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Teresa Blackford V. Welborn Clinic

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Teresa Blackford V. Welborn Clinic IN THE Indiana Supreme Court Supreme Court Case No. 21S-CT-85 Teresa Blackford Appellant (Plaintiff below) –v– Welborn Clinic Appellee (Defendant below) Argued: April 22, 2021 | Decided: August 31, 2021 Appeal from the Vanderburgh Circuit Court No. 82C01-1804-CT-2434 The Honorable David D. Kiely, Judge On Petition to Transfer from the Indiana Court of Appeals No. 19A-CT-2054 Opinion by Justice Goff Chief Justice Rush and Justices David, Massa, and Slaughter concur. Goff, Justice. Statutory limitations of action are “fundamental to a well-ordered judicial system.” See Bd. of Regents of Univ. of State of N. Y. v. Tomanio, 446 U.S. 478, 487 (1980). The process of discovery and trial, revealing ultimate facts that either help or harm the plaintiff, are “obviously more reliable if the witness or testimony in question is relatively fresh.” Id. And potential defendants, of course, seek to avoid indefinite liability for past conduct. C. Corman, 1 Limitation of Actions § 1.1, at 5 (1991). Naturally, then, “there comes a point at which the delay of a plaintiff in asserting a claim is sufficiently likely either to impair the accuracy of the fact-finding process or to upset settled expectations that a substantive claim will be barred” regardless of its merit. Tomanio, 446 U.S. at 487. At the same time, most courts recognize that certain circumstances may “justify an exception to these strong policies of repose,” extending the time in which a plaintiff may file a claim—a process known as “tolling.” Id. at 487–88. The circumstances here present us with these competing interests: the plaintiff, having been misinformed of a medical diagnosis by her provider, which dissolved its business more than five years prior to the plaintiff filing her complaint, seeks relief for her injuries on grounds of fraudulent concealment, despite expiration of the applicable limitation period. Because we consider the limitation period at issue a statute of repose (rather than a general statute of limitation or non-claim statute), we conclude that fraudulent concealment may not extend the time in which to file a claim. And even if the limitation period were subject to tolling, the defendant’s constructive fraud precludes equitable relief. For these Indiana Supreme Court | Case No. 21S-CT-85 | August 31, 2021 Page 2 of 18 reasons, we hold that the plaintiff’s claim is untimely.1 As such, we affirm the trial court’s order granting summary judgment to the defendant and denying the plaintiff’s motion for partial summary judgment. Facts and Procedural History In 2003, the Welborn Clinic (or, the Clinic) tested Teresa Blackford for hepatitis, a known cause of a skin condition from which she suffered at the time. Upon completing the test, the Clinic informed Blackford that the results were negative. For the next several years, Blackford continued to receive treatment for her skin condition from the Clinic. But on June 30, 2009, the Clinic, under the Indiana Business Trust Act (IBTA or Act), surrendered its authority to conduct business in the state, effectively terminating its relationship with Blackford. In 2014, as Blackford’s health declined, her new doctor diagnosed her with hepatitis. This diagnosis prompted Blackford to request her medical records from the Clinic, which revealed that she had in fact tested positive for hepatitis in 2003. Though treated for her condition by her new doctor, Blackford had developed cirrhosis of the liver because of the delay in treatment, exposing her to a heightened risk of other medical problems. Upon discovering the original test results, Blackford, on March 13, 2015, sued for medical malpractice—first with the Indiana Department of Insurance and then in the trial court. At trial, the Clinic moved for summary judgment, arguing that, because Blackford sued more than five years after the Clinic dissolved, the IBTA time-barred her claim. See Ind. 1 The Indiana Trial Lawyers Association (ITLA) raises a separate constitutional claim in its amicus brief, arguing that the Indiana Business Trust Act, as applied to Blackford, violates the Privileges and Immunities Clause and the Open Courts Clause of the Indiana Constitution. ITLA, however, as amicus, could not raise a new claim that the parties failed to raise. ITLA is not a party on appeal. See Ind. Appellate Rule 17(A). And it is well established that “[a]n amicus is not permitted to raise new questions but rather must accept the case as it finds it at the time of its petition to intervene.” Indiana Dep’t of Transportation v. FMG Indianapolis, LLC, 167 N.E.3d 321, 333 (Ind. Ct. App. 2021) (citing Anderson Fed’n of Tchrs., Loc. 519 v. Sch. City of Anderson, 252 Ind. 558, 254 N.E.2d 329 (1970)). Indiana Supreme Court | Case No. 21S-CT-85 | August 31, 2021 Page 3 of 