Bonnie C. Coleman | Hodges & Davis Law Firm Northwest Indiana

In 1999, the Indiana Supreme Court first held that a hospital may be held liable under agency law for the tortious conduct of an independent contractor, when the independent contractor was not an employee.  Sword v. NKC Hospitals, Inc. 714 NE 2d 142 (Ind. 1999). In Sword, a patient sought medical services at a hospital for the birth of her child, thereafter suffering injuries due to an anesthesiologist’s negligence in administering an epidural.  Previously, Indiana courts held that since a hospital couldn’t practice medicine, it was not liable for the acts of independent contractors who were not employees.  However, the Indiana Supreme Court changed that precedent in Sword when it held that a hospital could be held liable, under agency theory, for the acts of a physician, even though he was an independent contractor.  The question to be asked was not whether an employment relationship existed, but rather “Would a reasonable person conclude under the facts and surrounding circumstances that the independent contractor was either an employee or an agent of the hospital?” 

After Sword, it had generally been presumed that in order for a hospital to be vicariously liable, the negligent actor must have some sort of employment, contractual or other legal relationship with the hospital.  Also, the ruling was generally thought to apply only to hospitals and not to other medical care providers.

Recently, the Indiana Supreme Court issued two rulings expanding the scope of vicarious liability in the health care arena.  The first of the two cases involved a patient’s claim against an MRI facility, alleging that the MRI facility should be held vicariously liable for the negligent acts of its independent contractor radiologist.  Arrendale v. American Imaging & MRI, LLC et. al., No. 21S-CT-370 (Ind. March 24, 2022).The MRI facility argued that it could not be held liable for the acts of the independent contractor radiologist because Sword did not extend the theory of vicarious liability to an outpatient diagnostic center, since it wasn’t a hospital that provides full service medical care.  The Indiana Supreme Court disagreed, finding that since the ruling in Sword, health care delivery had changed markedly, with many more services being performed in outpatient settings; and that both the Federal District Court and the 7th Circuit Court of Appeals had applied Sword to non-hospital medical entities.  The Court further remarked that many states applied vicarious liability to non-hospital entities in similar situations.  The case was remanded to the trial court for a determination as to whether an agency relationship existed between the MRI facility and the radiologist under the rationale in Sword.

In a companion case, the Indiana Supreme Court considered whether the agency relationship would only be found if a formal contractual or legal relationship existed between an Orthopedic Physician and a physical therapist.  Wilson v. Anonymous Defendant 1, Supreme Court case no. 21S-CT-371 (Ind. March 24, 2022).In Wilson, a patient received orthopedic services from a Physician, who sent him to a Physical Therapy Rehab Group located on the 2nd floor of the Physician’s office building.  In addition to the referral to the PT Group, the Physician provided other written information to the patient that referred to physical therapy services as being offered by a department, and the records and billing appeared to have come from the Physician.  As a result of the referral, the Patient was seen by a Physical Therapist of the PT Group, who performed a procedure on the patient, causing injury.  The Physician argued that there was no vicarious liability resulting from the Physical Therapist’s negligence because there was no contractual agreement or legal relationship between the Physician and the Physical Therapist or the PT Group.  The Indiana Supreme Court held that despite the potential lack of a contractual or legal relationship between the Physician and the Physical Therapist, the Physician may be held vicariously liable for the negligent acts of the Physical Therapist if communications to the Patient would lead the Patient to believe that there was an agency relationship.  A medical care provider, according to the Court, will not be allowed to avoid vicarious liability when the lack of an agency relationship is not readily apparent to the average health care consumer.  The matter was remanded to the trial court to determine if there was evidence of an apparent agency relationship.

In broadening the law to these circumstances, the Indiana Supreme Court has taken a much harsher approach toward health care providers who attempt to avoid liability for the acts of others that it has promoted.  In order to avoid the risk of vicarious liability, health care providers should be clear to disclose, when making referrals, that no agency relationship exists.  A lack of proper disclosure that could mislead a patient into assuming otherwise could likely be problematic.

Please note that this post is only a brief summary of the law as it relates to vicarious liability in the medical field and does not constitute legal advice nor does it establish an attorney/client relationship.  Should you have specific questions regarding the above, please contact Bonnie C. Coleman at Hodges and Davis, P.C.

