Justices: patient fund not entitled to set-off

The Indiana Supreme Court has affirmed a $1 million excess damages award from the Indiana Patient’s Compensation Fund to the estate of a man who died following a truck accident, determining the fund is not entitled to a reduction of the award to account for the 20 percent chance the man would have died even without the doctor’s negligence.

In Indiana Dept. of Insurance, Indiana Patient's Compensation Fund v. Robin Everhart, Personal Rep. of the Estate of James K. Everhart, Jr., No. 84S01-1105-CV-282, James Everhart was riding his motorcycle when he was hit by a semi-truck driven by an employee of Standard Forwarding Co. Inc. Everhart was alive when he was taken to the hospital, but later died of cardiac arrest while in the care of Dr. C. Bilston Clarke, the doctor in the emergency room.

James Everhart’s wife, Robin, filed a wrongful death lawsuit, and the truck driver and Standard Forwarding settled for $1.9 million. Clarke settled for a lump-sum and future payments with a total present value of $187,001. Robin Everhart added a claim against the Patient’s Compensation Fund to recover the excess damages above her settlement with Clarke.

It was determined that James Everhart would have had an 80 percent chance of surviving his injuries had he received proper medical care. The estate was awarded $3.15 million, which the trial court refused to reduce by 20 percent, as the fund argued. The trial court awarded the estate the remaining $1 million of the statutory cap.

The Indiana Court of Appeals reversed based on the line of Mayhue cases and remanded for further proceedings.

The justices affirmed the trial court, looking at Cahoon v. Cummings, 734 N.E.2d 535 (Ind. 2000), in which the high court held that a successful Mayhue claim for causing an increased risk of harm entitled a plaintiff to damages in proportion to that increased risk. But all of the decisions in the Mayhue line of cases involved patients who stood a 50 percent or worse chance of recovering before suffering the medical negligence, wrote Chief Justice Randall T. Shepard.

But Cahoon doesn’t apply to cases in which a plaintiff stood a better-than-even chance of recovering before suffering some form of medical negligence. In addition, Robin Everhart’s case differs from the Mayhue line of cases in that joint tortfeasors negligently caused James Everhart an indivisible harm.

“That latter distinguishing fact triggers our rules on joint and several liability, which make it unnecessary for us to decide today whether to extend Cahoon to better-than-even cases,” he wrote.

The justices decided the rule for calculating set-offs could decide the instant matter, and it found that even if Cahoon required a reduction of the award, the fund would still have to pay the statutory maximum in excess damages. The trial court found that Robin Everhart and her son suffered injuries of at least $3.15 million, so the trial court should have reduced its finding on total injuries by $1.9 million because of the Standard Forwarding settlement and $250,000 for the settlement with Clark’s insurance company. The result: $1 million in uncompensated damages, the exact statutory limit of the fund’s liability for excess damages, wrote Shepard.

“Reducing the finding on injuries by twenty percent and then subtracting the full $1.9 million from the remainder, and then another $250,000, as the PCF asks, effectively ignores that Standard Forwarding, not Robin and Troy, should bear the remaining loss,” he wrote.