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

Common Contract Clauses That May Affect Your Business
As a business owner, you have likely signed many contracts regarding operating your business.  It is also possible that you didn’t read some of them or even if you read the document, you did not consult an attorney to assist you in interpreting or negotiating an arrangement.  This article is not an attempt to persuade you to use an attorney.  It goes without saying that as attorneys, we would always recommend obtaining legal advice prior to signing a legally binding contract.  Instead, this article is to provide you with some general information regarding common contract clauses that may appear in contracts you sign.

Notice.  A notice provision in a contract typically provides the address or location of where one party to the contract notifies the other party.  Making sure your address is correct and notifying a party if a future change of address occurs is important.  Additionally, these clauses define how notice is to be given, for example, hand delivery, certified mail, overnight courier or electronically.  A notice provision typically must be carefully followed if a complaint or other dispute arises regarding the contract.

Severability.  A severability clause provides that if a clause in a contract is illegal or unenforceable, then the remainder of the contract can remain valid.  For example, after a contract is entered into, one party may learn that the interest charge on late payments is greater than the amount permitted by law, so the attempt to collect the interest may be unenforceable.  However, the actual amount due under the contract would remain enforceable if the contract contains a severability clause.

Governing Law.  In the United States, some contracts are interpreted according to state law and some federal law.  If the contract is governed by state law, the contract may contain a clause identifying which state’s law applies.  We often see clients in Indiana being asked to sign a contract that contains a clause saying the contract is governed by New York law.  That happens especially when a vendor’s business headquarters is located in another state.  Each state has its own laws describing how a contract is to be applied and may identify parts of a contract that are illegal.  The laws in Indiana may result in a contract being interpreted one way and the laws of New York another way.  It is important to understand, if the contract contains a governing law clause, which state’s laws apply if a dispute arises regarding the contract.

Venue.  A contract that contains a venue clause may contain language, for example, that says venue for all purposes is federal or state courts in Lake County, Indiana.   What that means is that if there is a dispute regarding the contract, like the vendor didn’t perform or the customer didn’t pay, and a court is needed to enforce the contract, the lawsuit would have to be filed in a court in Lake County Indiana.  That generally is a good thing for a business operating in Lake County Indiana.  However, if that business operating in Lake County Indiana signs a contract that indicates venue is Broward County, Florida, that could create challenges.  Finding a lawyer in Florida and traveling to Florida for litigation may be difficult and create hardships for the Indiana company if a dispute arises in regard to the contract.

Time is of the Essence.  A time is of the essence clause generally means that if there are deadlines set up in the contract, the parties need to comply with them.  So, even when a party explains they will be late in providing services, a time is of the essence clause can be interpreted to mean that late performance is a breach of the contract and grounds for termination or the right to recover damages.

Binding Arbitration.  A binding arbitration clause may result in a requirement that the parties settle any dispute related to the contract in binding arbitration and could only ask the courts for assistance if the arbitration award needs to be enforced against a party.  Arbitration requires the appointment of one or more arbitrators, depending upon the rules of the contract or the agency that is used to provide the arbitration services.  In addition to payment of legal fees and expenses relating to resolving the dispute, the arbitrators charge fees which need to be paid by one or both of the parties.  Additionally, rules regarding evidence and argument may be different in arbitration as compared to courts.  If you prefer using a court and judge to resolve a dispute, you will want to avoid including a binding arbitration clause in a contract.

Limitation of Liability or Damage Caps.  Many vendors include a limitation of liability or damage caps.  These clauses vary.  One example would be for a vendor to include a clause that it is only liable for failed performance if it acted recklessly.  So, if the vendor was merely negligent, a customer may be prevented from obtaining reimbursement for damages caused by the negligence.  Another clause a vendor may include would be one that limits any damages to a specified amount or to payments made by the customer under the contract.  So, if the customer paid $25,000 under the contract, but the vendor caused $50,000 in damages, a clause capping the damages could limit recovery to $25,000, even though the damages were in excess of that amount.

