Court Opinion

ID: 4410936
Source: CourtListenerOpinion
Date Created: 2019-06-27 18:04:12.572907+00
Date Added: 2024-06-11T14:52:30.863285
License: Public Domain

FILED
                                                           Jun 27 2019, 1:46 pm

                                                               CLERK
                                                           Indiana Supreme Court
                                                              Court of Appeals
                                                                and Tax Court

                         IN THE

    Indiana Supreme Court
             Supreme Court Case No. 19S-CT-382

 Cynthia Morrison, individually and on behalf of
          Ernest Morrison, deceased,
                      Appellant (Plaintiff),

                              –v–

            Ricardo Vasquez, M.D., et al.
                     Appellee (Defendant).
_____________________________________________________________

   Indiana University Health Southern Indiana
                Physicians, Inc.,
                      et al.,
                    Appellants (Defendants),

                              –v–

                      Charlene Noel
                       Appellee (Plaintiff).

         Argued: March 14, 2019 | Decided: June 27, 2019
                       Appeal from the Marion Superior Court
                                No. 49D10-1712-CT-46774
                         The Honorable David J. Dreyer, Judge

                       Appeal from the Marion Superior Court
                                No. 49D07-1802-CT-7520
                        The Honorable Michael D. Keele, Judge
             On Petition to Transfer from the Indiana Court of Appeals
                                  No. 18A-CT-376
                                 No. 18A-CT-1299

                               Opinion by Justice David
             Chief Justice Rush, Justice Massa and Justice Goff concur.
                   Justice Slaughter dissents with separate opinion.

David, Justice.

    Both of the cases before us today present the same issue. That is,
whether for the purposes of determining preferred venue pursuant to
Trial Rule 75(A)(4), an organization with a location in the State of Indiana
is considered to have a “principal office” at the address of its registered
agent. Finding that a domestic organization’s actual principal office and
not the location of its registered agent is the appropriate preferred venue,
we affirm the trial court in Morrison and reverse the trial court in Noel.
Further, we hold that in light of new business corporation statutes, the
location of the registered agent no longer determines preferred venue for
either domestic or foreign corporations.

Facts and Procedural History
   In December 2017, Cynthia Morrison filed a complaint against various
defendants for medical malpractice in Marion County. Some of those
defendants filed a petition to transfer venue to Monroe County pursuant
to Indiana Trial Rule 75(A) arguing that Marion County does not meet the
preferred venue requirements. For her part, Morrison argued that Marion

Indiana Supreme Court | Case No. 19S-CT-382 | June 27, 2019               Page 2 of 9
County is a county of preferred venue because the registered agent of
Bloomington Hospital, one of the defendants, is in Marion County. The
trial court grant defendants’ motion to transfer venue from Marion
County, where IU Health has its registered agent, to Monroe County
where defendant has its actual principal place of business. The Court of
Appeals affirmed.

   In February 2018, Charlene Noel also filed a medical malpractice action
against several defendants in Marion County because the defendants’
registered agents are located there. Defendants then filed a motion to
transfer venue to Lawrence County where the alleged malpractice
occurred. Here the trial court denied defendants’ motion to transfer venue
to Lawrence County, where defendant has its actual principal place of
business, and instead, left the matter pending in Marion county, where IU
Health has its registered agent. The Court of Appeals affirmed.

  These two Court of Appeals opinions are in conflict with one another
and we write a consolidated opinion regarding both to clear up the
confusion.

Standard of Review
  Interpretation of our trial rules is a question of law that we review de
novo. State v. Holtsclaw, 977 N.E.2d 348, 349 (Ind. 2012).

Discussion
   Indiana Trial Rule 75(A) provides a list of preferred venues for
initiating a suit. One those is the “county where [ ] the principle office of a
defendant organization is located.” T.R. 75(A)(4). In 2006, this Court
issued an opinion in American Family Ins. Co. v. Ford Motor Co., 857 N.E.2d
971, 972 (Ind. 2006) determining, as a matter of first impression, that for
domestic or foreign corporations doing business in Indiana, the principle
office was its corporation’s registered office in Indiana. However, while
the introduction to the opinion discusses application of this rule to
domestic corporations, the rest of the opinion addresses only its

