COA allows Insurance Dept. claim in name of deceased individuals to proceed

A proposed complaint before the Indiana Department of Insurance was not void just because it was filed in the name of a deceased person on behalf of a deceased victim of alleged medical malpractice, the Indiana Court of Appeals has ruled.

Betty McFerran died shortly after her husband, Robert McFerran, died while a resident at Eagle Valley Meadows, a nursing home in Indianapolis. After her death, an attorney filed a proposed complaint with the Indiana Department of Insurance on Betty’s behalf, individually and as wife of Robert.

The proposed complaint alleged Eagle Valley Meadows provided negligent medical care and, as a result, Robert suffered permanent injuries, pain, emotional distress and death. The couple’s daughter, Sharon Dial, was later appointed successor administrator of Robert’s estate.

When a medical review panel ruled for Eagle Valley, Dial filed a complaint in Marion Superior Court alleging negligence resulting in her father’s death at the nursing home. But Eagle Valley argued Betty’s proposed complaint was a legal nullity due to her death before the proposed complaint was filed with the IDOI. Therefore, it argued, the proposed complaint did not toll the applicable statute of limitations, which resulted in Dial’s suit being brought outside the statute of limitations period.

The trial court directed both parties to submit post-hearing briefs, noting that it wanted “to see if there’s any more current cases that talk about that rule of law, that black-letter rule as it applies to newly created causes of action such as a claim under the Medical Malpractice Act.” After receiving the briefs, the court denied Eagle Valley’s motion for summary judgment.

Upon a grant of interlocutory appeal in the case, the Indiana Court of Appeals accepted and affirmed in The Health and Hospital Corporation of Marion County d/b/a Eagle Valley Meadows and American Senior Communities, LLC v. Sharon Dial, as Administrator for the Estate of Robert McFerran, Deceased, 20A-CT-2382.

The appellate court concluded that while a party must be alive to initiate a complaint in state or federal court, the cases Eagle Valley cited did not answer whether a proposed complaint filed before the IDOI by the deceased administrator of the alleged malpractice victim’s estate tolls the statute of limitations.

Noting that neither party provided authority regarding the applicability of Trial Rule 17 or Trial Rule 25 to proceedings before the medical review panel, the COA said both Eagle Valley and Dial cited out-of-state cases that did not involve a proposed complaint filed in front of a medical review panel.

“Dial’s invocation of Indiana Code section 34-11-8-1, which allows for the continuation of an action if it abates or is defeated by the death of a party, is misplaced because the statute also contemplates that the plaintiff was alive when the lawsuit was filed,” Judge Melissa May wrote. “… We are thus left with a question of first impression.”

The COA found that while Robert was the victim of the alleged malpractice, the administrator of his estate is the real party in interest and is therefore required to bring suit in state court because the administrator stands to recover and distribute whatever judgment may be entered against Eagle Valley.

“The presence of a living party able to accept relief is part and parcel of the court performing its judicial function,” May wrote.

The court also found that the medical review process was not thwarted, and Eagle Valley did not show how it was prejudiced because the proposed complaint was filed on behalf of Betty after her death, rather than on behalf of Dial or her other daughter.

“Eagle Valley Meadows chose to allow the medical review panel process to play itself out and did not raise any objection to the proposed complaint being filed in Betty’s name until the actual lawsuit was filed in the name of a living successor administrator of Robert’s estate,” May concluded. “For all these reasons, we affirm the trial court’s denial of Eagle Valley Meadows’ motion for summary judgment and remand for further proceedings not inconsistent with this opinion.”

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