Tunkl v. Regents of the University of California

Hugo Tunkl filed suit to recover damages for personal injuries alleged to have resulted from the negligence of two physicians at the University of California Los Angeles Medical Center, a non profit charitable institution. Tunkl died after suit was brought, and his wife was substituted as plaintiff.

Tunkl was admitted to the UCLA Medical Center as a patient on June 11, 1956. At that time, Tunkl signed a document titled Conditions of Admissions,” which stated that the patient agrees to “release the Regents of the University of California, and the hospital from any and all liability for the liability or wrongful acts or omissions of its employees.”

Plaintiff appeals from a trial court judgement in favor of the defendant hospital.

The question for the Court was whether such an exculpatory clause could be valid under Civil Code Section 1668 which governed contracts contrary to policy of law. The Court found that such a provision within a hospital-patient contract could not be valid because it fell within a category of agreements affecting the public interest and amounted to an adhesion contract.

In reaching this decision, the Court reviewed prior readings of the statute and found that cases have consistently held that the exculpatory provision may stand only if it did not involved the public interest. The next step in the Court’s analysis required ascertaining what constituted the public interest. Here, the Court found that caselaw had established a rough outline of when exculpatory clauses cannot stand due to public interest: the transaction concerns a business suitable for public regulation, the party seeking exculpation performs a service of great import to the public, the business holds himself out as willing to perform this service to members of the public, the business invoking the clause possesses bargaining strength against the public, and the purchaser is placed under the control of the seller. The Court added that an agreement did not need to meet all of these characteristics, fulfilling only some of them was sufficient to implicate public interest concerns.

Applying this framework to the case at hand, the Court found the hospital-patient agreement exhibited all of them. Hospitals enjoyed a decisive bargaining advantage by providing an essential service to the public, and patients were in no position to reject the agreement.

The Court considered the defendant’s argument that public interest concerns cannot invalidate exculpatory provisions for nonpaying patients. The Court held that this was unpersuasive and there was no distinction in the hospital’s duty of due care between paying and nonpaying patients. To hold otherwise and place greater burden on the nonpaying patient, the Court felt would be “as abhorrent to medical ethics as it is to legal principle.” Tunkl v. Regents of U. of Cal., 383 P.2d 441, 448 (Cal. 1963)

Lastly, the Court considered defendant’s argument that the hospital should be able to obtain exemption for negligence on the part of its employees. The Court found that this was also unpersuasive since the defendant was a corporation and acted through its agents. Caselaw had not established distinction between a corporation’s liability and vicarious liability resulting from the negligence of agents, and the Court found no reason to establish one. 

The Court reversed the judgement.

“If, then, the exculpatory clause which affects the public interest cannot stand, we must ascertain those factors or characteristics which constitute the public interest. The social forces that have led to such characterization are volatile and dynamic. No definition of the concept of public interest can be contained within the four corners of a formula.” Tunkl v. Regents of U. of Cal., 383 P.2d 441, 444 (Cal. 1963)

“The would-be patient is in no position to reject the proffered agreement, to bargain with the hospital, or in lieu of agreement to find another hospital. The admission room of a hospital contains no bargaining table where, as in a private business transaction, the parties can debate the terms of their contract.” Tunkl v. Regents of U. of Cal., 383 P.2d 441, 447 (Cal. 1963)

“The hospital, under such circumstances, occupied a status different than a mere private party; its contract with the patient affected the public interest. We see no cogent current reason for according to the patron of the inn a greater protection than the patient of the hospital; we cannot hold the innkeeper's performance affords a greater public service than that of the hospital.”Tunkl v. Regents of U. of Cal., 383 P.2d 441, 447 (Cal. 1963)

“Retention (of charitable immunity) for the nonpaying patient is the least defensible and most unfortunate of the distinction's refinements. He, least of all, is able to bear the burden. More than all others, he has no choice. He should be the first to have reparation, not last and least among those who receive it.” Tunkl v. Regents of U. of Cal., 383 P.2d 441, 447 (Cal. 1963)

“We must note, finally, that the integrated and specialized society of today, structured upon mutual dependency, cannot rigidly narrow the concept of the public interest. From the observance of simple standards of due care in the driving of a car to the performance of the high standards of hospital practice, the individual citizen must be completely dependent upon the responsibility of others.”Tunkl v. Regents of U. of Cal., 383 P.2d 441, 448 (Cal. 1963)

“Even if the hospital's doors are open only to those in a specialized category, the hospital cannot claim isolated immunity in the interdependent community of our time. It, too, is part of the social fabric, and prearranged exculpation from its negligence must partly rend the pattern and necessarily affect the public interest.” Tunkl v. Regents of U. of Cal., 383 P.2d 441, 448–49 (Cal. 1963)