Jensen v. IHC Hospitals, Inc.

• Decision Date: 04 April 1997
• Docket Number: No. 950164,950164
• Citation: 944 P.2d 327
• Parties: 314 Utah Adv. Rep. 24 Sherry JENSEN and Shayne Hipwell, individually and on behalf of all other heirs of Shelly Hipwell, and Ashley Michele Hipwell and Kaycie Shaylene Hipwell appearing by Shayne Hipwell as guardian ad litem, Plaintiffs, Appellants, and Cross-Appellees, v. IHC HOSPITALS, INC., dba McKay-Dee Hospital, and Michael J. Healy, M.D. and Does I through X, Defendants, Appellees, and Cross-Appellant.
• Court: Utah Supreme Court

Page 327

944 P.2d 327

314 Utah Adv. Rep. 24

Sherry JENSEN and Shayne Hipwell, individually and on behalf of all other heirs of Shelly Hipwell, and Ashley Michele Hipwell and Kaycie Shaylene Hipwell appearing by Shayne Hipwell as guardian ad litem, Plaintiffs, Appellants, and Cross-Appellees, v. IHC HOSPITALS, INC., dba McKay-Dee Hospital, and Michael J Healy, M.D. and Does I through X, Defendants Appellees, and Cross-Appellant.

No. 950164.

Supreme Court of Utah.

April 4, 1997.

Opinion Granting Rehearing

Aug. 22, 1997.

Rehearing Denied Sept. 25, 1997.

Richard D. Burbidge, Stephen B. Mitchell, Gary R. Johnson, Salt Lake City, and Simon H. Forgette, Kirkland, WA, for plaintiffs.

James W. Gilson, Kathy A. Lavitt, Salt Lake City, for IHC.

Elliott J. Williams, Kurt M. Frankenburg, Salt Lake City, for Dr. Healy.

ZIMMERMAN, Chief Justice:

The trial court granted summary judgment for defendants IHC Hospitals, Inc., dba McKay-Dee Hospital ("McKay-Dee"), and Michael J. Healy, M.D. ("Dr. Healy"), ruling that plaintiffs Sherry Jensen and Shayne Hipwell's action was barred by the medical malpractice statute of limitations, section 78-14-4 of the Utah Code. Jensen and Hipwell appealed the grant of summary judgment under section 78-2-2(3)(j) of the Utah Code. We reverse and remand to the trial court for resolution of a fact question relevant to the tolling of the statute of limitations.

A detailed recitation of the facts is necessary to understand the complex legal issues presented by this appeal. " 'Before we recite the facts, we note that in reviewing a grant of summary judgment, we view the facts and all reasonable inferences drawn therefrom in the light most favorable to the nonmoving party.' " K & T, Inc. v. Koroulis, 888 P.2d 623, 624 (Utah 1994) (quoting Higgins v. Salt Lake County, 855 P.2d 231, 233 (Utah 1993)). Because McKay-Dee and Dr. Healy moved for summary judgment, we state the facts in the light most favorable to Jensen and Hipwell.

Sherry Jensen and Shayne Hipwell are, respectively, the surviving mother and husband of Shelly Hipwell. They seek to recover for Shelly's wrongful death on behalf of themselves and as legal guardians of Shelly's two minor daughters (collectively "Shelly's family"). On December 12, 1988, the day before a scheduled induced delivery of her second daughter, Shelly experienced severe abdominal pain and went to the emergency room of McKay-Dee Hospital. After being sent home, Shelly returned to McKay-Dee on December 13th for a caesarian delivery of her baby. Shelly experienced various complications at McKay-Dee after the delivery, which Shelly's family claims were the result of malpractice and negligence on the part of McKay-Dee and Dr. Healy, Shelly's obstetrician. On December 23rd, Shelly was transferred to the University of Utah Hospital for further treatment. At University Hospital, Shelly suffered anoxic brain damage after a resident physician punctured her heart with a biopsy needle, leaving her in a coma, totally and permanently disabled. Shelly subsequently died some three and a half years later, on May 27, 1992.

In early 1989, while Shelly was at University Hospital in a coma, Dr. Healy discussed Shelly's case with his brother, attorney Tim Healy. After this discussion, attorney Healy had discussions with the Healys' sister, Diane DeVries. In the course of those discussions, attorney Healy asked DeVries to call Shelly's family and recommend attorney Roger Sharp, a Salt Lake attorney who specialized in medical malpractice cases. DeVries had known Shelly's family for some time. DeVries contacted Shelly's family but did not tell them that the Healys were her brothers, nor did she tell them that she was also Dr. Healy's file clerk. Shelly's family retained attorney Roger Sharp on February 10, 1989, to represent Shelly in a medical malpractice case. Three days later, attorney Healy wrote to attorney Sharp, confirming a fee-splitting arrangement. Shelly's family was not aware of attorney Healy's involvement in the case or of Diane DeVries' relationship with Dr. Healy and attorney Healy. The letter from attorney Healy to attorney Sharp makes clear that attorney Healy was communicating with Dr. Healy about attorney Sharp's investigation and implies that attorney Sharp's investigation of Dr. Healy's treatment was to be minimal.

