or visiting physicians.
PSI’s act of public representation (displaying names and specializations in its lobby) and its failure to supervise its staff contributed to its liability under the doctrines of ostensible agency and corporate negligence.

Whether the hospital (PSI) should be held directly liable for the negligence of its consultant, Dr. Ampil, despite the argument that he was merely an independent contractor.
Whether the missing gauze and subsequent complications constituted sufficient grounds to impute medical negligence and improper surgical care.

Whether the control exerted by Medical City over its consultant physicians establishes an employer-employee relationship for the purpose of attributing liability.
Whether the doctrine of ostensible agency (or apparent authority) applies based on the hospital’s representation to the public.

Whether PSI breached its duty to supervise its attending medical staff adequately.
Whether the failure to promptly investigate the operative anomalies (such as the missing gauze) contributed to its liability under the doctrine of corporate negligence.

Whether PSI’s arguments contesting the existence of an employer-employee relationship and the applicability of the aforementioned doctrines merit a reversal or modification of the initial judgment.