ILNews

Judges rule couple did not release medical providers from liability

Back to TopCommentsE-mailPrintBookmark and Share

A trial court appropriately denied the partial summary judgment motion filed by medical providers in a malpractice claim, the Indiana Court of Appeals held, because the plaintiffs did not release the medical group from liability by filing a proof of claim with the doctor’s insurer, which was insolvent and being liquidated.

Cynthia Kendall went to Deaconess Hospital with stroke-like symptoms in 2002 and was examined by Dr. Peters. He said she experienced a “transient ischemic attack,” gave her some baby aspirin, discharged her despite continuing symptoms and told her to follow up with her family doctor. An hour later, Kendall was back at the hospital, and testing discovered she had a stroke.

Peters had medical malpractice insurance with PHICO Insurance Co. of Pennsylvania, with a liability limit of $250,000 and aggregate limit of $750,000. Four months after Kendall’s stroke, a court in Pennsylvania declared the insurer insolvent and appointed a liquidator. All polices were cancelled and Kendall would have to recover from the insurer’s assets by filing a proof of claim in the liquidation.

She and her husband filed two forms, one that omitted the amount of her claim, and later one that asked for $250,000. The proof of claim contains a provision, stating in part that “the undersigned hereby releases any and all claims which have been or could be made against such PHICO insured … .”

She and her husband filed their medical malpractice complaint in 2008 after a medical review panel found the medical providers met the applicable standard of care. In 2011, Kendall received $75,000 from PHICO – 30 percent of the $250,000 claim she made.

The trial court denied summary judgment on the issue of whether the Kendalls had released their claim against Peters.

In Michael W. Peters, M.D. and Deaconess Hospital, Inc. v. Cynthia S. Kendall and Michael J. Kendall, 82A01-1302-PL-55, the Court of Appeals found the proof of claim’s liability provision lacked the essential elements to render it a binding contract.

“In Indiana Insurance Guaranty Association, a hospital settled its malpractice liability with the patient’s estate, and the court held that the (Indiana Insurance Guaranty Association) was obligated to reimburse the hospital because its insurance policy would have required PHICO to pay the full amount of the claim had PHICO not been insolvent,” Judge Patricia Riley wrote. “Based on the supreme court’s holding, the Kendalls are entitled to compensation for Dr. Peters’ malpractice, if established, notwithstanding PHICO’s insolvency, and if PHICO fails to uphold the obligations of its policy, Dr. Peters must pay the first $250,000 of the Kendalls’ damages and then pursue recovery of those costs from the IIGA.”

“Accordingly, PHICO has a legal and contractual duty to pay its policy limit for any damages determined to be the result of Dr. Peters’ malpractice. It is, therefore, insufficient as consideration for the release of all liability that the Kendalls were permitted to file a Proof of Claim that obligated PHICO to do no more than it was already bound to do,” she continued.
 

ADVERTISEMENT

Post a comment to this story

COMMENTS POLICY
We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
 
You are legally responsible for what you post and your anonymity is not guaranteed.
 
Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in Indiana Lawyer editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
 
No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
 
We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.
 

Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

Sponsored by

facebook - twitter on Facebook & Twitter

Indiana State Bar Association

Indianapolis Bar Association

Evansville Bar Association

Allen County Bar Association

Indiana Lawyer on Facebook

facebook
ADVERTISEMENT
Subscribe to Indiana Lawyer
ADVERTISEMENT