NOTICE: NOT FOR OFFICIAL PUBLICATION. UNDER ARIZONA RULE OF THE SUPREME COURT 111(c), THIS DECISION IS NOT PRECEDENTIAL AND MAY BE CITED ONLY AS AUTHORIZED BY RULE

.

IN THE 

## A RIZONA 

## C OURT OF 

## A PPEALS

D IVISION O NE

HELEN SCHIRMER
, Plaintiff/Appellant
,

v.

AVALON CARE CENTER

– SCOTTSDALE LLC, et al.
,

Defendant s

/Appellee s

.
No. 1 CA

- CV 19

- 0310

Appeal from the Superior Court in Maricopa County

No. CV2017

- 055125 The Honorable Theodore Campagnolo
, Judge

AFFIRMED IN PART; REVERSED AND REMANDED IN PART

COUNSEL
Jeffrey L. Victor
, P

. C

. , Scottsdale By Jeffrey L. Victor Counsel for Plaintiff/Appellant

Anderson & Karrenburg
, Salt Lake City, U T By Craig H. Howe, Blake D. Miller Pro Hac Vice C ounsel for Defendant s

/Appellee s FILED 7-14-2020SCHIRMER v. AVALON, et al. Decision of the Court

2 MEMORANDUM DECISION
Judge D. Steven Williams delivered the decision of the Court, in which Presiding Judge Michael J. Brown and Judge Randall M. Howe 1 joined.

W I L L I A M S , Judge:

¶1 Helen Schirmer ( ” Helen ”) appeals the superior court’s order granting summary judgment to all defendants

. For reasons stated below
, we affirm the dismissal of the claim s based up on the negligence of the nursing staff but reverse the dismissal of the remaining claims and remand for a jury to determine if the statute of limitations bars those claims

.

FACT UAL AND PROCEDURAL HISTORY

¶2 In May 2014, Carl Schirmer (“ Carl ” )
, Helen’s husband, was admitted to a nursing center, Avalon Care Center

- Scottsdale, L.L.C., (“A CC

- Scottsdale”) dba Avalon Care Center

- Shadow Mountain (“ACC

Shadow Mountain”)

. Upon admission, Carl signed an agreement listing ACC

- Shadow Mountain as the “ care center , ” which we refer to as “the Avalon facility

. ” While at t he Avalon facility, Carl fell and fractured his hip. As a result, he was hospitalized and later died on August 20 , 2014
, allegedly from complications related to the hip fracture

. ¶3 In January 2015, Helen’s attorney wrote to the Avalon facility’s attorney asking to discuss Helen’s claim that the nursing staff ’s negligence cause d Carl’s death. Helen’s attorney followed up with a second letter that included an expert opinion from Wendy Thomason, R

. N

. , supporting the negligence c laim

. ¶4 O n July 8, 201 5, Helen filed a complaint against Avalon Health Care, Inc. (“AHCI”)
, dba ACC

- Shadow Mountain and fictitious defend ants, asserting claims arising from Carl’s death

. AHCI, a Utah corporation, removed that action to federal court

. The federal district court granted AHCI summary judgment because it was not sufficiently involved in providing care to Carl to impose liability f or any of the alleged claims.

1 Judge Randall M. Howe replaces the Honorable Kenton D. Jon es, who was originally assigned to this panel. Judge Howe has read the briefs, reviewed the record, and watched the recording of the March 18, 2020 oral argument.SCHIRMER v. AVALON, et al. Decision of the Court

3 The Ninth Circuit Court of Appeals affirmed this decision. Schirmer v. Avalon Health Care, Inc.
, 772 Fed. Appx. 546 , 547 ( 9th Cir. 2019).

¶5 On July 14, 2017, after the federal court dismissed the first action, Helen filed a complaint naming ACC

- Scottsdale dba ACC

- Shadow Mountain ; Avalon Health Care Centers, L.L.C

. and Avalon Health Care Management of Arizona, L.L.C

. (“the corporate defendants”) ; and individual defendants, Douglas Daudelin, the Avalon facility regional director; Michael B. Morris, an Avalon facility administrator; Vanessa E. Holmes, the director of nurs ing for the Avalon facility; nurses LaShun McSwain and Kyle Mader; and certified nursing assistant Chad Pinkstaff. As in the 2015 complaint, the 2017 complaint alleged negligence, wrongful death, violation of the A dult P rotective Services Act (“APSA”) A .R. S. § 4 6

- 455(B)
, loss of consortium, and punitive damages. The 2017 complaint also alleged negligent hiring and management in the Avalon facility.