Indiana Supreme Court | Case No. 19S-CT-382 | June 27, 2019           Page 3 of 9
application to foreign entities. For instance, the opinion states: “we grant
transfer to attempt to clarify the venue rules applicable to suits against
foreign corporations. . .” Id. at 973. And further, the discussion of the
matter ends with: “We conclude that defendant Ford has a principal office
in the state for venue purposes. The same is true of all foreign
corporations qualified to do business in Indiana in compliance with the
Business Corporation Act.” Id. at 975. There’s no mention or analysis
with regard to domestic corporations aside from a brief mention of them
in the beginning of the opinion. Nevertheless, our Court of Appeals later
addressed this issue in CTB, Inc. v. Tunis, 95 N.E.3d 185, 189 (Ind. Ct. App.
2018) with regard to domestic corporations and relying on American
Family, applied the same rule, finding the registered agent address
provided the county of preferred venue.

   American Family and CTB were premised on business corporation law.
Specifically, Indiana Code section 23-1-24-1 (2014), required each
corporation to continuously maintain in Indiana a “registered office” and
“registered agent” whose business office was identical to the registered
office. However, effective January 1, 2018, that section was repealed and
new legislation promulgated. See 2017 Ind. Acts 813, 898. Under the new
legislation, “principal office” is defined as the “principal executive office
of an entity, whether or not the office is located in Indiana.” Ind. Code §
23-0.5-1.5-29. Also, instead of requiring a registered office and registered
agent with the same address, now entities doing business in Indiana are
required to “designate and maintain a registered agent in this state.” Ind.
Code § 23-0.5-4-1. Most notably, Indiana Code section 23-0.5-4-12
provides:

      The designation or maintenance in Indiana of a registered
      agent does not by itself create the basis for personal jurisdiction
      over the represented entity in Indiana. The address of the
      agent does not determine venue in an action or a proceeding
      involving the entity.

Indiana Supreme Court | Case No. 19S-CT-382 | June 27, 2019           Page 4 of 9
   The CTB panel acknowledged these revisions but declined to consider
their impact, as neither party before the court argued that the revisions
were applicable. CTB, 95 N.E.3d at 187.

   In Morrison, the Court of Appeals found that the revisions discussed
above came into play. That is, the court applied Indiana Code section 23-
0.5-4-12 which provides that “[t]he address of the agent does not
determine venue. . .” However, in Noel, the court found this statute
conflicted with American Family’s interpretation of Trial Rule 75 and
therefore, it determined the statute was a nullity and ineffective.

   Plaintiffs in both cases here argue that the rule set forth in American
Family/CTB means that in their suits, Marion County is the preferred
venue because that is where at least some of the defendants’ registered
agents are located. However, we decline to apply American Family to the
facts and circumstances of these cases. As discussed above, American
Family focused on foreign corporations. Because these corporations do not
have a principal place of business in this State, it makes sense to use the
office of the registered agent as a preferred venue. However, for domestic
corporations this rule makes little sense. As defendants aptly point out,
following this rule means that almost all corporations in Indiana would
fall under Marion County as the preferred venue because this is where
commonly used registered agent CT Corporation is located. CTB applied
the rule from American Family to both domestic and foreign corporations
without analysis about domestic corporations. Also, CTB’s registered
agent was in the same county as its physical office unlike the facts and
circumstances here. Thus, we decline to apply American Family or CTB to
the present cases, where the corporations at issue are domestic and the
registered agent is in a different county than the actual principal executive
office of the corporation.

   Further, we find that the new statutes are applicable to both foreign
and domestic corporations and that these statutes do not conflict with our
trial rules. Trial Rule 75(A)(4) does not state anything regarding a
registered agent; instead, it provides that the location of a “principal
office” is a preferred venue. It is the definition of “principle office” that
decides the outcome here. Pursuant to Indiana Code section 23-0.5-1.5-29,

Indiana Supreme Court | Case No. 19S-CT-382 | June 27, 2019          Page 5 of 9
a corporation’s principle office is no longer tied to the registered agent for
either domestic or a foreign corporations doing business in Indiana. Also,
Indiana Code section 23-0.5-4-12 provides that the registered agent
location does not determine venue. American Family was premised on
statutory provisions that were not simply amended to change
terminology: they have been completely repealed and replaced.
Accordingly, it is no longer controlling law.

   Morrison argues that Indiana Code section 23-0.5-4-12 is ineffective
because it is more stringent than the trial rules. Trial Rule 75(D) provides,
in relevant part:

      Any provision of these rules and any special or general statute
      relating to venue, the place of trial or the authority of the court
      to hear the case shall be subject to this rule, and the provisions
      of any statute fixing more stringent rules thereon shall be
      ineffective.