The above are just a few of the contract clauses that as a business owner you may encounter.  This article 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 or Shawn D. Cox at Hodges and Davis, P.C.

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

Pregnant Workers Fairness Act
Employers should be aware of a recent expansion of federal law as it relates to the rights of pregnant workers.  The Pregnant Workers Fairness Act (PWFA) places obligations on Covered Employers, which includes private and public sector employers with at least 15 employees, Congress, Federal agencies, employment agencies, and labor organizations.

This new Act extends certain protections from the Civil Rights Act and the Americans with Disabilities Act to Qualified Employees of Covered Employers under the PWFA.  Notably, the law requires Covered Employers to provide “reasonable accommodations” to a Qualified Employee in order to perform the essential job functions when the employee has known limitations due to pregnancy, unless the accommodations would cause the Covered Employer undue hardship.  The concept of providing reasonable accommodations is not new to most employers who have addressed requests made under the Americans with Disabilities Act; however, applying the accommodations to pregnant workers may be new to employers who have not been required to make accommodations under state law.  

The PWFA prohibits discrimination with regard to reasonable accommodations related to known limitations of pregnancy.  Therefore, it is unlawful for a Covered Employer to (i) not make reasonable accommodations to the known limitations related to pregnancy, childbirth or related medical conditions ; (ii) require a Qualified Employee to accept an accommodation other than one that is reasonable and arrived at through an interactive process; (iii) deny employment opportunities to a Qualified Employee if the reason is the employee’s need for reasonable accommodations; (iv) require a Qualified Employee to take leave if a reasonable accommodation can be made instead; and (v) take adverse action if a Qualified Employee makes a request or is using the reasonable accommodation.

The Equal Opportunity Employment Commission (EEOC) provides some samples of reasonable accommodations for known limitations including closer parking, flex hours, additional break time for bathroom, eating or rest; time off to recover from childbirth; excused from strenuous activity.  It is anticipated that a Covered Employer and a Qualified Employee would likely have a discussion about what the reasonable accommodation would be for these known limitations.  The EEOC has indicated it will begin accepting charges made for violations on and after June 27, 2023. 

It is important to note that The PWFA does not replace federal, state, or local laws that provide better protection to employees affected by pregnancy, childbirth, or related medical conditions.  For further information regarding the PWFA, go to www.eeoc.gov.

This post is only a brief summary of the PWFA 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 or Steven J. Scott at Hodges and Davis, P.C.      

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

The Indiana legislature was quite busy this past session regarding probate and trust law when it passed HEA 1205, HEA 1208, SEA 66, SEA 67 and SEA 193.  This update will focus on HEA 1208 and the changes made regarding service of notice in probate estates, which became effective July 1, 2022.

As we transitioned from filing pleadings by mail or in-person to electronic filing, the role of the clerk of the court regarding service of notices in probate estates was in flux.  In HEA 1208, the legislature clarifies the clerk’s role.

I.C. 29-1-1-12 sets forth the process of serving notice on interested persons in a probate estate.  Subsection (c) of the statute previously stated that “the personal representative or party charged with the duty of giving notice shall furnish the clerk with sufficient copies of the notice, prepared for mailing, and the clerk shall mail notice.  This provision is now repealed by HEA 1208.

I.C. 29-1-1-16 requires proof of service of notice to be filed prior to a hearing.  The reference to “the clerk or other” has been deleted from the statute regarding service made by the clerk, since the clerk is no longer responsible for serving notice.

Elections to take against the will of a decedent by a surviving spouse must be filed with the clerk of the court pursuant to I.C. 29-1-3-3.  Subsection (c) has been revised to require the clerk to serve a copy of the election on the personal representative of the estate and the “personal representative’s attorney of record through the E-filing System of the Indiana Courts or by first class postage prepaid. 