¶6 Defendants mo ved for summary judgment, arguing the

s tatute of limitations barred the action because the complaint was filed more than two years after Helen’s claims accrued

. A ccording to Defendants
, Helen was aware of the wrongful death and loss of consortium claims by January 2015
, when her expert opined the nursing staff was negligent, and the statute of limitations began to run on t he negligence claims, at the latest, on June 4, 2015, when Helen was appointed personal representative of Carl’s estate. In response, Helen argued the statute of limitations did not begin to run until early 2016 , when she learn ed the
correct name of the legal entity responsible for Carl’s injurie s , the names of the individual nurses, and the facts giving rise to her claims for administrative negligence

. ¶7 The superior court granted Defendants judgment on all claims , finding Helen knew the estate had a cause of action against the nursing home and its staff no later than December 31, 2014, when Helen’s expert provided her opinion. The court concluded Helen had a duty to investigate and determine the co rrect legal enti ty , and name that party in the federal case

. The court also found that even if Helen did not know t he names of the administrators until the discovery in the federal action, she had a duty to amend th e 2 015 complaint. Helen timely appeal ed , and w e have jurisdiction pursuant to A.R.S. § 12

- 2101(A)(1)

.
DISCUSSION

¶8 Summary judgment is appropriate if “ there is no genuine dispute as to any material fact and the moving party is entitled to judgmentSCHIRMER v. AVALON, et al. Decision of the Court

4 as a matter of law. ” Ariz. R. Civ. P. 56(a); see also Orme Sch

. v. Reeves, 166 Ariz. 301, 309 (1990)

. We review the superior court’s grant of summary judgm ent de novo , considering the facts and any inferences drawn from those facts in the light most favorable to the party opposing summary judgment

. Tierra Ranchos Homeowners Ass'n v. Kitchukov
, 216 Ariz. 195, 199, ¶ 15 (App. 2007 ).

¶9 The parties do not dispute that Helen had two years after her claims accrued to file an action

. See A.R.S. § § 12

- 542 and 46

- 4 55 (K)

. Helen did not file the second complaint within two years of Carl ’s death or her appointment as personal representative of his estate
, but contends it wa s , ne vertheless, timely because her claims did not accrue until early 2016

u nder the discovery rule

. To that end, Helen first argues the corporate defendants concealed and misrepresented the true identity of the legal entity that provided Carl ’s car e and other relevant facts , thereby tolling the accrual date of her claims ; and second, the 2017 complaint states independent claims for negligent hiring and management of the Avalon facility
, and she did not discover the facts giving rise to th o s e claim s until March 2016

. ¶10 The statute of limitations “ protect [ s ] defendants and courts from stale claims where plaintiffs have slept on their rights.” Gust, Rosenfeld & Henderson v. Prudential Ins. Co. of Am.
, 182 Ariz. 586, 590 (1995). Because a party is not allowed to “ sleep on [ t he i r ] rights ” regarding an unknown claim
, Doe v. Roe , 191 Ariz. 313, 322, ¶ 29 (1998)
, the discovery rule provides that “a cause of action does not ‘ accrue ’ until a plaintiff discovers or by the exercise of reasonable diligenc e should have discovered that he or she has been injured by the defendant’s negligent conduct
, ” Anson v. Am. Motors Corp.
, 155 Ariz. 420, 423 (App. 1987)

. Thus, “ [ a ] cause of action does not accrue until the plaintiff knows or should have known of both the what and the who elements of causation.” Lawhon v. L.B.J. Inst itutional Supply, Inc.
, 159 Ariz. 179, 183 (App. 19 88) (first emphasis added)

