Lake Imaging, LLC v. Franciscan Alliance, Inc.
| Decision Date | 04 May 2021 |
| Docket Number | Court of Appeals Case No. 20A-CT-1490 |
| Citation | 171 N.E.3d 619 |
| Court | Indiana Appellate Court |
| Parties | LAKE IMAGING, LLC, Appellant/Cross-Appellee-Defendant, v. FRANCISCAN ALLIANCE, INC. f/d/b/a Saint Margaret Mercy Health Centers, Appellee/Cross-Appellant-Plaintiff and ProAssurance Indemnity Company, Inc., Appellee/Cross-Appellant-Defendant |
Attorney for Appellant: Robert J. Palmer, May Oberfell Lorber, Mishawaka, Indiana
Attorneys for Appellee Franciscan Alliance, Inc.: Libby Yin Goodknight, Krieg DeVault LLP, Indianapolis, Indiana, Julie A. Rosenwinkel, Shannon L. Noder, Krieg DeVault LLP, Merrillville, Indiana
Attorneys for Appellee ProAssurance Indemnity Company, Inc.: John David Hoover, Jason L. Fulk, Hoover Hull Turner LLP, Indianapolis, Indiana
[1] The primary issue in this case is whether an indemnity claim by a healthcare provider against another healthcare provider based on alleged medical negligence is subject to Indiana's Medical Malpractice Act. We hold that it is.
[2] In 2004, Lake Imaging, LLC, and Franciscan Alliance, Inc., entered into an agreement under which Lake Imaging would provide radiology services as an independent contractor at certain Franciscan hospitals. The agreement included the following indemnification clause: "[Lake Imaging] agrees to indemnify and hold [Franciscan] harmless from any liability claimed as a result of [Lake Imaging's] negligence in the provision of services undertaken under this agreement." Lake Imaging App. Vol. II p. 93.
[3] Between April 19 and April 25, 2011, Joseph Shaughnessy was a patient at a Franciscan hospital, and Lake Imaging radiologists interpreted two CT scans of his head
. Franciscan did not notify Joseph that radiology services would be provided by an independent contractor. Joseph died on April 25, 2011.
[4] On April 10, 2013, Joseph's sons ("the Shaughnessys") filed a proposed medical-malpractice complaint with the Indiana Department of Insurance (DOI) against Franciscan and other medical providers. Neither Lake Imaging nor any of its radiologists was named in the proposed complaint or brought into the case by any of the named defendants.
[5] In January 2014, Franciscan notified Lake Imaging that one of the named defendants had recently alleged the following in a written discovery response:
been identified, management would have been different. It is not clear whether earlier identification would have changed the patient's outcome. Discovery continues.
Lake Imaging App. Vol. III p. 94. Franciscan stated it intended to seek indemnification under the indemnification clause "for any and all costs, expenses, damages and judgments that are imposed upon or incurred by [Franciscan] in this matter as a result of any negligence of Lake Imaging or its employed physicians[.]" Id. at 95.
[6] In November 2015, a DOI medical-review panel rendered a unanimous opinion that "[t]he evidence does not support the conclusion that [Franciscan] failed to meet the applicable standard of care as charged in the complaint." Lake Imaging App. Vol. II pp. 126-36. Nonetheless, the Shaughnessys pursued their claim in court. In September 2016, Franciscan and the Shaughnessys agreed to the entry of summary judgment for Franciscan on all the Shaughnessys’ claims "except [Franciscan's] potential vicarious liability for unnamed radiologists who interpreted [Joseph's] head CT scans
." Id. at 114. Later that month, the parties settled that remaining claim for $187,001.
