Robertson v. B.O.

• Decision Date: 31 October 2012
• Docket Number: No. 49S04–1111–CT–671.,49S04–1111–CT–671.
• Citation: 977 N.E.2d 341
• Parties: Stephen W. ROBERTSON, Indiana Commissioner of Insurance, as Administrator of the Indiana Patient's Compensation Fund and the Indiana Patient's Compensation Fund, Appellants (Defendants below), v. B.O., a Minor, by his Parents and Next Friends, Lisa A. Ort and Kevin C. Ort, Appellee (Plaintiff below).
• Court: Indiana Supreme Court

977 N.E.2d 341

Stephen W. ROBERTSON, Indiana Commissioner of Insurance, as Administrator of the Indiana Patient's Compensation Fund and the Indiana Patient's Compensation Fund, Appellants (Defendants below),

v.B.O., a Minor, by his Parents and Next Friends, Lisa A. Ort and Kevin C. Ort, Appellee (Plaintiff below).

No. 49S04–1111–CT–671.

Supreme Court of Indiana.

Oct. 31, 2012.

Susan E. Cline, Meggan Brumbaugh, Indianapolis, IN, Attorneys for Appellants.

Robert L. Thompson, F. John Rogers, Fort Wayne, IN, Richard L. Schultheis, Indianapolis, IN, Attorneys for Appellee.

Steven L. Langer, Tara M. Worthley, Valparaiso, IN, Attorneys for Amicus curiae The Indiana Trial Lawyer's Association.

Libby Y. Goodknight, Indianapolis, IN, Attorney for Amicus Curiae The Indiana State Medical Association.

On Petition to Transfer from the Indiana Court of Appeals, No. 49A04–1009–CT–528

MASSA, Justice.

In defending against a petition to recover excess damages arising from a medical malpractice action, may the Indiana Patient's Compensation Fund—after the healthcare provider settles with the plaintiff and admits liability—present evidence to dispute the existence or cause of the plaintiff's injury? In some types of cases, we have previously said yes. In the type of case before us today, however, we say no.

Facts and Procedural History

At age four, B.O. was diagnosed with a mild form of cerebral palsy known as spastic diplegia. Subsequently, his parents filed a complaint under the Indiana Medical Malpractice Act, claiming that the healthcare providers who attended B.O.'s birth were negligent. Specifically, they asserted that the healthcare providers failed to adequately monitor his condition during labor and delivery and then failed to respond when signs of fetal distress appeared. That fetal distress, they maintained, lasted for nearly two hours before his delivery and resulted in the development of his condition.

Shortly before trial, B.O.'s healthcare providers settled for a sum allowing B.O. to seek excess damages from the Indiana Patient's Compensation Fund (PCF). SeeInd.Code § 34–18–15–3 (2008). B.O.'s parents then filed a petition for excess damages, after which the PCF disclosed five expert witnesses prepared to testify that B.O. either did not have cerebral palsy consisting of spastic diplegia or that if he did, it did not result from the conduct of the healthcare providers at his birth. The parents then sought partial summary judgment seeking to limit the issue at trial to the amount of the compensable damages for the injury alleged by [B.O.] which is mild cerebral palsy consisting of spastic diplegia; and ... the [PCF] may not contend or offer testimony to establish that [B.O.] does not have mild cerebral palsy consisting of spastic diplegia and/or [B.O.'s] condition was not caused by the conduct of [the healthcare providers].

Appellant's App at 233–34. The trial court granted partial summary judgment for B.O., and the Court of Appeals reversed. Robertson v. B.O. ex rel. Ort, 949 N.E.2d 404, 407, 411 (Ind.Ct.App.2011). We granted transfer and now affirm the trial court.

Standard of Review

In reviewing a grant of summary judgment, the appellate court “faces the same issues that were before the trial court, and analyzes them in the same way.” Carie v. PSI Energy, Inc., 715 N.E.2d 853, 855 (Ind.1999). Where the challenge to the trial court's summary judgment presents only legal issues, not factual ones, the issues are reviewed de novo. Spangler v. Bechtel, 958 N.E.2d 458, 461 (Ind.2011).

The PCF is Precluded from Disputing the Existence or Cause of B.O.'s Claimed Injury

The Indiana Medical Malpractice Act (MMA) creates a bifurcated procedure for determining medical malpractice claims against a qualified healthcare provider. This process is correlated to the separate damages caps imposed by the MMA.

The [MMA] caps a recovery for a patient's injury or death at $1,250,000. Ind.Code § 34–18–14–3(a)(3) (2008). The Act limits the liability of a qualified health care provider whose medical negligence proximately caused the injury or death to the first $250,000 of damages. Ind.Code § 34–18–14–3(b). If a judgment or settlement fixes damages in excess of a qualified health care provider's liability, then a plaintiff may recover excess damages from the PCF. Ind.Code § 34–18–14–3(c).

