Prisoners Can Sue Virginia DOC’s Contract Medical Provider for Breach of Contract

Virginia Department of Corrections (VDOC) prisoners who receive inadequate medical care may sue the VDOC’s contract medical provider for breach of contract, the Supreme Court of Virginia decided on June 8, 2007.

Prison Health Services (PHS) is a contract medical provider for certain VDOC facilities. PHS’s contract requires that it “provide cost effective, quality inmate health care services for up to approximately 6,000 inmates (initially) housed at four correctional facilities.” The scope of health care services required by the contract includes all “medical, dental, and mental health services.”

In 2005, Oludare Ogunde, a prisoner at the Greensville Correctional Center, filed suit against PHS and several of its employees. Ogunde’s complaint alleged that he suffered from “severe acne cysts and acne keloidalis,” and that this condition was aggravated by shaving.

According to Ogunde, PHS and its employees denied Ogunde treatment for his skin condition and failed to provide him with an exemption from the VDOC’s grooming policy, VDOC grooming regulations prohibit male prisoners from wearing goatees or beards.

Ogunde argued that PHS’s failure to treat him and provide an exemption to the grooming policy amounted to breach of PHS’s contract with the VDOC. Accordingly, Ogunde sought compensatory damages, an injunction requiring PHS and its employees to provide him with medical treatment, and an exemption from the grooming policy.

The trial court, however, rejected Ogunde’s breach of contract claim, finding that Ogunde was not in privity with PHS because he was only an “incidental beneficiary” of the contract. Ogunde appealed and the Supreme Court of Virginia reversed.

“Under certain circumstances,” the court explained, “a party may sue to enforce the terms of a contract even though he is not a party to the contract.” “The essence of a third-party beneficiary’s claim,” the court wrote, “is that others have agreed between themselves to bestow a benefit upon the third party but one of the parties to the agreement fails to uphold his portion of the bargain.” Consistent with this principle, third parties have been allowed to sue on contracts where “the third party…shows that the parties to the contract clearly and definitely intended it to confer a benefit upon him.”

In Ogunde’s case, “PHS’s performance under the contract renders a direct benefit to Ogunde,” the court held. Consequently, “Ogunde was a third party beneficiary of the contract between PHS and VDOC.” Accordingly, the judgment of the trial court dismissing Ogunde’s breach of contract claim was reversed. See: Ogunde v. Prison Health Services, Inc., 274 Va. 55, 645 S.E.2d 520 (2007).

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