Case 2:19-cv-01165-GBW-SMV Document 40 Filed 12/04/20 Page 1 of 33
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE DISTRICT OF NEW MEXICO
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`WRONGFUL DEATH ESTATE OF
`ROSEMARY NAEGELE,
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`v.
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`MUHAMMAD KHAWAJA,
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`Plaintiff,
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`Defendant.
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`Civ. No. 19-1165 GBW/SMV
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`ORDER GRANTING SUMMARY JUDGMENT ON ALL CLAIMS
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`THIS MATTER comes before the Court on Defendant’s Motion for Summary
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`Judgment and Memorandum in Support Based on Statute of Limitations. Doc. 24.
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`Having reviewed the Motion (doc. 24) and its attendant briefing (docs. 28, 31), the Court
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`GRANTS the Motion and DISMISSES all of the claims in Plaintiff’s complaint with
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`prejudice.1
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`I. UNDISPUTED FACTS
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`On February 17, 2017, Rosemary Naegele underwent a cholecystectomy at Nor-
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`Lea General Hospital, a health care center operated by the Nor-Lea Hospital District
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`(hereinafter “Hospital District”). Doc. 1 at 5; doc 4 at 2; doc. 24 at 23. The Hospital
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`District is a tax-exempt New Mexico Special Hospital District and a governmental
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`1 Defendant has also filed a motion for summary judgment on the issue of punitive damages. Doc. 36.
`The Court DENIES this motion as MOOT because granting the instant motion for summary judgment on
`the issue of statute of limitations dismisses all of Plaintiff’s claims with prejudice.
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`Case 2:19-cv-01165-GBW-SMV Document 40 Filed 12/04/20 Page 2 of 33
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`entity. Doc. 24 at 6–7; doc. 28. Following her surgery, Defendant, a physician hired by
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`the Hospital District under a Physician Employment Agreement, admitted her to the
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`hospital under his care. See doc. 1 at 4; doc. 4 at 1; doc. 24 at 7–22; doc. 28 at 2–4. The
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`following day, Defendant discharged Ms. Naegele from the hospital. Doc. 1 at 6, doc. 4
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`at 2. Later that day, she died. Doc. 24 at 2, doc. 28 at 4.
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`Shortly after Ms. Naegele’s death, her siblings, who constitute her wrongful
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`death estate, consulted with an attorney about bringing a wrongful death action against
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`the Hospital District. Doc. 24 at 2, 26, 29, 31, 33, 35; doc. 28 at 4. On March 1, 2017, their
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`then-attorney sent a Notice of Claim pursuant to N.M. Stat. Ann. § 41-4-16 to the
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`Hospital District. Doc. 24 at 2, 23; doc. 28 at 4. The notice stated that “[a]t this time, it
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`appears that [Ms. Naegele] was not properly monitored and treated by hospital agents
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`and/or staff during her post-operative stay” and that “[s]he was discharged from Nor-
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`Lea General Hospital in an unstable condition….” Doc. 24 at 23.
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`Over two years later, on May 21, 2019, Plaintiff, now represented by current
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`counsel, filed an Application for Review of Medical Care and Treatment against
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`Defendant with the New Mexico Medical Review Commission. Doc. 24 at 2, 36; doc. 28
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`at 4–5. During the proceedings before this Commission, Defendant did not raise a
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`statute of limitations defense. Doc. 28 at 5; doc. 31 at 2. Defendant did, however, notice
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`Plaintiff that he “reserves the right to raise, in any lawsuit filed against [him], any and
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`all legal defenses available to him and that [his] participation in these proceedings is not
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`2
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`Case 2:19-cv-01165-GBW-SMV Document 40 Filed 12/04/20 Page 3 of 33
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`a waiver of any such defenses.” Doc. 31 at 14. On September 18, 2019, the Commission
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`found that “there was substantial evidence of professional negligence on the part of
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`[Defendant].” Doc. 28-2 at 1.
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`On November 15, 2019, Plaintiff filed this medical malpractice suit against
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`Defendant in the First Judicial District Court of Santa Fe County. Doc. 1 at 4. Plaintiff
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`alleges that Defendant was negligent in his discharge of and care for Ms. Naegele. Id. at
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`7. On December 11, 2019, Defendant removed the case to this Court. Id. at 1. On
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`August 20, 2020, Defendant filed the instant motion for summary judgment. Doc. 24.