Shawn D. Cox | Hodges & Davis Law Firm Northwest Indiana

The Small Business Reorganization Act of 2019 (the “SBRA”) became effective on February 19, 2020. The SBRA streamlined the Chapter 11 process through a new Subchapter V of Chapter 11. Notable benefits to debtors of a Subchapter V reorganization under the SBRA are an expedited plan confirmation process and the elimination of a creditor’s committee. Most importantly, it is not necessary to obtain plan approval from an impaired class of creditors, provided that the bankruptcy court determines that the plan is “fair and equitable” to each impaired class.

As enacted, the SBRA conditioned eligibility for a small business bankruptcy under Subchapter V on an aggregate secured and unsecured debt ceiling of $2,725,625.00. As part of the Coronavirus Aid, Relief and Economic Security Act (the “CARES Act”), that amount was increased to $7,500,00.00. This increase allowed heavily leveraged entities and business owners, as well as entities financing property of significant value, to benefit from the newly enacted provisions of the SRBA during a period of unprecedented economic disruption for many segments of our economy.

Although the CARES Act provisions were originally set to expire on March 27, 2021, the Covid-19 Bankruptcy Relief Extension Act of 2021 extended the increased debt ceiling for another year. Although proponents of bankruptcy reform in Congress have introduced legislation to permanently increase the Subchapter V debt limit, the increased debt limit reverted to its original ceiling on March 27, 2022, subject to adjustments for inflation.

Several temporary amendments to the Bankruptcy Code related to commercial leases will remain in effect for Subchapter V cases through December 27, 2022. Under the Consolidated Appropriations Act of 2021 (the “CAA”), Subchapter V debtors who can show a financial hardship as a result of COVID-19 can, with court approval, postpone the initial payment of rent upon the filing of a case for 120 days, which is 60 days more than generally provided by Section 365(d)(3) of the Bankruptcy Code. Although the rent must be repaid as an administrative expense, some courts may allow deferral until after confirmation of the Subchapter V plan of reorganization. Further, under the CAA amendments, a debtor may take up to 300 days (an increase of 90 days from the generally available 210 days) to determine whether to accept or reject its commercial lease. While most of the CAA amendments favor a debtor/tenant, the CAA also protects certain pre-bankruptcy payments of deferred rent from “clawback” as bankruptcy preferences.

On March 14, 2022, Senator Chuck Grassley introduced, with bipartisan support, the “Bankruptcy Threshold Adjustment Technical Corrections Act,” which sought to permanently reinstate the $7.5 million debt limit for Subchapter V. The Act also seeks to increase the Chapter 13 eligibility debt ceiling to an aggregate sum of $2,750,000. The Senate passed the Act on April 7, 2022 with an amendment that would cause the increased Subchapter V threshold to once again sunset two years after enactment. The bill is now before the House. 

Chapter 11 reorganizations have generally been cost-prohibitive for business debtors, and have required the cooperation of secured creditors and landlords to be successful. Subchapter V created a framework that sought to level the playing field, and the CARES Act and CAA amendments further expanded the opportunities for expedited reorganizations.  Although Subchapter V is currently (and perhaps only temporarily) available to fewer small businesses and business owners, businesses, their owners, as well as their advisors, should continue to consider the possible benefits of bankruptcy in this time of economic uncertainty.

This Article is a brief summary of recent changes to Chapter 11 of the Bankruptcy Code, including the temporary amendments to the SRBA included in the CARES Act and CAA, as well as related pending legislation. The information provided in this article does not constitute legal advice nor does it establish an attorney/client relationship. Should you have any questions regarding this article, please contact Hodges and Davis attorney Shawn Cox.

Gregory A. Sobkowski | Hodges & Davis Law Firm Northwest Indiana

Nonprofit board members can become subject to personal liability in a number of ways.  A director may be subject to liability for a breach of the duty of care, the duty of loyalty or the duty of obedience.  In addition, board members may become liable to third parties resulting from the director’s involvement in contributing to some harm sustained by a third party.  Finally, a director may also be exposed to liability under various federal and state statutes applicable to the corporation on whose board they serve.  Fortunately, there are protections against potential liability.

