CHICAGO _ From home loans to cell phones, contracts are everywhere these days in our increasingly complex commercial world. More than ever consumers are being asked to read the fine print - and sign on the dotted line - before buying a house, renting a car or starting a new job.
But while the use of contracts in routine commercial transactions has become more common, one thing about contracts has not changed: the bedrock principle that the parties must abide by the written terms.
A Cook County jury provided a resounding affirmation of this principle last month when it needed just 25 minutes to find a local physician's group guilty of breach of contract for failing to send out an agreed-upon letter to a doctor's patients advising them of his departure from the physician's group.
Dr. Martin C. Burke, D.O., sued the group, Loyola University Physician Foundation ("LUPF"), after it refused in 2004 to honor a contractual commitment requiring it to use a specific letter notifying Dr. Burke's patients in the event of any future change in his employment.
Instead, the physician's group, which was affiliated with Loyola Medical Center, chose to ignore its written employment contract with Dr. Burke and send out a letter with its own language subtly encouraging Dr. Burke's patients to remain with the medical group.
Dr. Burke's involvement with LUPF began in 2002 when it approached him about leaving the University of Chicago, where he had developed a thriving cardiology practice, to help institute a new electro-physiology department at Loyola Medical Center. As part of the agreement, he was to serve as a teacher, researcher and clinical practitioner. Of course, LUPF's hope was that Dr. Burke's many thousands of patients that he had been treating at the University of Chicago would continue their care with him at Loyola Medical Center.
Dr. Burke accepted LUPF's offer in 2002, and many of his patients followed him to Loyola Medical Center. For the next two years he faithfully performed his duties at LUPF, helping it establish its electro-physiology program. Dr. Burke also continued to grow his clinical practice.
Unfortunately, when Dr. Burke decided to leave LUPF in 2004, he was dismayed to learn it would not honor its contractual commitment regarding the specific notice to be given to his patients upon his departure. The contract, Dr. Burke asserted, was clear. It required LUPF to send out a specific letter, signed by both parties, containing certain language advising Dr. Burke's patients of his change in employment. The parties went so far as to attach the agreed-upon departure letter to the contract. Furthermore, the contract expressly stated that failure of either party to use the attached letter would "require rectification of damages by the offending party."
In direct contravention of the express terms of the contract, LUPF chose not to send out the agreed-upon letter. When Dr. Burke attempted to hold the defendant to the terms of the contract, it refused. Instead LUPF sent out a different letter, one that Dr. Burke specifically had reviewed and rejected. The letter sent by LUPF not only deleted Dr. Burke's signature, but also contained significantly different language that, in Dr. Burke's opinion, was at best confusing to the patients, and at worst, an attempt to keep them as patients at Loyola Medical Center.
With the help of Burke Burns & Pinelli, Ltd., Dr. Burke was able to convince the jury that the LUPF's decision to use its own letter not only violated Dr. Burke's employment contract - but triggered the liquidation damages provision in the contract. As a result, the jury awarded Dr. Burke $125,000 in damages.
"I think that the jury's swift verdict was also a referendum on the reason for putting an ‘integration clause' in a contract," said Burke Burns & Pinelli, Ltd. partner Vincent D. Pinelli, who tried the case along with associate Blanca R. Dominguez. "The jury clearly understood that the clause prohibits a party from doing exactly what the defendant tried to do here, rewrite the contract with oral testimony at trial."