. A plaintiff must also ha ve a “reason to connect the ‘what’ to a particular ‘who’ in such a way that a reasonable person would be on notice to investigate whether the injury might result from fault.” Walk v. Ring
, 202 Ariz. 310, 316, ¶ 22 (2002). Determining w hen a plaintiff should have known the who and what elements of a claim is usually a question of fact for the jury , and “summary judgment is warranted only if the failure to go forward and investigate is not reasonably justified. ” Id. at ¶ 23 (citing Doe , 191 Ari z. at 323, ¶ 32). A p laintiff has the burden of convinc ing the jury the discovery rule applies to delay the accrual of her claims

. Ulibarri v. Gerstenberger
, 178 Ariz. 151, 155 (App. 1993)

.SCHIRMER v. AVALON, et al. Decision of the Court

5 I. Whe n Helen Should Have Discover ed t he Correct Name of the Legal Entity Responsible for Carl ’s Care I s a Question of Fact

¶11 The 2015 complaint named the entities listed in the medical records: AHCI and ACC

- Shadow Mountain. Helen argues she did not learn ACC

- Scottsdale was the correct legal entity responsible for her claims until Defendants provided discovery in the federal litigation. Defendants concede they did not identify the legal name of ACC

- Scottsdale until January 21, 2016, during discovery in the course of the federal litigation. However, D efendants argue Helen was aware of her claim and had a duty to investigate the correct legal entity when her attorney sent a letter and an expert opinion asserting negligence by “ ACC

- Shadow Mountain

. ”

¶12 The admission documents and the medical records availa ble
to Helen state the care provider was ACC

- Shadow Mountain or AHCI. Helen contends that by using these corporate names, the documents actively misled her as to the correct legal entity. Defendants deny th e forms actively conceal ed or affirmatively misrep resent ed information because the correct legal name was available on the Arizona Corporation Commission ’s public website , and Helen should be deemed to know the contents of public records

. S ee Transamerica In s . Co. v. Trout
, 145 Ariz. 355, 358 (App. 1985) ; Ruth v. Unifund CCR Partners
, 604 F. 3d 908 (6 th Cir. 2010)

. ¶13 Defendants also argue Helen was on notice to investigate AHCI’s true identity b ecause AHCI had den ied it provided care to Carl as a defense in the federal litigation. Helen counters that Defendants’ federal pleadings were misleading and insufficient to put her on actual notice that she had named the incorrect legal entity

. Helen alleged Defendants had failed to disclose the name of the entity that ha d discoverable information in its initial disclosures , as required by Federal Rule of Civil Procedure 26 (a)

. Th i s obligation exist ed even if Helen d id not specifically request it , Fed. R. Civ. P. 26(a)(1)(A)(i)
, and an evasive disclosure constitutes a failure to disclose
, Fed. R. Civ. P. 37(a)(4)

. 2

¶14 Helen argues that Defendants conduct constitutes fraudulent concealment
, which relieved her of the duty to investigate until she discovered or was put on notice of facts giving rise to the concealment. Walk
, 202 Ariz. at 319 , ¶ 35 (“actual knowledge standard applies to

2 We recently noted the difficulty that can exist in determining the correct legal entity to name in a lawsuit given “[t]he complicated structuring [of care facilities] consisting of limited liability companies and limited partnerships . . . .” Scott v. Kem p , 248 Ariz. 380, ¶ 2 (App. 2020)

.SCHIRMER v. AVALON, et al. Decision of the Court

6 triggering the statute of limitations” when concealment ha s occurred ). Therefore, Helen assert s her late discovery was reasonable b ecause she had
no reason to suspect she had named the incorrect legal entity in the federal litigation

. Whether fraudulent concealment occurred is an issue of fact for the jury. Anson
, 155 Ariz. at 429

. Even if Defendants ’ f ederal pleadings should have put Helen on notice to i nvestig at e th e existence of a different corporate entity than was named
, Helen filed the 2017 complaint within two years of Defendant’s August 2015 answer ; that answer contained AHCI’s denial of responsibility , which Defendants contend should have put Helen on notice

. ¶15 The question then becomes whether Helen reasonably relied
up on the medical records available to her in determining who to sue
, or if she had a n obligation to further investigate the name of the entity before Defendants may have put her on notice she had sued the wrong entity. As discussed, supra , ¶ 10, “ w hether a reasonable person would have been on notice to investigate ” is usually a question of fact for the jury
, Walk
, 202 Ariz. at 316, ¶ 24.