Under I.C. § 34-30-4-1, a qualified director is immune from civil liability arising from the negligent performance of the director’s duties.  Director means an individual who serves without compensation for personal services as a director for purposes of setting policy, controlling or otherwise overseeing the activities or functional responsibilities of a nonprofit corporation operating for charitable, educational, religious or scientific purposes.  Compensation does not include payments to reimburse the expenses of a qualified director and for per diem.

Under the Indiana Nonprofit Corporation Act, a director is not liable for an action taken as a director or for failing to take an action unless the director has breached or failed to perform the duties of the director’s office in compliance with the duty of care and the breach or failure to perform constitutes willful misconduct or recklessness.  Under this provision, a director would not be liable for his or her mere negligence.

The Indiana Nonprofit Corporation Act also provides that, unless otherwise limited by the corporation’s Articles of Incorporation, a nonprofit corporation shall indemnify a director who is wholly successful in the defense of a proceeding to which the director was a party, because the director is or was a director of the Corporation against reasonable expenses actually incurred by the director in connection with the proceeding.  Expenses for purposes of this indemnification obligation includes attorney’s fees.  In general, a director qualifies for indemnification, if the director’s conduct was in good faith, and the director reasonably believed his or her actions were in the best interest of the corporation.  The indemnification provided for in the Nonprofit Corporation Act does not exclude other rights to indemnification under the corporation’s Articles of Incorporation, Bylaws, resolution or other policy of the board of directors.  Many nonprofit corporations may not have sufficient assets to fund their indemnification obligations to their directors.  Therefore, it is important that a nonprofit corporation obtain insurance to cover the liability for wrongful acts committed by directors and officers.


Laura B. Frost | Hodges & Davis Law Firm Northwest Indiana

A governmental entity in Indiana has a general duty to exercise reasonable care and diligence to keep its public roads and sidewalks in a reasonably safe condition for travel.  As a result, a city or town, for example, can be held liable if it negligently fails to take appropriate precautions, such as warning of hazardous road conditions or temporarily closing roads, to prevent injury to persons using the roadways.  However, under Ind. Cod. § 34-13-3-3(3), a provision of the Indiana Tort Claims Act, a governmental entity is not liable for a loss or injury if it is caused by a temporary condition of a roadway that results from weather.  The Indiana Supreme Court’s recent decision in Ladra v. State, 177 N.E.3d 412 (Ind. 2021), narrowed the scope of immunity granted to governmental entities for temporary weather-induced road conditions under this provision.  Under the new, modified rule, a governmental entity is not immune from liability under the Tort Claims Act if it is aware of a recurring dangerous condition that occurs during inclement weather conditions and fails to rectify it.   

Since 2002, the scope of immunity granted to governmental entities under Ind. Code § 34-14-3-3(3) for injuries resulting from temporary road conditions caused by weather had been governed by the Indiana Supreme Court’s ruling in Catt v. Bd. of Comm’rs, 779 N.E.2d 1 (Ind. 2002).  Under Catt, immunity under the statute required two things:  a road condition that is temporary and a road condition that is caused by weather.  Further, under Catt, the question of whether a condition is “temporary” focused only on the particular condition that caused the loss or injury in question.  In Catt, the plaintiff was injured when his car skidded on mud and crashed into a ditch that had formed in the middle of a roadway after a culvert had been washed out during a rainstorm.  The plaintiff presented evidence that the culvert in that location had been washed out during rainstorms and replaced on multiple prior occasions.  However, the Catt court held that the government’s knowledge of the frequency with which the culvert had washed out in the past was irrelevant.  What mattered was whether the government had prior knowledge that the culvert had washed out on this particular occasion.  Finding that the government had no such knowledge prior to the plaintiff’s crash, the Catt court held that the government was immune from liability under the Indiana Tort Claims Act.