[7] In May 2018, Franciscan sent Lake Imaging a letter demanding indemnification of the settlement amount pursuant to the indemnification clause. (Franciscan does not tell us why it waited nearly two years to demand indemnification.) Lake Imaging did not pay, and in July 2018, Franciscan sued, claiming breach of the indemnification clause. Lake Imaging moved for summary judgment, arguing, among other things, that Franciscan's claim is based on alleged medical negligence by Lake Imaging, is therefore a claim for medical malpractice, and is barred by the medical-malpractice statute of limitation, which provides such actions generally must be filed "within two (2) years after the date of the alleged act, omission, or neglect[.]" Ind. Code § 34-18-7-1(b). The trial court agreed that Franciscan's claim is one for medical malpractice. However, it did not reach the statute-of-limitation issue or grant Lake Imaging summary judgment. Instead, because Franciscan did not present its claim to the DOI and obtain an opinion from a medical-review panel before filing suit, as required by the Medical Malpractice Act (MMA), the court concluded it lacked subject-matter jurisdiction over the claim and dismissed it without prejudice, leaving Franciscan free to refile.
[8] Lake Imaging now appeals, and Franciscan cross-appeals.1
[9] The parties challenge both aspects of the trial court's summary-judgment order. Franciscan contends the court erred by finding its claim against Lake Imaging to be one for medical malpractice, subject to the requirements of the MMA. Lake Imaging argues the court got that part right but asserts that, instead of dismissing Franciscan's claim without prejudice for lack of subject-matter jurisdiction, the court should have gone on to address Lake Imaging's statute-of-limitation defense. These are issues of law, which we review de novo. Easler v. State , 131 N.E.3d 584, 588 (Ind. 2019).
[10] We begin by addressing Franciscan's argument that the trial court erred by concluding Franciscan's claim against Lake Imaging is one for medical malpractice and therefore subject to the MMA. Franciscan contends its claim is a straightforward indemnification action that did not accrue until 2018, when Lake Imaging refused to indemnify it for the Shaughnessy settlement. According to Franciscan, the claim is subject to the ten-year statutory limitation period for actions on written contracts, see Ind. Code § 34-11-2-11, meaning Franciscan had until 2028 to file it. Franciscan argues the MMA covers only claims brought by injured patients or their representatives. Lake Imaging, on the other hand, contends Franciscan's claim is subject to the MMA—including its statute of limitation and the medical-review panel requirement—because it is based on alleged medical negligence by Lake Imaging. Based on the text and purpose of the MMA, we agree with Lake Imaging.
[11] In interpreting statutes, our goal is to determine and give effect to the intent of the legislature. Daniels v. FanDuel, Inc. , 109 N.E.3d 390, 394 (Ind. 2018). We examine the statutory language to give effect to the plain and ordinary meaning of the terms used, and we presume the legislature intended the language to be applied logically and consistently with the underlying policy and goals of the statute. Id.
[12] In arguing the MMA applies only to claims brought by injured patients or their representatives, Franciscan relies on Indiana Code section 34-18-8-1, which provides:
(Emphasis added). Franciscan maintains that, because it is neither a patient nor the representative of a patient, its claim against Lake Imaging is not subject to the MMA.
[13] However, other provisions in the MMA show it applies more broadly. The statute of limitation provides, in part:
A claim, whether in contract or tort, may not be brought against a health care provider based upon professional services or health care that was provided or that should have been provided unless the claim is filed within two (2) years after the date of the alleged act, omission, or neglect, except that a minor less than six (6) years of age has until the minor's eighth birthday to file.
I.C. § 34-18-7-1 (emphases added). Franciscan's claim falls neatly under this statute: it is (1) "in contract," (2) "against a health care provider," and (3) "based upon professional services or health care that was provided or that should have been provided."
[14] In addition, Indiana Code section 34-18-8-4, which establishes the medical-review-panel requirement, references a "claimant," not a "patient":
(Emphasis added). Other MMA provisions also refer to the "claimant" instead of a "patient." See Ind. Code §§ 34-18-8-5 (), 34-18-8-7 (providing "a claimant may commence an action in court for malpractice at the same time the claimant's proposed complaint is being considered by a medical review panel," as long as the complaint filed in court does not identify the defendant and the "claimant" does not pursue the action until the medical-review panel has rendered its opinion).
[15] These provisions leave us convinced the legislature did...
To continue reading
Request your trial