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`II.
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`STANDARD OF REVIEW
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`Under Federal Rule of Civil Procedure 56(a), this Court must “grant summary
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`judgment if the movant shows that there is no genuine dispute as to any material fact
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`and the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a). The
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`movant bears the initial burden of “show[ing] ‘that there is an absence of evidence to
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`support the nonmoving party’s case.’” Bacchus Indus., Inc. v. Arvin Indus., Inc., 939 F.2d
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`887, 891 (10th Cir. 1991) (quoting Celotex Corp. v. Catrett, 477 U.S. 317, 325 (1986)). Once
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`the movant meets this burden, the non-moving party is required to designate specific
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`facts showing that “there are . . . genuine factual issues that properly can be resolved
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`only by a finder of fact because they may reasonably be resolved in favor of either
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`party.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250 (1986); Celotex, 477 U.S. at 324.
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`3
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`III. ANALYSIS
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`The parties do not dispute any relevant, material facts.2 See doc. 28 at 3–5; doc. 31
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`at 1–3. Rather, they dispute which statute of limitations/repose applies to these facts
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`and whether Defendant may raise this defense. See generally docs. 24, 28, 31. Defendant
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`asserts that the two-year statute of limitations in the New Mexico Tort Claims Act
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`(hereinafter “TCA”) bars all of Plaintiff’s claims against him because he was a public
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`employee when he treated and discharged Ms. Naegele and Plaintiff failed to file suit
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`against him within two years of discovering the occurrence and cause of Ms. Naegele’s
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`death. Doc. 24 at 3–4.
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`Plaintiff does not contest that the TCA statute of limitations bars its claims if it
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`applies and Defendant may raise it.3 See doc. 28. Rather, it argues the following: (i) the
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`three-year statute of repose in the New Mexico Medical Malpractice Act (hereinafter
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`“MMA”) applies to its claims instead of the TCA statute of limitations because
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`Defendant was an independent contractor for, not an employee of, the Hospital District,
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`id. at 7–10; (ii) this statute of repose controls even if Defendant was an employee of the
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`2 The parties do dispute whether Defendant was an employee of the Hospital District. See doc. 24 at 2, doc.
`28 at 3. This dispute, however, is legal, rather than factual, in nature. The parties do not disagree about
`Defendant’s job description, compensation, or any other fact related to the work that Defendant
`performed for the Hospital District. Rather, they disagree about whether, based on these undisputed
`facts, Defendant was an independent contractor for, or employee of, the Hospital District.
`3 The TCA statute of limitations starts to run “when the plaintiff knows or with reasonable diligence
`should have known of the injury and its cause.” Maestas v. Zager, 152 P.3d 141, 147 (N.M. 2007).
`Defendant alleges that Plaintiff knew of Ms. Naegele’s death and its cause on or before March 1, 2017
`when Plaintiff sent a Notice of Claim to the Hospital District. Doc. 24 at 4. Plaintiff offers no facts or
`evidence to contest this allegation. See doc. 28.
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`4
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`Case 2:19-cv-01165-GBW-SMV Document 40 Filed 12/04/20 Page 5 of 33
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`Hospital District because he was also a qualified health care provider at the time, id. at
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`12–15;4 and (iii) Defendant is estopped from raising the TCA statute of limitations
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`defense because he failed to assert it during the proceedings before the New Mexico
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`Medical Review Commission, id. at 15–17.
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`All of Plaintiff’s arguments fail. The two-year statute of limitations in the TCA
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`applies to its suit against Defendant because he is a public employee and its application
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`to Defendant, notwithstanding his status as a qualified health care provider, conforms
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`with the legislative intent behind the TCA and MMA. Defendant is also not estopped
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`from raising this defense. Therefore, all the claims that Plaintiff asserts in its complaint
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`are time-barred.
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`1. Defendant Was a Public Employee, Not an Independent Contractor, When He
`Treated and Discharged Ms. Naegele
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`Under the TCA, a public employee is “an officer, employee, or servant of a
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`governmental entity, excluding independent contractors.”5 N.M. Stat. Ann. § 41-4-3(F).
