Indiana Appellate Comments

     In insurance law, the insured has the initial burden to make accurate representations in the application.  If an insurance policy is issued, the insurer then has the burden to issue a policy with clear language and provide insurance according to the policy's terms.  Because the insurer is charged with writing an unambiguous policy, if a dispute between the insured and insurer turns on a term that is deemed ambiguous the policy is interpreted in favor of coverage. 

     In Allied Property & Casualty Ins. Co. v. Good, the Court of Appeals held that a policy is void ab initio and summary judgment should be entered in favor of the insurer when the insured makes a material misrepresentation on the application for insurance.  Specifically, the Court held:  "Because the uncontradicted evidence indicates Linda misrepresented the Goods' cancellation history on the application for homeowners insurance and Allied would not have issued the policy if it had known the truth about their history, the trial court erred by denying Allied's motion for summary judgment."

     Of note, Indiana appellate courts have stated that an ambiguity does not exist merely because the parties proffered differing interpretations of the policy language.  In this case, no ambiguity was found even though one of the three judges on the appellate panel interpreted the disputed language in the policy differently.  In dissent, Judge Bailey opined that the insured may not have provided misinformation in the application.  Judge Bailey further stated that, even if the insured provided misinformation, an insurer's use of a self-serving affidavit may not be sufficient to prove the materiality of the misrepresentation.

     It's been over a decade since the Indiana Supreme Court has issued an opinion regarding the "fireman's rule."  See Heck v. Robey, 659 N.E.2d 498, 500 (Ind. 1995).  Over time, courts had begun to erode the applicability of the rule, and had limited the rule to premises liability cases.  See, e.g., Johnson v. Steffen, 685 N.E.2d 1117, 1119 (Ind. Ct. App. 1997), trans. denied.

     In Babes Showclub, Jaba, Inc. v. Lair, Case No. 49A05-0805-cv-262, the Indiana Supreme Court reaffirmed the fireman's rule.  The Court held:  "[T]he 'fireman's rule' bars recovery by a professional emergency responder for the negligence that created the situation requiring the response."  In other words, "an emergency responder may not recover for the negligence that created the situation to which the responder responds."  In Lair, a police officer was unable to state a claim for injuries he incurred when responding to a call to remove an unruly patron from Babes Showclub.

     The purpose of the rule stems from a policy decision that emergency responders know of the dangerous circumstance for which they are entering (example, a burning building) and incur the associated risk.  Courts have made the policy decision that the emergency responders should not be able to sue for the negligence that created the emergency circumstance.

     In addition to reaffirming the rule's bar, the Court was careful to describe the rule's limitation.  The fireman's rule "does not bar recovery for negligence [or intentional tortious conduct] unrelated to the creation of the emergency."  For example, in Johnson, a police officer, while responding to a call to remove a parked car from a bicycle lane, was hit by a cyclist involved in a racing event and injured.  Under the rule, as described in Lair, the officer would be barred from recovering from any negligence from the driver/owner of the car, but may pursue a claim for any alleged negligence of the cyclist or cyclist event organizer.

"Jetson, You're Fired!"

            Indiana is an “employment at will” state, i.e. generally, employment may be terminated by the employer or employee at will, with or without reason. The Indiana Supreme Court has recognized only three exceptions to this doctrine. In Baker v. Tremco, Inc., Cause No. 29S02-0902-cv-00065, the Court extended the second exception, which rests on retaliatory discharge.

            Baker believed that one of Tremco’s suppliers was overcharging schools for their products and services. Baker claims that he was forced to resign because of his refusal to sell these products, and sued Tremco for breach of contract/wrongful termination.

            In McClanahan v. Remington Freight Lines, Inc., 517 N.E.2d 390, 428 (Ind. 1988), the Court had found a public policy exception to the employment at will doctrine “when an employee is discharged solely for exercising a statutorily conferred right.” The Court went on to state “firing an employee for refusing to commit an illegal act for which he would be personally liable is as much a violation of public policy declared by the legislature as firing an employee for filing a workmen’s compensation claim.” Id. at 392-93 (emphasis added).

