Authored By: Kiyaan Thomas
Florida International University
Date of judgement: May 12, 1980
Docket Number: 79-696
Judges: Decker, Moser, Cannon
Date of judgement: May 12, 1980
Bench Type: Division Bench
Introduction
The decision in Johnston v. Misericordia Community Hospital is an important case for understanding hospital responsibility in patient care. The Wisconsin Court of Appeals clarified that hospitals have a direct duty to ensure the qualifications and abilities of all medical staff operating within their facilities. Previously, hospitals were mostly liable only for the mistakes of their employees. In this case, it is noted that hospitals themselves must actively verify that all physicians, including independent doctors with privileges, are able and safe to treat patients. Failing to exercise proper oversight is considered actual negligence, similar to how doctors can be liable for lacking fundamental knowledge. The ruling emphasized that barriers and credentialing or supervision are not just administrative errors. They are serious legal breaches when they contribute to patient harm. This case also highlights the importance of hospital processes and internal checks, showing that hospitals cannot rely solely on the assumption that physicians with privileges are automatically qualified.
Parties Involved
Plaintiff: James Johnson, A patient who underwent A surgical procedure at Misericordia Community Hospital. Johnson suffered catastrophic injury due to medical error and later pursued claims against the hospital for institutional negligence.
Defendant: Misericordia Community Hospital operated the facility and had granted surgical privileges to Doctor Lester V. Salinsky, an independent orthopedic surgeon. Dr. Salinsky had a history of restrictions and denied privileges at other Milwaukee hospitals, which became central to the hospital’s alleged negligence. Employers Mutual Liability Insurance Company of Wisconsin was involved as the hospital’s insurer supporting the appeal.
Facts of the Case
On July 11, 1975, James Johnson underwent surgery at Misericordia Community Hospital to remove a pin fragment from his right hip. Dr. Lester V. Salinsky performed the operation. During surgery, Dr. Salinsky severed Johnson’s femoral artery and nerve, resulting in permanent paralysis, severe muscle atrophy, and significant loss of mobility. The injury permanently affected John’s ability to work and earn a living. Before the lawsuit against the hospital, Johnson settled with Dr. Salinsky through a Pierringer release, resolving claims against the doctor for $140,000 while retaining the right to pursue claims against Misericordia. The focus of the case against the hospital was not the surgical error itself, but the hospital’s failure to properly credential Dr. Salinsky. Evidence showed that his 1973 application for full privileges contained false statements, and he had a documented history of restrictions and denials at multiple Milwaukee hospitals, including restrictions on hip procedures at one hospital. Despite receiving consent to verify his credentials, the hospital failed to conduct adequate checks. The medical staff review committee and the governing board ignored clearer warning signs of professional unfitness.
The jury concluded that Misericordia was 80% responsible for Johnson’s injury due to institutional failures, while Dr. Salinsky bore 20% of the responsibility for the surgical error. Johnson was awarded $405,000 for his injuries and loss of future earnings capacities. The hospital appealed, contesting both the findings of negligence and the allocation of responsibility. Hospital oversight, or lack thereof, can directly affect patient safety. These facts illustrate how hospital oversight, or lack thereof, can directly affect patient safety. Even a single error in the credential process can have lifelong consequences for patients, as seen in Johnson’s permanent disability.
Arguments of the parties
Johnson’s argument emphasized that hospitals had a non-delegable duty to ensure the qualifications and abilities of all physicians practicing within their facilities. By failing to properly investigate Dr. Salinsky’s background, the hospital enabled a surgeon with known restrictions and prior disciplinary actions to perform a dangerous procedure, directly causing Johnson’s permanent injury. Johnson’s legal team argued that the hospital’s oversight failures were systematic, avoidable, and substantial contributors to the harm. They also noted that
hospitals are expected to implement through the review process, including checking previous employment records, malpractice claims, and any disciplinary actions, and that ignoring procedures undermines patient safety.
The hospital argued that it should not be held responsible for the independent surgeon’s errors, claiming that Dr. Salinsky’s malpractice was an independent cause of the injury. Misericordia contended that the hospital did not have actual knowledge of Dr. Salinsky’s history and that any deficiencies in the credential crosses did not directly cause Johnson’s harm. The hospital also suggested that a surgical error could have occurred at another hospital and, therefore, attempted to separate the credentialing failures from the injury itself. This argument essentially tries to minimize. This argument essentially tries to minimize it. This argument essentially tries to minimize institutional accountability by focusing on the independence of the physician rather than the hospital’s duty to protect patients.