I.C. 29-1-7-7(a) no longer includes the language “the clerk of the court shall publish” notice of the estate administration.  That language has been deleted, and new language has been included to simply state that notice “shall be published.”  Also, notice can be served “through the E-Filing System of the Indiana Courts or by first class posted prepaid mail on each heir, devisee, legatee, and known creditor whose name and address is set forth in the petition for probate or letters, except as otherwise ordered by the court.”  The sentence “The personal representative shall furnish sufficient copies of the notice, prepared for mailing, and the clerk of the court shall mail the notice upon the issuance of letters” has been deleted.  In other words, the attorneys must serve notice, and it is recommended that an Affidavit of Service or Certificate of Mailing Notice be filed with the court to confirm service has been made.  

HEA 1208 clarifies notice and objection deadlines related to final accounts in supervised estates.  Previously, there were conflicts in the statutes related to the deadline for an interested person to file written objections to a final account (i.e., I.C. 29-1-16-6 and 29-1-16-7).  

Upon the filing of a final account, hearing and notice must occur pursuant to I.C. 29-1-16-6.  The court or clerk must set a date by which all objections to the final account and petition for distribution must be filed.  Now, the date must be “at least fourteen (14) days before the hearing date and the personal representative or his/her agent must serve notice upon all persons “who are entitled to share in the final distribution of the estate, and whose names and addresses are known to the personal representative or may by reasonable diligence be ascertained as set forth in the personal representative’s petition for distribution.  The notice must state that the final report will be acted upon by the court on the date set unless written objections are presented to the court “at least fourteen (14) days before the hearing date.  Previously, the personal representative had to provide this information to the clerk, together with sufficient copies of said notice prepared for mailing.  This requirement has been deleted.  Now, the personal representative or the personal representative’s agent shall send a copy of the notice “through the E-filing system of the Indiana Courts or by first class postage prepaid mail to each of the interested parties at least thirty (30) days prior to the hearing date.  If notice is served by publication, the “fourteen (14) day” written objection deadline must be included in the notice that is published in the newspaper.  

I.C. 29-1-16-7 previously stated that any interested person may file written objections to any item or omission in the account “at any time prior to the hearing on an account of a personal representative.  That language has been deleted and replaced with “As stated in section 6 of this chapter….   

Electronic filing has reduced the role of the clerk of the court regarding service of notice in probate estates.  The probate code is now catching up to clarify the responsibilities of the practitioner vs. the responsibilities of the clerk.  It is now your responsibility to ensure proper notice is served.  While the clerk will affix a stamp and date to the notices for the practitioner and post the notices to the docket, you will not be “served” via Odyssey with these notices.  Rather, you and your staff will need to be proactive and download/copy the notices so that you can serve them on interested parties.  Also, it is imperative that you file an Affidavit of Service or Certificate of Mailing Notice to ensure the court’s record is clear that all interested parties have been served to avoid any issues down the road.  When in doubt, take action to serve everyone that could be considered an interested party and file an Affidavit of Service or Certificate of Mailing Notice to protect yourself and your personal representative from “lack of service” claims made by beneficiaries, creditors and other interested parties. 

Please note that this post is only a brief summary of HEA 1208 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.      

  The guardianship code incorporates several statutes found in the probate code.  One must be mindful of these statutes when handling guardianships.  

IC 29-3-2-6 Application of decedents’ estates law to guardianships and protected persons

Sec. 6. (a) The applicable rules regarding decedents’ estates in IC 29-1-7 through IC 29-1-17 apply to guardianships and protective proceedings under IC 29-3-4 when consistent with this article and IC 29-1-19.

(b) IC 29-1-1-6 through IC 29-1-1-7IC 29-1-1-9 through IC 29-1-1-10IC 29-1-1-12 through IC 29-1-1-14IC 29-1-1-16 through IC 29-1-1-18, and IC 29-1-1-20 through IC 29-1-1-24 apply to guardianships under this article and IC 29-1-19.

