Court Opinion

ID: 9897603
Source: CourtListenerOpinion
Date Created: 2023-11-14 19:18:38.647174+00
Date Added: 2024-06-11T09:15:54.745127
License: Public Domain

07/20/2023
                    IN THE SUPREME COURT OF TENNESSEE
                               AT NASHVILLE
                                       April 6, 2022 Session

     BEVERLY GARDNER v. SAINT THOMAS MIDTOWN HOSPITAL

                      Appeal by Permission from the Court of Appeals
                            Circuit Court for Davidson County
                      No. 17C2226       Joseph P. Binkley, Jr., Judge
                         ___________________________________

                                No. M2019-02237-SC-R11-CV
                           ___________________________________

JEFFREY S. BIVINS, J., delivered the opinion of the Court with respect to part II(A), in which
ROGER A. PAGE, C.J., and SHARON G. LEE, J., join, and an opinion dissenting in part, in
which ROGER A. PAGE, C.J., joins.

       This appeal presents issues similar to those in Ultsch v. HTI Memorial Hospital
Corp., No. M2020-00341-SC-R11-CV, ___ S.W.3d ___ (Tenn. 2023). In that case, I
dissented from the result reached by a majority of the Court, which held that provisions of
the statutory scheme commonly referred to as the Health Care Liability Act (“HCLA”)
abrogated the common law vicarious liability principle known as the operation-of-law
exception. I reach the same conclusion here and respectfully dissent from the result
reached by the majority in this case.

                             I. FACTUAL AND LEGAL BACKGROUND

       On April 25, 2017, Beverly Gardner (“the Plaintiff”) sent pre-suit notice of a
potential health care liability claim to Saint Thomas Midtown Hospital (“the Defendant”).
See Tenn. Code Ann. § 29-26-121(a)(1) (2012 & Supp. 2022). The Plaintiff allegedly
suffered injuries as a result of a May 8, 2016 surgery. The Plaintiff did not send pre-suit
notice to any of the Defendant’s employees or agents. On September 5, 2017, the Plaintiff
filed a health care liability action solely against the Defendant, alleging that the
Defendant—acting through its employees and/or agents—was negligent in its care and
treatment of her.1 After the Defendant answered and the parties engaged in discovery, the
Defendant filed a motion for summary judgment. As the basis for its motion, the Defendant
contended that the Plaintiff’s vicarious liability claim against it failed as a matter of law

        1
         As the case proceeded, a question arose as to whether the individuals specifically alleged to have
been negligent were actual employees and/or agents of the Defendant. Thereafter, the Plaintiff amended
her complaint such that references to the Defendant’s employees and/or agents were supplemented with the
phrase “actual or apparent.”
because any health care liability claims against the Defendant’s alleged employees and/or
agents were barred by the applicable statute of limitations before the Plaintiff filed suit.

        The trial court found that the one-year statute of limitations applicable to health care
liability claims against the Defendant’s alleged employees and/or agents began to run on
the date of the surgery and, thus, had expired by the time the Plaintiff filed suit. See Tenn.
Code Ann. §§ 28-3-104(a)(1) (2017), 29-26-116(a)(1) (2012). As a result, the trial court
determined that any health care liability claims against the alleged employees and/or agents
were procedurally barred by operation of law, that is, by the expiration of the statute of
limitations. Accordingly, the trial court concluded that the Plaintiff was precluded from
pursuing a vicarious liability claim against the Defendant. See Abshure v. Methodist
Healthcare-Memphis Hosps., 325 S.W.3d 98, 110 (Tenn. 2010). As a result, the trial court
granted the Defendant’s motion for summary judgment. The Court of Appeals reversed
the trial court’s judgment for the same reasons it did so in Ultsch. Gardner v. Saint Thomas
Midtown Hosp., No. M2019-02237-COA-R3-CV, 2021 WL 1235226, at *1, 7 (Tenn. Ct.
App. Apr. 1, 2021) (concluding that provisions of the HCLA conflicted with and prevailed
over the common law operation-of-law exception), perm. app. granted, (Tenn. Sept. 24,
2021). The Defendant’s appeal is now before this Court.

                                        II. ANALYSIS

       Like Ultsch, this appeal involves an exception to the general common law rule that
a plaintiff ordinarily may sue a principal based on its vicarious liability for the tortious
conduct of its agents without suing the agent. The relevant principle in this case, known
as the operation-of-law exception, provides that a plaintiff may not proceed solely against
a principal based on vicarious liability for the conduct of an agent “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.” Abshure, 325 S.W.3d at 106; see
also Creech v. Addington, 281 S.W.3d 363, 366 (Tenn. 2009). As in Ultsch, a majority of
the Court here concludes that the common law principle must yield to certain provisions
of the HCLA. I respectfully disagree.

