Relation Back Doctrine
There are three requirements under Trial Rule 15(C) which must be met before an amended complaint may relate back to the date of the original complaint. First, the claim in the amended complaint must arise out of the conduct, transaction or occurrence set forth in the original complaint. Second, within 120 days of commencement of the action, the new defendant must have received notice of the lawsuit such that he will not be prejudiced in maintaining a defense on the merits. It is not sufficient that the prospective defendant only have notice of the injury and plaintiff’s retention of counsel. Rather, there must be notice, actual or constructive, that the lawsuit was filed. Third, within the same 120 day period, the defendant must have known or should have known that, but for a mistake concerning the identity of the proper party, the action would have been filed against him.
The Indiana Supreme Court recently addressed these requirements in Porter County Sheriff Department v. Guzorek, 2006 WL 3410824 (Ind. 2006). Officer Falatic struck Guzorek’s vehicle from behind. Falatic was in a Sheriff Department vehicle and returning from a call. Guzorek’s attorney sent a Tort Claims Act notice to the Department stating that Falatic was acting within the scope of his employment and the Department was liable. Thereafter, Guzorek filed a complaint naming Falatic as the only defendant. Liability of the Department was not alleged in the complaint. The court entered summary judgment for Falatic holding that he was immune from liability under the Tort Claims Act. While Falatic’s motion for summary judgment was pending, but after the applicable statute of limitations had run, Guzorek filed a motion to amend her complaint to name the Department. The trial court permitted the amendment and denied the Department’s motion for summary judgment. It certified the issue and the Court of Appeals reversed, directing summary judgment to be entered in the Department’s favor based on governmental immunity.
On transfer, the Indiana Supreme Court held that the amended complaint related back to the original date of filing and was not barred by the statute of limitations. The court found that the Department had received notice of the lawsuit and would not be prejudiced in maintaining its defense on the merits. The court stated because the Tort Claims Act imposed a statutory duty on the Department to provide Falatic with representation, and Falatic and the Department were represented by the same attorney, “it seems fair, indeed obvious, to infer that PSCD was aware of the claim against Falatic from the outset.” The court also stated that the “prejudice” component of the Notice Requirement requires the defendant to establish that he was denied the ability to present facts and evidence because the claim was asserted untimely. The fact the statute of limitations has run on the claim is not sufficient to establish prejudice under Trial Rule 15(C).
Over a very strong dissenting opinion, the majority next found that Gurorek had satisfied the Mistake Requirement. The majority stated both mistakes of fact and law may suffice under Trial Rule 15(C). However, where a party makes a conscious and tactical choice to sue one but not all multiple defendant candidates, it cannot add a new defendant after the statute of limitations period has run. “[S]uch a choice cannot be considered a mistake under Rule 15(C).” Despite this restriction on relation back, the court concluded that Gurorek must have made a mistake in naming Falatic initially, instead of the Department, because Falatic clearly had been operating the vehicle in the scope of his employment and, therefore, was immune from liability under the Tort Claims Act. The reader is invited to examine the dissenting opinion in this case which provides an excellent analysis of the historic underpinnings of the Mistake Requirement under Trial Rule 15(C).
Attorney Misconduct and Relief from Judgment
Relief from judgment is proper under Trial Rule 60(B)(3) where a party shows that its adversary has engaged in misconduct; that the misconduct prevented the party from fully and fairly presenting its case at trial; and a meritorious defense as to liability or that damages are excessive is available. Each of these factors was discussed by the Indiana Supreme Court in Outback Steakhouse of Florida, Inc. v. Markley, 856 N.E.2d 65 (Ind. 2006).
In Outback, Whitaker attended Outback’s grand opening and later went to a local bar. Whitaker left the bar and caused a car accident injuring the plaintiffs. Plaintiffs hired two attorneys who shared an office to represent them against Outback. In 1997, one of plaintiff’s attorneys contacted Roysdon, an Outback employee. Roysdon stated that Whitaker was visibly intoxicated at Outback and Roysdon served him despite his intoxication. Plaintiffs filed suit against Outback under Indiana’s Dram Shop Act. During discovery, Outback served plaintiffs with interrogatories requesting that plaintiffs identify the facts supporting their claim and the identity of persons possessing knowledge of those facts. Plaintiffs did not identify Roysdon. During a later deposition taken by Outback, Roysdon testified that Whitaker was not visibly intoxicated. This statement was not challenged by plaintiffs’ attorney and plaintiff did not disclose that Roysdon had made a prior inconsistent statement.
Roysdon, during trial, contacted plaintiffs’ attorneys and stated that she had lied in her deposition and that she had not informed Outback of her change of story. Although they had not listed her as a witness, plaintiffs called Roysdon who testified that Whitaker was visibly intoxicated when served at Outback. Outback impeached Roysdon with her deposition testimony. A verdict was returned against Outback who later learned of the 1997 interview. Outback’s motions for post trial relief were denied by the trial court and the Indiana Court of Appeals affirmed.
On transfer, the Indiana Supreme Court determined that plaintiffs’ attorneys had engaged in discovery abuses which, whether negligent or intentional, amounted to misconduct under Trial Rule 60(B)(3). The failure to identify Roysdon in the applicable interrogatory response constituted a violation of Trial Rules 26 and 33. Moreover, the failure to supplement their interrogatory responses after learning of Roysdon’s second change of story was a breach of the plaintiffs’ duty to supplement discovery. The court also found that statements made during Plaintiffs’ closing argument amounted to misconduct. The court was particularly disturbed by plaintiffs’ closing argument which attacked the fact that Outback had relied in opening statement on Roysdon’s expected testimony. As a result of these abuses, the court concluded that Outback’s ability to present its case was prejudiced because Roysdon’s undisclosed change of testimony destroyed “not only Outback’s theory of the case but also its credibility with the jury.” The court concluded “to permit the judgment to stand would create too great an incentive to play fast and loose with the judicial process.”
Stephen Arthur (email@example.com) is a partner with Harrison & Moberly, LLP, in Indianapolis, concentrating his practice in federal and state complex commercial litigation. Mr. Arthur is the author of books on Indiana Civil Trial Practice and Indiana Procedural Forms, and co-author of Professor Harvey’s volumes in West Publishing’s Indiana Practice Series. The author wishes to thank Paul Carroll for his assistance in the preparation of this case review. The opinions and analysis expressed in this column are those of the author.