(c) This article extends to persons specifically provided for under IC 29-1-19. The provisions of this article are cumulative to the provisions of IC 29-1-19. A conflict arising between this article and IC 29-1-19 is resolved by giving effect to the law stated in IC 29-1-19 in cases to which it applies.

(d) The provisions of IC 29-1-15 concerning the sale of decedents’ property apply to the sale of protected persons’ property.

(e) The provisions of IC 29-1-16 concerning accounting in decedents’ estates apply to accounting in protected persons’ estates that are consistent with this article.

(f) The provisions of IC 29-1-14-2IC 29-1-14-10IC 29-1-14-11IC 29-1-14-12IC 29-1-14-13, and IC 29-1-14-17 concerning claims against decedents’ estates apply to claims against protected persons’ estates.

As added by P.L.264-1989, SEC.3

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

The Indiana legislature was quite busy this past session regarding probate and trust law when it passed HEA 1205, HEA 1208, SEA 66, SEA 67 and SEA 193. This update will focus on SEA 66, which became effective July 1, 2022.

When a solvent supervised estate is ready to be closed and the assets distributed, certain actions must be taken by the court-appointed personal representative. First, a final account must be filed and approved by the court. Once approved, the personal representative then proceeds to distribute the estate assets to the individuals entitled thereto (heirs, if there is no will, and legatees/devisees if there is a will). After distribution occurs, the personal representative must file a Supplemental Report of Distribution advising the court that all distributions have been made and requesting discharge from any further liability or responsibility. The court then enters an order approving the Supplemental Report of Distribution, discharges the personal representative, and closes the estate.

What if an asset listed in the Final Account has not been distributed after the court enters the order closing the estate? The legislature passed SEA 66 to provide a mechanism to address this particular situation.

A distributee entitled to the asset specifically described in the Final Account can file or record an affidavit with the court which: (1) states the cause number and caption of the estate; (2) states the date on which the decree of final distribution was entered by the court; (3) identifies the undistributed asset described in the decree and to which the distributee is entitled; (4) states the interest in the assets that has passed to the distributee who signs the affidavit and to each other distributee who has an interest in the asset; and (5) states that the undistributed asset has passed by operation of law pursuant to I.C. 29-1-7-23(a) to the distributee who signs the affidavit, as a result of the decedent’s death and the entry of the decree of final distribution. I.C. § 29-1-17-13.5(b).

If the undistributed asset consists of an interest in real property, the affidavit and the decree of final distribution must be filed with the county recorder where the real property is located. I.C. § 29-1-17-13.5(d).

In addition, the statute provides the personal representative with powers to complete distribution and delivery of undistributed assets for a period of 90 days after the order of discharge. I.C. § 29-1-17-13.5(e). During this period, the personal representative can execute documentation to assign or transfer undistributed personal property without further order of the court. The personal representative is also empowered to sign and record a Personal Representative’s Deed to complete the distribution of real property.

The distributee can also petition the court during the 90-day period following discharge for an order compelling the personal representative to sign and deliver, or to sign and record, a Personal Representative’s Deed or other assignment or transfer document to complete the distribution of the asset. If timely filed, the court’s order is effective without notice to any persons other than the personal representative and the distributee who filed the petition, even if the order is issued after the expiration of the 90-day period.

While the goal is to ensure that all assets are distributed before an estate is closed, there are instances when this simply does not occur for some reason. Recognizing that this scenario can present itself, the legislature proactively enacted SEA 193 to provide flexibility to the estate distributees and the personal representative in the event this situation arises.

Please note that this post is only a brief summary of SEA 66 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.