In the Ladra case, the Indiana Supreme Court re-examined and modified the rule under the Catt decision by holding that when a governmental entity knows of an existing defect in a public thoroughfare and has had ample opportunity to respond, immunity does not apply under the Tort Claims Act simply because the defect manifests itself during recurring inclement weather.  In Ladra, the plaintiff was injured when her car crashed after hydroplaning on a flooded area of Interstate 94.  The plaintiff presented evidence that this particular area of the highway had a history of consistent flooding after heavy downpours and that INDOT had on multiple prior occasions been required to unclog drains along the interstate to clear the highway of flooding.  The trial court had granted summary judgment to INDOT which the Court of Appeals affirmed, finding that INDOT was immune from liability under the Tort Claims Act since, although INDOT had knowledge of prior incidents of flooding, there was no evidence that INDOT had prior knowledge of the specific flooding occurrence that led to the plaintiff’s accident.  In reversing the grant of summary judgment, the Supreme Court reasoned that the rule under the Catt decision essentially required a plaintiff to prove the impossible:  that a governmental entity knew of a particular weather condition before it occurred and failed to remedy it.  The Court further reasoned that granting immunity when a governmental entity negligently fails to remedy a known defect that only manifests during a temporary, but recurring, weather condition effectively permits the governmental entity carte blanche to act without the reasonable care required under the circumstances, and imposes substantial hardship on those injured by the government’s negligence.  The Court concluded that the Catt rule was overbroad, in that it resulted in granting immunity regardless of governmental negligence or prior knowledge if the loss also resulted from a temporary weather condition.  Applying the new, modified rule, the Court concluded that even though INDOT did not have prior knowledge that the highway was flooded on the night of the plaintiff’s crash, INDOT was not immune from liability under the Tort Claims Act because there was evidence that the roadway flooding resulted from INDOT’s failure to fix drains in the area that INDOT was aware consistently became clogged and resulted in roadway flooding during inclement weather.

In light of the Court’s ruling in Ladra, governmental entities in Indiana may face an increase in claims by plaintiffs injured on public roadways during adverse weather events.  

Gregory A. Sobkowski | Hodges & Davis Law Firm Northwest Indiana

Serving on the board of a non-profit corporation can be a very rewarding and fulfilling experience.  It is, however, important to understand the obligations which come with that service.  These obligations can be summed up by the three primary duties of a director of a non-profit corporation; the duty of care, the duty of loyalty, and the duty of obedience.  This article will examine the elements of each of these duties.  

Duty of Care.  The duty of care requires a director to discharge his or her duties in good faith, with the care an ordinarily prudent person in a like position would exercise under similar circumstances and in a manner the director reasonably believes to be in the best of interest of the corporation.  This duty is codified in Indiana’s Non-Profit Corporation Act.  At a minimum, this duty requires a director to become informed in preparation for participating in the decision-making process at board meetings.  In discharging directors’ duties, the director may rely on information, opinions, reports or statements including financial information prepared or presented by:  

(1) an officer or employee of the corporation who the director reasonably believes to be reliable and competent in the matters presented;

(2) by a qualified professional such as legal counsel or a CPA who the director reasonably believes to be reliable and competent in the matters presented; and

(3) a committee of the board of which the director is not a member if the director reasonably believes the committee merits confidence.

A director does not act in good faith if the director has knowledge concerning an issue which makes reliance on the information described above unwarranted.

Duty of Loyalty.  The duty of loyalty requires that a director place the interests of the corporation above his or her own personal interest, particularly when the potential for conflict arises.  Avoiding conflicts of interest and disclosing them when they arise are both important aspects of the duty of loyalty.  In order to ensure enforcement of the duty of loyalty, non-profit corporations should adopt conflict of interest policies for their officers and directors.  The goal of conflict of interest policies should be full disclosure of any duality of interest or possible conflict of interest that a director may have with the corporation.  Any director who has a business relationship which impacts upon a matter before the corporation’s board should not vote or exert personal influence on the outcome of the matter.  Finally, as part of the duty of loyalty, a director should not appropriate to his or her own use a business opportunity that belongs to the corporation.

Duty of Obedience.  The duty of obedience requires directors to make decisions and take actions which are consistent with the stated objectives of the corporation and the rules and regulations applicable to the corporation.  This duty requires a director to be familiar with the objectives of the corporation as well as the rules and regulations governing the corporation and to abide by them.  

Before agreeing to serve as a director of a non-profit corporation, consider the duties described above and make sure you are willing and able to fulfill them.

Bonnie C. Coleman | Hodges & Davis Law Firm Northwest Indiana

On November 5, 2021, the CMS Omnibus COVID-19 Health Care Staff Vaccination Interim Final Rule become effective.  In essence, the rule imposes a mandatory COVID-19 vaccination requirement applicable to all health care providers and suppliers that receive reimbursement under the Medicare and Medicaid programs and are regulated under CMS health and safety regulations.  If CMS does not have regulatory authority over a facility, e.g., assisted living facilities or group homes, the Regulation does not apply.