¶16 Defendants contend that Helen’s duty to investigate the correct legal name is not
, at its core , a factual question because Defendants did not make affirmative assurances as in Walk or Anson

. While the statements in the medical records and Defendant’s answer were not direct misrepresentation s , t he question is whether Helen had reason to know she should be looking for an alternative legal entity based up on the medical records available to her and Defendants’ conduct during the federal litigation. Walk
, 202 Ariz. at 316, ¶ 24. On this record , a jury must resolve this material issue

. ¶17 Finally, Helen ’s kn owledge of the correct legal entity before the federal litigation was dismissed does not render the 2017 com plaint untimely. As Defendant s acknow ledged
, Helen could have sought to amend the complaint in the federal co urt or filed a timely separate action against the correct entity. By filing the 2017 complaint, Helen chose the latter. It is for a jury to decide if th at complaint was timely.

II. As a Matter of Law, Helen Should Have Known or Discovered the Names of the Individual Nursing Staff Members

¶18 Helen contends the 2015 complaint alleged nursing

n egligence without knowing which particular nurses were involved. According to Helen , th e individual nurses’ names were not available until the discovery phase of the federal litigation because t he patient medicalSCHIRMER v. AVALON, et al. Decision of the Court

7 records did not reveal whi ch nurses, if any, committed a negligent act , and Defendants concealed the Incident Fall Reports that would have provided th at information

. ¶19 Even if Helen did not know the individual nurses’ names until March 2016 , she was aware of alleged negligence by nu rsing “staff” in January 2015 based up on her expert’s opinion

. Thus
, by January 2015, Helen was o n notice to investigate and d etermine the names of the individual nurses she allege d were negligent. The discovery rule does not allow a party “to hide behind its ignorance when reasonable investigation would have alerted it to the claim.” E LM Ret

. Ctr. , LP v. Callaway
, 226 Ariz. 287, 290, ¶ 12 (App. 2010)

. A p laintiff ha s an affirmative duty of due dilig ence to investigate her potential claims. Id. ( citing Doe , 191 Ariz. at 324, ¶ 37 )

. ¶20 In response to Defendants’ summary judgment motion, Helen needed to show that in the exercise of reasonable diligence, she was unable to discover the nurses’ identities within the limitations period. See
, e.g. , Doe , 191 Ariz. at 3 23 , ¶¶ 32

- 33. Helen had Carl ’s “medical records,” but she did not learn that separate “ Fall In cident Reports ” existed until the discovery phase of the federal litigation. Helen contends Defendants concealed the Fall Incident Reports which prevented her from obtaining this information. However, these reports have never been disclosed

. ¶21 Knowledge of the existence of a claim does not necessarily require knowledge of the specific Defendants’ identities. Lawhon
, 159 Ariz. at 181

. Yet Helen knew of negligent conduct by at least a single nurse , and therefore, had a duty to investigate the iden tity of that person. E ven without the Fall Incident R eports, Helen discovered which witnesses to depose with in the fe deral litigation , including two of the nurses named in the 2017 complaint

. Having done so, Helen provid ed no reason why she could not have determined the names of the individual nurses before the limitations period expired. A nd a lthough i nformation contained with in the Fall Incident Reports wa s relevant, it wa s clearly not the only way Helen could have dete rmine d the nurses ’ names. Therefore, any concealment of these reports did not pre clude Helen from otherwise investigating or asserting her claims. As a matter of law, Helen had sufficient knowledge to determine the identity of the individual nurse s before the statute of limitations expired , but failed to do so. Helen’s window for a negligence claim against those nurses has closed.SCHIRMER v. AVALON, et al. Decision of the Court

8 III. When Helen Discovered She Had a Claim for the Independent Negligence of the Corporate Defendants and Administrators I s a Question of Fact

¶22 The superior court found Helen learned of the admin i strator s’ alleged negligence during the federal litigation and, therefore, should have raised this claim with in that case. Defendants contend Helen was aware , or should have been aware
, of these claims in January 2015 when her expert provided an opinion that the nursing staff was negligen t.