   However, what Morrison is really arguing is that the new statute is
more stringent than American Family’s interpretation of the prior statutes.
As discussed above, American Family did not analyze the prior statutes
with an eye towards domestic corporations and as such, even if the prior
statutes were not repealed and replaced, American Family does not apply
to domestic corporations. Additionally, the trial rules provide that
preferred venue lies (among other places), where the principle office of
defendant is. The statute does not preclude Morrison from filing in
Monroe County where that principle office is. Filing in Monroe County
rather than Marion County is consistent with the purpose of our venue
rules:

      Preferred venue is located in counties where information is
      readily available, where relevant land and personal property
      can be found, where witnesses can be easily brought to court,
      and where the litigants reside or hold office. Reliable preferred
      venue rules increase judicial efficiency because a judge can
      focus on the merits of a dispute rather than its relocation to a

Indiana Supreme Court | Case No. 19S-CT-382 | June 27, 2019            Page 6 of 9
       more convenient forum. Litigants likewise benefit from relative
       certainty about the preferred forum and from the savings in
       time and expense that such rules provide.

Randolph County v. Chamness, 879 N.E.2d 555, 557 (Ind. 2008). Neither
Morrison nor Noel live in Marion County, the events at the root of either
litigation did not occur there and the defendant healthcare corporations
are not located there. 1 The only tie to Marion county is the tie created by
the presence of the registered agent there. This tie has nothing to do with
the rationale for the preferred venue rules. The new statutes better define
principle office and provide for a preferred venue consistent with the
rationale for venue rules.

   Finally, Morrison also argues the new statutes are not applicable to her
because she filed her complaint prior to its enactment. She further argues
the statute is not retroactive. However, while Morrison may have filed her
complaint prior to the enactment, preferred venue was not determined by
the trial court until after enactment. 2 Additionally, even if we were to use
the date of filing, procedural statutes may be applied retroactively. Ind.
Bureau of Motor Vehicles v. Watson, 70 N.E.3d 380, 385 (Ind. Ct. App. 2017).
Here, the statutes related to the determination of venue are procedural in
nature. Procedural law is law that “prescribes the method of enforcing a
right or obtaining redress for invasion of that right.” Hayden v. State, 771
N.E.2d 100, 102 (Ind. Ct. App. 2002). By contrast, substantive law “creates,
defines and regulates rights.” Id. Here, the venue rules merely prescribe
the preferred location of filing. They do not deprive Morrison of a right to
seek damages from the defendants but only govern where she may seek
redress. Accordingly, the statute is procedural and applies to Morrison.

1In Morrison, one of the defendant physicians resides in Marion County, but works in Monroe
County. Trial Rule 75(A)(1) provides for preferred venue where the “greater percentage” of
individual defendants reside. Such is not the case here.
2 Morrison filed her complaint on December 1, 2017. Ind. Code section 23-0.5-4-12 became
effective January 1, 2018. See 2017 Ind. Acts 813, 898. Some of the defendants filed a motion to
transfer venue on January 17, 2019, and the court granted that motion on February 19, 2018.

Indiana Supreme Court | Case No. 19S-CT-382 | June 27, 2019                           Page 7 of 9
Conclusion
   We hold that a domestic organization’s actual principal office and not
the location of its registered agent is the appropriate preferred venue.
Further, we hold that in light of new business corporation statutes that
define “principal office” and provide that the registered agent’s location
does not determine venue, the location of the registered agent no longer
determines preferred venue for either domestic or foreign corporations.
We affirm the trial court in Morrison and reverse the trial court in Noel and
remand both for further proceedings.

Rush, C.J., Massa and Goff, JJ., concur.
Slaughter, J., dissents with separate opinion.

ATTORNEY FOR APPELLANT, CYNTHIA MORRISON

Mary A. Findling
Findling Park Conyers Woody & Sniderman, P.C.
Indianapolis, Indiana

ATTORNEYS FOR APPELLEES, RICARDO VASQUEZ, M.D. AND
VASCULAR CENTER & VEIN CLINIC OF SOUTHERN INDIANA

Karl L. Mulvaney
Nana Quay-Smith
Bingham Greenebaum Doll, LLP
Indianapolis, Indiana

David S. Strite
Rachel K. Dalton
O’Bryan Brown & Toner, PLLC
Louisville, Kentucky

Indiana Supreme Court | Case No. 19S-CT-382 | June 27, 2019          Page 8 of 9
ATTORNEYS FOR APPELLANTS, INDIANA UNIVERSITY HEALTH
SOUTHERN INDIANA PHYSICIANS, INC., SARAH WHITEMAN,
NP, AND CARLITO SABANDAL, M.D.