The Regulation applies to eligible staff of the covered health care providers and suppliers, which includes current and new staff who provide care, treatment or any other services for the facility and/or its patients.  This includes facility employees, licensed practitioners, students, trainees, and volunteers, as well as individuals who provide care, treatment and/or other services for the facility or its patients under contracts or other arrangements.  It does not apply to individuals who provide 100% of their services remotely.

The Regulation provides for two phases and the covered entities must establish a process or policy to fulfill the vaccination requirements during the two phases.  Within 30 days following the Regulation’s effective date, Phase 1 must be completed.  During Phase 1, all covered individuals must have received, at a minimum, the first dose of a primary series or a single dose (for example, Johnson & Johnson) prior to being eligible to provide care, treatment or any other services.  For Phase 2, the series must be completed, for example, the second Pfizer or Modern dose must have been received.  CMS does not require 14 days from the last dose to meet the Phase 2 requirement, only that the dose be administered.

The vaccines that count toward the requirement are those that have been licensed or authorized for emergency use by the FDA.  Additionally, vaccine’s identified by WHO (World Health Organization) and not yet approved for use by the FDA, emergency or otherwise, are also acceptable.  Currently the vaccines licensed or approved for emergency use by the FDA for include Pfizer, Moderna and Johnson & Johnson.  At this time, CMS has indicated it does not require a booster shot to be deemed fully vaccinated, but does suggest that if the booster becomes required as part of a series, as opposed to recommended, the requirement would change under the current form of the Regulation. Since the booster is delayed by 6 months, it is expected that further guidance would be provided in conjunction with making the booster a requirement.

There are exemptions that must be made available for staff with recognized medical conditions for which vaccines are contraindicated, or religious beliefs.  These exemptions should be contained within the policies and procedures and should be aligned with and administered in accordance with federal law.  Any individual seeking an exemption should consult with the provider or supplier for whom the individual works or provides services.  The Regulation does not mandate testing of those with an exemption, but instead anticipates that the provider/supplier determine under federal law what requirements/accommodations should be contained within its policy.

Non-compliance will be enforced against the provider or supplier.  Healthcare providers are also instructed by the CMS that this regulation has primary application over other potentially applicable regulations.  This means that all applicable regulations apply, however, if there is a conflict, then the conflicting provision of this regulation will apply to healthcare providers and suppliers as opposed to conflicting provisions of other regulations.

Please note that this post is only a brief summary of the CMS Regulation and does not constitute legal advice nor does it establish an attorney/client relationship.  Should you have specific questions regarding the above, please contact Bonnie C. Coleman at Hodges and Davis, P.C.



Hodges & Davis-November 2021

Steven J. Scott | Hodges & Davis Law Firm Northwest Indiana

It is something that no one wants to receive and likely doesn’t want to think about; however, if you receive notice from the EEOC that an employee or former employee has filed for a Charge of Discrimination, it is not a notice that can be ignored.

  • Pre-Charge.

If an employer has an inkling or inclination that an employee may file a Charge of Discrimination, the employer should take immediate steps to insure that documents are properly maintained, employment issues are properly documented including such items as initial interviews with co-workers, supervisors and potentially decision makers at the management level.

  • Charge Received.

Once the EEOC Charge is received.  A careful review of the Charge and accompanying Notice regarding the time frame to respond to the Charge is necessary.  At this point it is likely a good idea to consult with an attorney regarding the next steps to take with the EEOC.  Even if the employer believes that the allegations are unfounded, the Charge should be taken seriously and a response, likely a Position Statement, should be completed, including documents that provide support for the response within the time limits set forth by the EEOC.

  • EEOC Investigation.

The EEOC investigation process can be similar to discovery in a litigated matter.  The EEOC has authority to conduct written discovery regarding the EEOC Charge and any items the EEOC deems relevant.  Any requests for information must be responded to in a timely fashion.  If additional time is needed to respond to said request, that additional time should be requested promptly with the EEOC.  Typically, the EEOC will provide additional time to respond to requests as long as reasonable.