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`4 Plaintiff also asks the Court to certify to the New Mexico Supreme Court the question of what statute of
`limitations/repose applies to a public employee who is also a qualified health care provider as it “may be
`determinative of an issue in pending litigation … and there is no controlling appellate decision,
`constitutional provision, or statute.” Doc. 28 at 11 (quoting N.M. Stat. Ann. § 39-7-4). Federal courts,
`however, should not run to a state supreme court “every time an arguably unsettled question of state law
`comes across [their] desks.” Pino v. United States, 507 F.3d 1233, 1236 (10th Cir. 2007). If, like the issue
`here, there is a reasonably clear and principled course for resolution, then the federal court should resolve
`the matter. See id. (citations omitted).
`5 The TCA also provides that the following independent contractors are public employees: (i) licensed
`medical, psychological or dental arts practitioners providing services to the corrections department
`pursuant to contract; (ii) members of the board of directors of the New Mexico insurance pool; (iii)
`licensed medical, psychological or dental arts practitioners providing services to the children, youth and
`families department pursuant to contract; (iv) volunteers, employees and board members of court-
`appointed special advocate programs; (v) individuals participating in the state’s adaptive driving
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`5
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`An independent contractor is “a person who contracts with another to do something for
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`him but who is not controlled by the other nor subject to the other’s right to control
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`with respect to his physical conduct in the performance of the undertaking.” Harger v.
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`Structural Servs., Inc., 916 P.2d 1324, 1331 (N.M. 1996) (quoting Restatement (Second) of
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`Agency § 2 (1958)). “A right to control analysis focuses on whether the principal
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`exercised sufficient control over the agent to hold the principal liable for the acts of the
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`agent.” Celaya v. Hall, 85 P.3d 239, 242 (N.M. 2004) (citing Harger, 916 P.2d at 1334).
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`The Supreme Court of New Mexico, however, has cautioned that “the right to
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`control approach may not always be the most appropriate test, particularly for a
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`professional” like a physician. Id. at 242–43. Where a worker is a professional, the
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`Supreme Court of New Mexico has adopted the Second Restatement of Agency § 220 as
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`the framework for deciding whether the worker is an employee or independent
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`contractor under the TCA. See id. at 243. Therefore, in determining whether an
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`individual is an independent contractor, New Mexico law requires courts to consider
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`the totality of circumstances, including but not limited to:
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`(a) [T]he extent of control which, by the agreement, the master may exercise over
`the details of the work;
`(b) [W]hether or not the one employed is engaged in a distinct occupation or
`business;
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`program while using a special-use state vehicle for evaluation and training purposes in that program. See
`N.M. Stat. Ann. § 41-4-3(F). None of these provisions is relevant to Defendant’s employment with the
`Hospital District.
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`6
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`(c) [T]he kind of occupation, with reference to whether, in the locality, the work
`is usually done under the direction of the employer or by a specialist without
`supervision;
`(d) [T]he skill required in the particular occupation;
`(e) [W]hether the employer or the workman supplies the instrumentalities, tools,
`and the place of work for the person doing the work;
`(f) [T]he length of time for which the person is employed;
`(g) [T]he method of payment, whether by the time or by the job;
`(h) [W]hether or not the work is part of the regular business of the employer;
`(i) [W[hether or not the parties believe they are creating the relation of master
`and servant; and
`(j) [W]hether the principal is or is not in business.
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`Restatement (Second) of Agency § 220(2).6 “However, no particular factor should
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`receive greater weight than any other, except when the facts so indicate, nor should the
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`existence or absence of a particular factor be decisive.” Harger, 916 P.2d at 1334. And,
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`“[a]ny determination based on only one or two of the factors … and contrary to
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`inferences supported by the remainder of the evidence … need[s] to be of such a clear
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`and definite nature as to be nearly overwhelming.” Id.
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`Applying the Second Restatement of Agency factors to Defendant’s Physician
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`Employment Agreement7 leads to a clear result regarding the nature of Defendant’s
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`6 When adopting the Second Restatement of Agency § 220 as the framework for deciding whether an
`individual is an employee or an independent contractor, the Supreme Court of New Mexico provided a
`non-exhaustive list of factors for lower courts to consider. See Celaya, 85 P.3d at 243. These factors are
`identical to those of the Restatement except for the omission of Second Restatement of Agency § 220(2)(b).