Final Decision
The Court of Appeals of Wisconsin upheld the jury’s verdict, holding the hospital largely responsible for Johnson’s injury. The court affirmed that the hospital’s institutional failures, particularly in credentialing and supervision, were substantial factors that contributed to the harm. Johnson’s award of $405,000, which included compensation for permanent personal injury and future loss of earning capacity, was maintained. The court emphasized that Johnson’s young age and the performance of his disability justify his damages and that hospitals must actively ensure the safety and abilities of their medical staff.
Legal Reasoning
The court’s reasoning centered on the principle that hospitals owe a direct duty to patients separate from the liability of individual doctors. Hospitals cannot delegate responsibility for patient safety to independent physicians. Granting privileges to a doctor with a history of restrictions without verifying professional credentials constitutes actionable negligence. The court emphasized the concepts of constructive knowledge, meaning that the hospital is legally considered to know facts that it should have discovered through reasonable diligence. Since the hospital had procedures and consent to verify Dr. Salinsky’s background, failing to investigate made the hospital legally accountable for its lack of knowledge. This failure was systematic, avoidable, and directly contributed to Johnson’s injury.
Regarding causation, the court applied the substantial factor test, determining that the hospital’s negligence and credentialing were a major factor in causing the harm. If the hospital had followed proper procedure, Dr. Salinsky would have been restricted or denied privileges, and the catastrophic injury would likely not have occurred. The court clarified that negligence does
not need to be the sole cause of harm. It is sufficient if it substantially contributed to the injury. The 80% responsibility assigned to the hospital reflects this reasoning.
The court also reinforced the broader principle that patients’ trust and physicians’ extend to the trust in the institution granting them privileges. Hospitals are expected to act as capable organizations, ensuring the safety of their staff and faculty; ignoring red flags or failing to verify professional histories is a fundamental lapse in institutional responsibilities. The court made clear that hospitals have an independent obligation to maintain a safe environment, which includes proper hiring, reviewing, and monitoring processes.
The court’s decision also highlights the importance of hospitals maintaining ongoing oversight even after granting privileges. Legal responsibility is not limited to the moment of credentialing. Hospitals must continue to monitor physicians’ performance, review patients’ outcomes, and act promptly when concern arises. By ignoring prior restrictions and failing to implement active oversight mechanisms, Misericordia demonstrated that negligence can be both initial and continuous. The ruling thus clarifies that institutional duties encompass both preemptive and ongoing safety guards, making hospitals accountable for sustaining standards of care rather than relying solely on initial assessment of medical staff.
Conclusion
Johnson v. Misericordia Community Hospital demonstrates how institutional negligence can be as legally significant as individual medical errors. The court extended the principle of professional knowledge and ability from individual physicians to hospitals themselves. A hospital must know what responsibilities institutions have regarding their medical staff and failures, and oversight or credentialing can lead directly to patient harm. Misericordia’s Inaction allowed an unfit surgeon to operate, resulting in permanent injury to Johnson. The case emphasizes that hospitals have a non-negotiable duty to ensure patient safety and systematic failures in governance, supervision, and credentialing are actionable under the law. Johnson V. Misericordia Remains A fundamental case for hospital liability. It remains A fundamental case for hospital liability, highlighting the central role of informed institutional judgment in protecting patients and preventing avoidable harm.
This case acts as a reference for current and future healthcare institutions that legal responsibility extends beyond individual procedure to the overall institution that supports patient care. Hospitals are expected to cultivate a culture of accountability, maintain accurate records, implement rigorous checks, and ensure that policies are actively followed. Johnson v. Misericordia Community Hospital shows that when these system fails, the institution of the lottery is a direct contributor to harm. This emphasizes that patient safety is not only a clinical obligation, but also structural and organizational, which hospitals cannot ignore. This ruling
prompted hospitals to reevaluate and formalize their credential and peer review process, shaping how institutions nationwide approach patient safety and risk management.
Reference
Johnson v Misericordia Community Hospital [1980] Wis App 3156, 294 NW2d 501, 97 Wis 2d 531.
The Court of Appeals of Wisconsin, Johnson v Misericordia Community Hospital, https://www.wicourts.gov accessed 3 December 2025.