  • Conclusion

Upon receipt of a Charge of Discrimination, an employer should gather relevant documents, provide a complete position statement and promptly respond to any requests for information from the EEOC.  Failure to do so can negatively impact the manner in which the Charge against the employer is resolved.


This article constitutes a brief summary regarding EEOC Charges of Discrimination.  The information provided does not constitute legal advice, nor does it establish an attorney/client relationship.  If you have any questions regarding the contents of this article, please contact Hodges and Davis attorney Steven J. Scott.


Hodges & Davis- October 2021

Benjamin T. Ballou | Hodges & Davis Law Firm Northwest Indiana

The Indiana legislature was quite busy this past session regarding probate law (HEA 1252, HEA 1255 and SEA 276) and health law (SEA 204).  This update will focus on HEA 1252, which became effective July 1, 2021.

A.    Technical corrections were made to I.C. § 29-1-7-15.1 to change the references in statute from “estate” to “property” (i.e., “real property” instead of “real estate”).

B.    Changes were made to I.C. § 29-1-7-15.2 regarding the protection afforded to real estate and proceeds of the sale of such real estate.  Generally, I.C. § 29-1-7-15.1(b) provides that an executor/administrator cannot sell real property to pay any debt or ligation of the decedent which is not a lien of record in the county where the property is located, or pay any costs of administration, unless a petition for administration is filed not later than 5 months after death and the clerk issues letters not later than 7 months after death.  Per the amendments to I.C. § 29-1-7-15.2, if the personal representative of the estate sells the real property to satisfy a lien of record in which the real estate is located, pay costs of administration, or use the proceeds for any other payment or distribution approved by the written consent of a majority in interest of the estate distributees (per I.C. §29-1-10-21), the proceeds of such sale retain the same protection that I.C. § 29-1-7-15.1(b) provides regarding payment of any debt or obligation not described above.

C.     A new statute was added to the probate code regarding a “tenant’s representative”.  I.C. § 29-1-8-11 sets forth the process by which an individual appointed as a tenant’s representative under I.C. § 32-31-1-23 (established under this same legislation and discussed below) can exercise authority on behalf of a deceased tenant.  The statute allows the tenant representative to collect all or part of the deceased tenant’s security deposit; collect the deceased tenant’s personal property from the residence; distribute any portion of the security deposit to the deceased tenant’s distributees; distribute the deceased tenant’s tangible personal property to the deceased tenant’s distributees; and execute a small estate affidavit pursuant to I.C.§ 29-1-8 on behalf of the deceased tenant’s distributees and present it to the landlord to obtain the security deposit and tangible personal property.

If an estate is opened, and the deceased tenant’s representative is provided with letters testamentary or letters of administration, the tangible personal property must be delivered to the named personal representative of the estate.

The tenant’s representative is required to keep complete records of all transactions for 9 months after death, or 3 months after the records are delivered to the personal representative of the estate, whichever occurs first.

A written accounting must be rendered by the deceased tenant’s representative pursuant to a court order (which can be entered at any time) or written demand received from a child of the deceased tenant, the personal representative of the deceased tenant’s estate or an heir/legatee of the deceased tenant (which must be requested within 9 months of death).  The accounting must be delivered to the court, the personal representative of the deceased tenant’s estate, an heir/legatee, or a child of the deceased tenant.  The accounting must be delivered within 60 days.  Only 1 accounting is required in a 12-month period.  If the deceased tenant’s representative fails to deliver an accounting, the court or the person demanding the accounting may initiate a mandamus action to compel the provision of an accounting.  If the court finds that the deceased tenant’s representative failed to render an accounting without just cause, attorney’s fees and court costs may be awarded.

A deceased tenant’s representative can proactively request a court to review and settle his/her account.  The petition must be filed with the court exercising probate jurisdiction in the county where the deceased tenant resided, and the filing fee is a legitimate expense of the deceased tenant’s estate.  Trust code provisions governing a trustee’s petition to settle and allow an account govern this same type of process (see I.C. § 30-4-5-14(b), (c), (d) and I.C. § 30-4-5-15).  The petition must be served on the personal representative of the deceased tenant’s estate, any person beneficially interested in the estate, the deceased tenant’s heirs at law, the named personal representative in the deceased tenant’s Last Will and Testament that was probated without administration (i.e., “spread of record”) and the persons or entities listed therein as beneficiaries, and any other person the court directs.  If the court reviews and approves the account, and proper notice is provided, the deceased tenant’s representative is discharged from liability and is binding upon all interested persons (except in cases of fraud, misrepresentation, inadequate disclosure or failure to provide proper notice).