`The omission, however, is not of particular import as the Supreme Court of New Mexico acknowledges
`that “complete analysis may require an assessment not only of the relevant factors enumerated in the
`Restatement, but of the circumstances unique to the particular case.” Id. (citing Harger, 916 P.2d at 1334).
`7 Under New Mexico law, the nomenclature used by the parties in “contractual provisions do[es] not
`control the determination of whether [an individual] was an employee or an independent contractor.”
`See Houghland v. Grant, 891 P.2d 563, 566 (N.M. Ct. App. 1995). Courts are to define an employment
`relationship with respect to the facts of the entire case rather than the terms that the parties assign to it.
`See id. Nonetheless, the Court’s analysis relies upon Defendant’s Physician Employment Agreement
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`7
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`Case 2:19-cv-01165-GBW-SMV Document 40 Filed 12/04/20 Page 8 of 33
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`relationship with the Hospital District when he treated and discharged Ms. Naegele.
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`While Defendant did provide skilled services and worked for the Hospital District for
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`only a short period of time, the balance of the factors firmly establishes that he was an
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`employee, not an independent contractor: The Hospital District not only exercised
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`control over many of the details of Defendant’s work but also provided him with the
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`facilities and resources he needed to perform it; Defendant’s compensation was based
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`on units of time rather than units of work; his work was essential to the Hospital
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`District’s regular business; and Defendant and the Hospital District intended to form an
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`employer-employee relationship, not an independent contractor one.
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`a. The Control that the Hospital District Exercised over Defendant’s Work Strongly
`Indicates that He Was a Public Employee, Not an Independent Contractor
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`The control that the Hospital District had over many of the details of the medical
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`services that Defendant rendered to its patients strongly supports a finding that he was
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`an employee, not an independent contractor. “[T]he control or right to control needed
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`to establish the relation of master and servant may be very attenuated.” Restatement
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`(Second) of Agency § 220 cmt. d. This understanding is especially true in the medical
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`context where “[a] physician’s professional ethics require that he have ‘free and
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`complete exercise of his medical judgment and skill….’” See Lurch v. United States, 719
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`because it is the only evidence before it about the specifics of Defendant’s employment with the Hospital
`District and Plaintiff does not argue or provide evidence that Defendant’s employment did not conform
`to the Agreement’s terms.
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`8
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`Case 2:19-cv-01165-GBW-SMV Document 40 Filed 12/04/20 Page 9 of 33
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`F.2d 333, 337 (10th Cir. 1983) (quoting Principles of Medical Ethics § 6, reprinted in
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`Opinions and Reports of the American Medical Association Judicial Council, 5 (1977)).
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`The Physician Employment Agreement gave the Hospital District exclusive
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`control over where, when, and to whom Defendant provided medical services. See doc.
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`24 at 8–9, 22. It specifies that Defendant was to “provide professional medical services
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`exclusively to Hospital [District] patients at such location or locations as determined by
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`Hospital [District]… [and] not engage in the practice of medicine except as an employee
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`of Hospital [District]…” absent the “express prior written consent of Hospital
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`[District].” Id. at 8, 9 (emphasis added). It also stipulates that Defendant was to “work
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`[a] 7 days on 7 days off schedule commencing at 8 AM on Monday and ending the
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`following Monday at 8 AM … [and] be physically present at change of shift on Monday
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`to handoff patients to new Hospitalist.” Id. at 22.
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`The Physician Employment Agreement also gave the Hospital District some
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`control over how Defendant provided these services. Defendant was to “round on
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`inpatients twice a day once in the morning and again in the afternoon” and “treat
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`employees of Hospital [District], patients, business associates of Hospital [District] and
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`others in a manner consistent with Hospital [District]’s Standards of Behavior.” Id. at
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`12, 22. That the Hospital District did not provide detailed supervision of Defendant’s
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`treatment is not dispositive. See Celaya, 85 P.3d at 244. Some “services, like those of
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`9
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`…[a] physician … require special skills … [and] are not amenable to detailed
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`performance management.” Id.
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`Finally, Defendant also was subject to several Hospital District policies and
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`regulations. “Requiring a physician to comply with a hospital’s policies and procedures
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`does not per se indicate that the hospital has sufficient control over the physician to
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`indicate an employer-employee relationship.” Houghland v. Grant, 891 P.2d 564, 567
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`(N.M. Ct. App. 1995) (citation omitted). Nonetheless, it is relevant to the inquiry. See id.