18 Code § 23-5-1-11 (2018) (entitling a business trust to “prosecute and defend” all claims filed within a five-year period after the trust surrenders its authority to conduct business). Blackford responded by moving for partial summary judgment on the same issue, asserting that the Clinic fraudulently concealed her test results, thus equitably tolling the IBTA’s five-year limitation period. The trial court ruled for the Clinic. In a divided opinion, the Court of Appeals reversed. Blackford v. Welborn Clinic, 150 N.E.3d 687 (Ind. Ct. App. 2020). The majority held (1) that fraudulent concealment may, upon a sufficient showing of facts, toll the IBTA’s five-year limitation period; (2) that, as a matter of law, by giving Blackford inaccurate test results in 2003, and by designating no evidence to the contrary, the Clinic fraudulently concealed—passively, if not actively—material medical information; and (3) that, by investigating her condition after termination of the doctor-patient relationship “in a reasonably diligent manner,” Blackford filed a timely complaint under the IBTA. Id. at 696–97. The dissent, however, would have affirmed the trial court on grounds of Blackford’s untimeliness in filing the complaint, reasoning that, while the discovery rule applies to active fraud, passive (or constructive) fraud, as Blackford alleged here, tolls the limitations period only “‘until the termination of the physician-patient relationship.’” Id. at 697–98 (Brown, J., dissenting) (quoting Boggs v. Tri-State Radiology, Inc., 730 N.E.2d 692, 698 (Ind. 2000)). We granted the Clinic’s petition for transfer, thus vacating the Court of Appeals opinion. See Ind. Appellate Rule 58(A). Standard of Review A de novo standard of review applies to summary-judgment rulings. Alldredge v. Good Samaritan Home, Inc., 9 N.E.3d 1257, 1259 (Ind. 2014). Under this standard, summary judgment is appropriate “if the designated evidentiary matter shows that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.” Ind. Trial Rule 56(C). Claims asserting a defense based on a statutory limitation period are particularly suitable for summary- Indiana Supreme Court | Case No. 21S-CT-85 | August 31, 2021 Page 4 of 18 judgment determination. See City of Marion v. London Witte Grp., LLC, 169 N.E.3d 382, 390 (Ind. 2021). “When a moving party asserts as an affirmative defense that an action is time-barred, and establishes that the action was commenced beyond the statutory period, the burden shifts to the nonmovant to establish an issue of fact material to a theory that avoids the defense.” Jurich v. John Crane, Inc., 824 N.E.2d 777, 780 (Ind. Ct. App. 2005). Discussion and Decision On transfer, the Clinic—joined by the Defense Trial Counsel of Indiana as amicus curiae—argues that, by its plain terms, the IBTA “creates a date certain after which all claims against it are barred.” Pet. to Trans. at 15. And to recognize an equitable exception for fraud, the Clinic contends, runs contrary to the IBTA’s plain language and to its purpose of shielding businesses from the need to defend against stale claims. Id. at 15–18. For her part, Blackford, along with amicus curiae the Indiana Trial Lawyers Association, maintains that the Clinic’s fraudulent concealment of her test results tolled the IBTA’s five-year limitation period. Legislative policy and principles of equity, she insists, prevent a party from exploiting another by fraudulent activity. Resp. to Trans. at 6. Simply put, she asserts, “[f]raud vitiates anything.” Id. To resolve this dispute, our decision proceeds in two parts. We first examine the various statutory limitations of action—general statutes of limitation, statutes of repose, and non-claim statutes—to determine whether the IBTA permits equitable tolling. Concluding that it does not, we then ask whether a limited exception applies in cases of fraudulent concealment—a question we likewise answer in the negative on grounds that the Clinic’s constructive fraud justifies no equitable relief for Blackford. Indiana Supreme Court | Case No. 21S-CT-85 | August 31, 2021 Page 5 of 18 I. The IBTA’s limitation period is not subject to equitable tolling. Enacted in 1963, the IBTA expressly recognizes a business trust—an unincorporated association in which one or more trustees engage in professional activities for the profit of its beneficiaries—as a type of organization permitted to conduct business in the state.2 Act of Mar. 14, 1963, ch. 353, §§ 2, 3, 1963 Ind. Acts 900, 901–02 (codified as amended at I.C. §§ 23-5-1-2, -3). When a business trust withdraws or “surrender[s]” its authority to conduct business, by filing a notice of intent with the secretary of state, the IBTA allows for a five-year winding-up period, during which the trust may “convey and dispose of its property and assets” and “perform any other act or acts pertinent to the liquidation of its business.” I.C.
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