As part of his investigation, attorney Sharp sent a document request to Dr. Healy, seeking "a copy of all medical records regarding [Shelly] Hipwell." Dr. Healy did not produce a copy of all medical records, but instead produced a selective set of documents that he personally reviewed. Attorney Sharp never received a copy of Shelly's complete medical records from Dr. Healy. By letter, attorney Sharp also requested a copy of Shelly's complete medical records from McKay-Dee Hospital. However, he subsequently orally limited that request and ultimately received only limited medical records from McKay-Dee. On May 6, 1989, attorney Sharp and Shelly's family settled her case against University Hospital for $250,000, the amount of the previously effective statutory cap on damages against the University. ¹

In mid-1989, Shelly was transferred from McKay-Dee Hospital, to which she had returned from University Hospital on April 14, 1989, to the Greenery, a rehabilitation facility in Washington State. Carol Pederson, a social worker at the Greenery, contacted attorney Simon Forgette on August 10, 1989, to request that he provide an opinion of the settlement in Shelly's case and evaluate the conduct of her attorneys in settling the case. At that time, Forgette's memos to the file regarding the possible new case indicate that Forgette understood that Shelly's liver had been lacerated during her caesarian delivery at McKay-Dee. On August 29th, Forgette contacted Pederson, who assured him that she had the family's permission to discuss Shelly's case. She identified Sharp as Shelly's Utah attorney. That same day, Pederson wrote a letter to Forgette in which she stated, "Ms. Jensen [Shelly's mother] has requested you to offer an opinion on the settlement reached in this case, and advise the family regarding any further legal action which might be indicated." On September 18th, Forgette reviewed medical records provided by Pederson and asked that she arrange for a meeting with Ms. Jensen, Shelly's mother. His understanding at that time was still that Shelly's liver had been lacerated at McKay-Dee. Forgette's memo to his file also indicates that he needed to determine "the statute of limitations on bringing any claim against hospitals or against attorneys."

On October 19, 1989, Ms. Jensen, Shelly's mother, traveled to Washington and met with Forgette to discuss Shelly's case. Ms. Jensen orally retained Forgette on this date and Forgette was to request a copy of attorney Sharp's file. Forgette's memo to the file at this time indicates that he was working with a Utah attorney who was doing some background investigations regarding Shelly's case and the settlement with University Hospital. This attorney wanted to "remain in the background" because he had worked with attorney Sharp in the past and received a significant amount of business from McKay-Dee. The memo to the file also indicates that, after meeting with Shelly's mother, Forgette's understanding was that Shelly's liver "had been either damaged or had burst" while she was at McKay-Dee. On October 20th, Forgette wrote to Sharp requesting a copy of his file on Shelly. By December 14th, Ms. Jensen still had not signed a formal retainer and Forgette had still not received Sharp's file. On that date, Forgette drafted a retainer agreement to send to Ms. Jensen, which provided that Forgette was to handle claims against McKay-Dee Hospital, University Hospital, Roger Sharp, attorney Healy and/or others. On December 26th, Forgette received a portion of Sharp's file, but he did not receive the entire file until February 15, 1990. In the meantime, the present plaintiffs, Ms. Jensen and Shayne Hipwell (Shelly's husband), signed Forgette's written retainer agreement on January 17, 1990.

When Forgette received Sharp's file on February 15th, he learned of attorney Healy's involvement in the case and learned that Sharp's file did not contain a complete set of medical records from Dr. Healy or McKay-Dee Hospital. Forgette did not file a notice of intent to commence suit in the instant case against McKay-Dee Hospital and Dr. Healy until almost two years later, on December 16, 1991. ² Shelly Hipwell died on May 27, 1992 and Forgette filed the complaint in this suit on July 29, 1992.

After allowing the parties to complete discovery, the trial court granted summary judgment to Dr. Healy and McKay-Dee on February 21, 1995, ruling that the two-year statute of limitations governing medical malpractice actions contained in section 78-14-4 of the Utah Code had run by December of 1991, when Forgette filed his notice of intent. On appeal, Shelly's family makes a series of arguments, which are summarized below.

First, Shelly's family contends that the wrongful death statute of limitations, section 78-12-28(2) of the Code, applies to their wrongful death claims. They argue that their claims cannot be barred until two years after Shelly's death because the wrongful death statute of limitations does not begin to run until the decedent's death. In the alternative, they argue that if the medical malpractice statute of limitations contained in section 78-14-4 of the Code applies in cases of wrongful death due to medical malpractice, the two-year period it contains should not begin to run until the decedent's death. We reject both these claims.

Second, Shelly's family asserts that the running of the statute of limitations on both Shelly's personal injury claims (which survived her death and are now asserted by her family) and their wrongful death claims should be tolled because of Dr. Healy's alleged fraudulent concealment of the facts...