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`at 566. See also Restatement (Second) of Agency § 220 cmt. l (“If the work is done upon
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`the premises of the employer with his machinery by workmen who agree to obey
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`general rules of regulation of the conduct of employees, the interference is strong that
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`such workmen are the servants of the owner.”). Per the Physician Employment
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`Agreement, Defendant had to provide patient call coverage and professional medical
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`care to patients in accordance with Hospital District Policies, and “comply with
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`reasonable directives of Hospital [District]’s Chief of Staff or Medical Directors or
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`Hospital [District] directives, rules, regulations, procedures, and/or Hospital [District]
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`Policies.” Id. at 9, 11, 15. If Defendant failed to follow these policies, the Hospital
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`District could subject him to discipline. Id. at 10.
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`Plaintiff argues that Defendant’s Physician Employment Agreement “doesn’t
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`provide for Hospital District control over [Defendant’s] performance, but rather
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`requires him to exercise his own professional judgment.” Doc. 28 at 9 (internal
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`10
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`Case 2:19-cv-01165-GBW-SMV Document 40 Filed 12/04/20 Page 11 of 33
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`quotation marks omitted). However, a contractual provision precluding a hospital
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`“from interfering with [a doctor’s] exercise of his own professional judgment in his
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`practice … is neither dispositive nor particularly material to whether [the doctor] was
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`an employee of [the hospital] under the [TCA].” Blea v. Fields, 120 P.3d 430, 436 (N.M.
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`2005) (citations omitted).
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`It might also be argued that the Hospital District lacked control over Plaintiff
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`because it could not terminate him at will. See Houghland, 891 P.2d at 566 (citing
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`Savinsky v. Bromley Group, Ltd., 740 P.2d 1159, 1160 (N.M. Ct. App. 1987)). The
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`Physician Employment Agreement allows Defendant to cease working for the Hospital
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`District with 30-day prior written notice but prevents the Hospital District from
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`terminating him without cause. See doc. 24 at 11, 13. Ability to terminate an employee
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`at will, however, is but one factor a court must consider when evaluating the extent of
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`the employer’s right to control the details of an individual’s work. See Houghland, 891
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`P.2d at 566 (listing other factors). Moreover, the for-cause protections that Defendant
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`enjoyed did not limit the Hospital District’s ability to control details of Defendant’s
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`work via the Physician Employment Agreement and/or Hospital District directives,
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`rules, regulations, procedures, and policies. See doc. 24 at 11.
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`b. The Skill Inherent in the Medical Services Provided by Defendant Somewhat
`Supports a Finding that He Is an Independent Contractor, but Is Not Dispositive
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`The skill inherent in the full-time professional medical services that Defendant
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`provided to patients on behalf of the Hospital District provides some support for the
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`11
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`Case 2:19-cv-01165-GBW-SMV Document 40 Filed 12/04/20 Page 12 of 33
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`argument that he was an independent contractor, not an employee. Defendant
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`covenanted in his Physician’s Employment Agreement that he “is experienced and
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`competent to provide professional medical services” and pledged to maintain both “a
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`valid and unrestricted license to practice medicine in the state of New Mexico” and “a
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`valid and unrestricted license or registration to prescribe drugs, medications or
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`controlled substances.” Id. at 9. There is no evidence in the record that he lacked this
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`experience, competency, and licensure.
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`However, Defendant’s skill is not dispositive. New Mexico courts have
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`expressly rejected the rule that the skill inherent in being a physician necessarily
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`renders a physician an independent contractor rather than an employee for the
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`purposes of tort liability. See Reynolds v. Swigert, 697 P.2d 504, 508 (N.M. Ct. App. 1984).
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`New Mexico courts have also routinely found that physicians may be employees
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`despite the skill necessary for their positions. See, e.g., Blea, 120 P.3d at 437; Houghland,
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`891 P.2d at 570; Reynolds, 697 P.2d at 508.