James L. Whitlatch
Kathryn DeWeese
Bunger & Robertson
Bloomington, Indiana

ATTORNEYS FOR APPELLEE, CHARLENE NOEL

Sara A. Langer
Steven L. Langer
Langer & Langer
Valparaiso, Indiana

ATTORNEYS FOR AMICUS CURIAE, INDIANA TRIAL LAWYERS
ASSOCIATION

David L. Farnbauch
Sweeney Law Firm
Fort Wayne, Indiana

Diana C. Bauer
Bauer Legal LLC
Fort Wayne, Indiana

Indiana Supreme Court | Case No. 19S-CT-382 | June 27, 2019   Page 9 of 9
Slaughter, J., dissenting.

   The Court holds that a defendant organization’s “principal office” for
preferred-venue purposes should be the county where it maintains its
headquarters, not where its registered agent is located. As a policy matter,
that outcome makes eminent sense to me, especially in light of recent
changes to Indiana’s business-organizations law. I am unable to join the
Court’s opinion, however, because the better way to effectuate that policy
change is by formally amending our trial rules and not reinterpreting
them by judicial fiat with retroactive application. But until that happens—
until we amend our rules to provide for such change—I would continue to
follow the understanding of “principal office” that has prevailed for
nearly fifty years. On this record, that means both plaintiffs should be able
to proceed with their respective suits in Marion County. Thus, I would
affirm the trial court in Noel and reverse in Morrison.

   Since 1970, litigants and lower courts have understood “principal
office” in Trial Rule 75 to refer to the location of a defendant
organization’s registered agent. Years later, we reinforced this
understanding in American Family Insurance Company v. Ford Motor
Company, 857 N.E.2d 971 (Ind. 2006), in holding that Ford’s principal office
for venue purposes is Marion County because that is where its registered
agent is located. Despite this longstanding application, the Court today
reverses course. It says that American Family applied only to foreign
corporations, as if “principal office” in Rule 75 means one thing for a
domestic organization and something else for a foreign organization. That
conclusion finds no support in the text of Rule 75 and is contrary to both
the rationale of American Family and the opinion’s opening words: “We
hold that the term ‘principal office’ as used in subsections (4) and (10) of
Trial Rule 75(A) refers to a domestic or foreign corporation’s registered
office in Indiana.” Id. at 972 (emphasis added).

   Nothing in Rule 75 compels today’s decision. The rule nowhere says
“principal office” means something different depending on an
organization’s foreign or domestic status. What prompts today’s about-
face, rather, is a 2018 legislative change that now defines “principal office”
to refer to an organization’s “principal executive office”. Ind. Code § 23-
0.5-1.5-29. Elsewhere, the statute purports to dictate to us that the address
of an organization’s registered agent “does not determine venue in an
action or a proceeding involving the [organization].” Id. § 23-0.5-4-12.

   As we have long held, our rules governing the practice and procedure
in our courts prevail over any conflicting statute. “On matters of
procedure, to the extent a statute is at odds with our rule, the rule
governs.” Garner v. Kempf, 93 N.E.3d 1091, 1099 (Ind. 2018) (citation
omitted). The Court acknowledges that the disputed venue statutes here
are “procedural in nature.” But it nevertheless concludes that these
statutes somehow “do not conflict with our trial rules.” The conflict is self-
evident. Our longstanding interpretation of “principal office” refers to the
registered agent’s location, which on this record is Marion County for
both plaintiffs. The statutes, however, purport to dictate the opposite
result—that Marion County is not a county of preferred venue for either
plaintiff because, according to the statute, “[t]he address of the
[registered] agent does not determine venue in an action or a proceeding”
involving an organization. I.C. § 23-0.5-4-12. These irreconcilable results
mean the statutes must yield to our rule. I would apply Rule 75 as it has
long been understood and hold that Marion County—where IU Health’s
registered agent is located—is a preferred venue in both Noel and
Morrison.

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