It is worth noting that situations similar to those described in this elder abuse case could just as easily occur at any of the healthcare facilities in the area, such as Kaiser Permanente, UC Davis Medical Center, Mercy, Sutter, or any skilled nursing facility.
(Please also note: the names and locations of all parties have been changed to protect the confidentiality of the participants in this wrongful death case and its proceedings.)
The phrase at issue first appeared in Egan v. Mutual of Omaha, 24 Cal.3d 809 (1979). In Egan, an insured obtained punitive damages against Mutual of Omaha based on the conduct of employees McEachen and Segal, both claims representatives from its Los Angeles branch. Neither of these employees were officed in corporate headquarters, nor did they have any ability to dictate corporate-wide policy. See id. at 815, 823. Nevertheless, the California Supreme Court found them to be managing agents of Mutual of Omaha, specifically rejecting Mutual of Omaha’s argument that the employees were not managing agents because neither was involved in high-level policy making. Id. at 822. For more information you are welcome to contact Sacramento personal injury lawyer, Moseley Collins.
The Egan Court explained that the “[t]he determination whether employees act in a managerial capacity” does not “hinge on their level” in the corporate hierarchy. Id. Rather, the critical inquiry is the degree of discretion the employees possess in making decisions that will ultimately determine corporate policy. Id. at 822-23. In applying this rule to its facts, the Court held that [w]hen employees dispose of insureds’ claims with little if any supervision, they possess sufficient discretion for the law to impute their actions concerning those claims to the corporation. Id. at 823. Further amplifying its decision as to how employees in one branch office of a national corporation were making decisions that will ultimately determine corporate policy, the Court explained:
The authority exercised by McEachen and Segal necessarily results in the ad hoc formulation of policy.
In concluding that McEachen and Segal were managerial employees, we subscribe to the views of Justice Tamura in his concurring and dissenting opinion in Merlo v. Standard Life & Acc. Ins. Co. [who explained] … [The claims representative] personally managed the most crucial aspects of his employer’s relationship with its policyholders. Defendant should not be allowed to insulate itself from liability by giving an employee a nonmanagerial title and relegating to him crucial policy decisions. Egan, 24 Cal. 3d 809, 823 (1979). (See Part 16 of 20.)
For more information you are welcome to contact Sacramento personal injury lawyer, Moseley Collins.