Split justices eliminate proximity rule for emotional distress claims

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A mother who brought claims for emotional distress after learning that her disabled daughter had been sexually abused can once again proceed with her case after a majority of the Indiana Supreme Court created a new rule eliminating the proximity requirement for emotional distress recovery. A dissenting justice, however, warned that the “watershed” ruling could have a wider-ranging impact than anticipated.

Melody Ruch is the mother of 17-year-old K.G., who is blind, nonverbal, has limited mobility and is unable to communicate reciprocally. K.G. suffers from various congenital disorders, including cerebral palsy, quadriplegia, epilepsy and microcephaly.

Because of her disabilities, K.G. was enrolled in the New Augusta North Public Academy in Pike Township, where she received instructional and special needs services. Those services included regular diaper changes by an instructional assistant named Morgan Smith.

In late 2015 or early 2016, Smith sexually abused K.G. while changing her diaper. K.G. subsequently began suffering from sleeplessness and night terrors, and she became combative toward her caregivers.

Ruch noticed these changes in her daughter’s behavior, but she didn’t learn of the sexual abuse until April 2018, when Smith confessed. Smith later pleaded guilty to Level 3 felony child molesting and was sentenced to 13 years, all suspended to probation.

In August 2019, Ruch sued Smith, the academy and the Metropolitan School District of Pike Township both individually and in her capacity as K.G.’s parent and next friend. In her individual capacity, Ruch alleged she had suffered emotional distress that compromised her ability to care for K.G. at home, leading to her incurring expenses for K.G.’s placement in a chronic care facility.

The school moved for summary judgment, arguing Ruch did not satisfy either the modified-impact rule or the bystander rule for recovering under an emotional distress claim, and the Marion Superior Court agreed, dismissing the individual-capacity claims.

The Court of Appeals of Indiana partially affirmed, declining to “expand a tortfeasor’s liability for the [negligent] infliction of emotional distress beyond the traditional impact rule, the modified impact rule, and the bystander rule.”

But the Indiana Supreme Court majority did impose a “narrow expansion of our common law,” creating a new test for emotional distress claims and ruling that summary judgment for the school was improper.

Writing for the majority, Justice Christopher Goff began by noting that “common-law rules governing claims for the negligent infliction of emotional distress reflect a jurisprudence of incremental change.” He pointed to the adoption of the impact rule in 1897 in Kalen v. Terre Haute & Indianapolis Railroad Co., the 1991 cases of Cullison v. Medley and Shuamber v. Henderson regarding the modified-impact rule, and the 2000 adoption of the bystander rule in Groves v. Taylor, among other cases. 

“Each of the cases discussed … share a common factual trait: the commission of a violent tort in open view, directly observable by the plaintiff (whether the victim or the bystander) either when it occurs or soon after,” Goff wrote. “By contrast, the type of injury inflicted here — the sexual molestation of a child — typically occurs under a shroud of secrecy.

“… Considering the ‘extraordinary circumstances surrounding the plaintiff’s discovery of the injury,’ and considering the remedial limitations imposed by our existing legal framework, justice compels us to fashion a rule permitting a claim for damages limited to circumstances like those presented here,” he continued. “Under that rule, when a caretaker assumes a responsibility for a child, and when that caretaker owes a duty of care to the child’s parent or guardian, a claim against the caretaker for the negligent infliction of emotional distress may proceed when the parent or guardian later discovers, with irrefutable certainty, that the caretaker sexually abused that child and when that abuse severely impacts the parent or guardian’s emotional health.” 

The new “carve-out rule” provides sufficient protection against spurious claims and open-ended liability by limiting the class of potential plaintiffs and requiring “irrefutable certainty,” the majority held. The court also pointed to the rule’s requirement for evidence of a severe impact on a parent or guardian’s mental health, which could include mental health treatment or “dramatic changes” in a parent’s demeanor, among other evidence.

“Indiana isn’t the first state to eliminate the proximity requirement in emotional-distress claims,” Goff wrote, pointing to decisions from Alaska, Louisiana and Hawaii. Even so, he acknowledged that most states have not disposed of that requirement.

“But, while Indiana often assumes a ‘cautiously progressive’ approach to its law, ‘more than one the state has taken a road less traveled.’”

Applying the new test to Ruch, the majority justices concluded the case met each of the test’s four elements: the school, as the tortfeasor, had a duty of care to Ruch; there is irrefutable certainty that the tortious act, sexual abuse, was committed; the tortious act is one that is rarely, if ever, witnessed by a parent or guardian; and the abuse severely impacted Ruch’s emotional health.

Specifically as to Ruch’s mental health, the majority wrote that after learning of K.G.’s abuse, Ruch “became angry and would lash out at her children and husband. And even after completing her counseling, Ruch testified, she still struggled to control these emotions.”

Thus, summary judgment for the school was inappropriate, and the trial court improperly dismissed Ruch’s individual claim for economic damages, the court concluded, noting the summary judgment motion only addressed the emotional distress claim. The case was remanded for further proceedings.

Chief Justice Loretta Rush and Justice Steven David concurred with Goff’s majority opinion, but Justice Mark Massa dissented in a separate opinion joined by Justice Geoffrey Slaughter.

“This heart-rending case illustrates the adage that hard cases make bad law,” Massa wrote. He noted the proximity requirement had “remained unchanged” for 125 years until the majority’s Wednesday opinion.

“Only time will tell whether today’s watershed rule is so narrow and fact-specific that it proves to be a one-way ticket for this ride only — or whether, as I suspect, it is the proverbial camel’s nose under the test, with the rest of the camel soon to follow,” he wrote.

“The fine-tuning we announced today is more a legislative than a judicial function,” the dissent continued. “The legislature is better suited to weigh the competing value judgments that suffuse today’s opinion on when claimants can recover inherently subjective emotional-distress damages.

“If the Court is right that today’s rule reflects ‘the reasonable expectations of the millions of Hoosiers governed by our legal system,’” he concluded, “then their elected representatives in our legislature should be the ones to say so.”

The case is K.G., by her Parent and Next Friend, Melody Ruch, and Melody Ruch, Individually v. Morgan Smith, New Augusta North Public Academy, and Metropolitan School District of Pike Township, 21S-CT-561.

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