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`c. Defendant’s Reliance on the Instrumentalities and Facilities Provided by the Hospital
`District for His Work Strongly Indicates that He Was a Public Employee, Not an
`Independent Contractor
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`Defendant’s reliance on the facilities and instrumentalities of the Hospital
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`District to perform his medical services strongly supports a finding that he is an
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`employee, not an independent contractor. “[I]f the worker is using his employer’s tools
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`or instrumentalities, especially if they are of substantial value, it is normally understood
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`12
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`that he will follow the directions of the owner in their use, and this indicates that the
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`owner is a master.” Restatement (Second) of Agency § 220 cmt. k. Under the Physician
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`Employment Agreement, the Hospital District was to “furnish office space, equipment,
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`instruments, supplies, medicines, and support personnel for the practice of [Defendant]
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`as determined necessary by Hospital [District] in its sole discretion.” Doc. 24 at 15. The
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`Agreement also provided some broad directions, rules, and regulations for how
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`Defendant was to use the facilities and human resources provided. See id. at 11–12.
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`There is no evidence before the Court that suggests that the Hospital District failed to
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`provide these facilities and resources or that Defendant did not use the provided
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`facilities and resources when rendering medical care to patients like Ms. Naegele.
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`Rather, the circumstances of Defendant’s employment are similar to those of the
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`salesperson in Illustration Six of the Second Restatement of Agency. There, the authors
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`assert that a salesperson who “agrees to give substantially his full time to the
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`employment and who is furnished a car by [his] employer” is that employer’s servant.
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`Restatement (Second) of Agency § 220 cmt. k, illus. 6. Like this salesperson, Defendant
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`provided full-time services for the Hospital District, see doc. 24 at 8, and received the
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`materials necessary to perform these services from the Hospital District, see id. at 15.
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`Plaintiff cites, as evidence that Defendant is an independent contractor, that the
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`Physician Employment Agreement allowed Defendant “to supply additional items if he
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`deemed it necessary for his practice.” Doc. 28 at 4 (citing doc. 24 at 9). This observation
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`13
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`Case 2:19-cv-01165-GBW-SMV Document 40 Filed 12/04/20 Page 14 of 33
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`is unconvincing. First, Defendant had to obtain the prior consent of the Hospital
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`District to use these items on its premises and with its patients. See 24 at 15. Second,
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`Plaintiff has not provided any evidence that Defendant ever used his own instruments
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`to treat patients while working for the Hospital District, let alone to treat and discharge
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`Ms. Naegele.
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`d. The Length and Compensation Structure of Defendant’s Work for the Hospital
`District Strongly Indicate that He Was a Public Employee, Not an Independent
`Contractor
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`The length and compensation structure for the medical services that Defendant
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`provided for the Hospital District strongly indicate that he was an employee of the
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`Hospital District, not an independent contractor. Payment by unit of time rather than
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`unit of output is a powerful indication that the person performing the work is an
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`employee, not an independent contractor. See Restatement (Second) of Agency § 220
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`cmt. j. Here, Defendant was paid not by the number of patients he saw but rather by
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`the number of days that he worked. Under the Physician Employment Agreement, his
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`base compensation for the six-month period of his employment was $1,900 per twenty-
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`four-hour day in accordance with the Hospital District’s customary policies and its
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`normal payroll schedule. Doc. 24 at 21. If the Hospital District scheduled Defendant for
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`additional shifts to cover for absences, his compensation was based upon the Hospital
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`District’s fee schedule. Id. at 22. The Hospital District, not Defendant, billed for and
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`collected the fees generated by the medical services that Defendant rendered. Id. at 14.
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`14
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`Case 2:19-cv-01165-GBW-SMV Document 40 Filed 12/04/20 Page 15 of 33
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`Plaintiff argues, notwithstanding this compensation structure, that Defendant
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`was an independent contractor, in part, because his employment was only for six
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`months and he worked unusual hours, seven days on and seven days off. Doc. 28 at 9–
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`10. Length of employment, however, is only significant because of the inference that “if
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`the time of employment is short, the worker is less apt to subject himself to control as to
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`details and the job is more likely to be considered his job than the job of the one
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`employing him.” Restatement (Second) of Agency § 220 cmt. j. Here, though, even if
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`six months were considered a short period of time, the inference of a lack of control
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`does not exist as the Physician Employment Agreement expressly subjects many aspects
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`of Defendant’s performance to the control of the Hospital District. See doc. 24 at 9, 15.
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`As for Defendant’s unusual work schedule, it is further evidence for the control that the
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`Hospital District had over him, not for his independence—Defendant was not free to set
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`his own work schedule, but rather had to work seven days a week every other week
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`because that is what his contract dictated. See id. at 22.