D.     Changes were also made to I.C. § 29-3-12-1, which governs termination of a guardianship.  I.C. § 29-3-12(e) sets forth the specific powers a guardian may exercise after the protected person’s death.  If the court approves the payment of expenses and obligations under this statute, then the guardian shall pay certain expenses and obligations in amounts approved by the court in the decreasing order of priority:

    • final administration expenses of the guardianship approved by the court;
    • reasonable expenses for funeral, tombstone, monument, or other marker and disposition of the bodily remains (subject to the limitations provided in I.C. § 29-1-14-9(a)(2));
    • statutory allowances to the protected person’s surviving spouse or surviving child under I.C. §29-1-4-1;
    • debts disclosed to the court and which could be filed and allowed as claims under I.C. § 29-1-14, having the priority and preference established under I.C. §29-1-14-9(a)(4);
    • reasonable expenses of last illness disclosed to the court and which could be filed and allowed as claims under I.C. § 29-1-14, having the priority and preference established under I.C. §29-1-14-9(a)(5);
    • debts disclosed to the court and which could be filed and allowed as claims under I.C. § 29-1-14, having the priority and preference established under I.C. §29-1-14-9(a)(6);
    • any other obligations disclosed to the court and which could be filed and allowed as claims under I.C. § 29-1-14, having the priority and preference established under I.C. §29-1-14-9(a)(7).

E.     The definition of “Principal” under the Power of Attorney Act found at I.C. § 30-5-2-18(1)(A) now includes an individual who is at least 18, emancipated, or currently serving in the U.S. military.

F.     As referenced above, a new statutory scheme for a deceased or incapacitated tenant was implemented.  I.C. § 32-31-1-23 imposes duties on the landlord who has knowledge of a deceased tenant who was the sole occupant of the premises.  Specifically, the landlord must do the following:

    • notify the tenant’s representative of the tenant’s death;
    • provide access to the premises for the tenant’s representative to remove personal property therefrom;
    • deliver the security deposit and unearned rent to the tenant’s representative (the landlord can required the tenant representative to prepare and sign an inventory related to any tangible personal property removed from the premises).

If a landlord believes a sole occupant tenant is incapacitated and absent from the premises, the landlord must notify the tenant’s representative of such incapacity.  The landlord must also give the tenant’s representative access to the premises to remove personal property.  Again, the landlord can required the tenant representative to prepare and sign an inventory related to any tangible personal property removed from the premises.  The landlord must also deliver the security deposit and unearned rent to the tenant’s representative.

This new statute also sets forth who can accept an appointment and serve as a tenant’s representative, in the following order of priority:

    1.      A person designated by the tenant in a written document delivered to the landlord.
    2.      A person designated, in writing, by the tenant in a written lease between the tenant and the landlord.
    3.      An attorney in fact named by the tenant in a power of attorney during the tenant’s lifetime.
    4.      A temporary guardian or guardian of the person of a tenant.
    5.      A tenant’s heir.
    6.      A person selected and appointed by a probate court upon a petition by any interested person under this section.

If a dispute exists between two (2) or more persons claiming to be a tenant’s representative, the probate court’s decision controls after a hearing held upon notice to the interested persons.  To accept an appointment, the individual must providing written notice to the tenant’s landlord of the tenant representative’s acceptance of appointment.  If the tenant is appointed by the probate court, acceptance is achieved by complying with the conditions stated in the probate court’s order.

How long does the authority of the tenant’s representative last?  Once a deceased tenant’s heir, a deceased tenant’s attorney in fact, a temporary guardian, or a guardian of the person knows that a personal representative has been appointed for the deceased tenant’s estate; a tenant’s attorney in fact is acting on the living tenant’s behalf; or, a guardian has been appointed for the living incapacitated tenant’s property, then the authority terminates.