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

In 2020, Mammoth Solar submitted an application for approval of a 4,511-acre commercial solar energy farm in Pulaski County. Pulaski County’s Unified Development Ordinance (“UDO”) required a special exception for construction and operation of solar energy systems (“SES”). The UDO specified a detailed list of information that all SES applications “shall include”, together with a list of additional information that any commercial SES applications “shall include.” Among the information and materials the UDO stipulated to be submitted with a commercial SES application were: a detailed site layout plan, including a fire protection plan for the construction and operation of the facility; a topographic map; a communications study; certification of compliance with utility notification requirements; and evidence of compliance with storm drainage, erosion, and sediment control regulations. Mammoth Solar’s application admittedly did not include the foregoing items, but Mammoth Solar explained that the information would be submitted later, during the design phase of its project and prior to obtaining a building permit. The Board of Zoning Appeals proceeded to hold a public hearing on Mammoth Solar’s application, at the conclusion of which, the BZA approved the special exception.

Several remonstrators appealed the BZA’s approval of Mammoth Solar’s application to the Pulaski Superior Court. The trial court concluded that the BZA did not have authority to hold a public hearing or approve Mammoth Solar’s special exception because the application did not include all of the information specified in the UDO. The trial court thus vacated the decision and remanded the matter back to the BZA.

On appeal, the Indiana Court of Appeals affirmed the trial court’s decision. Mammoth Solar v. Ehrlich, 196 N.E.3d 221 (Ind. Ct. App. 2022). The Court of Appeals noted that the interpretation of an ordinance is a question of law and that an agency’s incorrect interpretation of an ordinance is entitled to no weight. The Court further stated that where an agency misconstrues an ordinance, there is no reasonable basis for the agency’s action, and therefore, the action is arbitrary and capricious and must be reversed by the reviewing court. The Court reasoned that where an ordinance uses the word “shall,” the requirement is viewed as mandatory unless it is clear from the context or purpose of the ordinance that a different meaning was intended. Here, the Court of Appeals found that the UDO unambiguously stated that the application “shall include” the specified information and left the BZA no room for discretion to allow Mammoth Solar’s application to proceed without all of the information required in the UDO. The Court found unpersuasive Mammoth Solar’s argument that because other provisions of the UDO gave an administrator authority to determine the form and content of development applications and update application requirements, the BZA had latitude to permit submission of some information at a later time. The Court found that any such authority did not allow modification of application requirements after that application has been submitted. The Court therefore concluded that the BZA had no authority approve Mammoth Solar’s special exception because the application submitted was incomplete. As a result, the Court held that the BZA’s approval of the application was arbitrary and capricious, and was properly reversed.

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

A lawsuit has been filed against your company, you have retained an attorney and the attorney has filed an answer and affirmative defenses to the complaint. A month or two goes by and your attorney informs you that Plaintiff has sent discovery which you, as Defendant, need to respond to within the next thirty (30) days.

If a company is not accustomed to litigation, this can be frustrating and can lead to immediate annoyance. Companies should realize that this is quite typical for a litigated matter. The parties, both Plaintiff and Defendant, pursuant to the Indiana Code and Federal Code of Civil Procedure, can issue written discovery requests essentially asking questions that need to be responded to and requesting documents that need to be furnished. While questions and requests to produce documents may seem unnecessary and excessive, such relevant questions and production requests must be responded to pursuant to Civil Procedure in an ongoing litigated matter.

The best and most efficient way to respond to such requests is to take such requests seriously, answer them thoroughly, and provide your attorney with complete answers and a complete set of documents that respond to said requests. If the questions and request for documents appear to be overreaching or confusing, do not ignore but rather schedule an in-person meeting with your attorney to discuss and go over requests. If requests are not reasonable and not relevant, objections can be made in response to unreasonable, irrelevant requests, but that decision should be left to the attorney. In the end, discovery between the parties is the “next phase of litigation” following the filing of a complaint and an answer to complaint.

Typically, once the written portion of discovery is complete, the parties move on to depositions of the parties and witnesses, but that is a topic of another article.

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

The Indiana legislature was quite busy this past session regarding probate and trust law when it passed HEA 1205, HEA 1208, SEA 66, SEA 67 and SEA 193.  This update will focus on SEA 193, which became effective July 1, 2022. 

