Where an HCLA plaintiff decides to pursue claims only against the principal under a vicarious liability theory and the plaintiff follows the statutory timing outlined in the HCLA, the claim will not be barred due to the previous common law holding that a vicarious liability claim against a principal is barred “when the plaintiff’s claim against the agent is procedurally barred by operation of law before the plaintiff asserts a vicarious liability claim against the principal.” In Gardner v. Saint Thomas Midtown Hospital, No. M2019-02237-COA-R3-CV (Tenn. Ct. App. April 1, 2021), plaintiff filed an HCLA claim against defendant hospital based on allegedly negligent care by an anesthesiologist while she was having surgery at defendant hospital. In her complaint, plaintiff stated that defendant was “careless and negligent” while “acting through its employees and/or agents,” and that defendant was “liable for any negligent acts and/or omissions of any actual or apparent agents and/or employees[.]” In defendant’s answer, it “specifically denie[d] that the physicians whose care is alleged in the Complaint were agents or employees of defendant.”
After discovery, defendant filed a motion for summary judgment, for the first time alleging that an entity called Anesthesia Medical Group (AMG) was the employee of the anesthesiologist who treated plaintiff. Defendant argued that plaintiff’s claim could not stand because it was “premised solely on vicarious liability, but the underlying claims against the alleged agents were barred by the statute of limitations at the time suit was filed against [defendant].” The trial court agreed with defendant, granting summary judgment, but the Court of Appeals reversed.
The Court began its analysis by looking at the language of the HCLA, noting that under the current version, “the provision of health care services includes the provision of ‘care by health care providers,’ and that care includes care by the provider’s ‘agents, employees, and representatives.’” (quoting Tenn. Code Ann. § 29-26-101(b)). Pursuant to this language, the Court found that defendant was “subject to a claim for health care liability for the care provided by its agents and employees,” which is the type of claim plaintiff was asserting here.
The issue in this case was how the provisions of the HCLA addressing pre-suit notice and the extension of the statute of limitations interact with previous Tennessee common law regarding vicarious liability claims. Under the HCLA, “when pre-suit notice is given to a health care provider…, the statute of limitations is extended for 120 days.” Plaintiff here gave proper pre-suit notice, so the statute of limitations on her claim against the hospital did not end until 120 days after the one-year anniversary of her surgery, which was the date of injury. Although plaintiff’s claim against defendant was timely, defendant argued that AMG was the agent who actually engaged in negligent conduct, and that because plaintiff’s claim against AMG was barred by the statute of limitations at the time her suit against defendant was filed, summary judgment was appropriate.
Defendant relied on Abshure v. Methodist Healthcare-Memphis Hospitals, 325 S.W.3d 98 (Tenn. 2010), which was a medical malpractice suit decided before the 2011 amendments requiring pre-suit notice were added to the HCLA. Abshure dealt with vicarious liability claims, and while the Court in that opinion pointed out that “a plaintiff may sue a principal based on its vicarious liability for the tortious conduct of its agents without suing the agent,” it also noted
that there were “certain circumstances in which it would be improper to permit a plaintiff to proceed solely against a principal based on its vicarious liability for the conduct of an agent.” One of these circumstances, and the one at issue in this case, was “when the plaintiff’s claim against the agent is procedurally barred by operation of law before the plaintiff asserts a vicarious liability claim against the principal.” (quoting Abshure).
Considering the plain language of the HCLA and the time at which Abshure was decided, the Court of Appeals held that summary judgment was not appropriate here. The Court reasoned:
If we apply the fourth exception to vicarious liability identified in Abshure to [plaintiff’s] vicarious liability claims against [defendant] in the present case, the result would likely be to bar her claims because, when she filed her complaint against [defendant]…, the one-year statute of limitations had run on any direct claims against AMG. Under the plain language of the HCLA, however, as discussed above, the plaintiff’s claims against [defendant] were timely. It is evident that the common law principles described in Abshure conflict with the plain language of the HCLA. When a statute conflicts with the common law, the statute prevails.
[W]ere we to follow the common law rule relied upon by [defendant], the result would effectively shorten the time for pre-suit notice resolution of claims for vicarious liability cases brought solely against a principal. To avoid the trap envisioned by [defendant], a plaintiff choosing to sue only the principal would be required to give the principal pre-suit notice at least sixty days prior to the date upon which the statute of limitations applicable to an agent expires in order to benefit from the 120-day extension provided by Tenn. Code Ann. § 29-26-121(c). A plaintiff could also give pre-suit notice to the agent/employee, but Tenn. Code Ann. § 29-26-121(a)(1) requires pre-suit notice only for ‘a named defendant.’ Moreover, …the statute does not change the common law rule that a plaintiff may choose to sue the principal and not the agent.
Based on this reasoning, the Court held that “in health care liability cases in which a plaintiff chooses to sue only the principal, the provisions of the HCLA regarding pre-suit notice prevail over the common law exception in Abshure with respect to the tolling of the statute of limitations.”
The Court of Appeals also analyzed whether defendant had failed to fulfill its duty under the HCLA to notify plaintiff of “any other person, entity, or health care provider who may be a properly named defendant” based on its failure to identify AMG until its memorandum supporting summary judgment. (citing Tenn. Code Ann. § 29-26-121(a)(5)). Defendant argued that it was not required to disclose AMG to plaintiff because “its position was and still is that its employees and the alleged agents would not be ‘properly-named Defendants’ because they were not negligent and did not cause any injury to the Plaintiff.” The Court quickly rejected this assertion, stating that “a named defendant receiving pre-suit notice is not relieved of complying with this provision of the HCLA based on its belief that a non-named party is not liable for conduct that may be proved negligent.” As the Tennessee Supreme Court had recently pointed out in a different case, the Court noted that this provision of the HCLA “does not provide a remedy for a defendant’s failure to comply with its requirements,” and no mention of a remedy or penalty was included in this portion of the opinion. (internal citation omitted).
Because the HCLA prevailed over previous common law, summary judgment was reversed and the case was remanded.
The Court of Appeals came to the right decision in this case, offering a well-reasoned explanation of why this claim should not be barred based on the Abshure reasoning. The HCLA has been a dynamic area of Tennessee law, and common law decided prior to the sweeping 2011 amendments should be considered in light of the changes made to many portions of the statute. Note that the opinion in Ultsch v. HTI Memorial Hospital Corp., No. M2020-00341-COA-R9-CV (Tenn. Ct. App. April 1, 2021) was released the same day as Gardner. The Ultsch case dealt with the same issue of the “interplay between the [HCLA] and the common law on vicarious liability with respect to pre-suit notice in a health care liability claim against the principal only,” and the Court used identical reasoning (and almost identical wording) to reach the same holding as in Gardner.
NOTE: This opinion was released 5.5 months after oral arguments in this case.