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`e. The Overlap Between the Medical Services that Defendant Provided and the Regular
`Business of the Hospital District Indicates that He Was an Employee
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`The work that Defendant provided the Hospital District was essential to its
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`regular business, which supports a finding that he was an employee, not an
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`independent contractor. The business of the Hospital District is the operation of
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`“healthcare centers in Lovington, Tatum, and Hobbs, New Mexico.” Doc. 24 at 7. It
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`contracted with Defendant “to employee [sic] a physician as an employee to serve the
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`Case 2:19-cv-01165-GBW-SMV Document 40 Filed 12/04/20 Page 16 of 33
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`health needs of the communities that [it] serves.” Id. Defendant “render[ed] full-time
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`professional medical services in the Specialty…” of Internal Medicine to patients from
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`these communities. Id. at 8.
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`f. The Language in the Physician Employment Agreement Shows that Defendant and
`the Hospital District Intended to Create an Employment Relationship
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`The provisions of the Physician Employment Agreement demonstrate that the
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`intent of Defendant and the Hospital District was to create an employment relationship,
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`not an independent contractor one. While the terms that an employment contract uses
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`to define the status of an individual do not determine whether he is an employee or an
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`independent contractor, they are relevant and material as to the intent of the parties to
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`the contract. See Blea, 120 P.3d at 436. Here, Defendant’s contract is an employment
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`agreement and refers to him exclusively as an employee. See doc. 24 at 7, 8, 11. This
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`clear expression shows that the parties intended for Defendant to be an employee of the
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`Hospital District, not an independent contractor for it.
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`Plaintiff argues that Defendant cannot be an employee of the Hospital District
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`because the indemnification clause in the Physician Employment Agreement is
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`inconsistent with the TCA. See doc. 28 at 10. The indemnification clause requires
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`Defendant to indemnify the Hospital District from “any and all claims, expenses,
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`judgments and costs … resulting from any audit, investigation, or other claim made by
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`any third party … concerning improper acts of [Defendant] violating Hospital [District]
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`policy while an employee of Hospital [District], where such acts or omissions were
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`Case 2:19-cv-01165-GBW-SMV Document 40 Filed 12/04/20 Page 17 of 33
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`committed by [Defendant] after [Defendant] was advised by Hospital [District] to
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`modify such behavior, treatment style or pattern of conduct.” Doc. 24 at 10. The TCA,
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`however, bars governmental entities like the Hospital District from obtaining
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`contribution, indemnity, or subrogation from a public employee “unless the public
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`employee has been found to have acted fraudulently or with actual intentional malice
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`….” N.M. Stat. Ann. § 41-4-17(A). At most, the inclusion of a provision that may be
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`unenforceable if Defendant is a public employee supports an inference that the parties
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`did not intend for him to be an employee. In this case, however, this weak inference
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`does not overcome the parties’ other clear expressions that they intended Defendant to
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`be an employee rather than an independent contractor, let alone the balance of the other
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`Restatement factors that favor a finding consistent with this intent.
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`* * *
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`Applying the factors in the Second Restatement of Agency to the totality of the
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`undisputed facts about Defendant’s job, the Court concludes that Defendant was an
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`employee of the Hospital District, a governmental entity, when he treated and
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`discharged Ms. Naegele. In fact, viewed in their entirety, the Court finds that the
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`circumstances of Defendant’s employment are substantially similar to those of the
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`defendant doctor in Blea whom the New Mexico Supreme Court found to be an
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`employee, rather than an independent contractor. See 120 P.3d at 436–37. Like the
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`doctor in Blea, Defendant had to work at specific times and perform other duties and
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`Case 2:19-cv-01165-GBW-SMV Document 40 Filed 12/04/20 Page 18 of 33
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`services as requested by the Hospital District. See id; doc 24 at 22. Like the hospital in
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`Blea, the Hospital District compensated Defendant with a salary, benefits, and
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`insurance, handled all the billing related to the medical services that Defendant
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`performed, and provided all of Defendant’s supplies, equipment, and support staff. See
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`Blea, 120 P.3d at 436–37; doc. 24 at 14–15, 21.
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`2. The TCA Statute of Limitations Applies Where a Public Employee is Also a
`Qualified Health Care Provider
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`The determination that Defendant is a public employee would ordinarily result
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`in the application of t