To the surprise of many, the Indiana legislature eliminated Indiana’s Probate Code Study Commission in 2014.  In 2019, the legislature re-established the Commission pursuant to I.C. § 2-5-16.1-1 et seq.  The Commission is seen as a conduit and liaison for the Probate, Trust and Real Property Section of the Indiana State Bar Association and the legislature.  The Commission is intricately involved in reviewing proposals, drafting legislation and making recommendations to the legislature.  Pursuant to I.C. § 2-5-16.1-3, the Commission consists of the following members:

(1) Nine (9) members appointed by the governor that meet the following requirements:

(A) Each Indiana congressional district must be represented by at least one (1) member appointed under this subdivision who is a resident of that congressional district.

(B) One (1) member must work in the trust department of a bank, trust company, savings institution, or credit union chartered and supervised under IC 28 or federal law.

(C) One (1) member must be an attorney licensed in Indiana who primarily practices in the area of creditors’ rights.

(D) One (1) member must be an attorney licensed in Indiana who practices in the area of estate planning.

(E) One (1) member must be an attorney licensed in Indiana who practices in the area of guardianships.

(F) One (1) member must be an attorney licensed in Indiana who practices in the area of trusts.

(G) One (1) member must be an attorney licensed in Indiana who practices in the area of probate of estates.

(H) One (1) member must be an attorney licensed in Indiana who practices in the area of probate litigation.

(I) One (1) member must be an Indiana trial court judge, full-time magistrate, or full-time commissioner whose jurisdiction includes probate.

(J) One (1) member must be an active or retired faculty member of an Indiana institution of higher learning who specializes in the field of estate planning and probate.

(2) Three (3) members appointed by the president pro tempore of the senate from among the members of the senate, not more than two (2) of whom may be affiliated with the same political party.

(3) Three (3) members appointed by the speaker of the house of representatives from among the members of the house of representatives, not more than two (2) of whom may be affiliated with the same political party.

(4) The chief justice of the supreme court or a designee of the chief justice, “who shall serve as a nonvoting member.”

SEA 193 added language to subsection (4) stating that the chief justice or a designee of the chief justice is now a nonvoting member of the Commission.

SEA 193 also revised I.C. § 2-5-16.1-6(b) which sets forth the requirements for the Commission to take final action.  Under the new legislation, “at least eight (8) voting members of the commission are required for the commission to take final action.”

The Commission plays a vital role in the legislative process in the areas of probate, trust and real property matters.  The re-establishment of the Commission by the legislature in 2019 ensures that proposed legislation has been vetted and reviewed prior to reaching the floor of the Indiana House and Senate for review, deliberation and enactment.  

 

Please note that this post is only a brief summary of SEA 193 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.      

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

The Indiana legislature was quite busy this past session regarding probate and trust law when it passed HEA 1205, HEA 1208, SEA 66, SEA 67 and SEA 193.  This update will focus on SEA 67, which became effective July 1, 2022. 

For several years, there have been efforts to raise Indiana’s “small estate” threshold from $50,000.00 to $100,000.00.  For decedents dying prior to July 1, 2006, the small estate threshold is $25,000.00.  For decedents dying after June 30, 2006 and before July 1, 2022, the small estate threshold is $50,000.00.  Now, after several unsuccessful attempts, the legislature successfully passed SEA 67 which increased Indiana’s small estate threshold from $50,000.00 to $100,000.00 effective July 1, 2022.  

What this means is that assets in the decedent’s individual name only (assets which do not have joint owners or beneficiaries named) can be transferred to the decedent’s intestate heirs (provided the decedent did not have a Last Will and Testament) or to the devisees and legatees under the decedent’s Last Will and Testament using a “small estate affidavit” pursuant to I.C. § 29-1-8-1.  The value of the assets, less liens encumbrances and reasonable funeral expenses, cannot exceed the sum of $100,000.00.  If that is the case, you can forego opening a formal probate estate and utilize Indiana’s small estate affidavit statute to transfer the assets to the individuals entitled to them.  