            In Baker, the Indiana Supreme Court extended this exception to include instances where an employee is not fired – but is constructively discharged from his employment for refusing to participate in illegal activity. The Court stated: “Depending on the facts, it is merely retaliatory discharge in reverse.” Despite the extended exception, the Court held that Baker’s facts did not fall within the ambit of the exception because the alleged overpricing did not, as a matter of law, contravene the public bidding statutes.

by Steven D. Groth and Curtis T. Jones

           Since 1916, courts have been discussing in dicta or predicting what presumption should be accorded to Indiana children ages 7 to 14 who are claimed to have contributed to negligence alleged in civil cases. In Clay City Consolidated School Corp. v. Timberman, Cause No. 11S04-0904-CV-134, the Indiana Supreme Court unanimously ended the speculation in this wrongful death case.

            Instances of Negligence. If the issue is whether a child between the ages of 7 and 14 was negligent, the Indiana Supreme Court has adopted the Restatement (Second) of Torts § 283A (1965) for the standard of care to be used: such children are “required to exercise due care for his or her own safety under the circumstances and that the care required is to be measured by that ordinarily exercised under similar circumstances by children of the same age, knowledge, judgment, and experience.” citing Creasy v. Rusk, 730 N.E.2d 659, 662 (Ind. 2000) and Schultz v. Ford Motor Co., 857 N.E.2d 977, 980 n.2 (Ind. 2006).

            Burden of Proof for Contributory Negligence Defense: If the  question is what is the defendant's burden to prove that a child between the ages of 7 and 14 was contributorily negligent, then the  defendant  must overcome a rebuttable evidentiary presumption that the child is incapable of contributory negligence. The Court’s opinion in Timberman recognized the “presumption,” yet emphasized the “rebuttable” nature of that presumption. The Court stated that “this presumption in favor of youthful alleged victims is a very modest benefit at best” and “will not preclude summary judgment for the alleged tortfeasor on grounds of contributory negligence in the appropriate case.” 

            The Court further emphasized: the evidentiary “presumption is rebuttable such that the child nevertheless ‘may be guilty thereof.’”  Despite  expressly  recognizing this presumption, the Court's holding in Timberman sets the procedural limits for the presumption, and outlines how alleged tortfeasors  may prove contributory negligence against a child between the age of 7 and 14,  by offering evidence that the child was accountable, based on his or her age, mental capacity, intelligence, and experience. 

    By:  Kelly Scanlan

            In a recent decision, the Supreme Court of Indiana clarified what evidence litigants may introduce to assist juries in determining the “reasonable value of medical services.” In Stanley v. Walker, the Court did away with the notion that Indiana’s Collateral Source Statute precludes defendants from introducing discounted amounts paid and accepted for a plaintiff’s medical bills. Relying primarily on the realities of health care billing and finance, the Court held that “the collateral source statute does not bar evidence of discounted amounts in order to determine the reasonable value of medical services. To the extent the adjustments or accepted charges for medical services may be introduced into evidence without referencing insurance, they are allowed.”

            The Stanley opinion comes on the heels of the Supreme Court’s decision in Butler v. Indiana Dep’t of Ins., 904 N.E.2d 198 (Ind. 2009), in which the Court held that in wrongful death actions, the amount recoverable for reasonable medical and hospital expenses is the total amount ultimately accepted by health care providers after any billing adjustments, not the total originally billed. Due to the language of a settlement agreement between the parties in Butler, the Court did not reach the collateral source doctrine issue in that case. The narrow holding in Butler rested almost exclusively on the plain language of Indiana’s Adult Wrongful Death Statute. 

            Bose McKinney & Evans LLP filed amicus briefs on behalf of the Insurance Institute of Indiana in both appeals. Despite their differing underlying rationale, and the Court’s slightly more middle of the road approach in Stanley, both cases represent positive results for defendants in personal injury and medical malpractice cases in Indiana. These decisions will help ensure that juries are provided with accurate evidence regarding the amount of damages necessary to compensate plaintiffs for medical bills they are actually required to pay.