G.R. No. 126297 /G.R. No. 126467/G.R. No. 127590. February 11, 2008.
PROFESSIONAL SERVICES, INC. (PSI), petitioner, vs. THE COURT OF APPEALS and NATIVIDAD and ENRIQUE AGANA, respondents. [Consolidated Cases]

FACTS

Natividad Agana underwent surgery at Medical City General Hospital, owned by PSI, for suspected cancer. Dr. Miguel Ampil performed an anterior resection, assisted by the hospital’s medical staff. The surgery report noted a missing sponge count, which was announced to the surgeon but not resolved. Post-operation, Natividad suffered severe pain and later discovered gauze protruding from her vagina, which Dr. Ampil extracted. Subsequent treatment at another hospital revealed a retained gauze causing a recto-vaginal fistula, necessitating further surgery. Natividad and her husband sued PSI, Dr. Ampil, and Dr. Juan Fuentes for damages. Natividad died during the pendency of the case.
The trial court held all defendants jointly and severally liable. The Court of Appeals affirmed but dismissed the case against Dr. Fuentes. PSI and Dr. Ampil filed separate petitions. The Supreme Court’s First Division, in a 2007 Decision, affirmed PSI’s joint and several liability with Dr. Ampil. PSI filed a motion for reconsideration, arguing no employer-employee relationship existed with Dr. Ampil to hold it vicariously liable under Article 2180 of the Civil Code.

ISSUE

Whether PSI is jointly and severally liable for the medical negligence that caused injury to Natividad Agana.

RULING

Yes. The Court denied PSI’s motion for reconsideration, affirming its direct and vicarious liability. The ruling is anchored on the doctrine of corporate negligence and ostensible agency. First, the doctrine of corporate negligence imposes a direct duty on hospitals to ensure the quality of medical care within their facilities, including the supervision of all medical personnel and the enforcement of safety protocols. PSI breached this duty by failing to maintain an adequate sponge count system and to properly investigate the incident, which constituted independent negligence under Article 2176.
Second, PSI is liable under the principle of ostensible agency or agency by estoppel. By publicly accrediting and displaying Dr. Ampil’s name in its lobby as a member of its medical staff, PSI held him out as its agent, leading patients like Natividad to reasonably believe he was a hospital employee. PSI is thus estopped from denying this relationship. The Court emphasized that modern jurisprudence recognizes the need to hold hospitals accountable to protect patients, balancing interests in the evolving hospital industry. PSI’s failure to supervise and its concealment of records further solidified its liability alongside Dr. Ampil’s primary negligence.