The small estate affidavit must contain the following representations:

(1) That the value of the gross probate estate, wherever located,

(less liens, encumbrances, and reasonable funeral expenses) does not exceed:

(A) twenty-five thousand dollars ($25,000), for the estate of an individual who dies before July 1, 2006;

(B) fifty thousand dollars ($50,000), for the estate of an individual who dies after June 30, 2006, and before July 1, 2022; and

(C) one hundred thousand dollars ($100,000), for the estate of an individual who dies after June 30, 2022.

(2) That forty-five (45) days have elapsed since the death of the decedent.

(3) That no application or petition for the appointment of a personal representative is pending or has been granted in any jurisdiction.

(4) The name and address of each distributee that is entitled to a share of the property and the part of the property to which each distributee is entitled.

(5) That the affiant has notified each distributee identified in the affidavit of the affiant’s intention to present an affidavit under this section.

(6) That the affiant is entitled to payment or delivery of the property on behalf of each distributee identified in the affidavit.

If a motor vehicle or watercraft is involved, you only need to wait 5 days (instead of 45 days) to present a small estate affidavit to the BMV to transfer the title.  The BMV has its own form affidavit (State Form 18733) that you can use to transfer the title. 

Enactment of SEA 67 will provide more families with the opportunity to transfer their loved one’s assets via small estate affidavit instead of dealing with the cost and delay of a formal probate estate.  That being said, it is recommended that you be proactive and establish an estate plan during your lifetime and not rely on Indiana’s new small estate threshold of $100,000.00 to transfer your assets.  It would be unfortunate for your family to be faced with opening a probate estate if the value of your estate, less liens and encumbrances and reasonable funeral expenses, totaled $100,100.00.  Proactive planning, utilizing a Revocable Trust or Transfer-on-Death beneficiary designations to avoid the probate process, is far more cost effective in the long run.  

 

Please note that this post is only a brief summary of SEA 67 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.      

Indiana residents now have a streamlined option for appointing a health care representative to speak on their behalf in the event they become incapacitated and to simultaneously make their future health care wishes and treatment preferences known.

Senate Enrolled Act 204 (“SEA 204”), codified in Indiana Code § 16-36-7, allows the appointment of a health care representative, health care power of attorney, and living will to be included in one document known as an Advance Directive.

Previously, Hoosiers were required to execute multiple documents when choosing who to appoint as their health care representative, what powers that representative would have, and what wishes the individual had in relation to end-of-life care and other future health care decisions.

The updated law defines “Advanced Directive” as “[a] written declaration of a declarant who 

(1) gives instructions or expresses preferences or desires concerning any aspect of the declarant’s health care or health information, including the designation of a health care representative, a living will declaration made under IC 16-36-4-10, or an anatomical gift made under IC 29-2-16.1; and 

(2) complies with the requirements of this chapter.”

Advanced Directives must be signed, by paper or electronically, in front of two (2) witnesses or a notary public.  A copy of the executed directive must be provided to the first named health care representative and provided to the individual’s health care provider to place in the individual’s electronic medical record.

The passage of SEA 204 represents a long overdue update to Indiana’s advance directive statute as it is the first update in over 25 years.  It is important to note Advanced Directives executed prior to January 1, 2023 under the old laws are not invalid; however, beginning January 1, 2023, all new Advanced Directives must comply the new law. 

Furthermore, the new law does not invalidate Indiana’s P.O.S.T. forms or out-of-hospital DNR forms which may still be used as needed based on an individual’s current health care directives and needs.

Please note that this post is only a brief summary of SEA 204 and does not constitute legal advice nor does it establish an attorney/client relationship.  Should you have a specific questions regarding the above, please contact Emilie E.D. Hunt at Hodges and Davis, P.C.

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.