What liability does a landlord have?  If the landlord complies with these statutory requirements, there is no liability to the tenant, if the tenant is living; to the tenant’s estate, if the tenant is deceased; or, to any other person that has a claim or interest in the personal property removed from the premises, unearned rent, or security deposit.  However, a landlord that willfully violates subsection (a) or (b) is liable to the tenant, if the tenant is living; or, to the tenant’s estate, if the tenant is deceased, for actual damages.

In addition to the rights provided in this section, the tenant’s representative has the incapacitated or deceased tenant’s rights and responsibilities under I.C. § 32-31-4 (which addresses moving and storage of a tenant’s property).



Please note that this post is only a brief summary of HEA 1252 and does not constitute legal advice nor does it establish an attorney/client relationship.  Should you have specific questions regarding the above, please contact Benjamin T. Ballou at Hodges and Davis, P.C.


Hodges & Davis, P.C.-September 2021

Under the Coronavirus Response and Relief Supplemental Appropriations Act of 2021 and the American Rescue Plan Act of 2021, the Federal Emergency Management Agency (FEMA) is authorized to provide financial assistance for COVID-19 related funeral expenses incurred after January 20, 2020.  The criteria to be eligible for assistance is as follows: (1) the death must have occurred in the United States; (2) the death certificate must indicate the death was attributable to COVID-19; (3) the applicant must be a U.S. citizen, non-citizen national, or qualified alien who incurred funeral expenses after January 20, 2020.  There is no requirement for the deceased person to have been a United States citizen, non-citizen national, or qualified alien.

To expedite a claim for assistance you are encouraged to keep and gather documentation supporting your claim, including: (1) an official death certificate that attributes the death directly to COVID-19 and shows the death occurred in the United States; (2) documents showing the amount spent on funeral expenses for the decedent; and, (3) proof of any funds received from other sources including burial or funeral insurance, governmental agencies or other voluntary agencies. Those who believe that they meet the above criteria, are encouraged to contact FEMA to apply for assistance.


Hodges & Davis, P.C.- April 2021

Blake Hartman (“Hartman”) was a former officer and director of BigInch Fabricators & Construction Holding Company, Inc. (the “Corporation”), a closely held corporation.  He is also a minority shareholder of the Corporation.

In 2006, Hartman and the other shareholders of the Corporation agreed to be bound by a contract which contained a buyback clause requiring the Corporation to repurchase a shareholder’s interest in the Corporation if the Corporation involuntarily terminates the shareholder as an officer or director.  The clause further provided that the Corporation must pay the former officer or director the “appraised market value” of the shares as determined by a third-party valuation.

In 2018, Hartman was terminated without cause, triggering this contractual clause requiring the Corporation to purchase Hartman’s shares in the Corporation.  The Corporation hired a third-party appraisal company to appraise Hartman’s interest and applying a fair market value standard, the appraiser discounted the shares for their lack of marketability and Hartman’s lack of control.

Hartman filed suit against the Corporation, asserting that the discounts are inapplicable because the shareholder agreement didn’t contemplate a fair market value standard.  The trial court found in the Corporation’s favor, finding that the term “appraised” merely states how to determine “market value” and that “market value” and “fair market value” are synonymous terms, which are consistent with the appraiser’s approach.  The Indiana Court of Appeals disagreed, concluding that the discounts could not apply to any closed-market sale.

The Indiana Supreme Court disagreed and held that the discounts used by the appraiser did apply in this case.  In Indiana, parties are free to enter into contracts and the courts, when construing a contract’s terms, give the plain and ordinary meaning to the language used.  The Supreme Court stated that prior caselaw prohibiting the use of discounts in determining market value did not apply where the terms of the contract expressly called for “appraised market value.”  The Court held that the terms “appraised market value” and “fair market value” are synonymous terms which contemplate an appraisal value of the terminated shareholder’s individual interest in the company—not the value of the company as a whole.  As such, the shareholders agreed to a valuation of their shares as if they were sold on the open market.  Such a valuation can include discounts for lack of marketability and lack of controlling interest in the Corporation.  Therefore, the Indiana Supreme Court held that those discounts could be applied to the buyout of Hartman’s shares by the Corporation.

Should you have specific questions regarding the above, please contact Carl J. Hall at Hodges and Davis, P.C.


Hodges & Davis, P.C.- March 2021