  A. Application of the Operation-of-Law Exception Precludes the Plaintiff’s Vicarious
                                     Liability Claim

       At the time the Plaintiff filed suit, the General Assembly had enacted a series of
provisions—the HCLA—that apply to what are now known as health care liability actions.
Through the HCLA, the General Assembly placed limitations on a potential plaintiff’s
claim in a health care liability action. The HCLA altered the common law with regard to
what were formerly known as medical malpractice actions, establishing certain primarily
procedural requirements specific to health care liability actions. In particular, pursuant to
the HCLA, persons wishing to pursue a health care liability action must provide pre-suit
                                             -2-
notice of their potential claim and wait a certain period before initiating suit, but they need
provide notice only to “each health care provider that will be a named defendant.” Tenn.
Code Ann. § 29-26-121(a)(1). Upon compliance with the pre-suit notice requirement, “the
applicable statutes of limitations and repose shall be extended for a period of one hundred
twenty (120) days from the date of expiration of the statute of limitations and statute of
repose applicable to that provider.” Id. § 29-26-121(c) (2012 & Supp. 2022). The statute
of limitations in a health care liability action generally is one year from the date the cause
of action accrued. Id. §§ 28-3-104(a)(1), 29-26-116(a)(1).

        Because Tennessee is a common law state, see Hodge v. Craig, 382 S.W.3d 325,
337 (Tenn. 2012), certain principles pertinent to vicarious liability developed over the
course of time before the enactment of the HCLA. Among them is a general rule that
ordinarily “a plaintiff may sue a principal based on its vicarious liability for the tortious
conduct of its agents without suing the agent.” Abshure, 325 S.W.3d at 105. There are,
however, exceptions to the general rule. At issue in this appeal is the one known as the
operation-of-law exception, which provides that a plaintiff may not proceed solely against
a principal based on its vicarious liability for the conduct of an agent “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.” Id.; see also Creech, 281 S.W.3d
at 366.

        In this case, the Plaintiff sent pre-suit notice to the Defendant but not to the
Defendant’s alleged employees and/or agents. Thus, the Plaintiff did not trigger the
extension of the one-year statute of limitations as to health care liability claims against
those employees and/or agents. See Tenn. Code Ann. § 29-26-121(c). The Plaintiff later
filed a health care liability action solely against the Defendant that alleged vicarious
liability, but only after the expiration of the statute of limitations as to any health care
liability claims against the Defendant’s employees and/or agents. Thus, at the time the
Plaintiff filed suit against the Defendant, any health care liability claims against the
Defendant’s employees and/or agents were procedurally barred by operation of law
because the one-year statute of limitations had expired. See JRS Partners, GP v. Leech
Tishman Fuscaldo & Lampl, LLC, No. 3:19-CV-00469, 2020 WL 5877131, at *15 (M.D.
Tenn. Oct. 2, 2020); Smith v. Holston Med. Grp., PC, No 2:12-CV-72, 2013 WL
11478937, at *3–4 (E.D. Tenn. June 20, 2013). Accordingly, the operation-of-law
exception precluded the Plaintiff from asserting a health care liability claim against the
Defendant based on vicarious liability, see Abshure, 325 S.W.3d at 106; Creech, 281
S.W.3d at 366, unless the exception conflicts with the HCLA.

        The facts of this case differ somewhat from our precedents cited above. Creech
involved a belated effort to amend a complaint when the plaintiff did not assert vicarious
liability upon first filing suit. We rejected liability as to the principal on the plaintiff’s
amended complaint that added the vicarious liability claim after any claim as to the agents
                                            -3-
was barred by operation of law, in that case by the doctrine of res judicata. Creech, 281
S.W.3d at 371, 376, 383. In Abshure, the plaintiffs filed a proper vicarious liability claim
against the principal before their claims against the agent were barred by operation of law.
Abshure, 325 S.W.3d at 112. Because the plaintiffs timely alleged vicarious liability before
medical malpractice claims against the agent were barred by the statute of repose, we
allowed the vicarious liability claim to proceed. Id. at 101–02, 102 n.3, 112. Unlike
Creech, the Plaintiff here alleged vicarious liability in the initial complaint rather than
attempting to add the claim after having initially omitted it. Unlike Abshure, the Plaintiff
here did not file suit before health care liability claims against the Defendant’s alleged
employees and/or agents were barred by operation of law. Regardless, the key principle
from our precedents is that the operation-of-law “limitation arises when the plaintiff
attempts to assert a vicarious liability claim against the principal after its right to assert a
claim against the agent has become procedurally barred.” Id. at 110. The Plaintiff here
did just that, asserting a vicarious liability claim against the principal after its right to assert
a claim against the alleged agents was procedurally barred by the statute of limitations.
Accordingly, the trial court correctly determined that the operation-of-law exception
precluded the Plaintiff’s vicarious liability claim against the Defendant, unless the
exception conflicts with the provisions of the HCLA.