Ind. Dep't of Ins. v. Everhart, 960 N.E.2d 129, 133 (Ind.2012). An injured plaintiff thus proceeds first against the healthcare provider, Ind.Code §§ 34–18–8–1 to –8 (2008), and then against the PCF, Ind.Code § 34–18–15–3 (2008). Central to the resolution of this case is the meaning of Indiana Code § 34–18–15–3(5) which states in part:

If the commissioner, the health care provider, the insurer of the health care provider, and the claimant cannot agree on the amount, if any, to be paid out of the patient's compensation fund, the court shall, after hearing any relevant evidence on the issue of claimant's damage submitted by any of the parties described in this section, determine the amount of claimant's damages, if any, in excess of the two hundred fifty thousand dollars ($250,000) already paid by the insurer of the health care provider. The court shall determine the amount for which the fund is liable and make a finding and judgment accordingly. In approving a settlement or determining the amount, if any, to be paid from the patient's compensation fund, the court shall consider the liability of the health care provider as admitted and established.

Ind.Code § 34–18–15–3(5) (emphasis added).¹ The contentions of the parties hinge on the precise meaning of “liability” and in what manner it is “admitted and established” in the second stage of the bifurcated MMA proceedings.

The PCF believes that the evidence it seeks to introduce is “not only relevant, but necessary” to a determination of damages. Appellant's Br. at 9. As we understand the argument, the final sentence of Indiana Code Section 34–18–15–3(5), which requires the trial court to “consider the liability of the health care provider as admitted and established,” Ind.Code § 34–18–15–3(5) (emphasis added), is inapplicable for two reasons: (1) recent Indiana case law has interpreted this provision “to allow causation type evidence” because “[e]vidence of the existence of an injury can be relevant to both causation and damages,” Appellant's Br. at 18, and (2) Section 34–18–15–3(5) does not preclude the PCF “from challenging the compensable nature of B.O.'s injury.” Appellant's Br. at 12. Under the facts of this case, we disagree on both counts.

A. Foreclosure of Existence and Causation of Injury

1. “Liability” under Ind.Code § 34–18–15–3(5)

The PCF argues that it may introduce evidence of “medical issues of causation relevant to determining damages.” Appellant's Br. at 15. Specifically, the PCF seeks to introduce evidence at trial to dispute the nature of B.O.'s injury, contending that B.O. either has no injury or that his injury was not caused by the healthcare providers' breach of duty. This argument raises a question we briefly addressed in Atterholt v. Herbst, 902 N.E.2d 220 (Ind.2009): what is meant when “liability” is “admitted and established” under Indiana Code § 34–18–15–3(5)? In Herbst we said:

The Medical Malpractice Act does not define “liability.” However, the Act provides that undefined legal terms have the meaning consistent with the common law. [Ind.Code] § 34–18–2–2. According to Black's Law Dictionary (8th ed. 2004), liability is the “quality or state of being legally obligated or accountable.”

Herbst, 902 N.E.2d at 223. We thus begin with a look to the common law definition of liability in a negligence case.

Traditionally, negligence consists of “(1) a duty owed by the tortfeasor to the tort victim, (2) a breach of that duty, and (3) an injury to the tort victim proximately caused by the breach.” Spangler, 958 N.E.2d at 468 (citing Estate of Mintz v. Conn. Gen. Life Ins. Co., 905 N.E.2d 994, 998–99 (Ind.2009)). A plaintiff proving each of these elements establishes that a defendant is “legally obligated or accountable,” Herbst, 902 N.E.2d at 223 (quoting Black's Law Dictionary (8th ed. 2004)). That is to say, the defendant is liable. All that remains is a determination of the amount of damages to which the plaintiff is entitled. See id.

This definition, then, gives us two criteria relevant to the PCF's appeal. First, “[i]t is axiomatic that, before liability can be imposed, there must be proof that the defendant's negligence proximately caused the plaintiff's harm.” Dunn v. Cadiente, 516 N.E.2d 52, 55 (Ind.1987); see also Dillon v. Glover, 597 N.E.2d 971, 973 (Ind.Ct.App.1992) (quoting Dunn and reasoning: “[i]t therefore follows that once liability is established, the issue of proximate cause is decided.”). Likewise, in order to establish liability, a plaintiff must demonstrate an injury; without a connectionbetween the breach of duty and the injury, causation fails. Dunn, 516 N.E.2d at 55. From this it seems clear that, for purposes of determining excess damages, if “the court shall consider the liability of the health care provider as admitted and established” pursuant to Section 34–18–15–3(5), then the supporting requirements that the healthcare providers' breach of duty caused an injury to B.O. must—by necessity—also be viewed as “admitted and established.”

Here, B.O. has claimed a single injury: cerebral palsy consisting of spastic diplegia. That is the claim that the healthcare providers chose to settle, and thus that is the claim for which liability is “admitted and established”—including, by implication, the required elements of causation and injury. All that remains to be determined is the amount of damages to which B.O. is entitled from the PCF for the malpractice.

We recognize that this means that the existence and type of injury that B.O. sustained is determined without the full explication that may have been adduced at a trial. But this was the method chosen by...