Cardiovascular Servs. Inc. v. W. Houston Health Care Grp., Inc
In Cardiovascular Servs. Inc. v. W. Houston Health Care Grp., Inc., No. 01-94-01075-CV, 1995 WL 523615 (Tex. App.--Houston 1st Dist. Sept. 7, 1995, no writ), a corporation that was owned and operated by a physician, entered into an agreement with a hospital under which the physician would provide cardiovascular services at the hospital.
The physician sued the hospital alleging that it violated the agreement by hiring another physician to perform the same services he contracted to perform.
The hospital filed a motion for summary judgment and argued that the contract was not exclusive.
The physician contended the contract was exclusive because it stated that he was to be available 24 hours a day, 7 days a week.
The trial court granted summary judgment in the hospital's favor and the physician appealed.
The Houston Court of Appeals concluded that the contract was not ambiguous and was an "exclusive requirements contract."
The court noted that the contract stated that there was no minimum patient requirement and that the physician was only to perform his services when requested by the hospital's physicians. Id.
However, the court reasoned that when reading the contract's language in context, it was clear that the parties intended for the hospital to request physician's services whenever a patient needed such services. Id.
Additionally, the court noted that the contract expressly stated its purpose was to assure the availability of the physician's services for the hospital's "patients around the clock." Id.
The court further concluded that finding the contract was non-exclusive would render it unenforceable for lack of mutuality. Id.
The court explained that "an agreement whereby a seller promises to provide goods or services at a stated price, without obligating the buyer to place any orders, is unenforceable for want of mutuality." Id. Simply put, a contract wherein one of the parties is not obligated to do anything is unenforceable. Id.