          B. The Operation-of-Law Exception Does Not Conflict with the HCLA

        A majority of the Court concludes that application of the operation-of-law exception
in this case would directly conflict with and essentially nullify provisions of the HCLA,
and the common law principle therefore must yield to the statute. See, e.g., Graves v. Ill.
Cent. R.R. Co., 148 S.W. 239, 242 (Tenn. 1912) (stating that “[w]hen there is a conflict
between the common law and a statute, the provision of the statute must prevail”). As
explained in more detail in my dissenting opinion in Ultsch, I respectfully disagree with
the majority.

        Because the HCLA, at least to some extent, is in derogation of the common law,
this Court must construe it strictly and confine it to its express terms. See Shore v. Maple
Lane Farms, LLC, 411 S.W.3d 405, 423 (Tenn. 2013); Houghton v. Aramark Educ. Res.,
Inc., 90 S.W.3d 676, 679 (Tenn. 2002). Thus, this Court should not construe the HCLA to
displace the common law any further than the legislation expressly declares or necessarily
implies. See Shore, 411 S.W.3d at 423; Seals v. H & F, Inc., 301 S.W.3d 237, 257 (Tenn.
2010) (Koch, J., concurring in part and dissenting in part); In re Deskins’ Estates, 381
S.W.2d 921, 922 (Tenn. 1964). There is no contention that the HCLA expressly abrogates
the common law principle that it is improper to permit a plaintiff to proceed solely against
a principal based on vicarious liability “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.” Abshure, 325 S.W.3d at 105. Thus, if the HCLA is to displace

                                               -4-
the operation-of-law exception, it must be by necessary implication. Unlike the majority,
I cannot conclude that it does so.

        A necessary implication is not derived from mere consistency or compatibility with
the legislation. Rather, a necessary implication is “one that is so strong in its probability
that the contrary thereof cannot reasonably be supposed.” Norman J. Singer & J.D.
Shambie Singer, Sutherland Statutes and Statutory Construction § 55:3 (7th ed. 2012). In
my view, that standard is not met here, because the common law principle and the statutory
provisions can coexist, in that a plaintiff can comply with both. Because the two can
coexist, it is not unreasonable to conclude that the General Assembly, when enacting the
HCLA provisions, did not intend to abrogate the operation-of-law exception.2 See Chelsea
Hous. Auth. v. McLaughlin, 125 N.E.3d 711, 721 (Mass. 2019) (stating that a statute
abrogates a common law principle by necessary implication when the principle “is so
repugnant to and inconsistent with the statute that both cannot stand”). Accordingly, I do
not believe that the Plaintiff has carried the burden of demonstrating abrogation by
necessary implication.3 I would hold that the common law principle does not conflict with
the HCLA, and, therefore, the legislation left the common law principle in place just as it
was before its enactment. See, e.g., Lavin v. Jordon, 16 S.W.3d 362, 368 (Tenn. 2000)
(stating that when common law principles are not in conflict with a statute, the legislation
“leaves the law as it was before its enactment”).

                                         III. CONCLUSION

       As in Ultsch, the Plaintiff here filed suit solely against the Defendant—alleging
vicarious liability—after any health care liability claims against the Defendant’s employees
and/or agents were procedurally barred by the applicable statute of limitations.
Accordingly, I would hold that the trial court correctly granted the Defendant summary
judgment based on application of the operation-of-law exception. I cannot join the
majority’s conclusion that the enactment of the HCLA displaced the operation-of-law
exception under the circumstances of this case. Accordingly, I respectfully dissent from
the result reached by a majority of this Court.

                                                        _________________________________
                                                        JEFFREY S. BIVINS, JUSTICE

        2
         The majority states that this Court has never adopted a “cannot coexist” standard. However, the
majority does not indicate that the language is inconsistent with the high bar required for abrogation by
necessary implication.
        3
          The party contending that legislation changed the common law bears the burden of showing that
the legislature intended such a change. Tome v. United States, 513 U.S. 150, 163 (1995).
                                                  -5-