¶23 Helen’s claims against the corporate defendants and individual administrators we re based up on conduct distinct from the conduct giving rise to the nursing staff negligence claim

. Helen’s nursing expert addressed only nursing negligence and did not consider or suggest any negligence by the administrators or corporate defendants

. According
to Helen , she did not learn she also had a claim for the negligent

a dministrat ion of the Avalon facility until she took depositions with in the federal litigation and re tained an expert in nursing home adminis tration. Helen’s expert on nursing home admin istration stated that she learned facts giving rise to the claim s for the administrator’s ne gligence o nly after the depositions in the federal litigation. Only then did Helen learn the Avalon facility was understaffed, had insufficient equipment, and lacked a n assis tant director of nursing

. 3

¶24 Defendant s contend Helen knew of these claims at least by September 2015
, when she notified Defendants that she planned to depose the “ Director of Nursing ” and an “ Administrator” in the federal litigation

. The fact that Helen’s joint case management report listed the unnamed Director of Nursing and an Administrator does not establish , as a matter of law, that she knew or should have known sufficient facts giving rise to the claims for negligen t hiring a nd manageme nt

. In any event, Helen filed the 2017 complaint within two years of that date.

¶25 Defendant s also argue the 2017 complaint does not allege any

new facts supporting separate claims of “ administrat ive negligence .” However, the 2017 complaint contained new alleg ations that Defendants

3 Defendants contend Helen’s experts’ affidavits are deficient
, and, in any event, they fail to create a question of fact. As discussed above, the affidavit of the expert on nursing home administration raised a question o f fact whether Helen , in the exercise of reasonable diligence, could have discovered earlier the claim for negligent hiring and management

. Thus, a jury must decide this issue

. Defendant s can raise any objections to th e affidavit s they deem appropriate in the course of trial

.SCHIRMER v. AVALON, et al. Decision of the Court

9 were liable for the hiring and management of the ir employees and agents
, exercised control and management over the facility , and failed to “manage, control and/or administer” the facilit y as required by law , proximately causing Carl ’s death

. The 2017 complaint also alleged that Daudelin and Morris , as regional director and administrator respectively
, breached various dut ies owed to Carl

. Count Three alleged a violation of the APSA ( A.R.S. § 46

- 455 ) , and added specific allegations that Defendants consciously decided to “promote profits instead of providing the legally mandated care ” and violated the APSA by breaching the “aforementioned duties

. ” These allegati ons were not in the 2015 complaint.

¶26 Helen’s negligent hiring and management claims are based
up on the direct action or inaction of the corporate defendants and administrators

. As such , they are direct theories of liability and independent from any vicarious liability resulting from the principal

- agent relationship between the nurses and the corporate defendants

. See Kopp v. Physician Grp. of Ariz.
, Inc. , 244 Ariz. 439, 441

- 42, ¶¶ 11

- 12 (2018). Helen’s evidence is sufficient to create a fact ual question whe n she first knew or should have known of the facts giving rise to these claims. Therefore, summary judgment was improper.

¶27 Defendants again argue that Helen could have amended the 2015 complaint or filed a separate timely action upon learning facts to support the separate claims of negligen t hir in g and management

. The 2017 complaint purport s to do just that.

IV. Vicarious Liability

¶28 Because the negligence claims against the nurses are time

barred, t he corporate defendants cannot be found vicariously liable for th ose claims

. Chaney Bldg. Co. v. City of Tucson
, 148 Ariz. 571, 574 (1986) ( “In cases of derivative liability, a judgment or dismissal in favor of the servant relieves the master of liability.”)

. However, dismissal of the claims against the nurses does not require dismissal of the independent claims against t he corporate defendants or administrators for direct liability for any negligent hir ing and management

. Kopp , 244 Ariz. at 441

- 42, ¶ ¶ 11

- 12.

CONCLUSION

¶29 We affirm the dismissal of the claims against nurses McSwain, Pinkstaff, and Mader and the dismissal of the claims against the corporate defendants based up on the vicario us liability o f those defendants. We reverse the entry of summary judgment against administrators
, Daudelin, Morris, and Holmes and the corporate defendants for claims based up onSCHIRMER v. AVALON, et al. Decision of the Court

10 their direct liability for negligent hir ing and management. O n remand, a jury must determine when these claims accrued and whether Helen’s complaint was filed within the statute of limitations.