Wednesday, May 22, 2024

Appellate Court of Maryland Holds that Appeals of IN § 27-1001 Claims to the OAH do not Preclude CJP § 3-1701 Claims and that Tortfeasors can be Liable for Subsequent Negligent Actions of Medical Providers.

Tami Browne v. State Farm Mutual Automobile Insurance Co., No. 1825, Sept. Term, 2021.

            Tami Browne was injured in an automobile accident where the at-fault driver fled the scene. Browne reported low back, hip, and neck pain and received non-surgical treatment. Subsequently, after continuing pain, Browne underwent an MRI which revealed a Tarlov cyst near her spine and a protruding disc. Browne underwent a surgical procedure to remove the cyst and later complained of worsening symptoms due to the surgery. Browne filed a claim with her insurer, State Farm, who refused to provide coverage for Browne’s subsequent treatment as there was no documentation connecting the cyst surgery to the accident. The parties were unable to settle the claim; therefore, Browne filed a breach of contract action against State Farm in the Circuit Court for Montgomery County. While the breach of contract case was pending, she filed an administrative complaint against State Farm for failure to act in good faith under Insurance Article (“IN”) § 27-1001 and Courts and Judicial Proceedings (“CJP”) § 3-1701.

The Maryland Insurance Administration (MIA) determined that State Farm did not owe Browne the entire $50,000 within her policy limits, and that State Farm had not failed to act in good faith. Browne subsequently appealed the decision to the Office of Administrative Hearings (OAH), which affirmed the previous MIA decision. Browne then amended her breach of contract action to include the statutory lack of good faith claim under CJP § 3-1701. Both parties then moved for summary judgment, where the circuit court ultimately granted summary judgment in favor of State Farm, determining that the OAH decision collaterally estopped Browne from litigating a civil action that involved the same issues at question in the OAH decision. The court then denied Browne’s motion as moot.

Writing for the Appellate Court of Maryland, formally known as the Maryland Court of Special Appeals, Judge Adkins first determined that a CJP § 3-1701 action is not a direct appeal of the OAH decisions as it is an independent civil claim. Although a civil action authorized by CJP § 3-1701 is reviewed de novo of MIA decisions, courts have repeatedly stated that this cause of action is not an appeal. Thompson v. State Farm Mut. Auto. Ins. Co., 196 Md. App. 235, 238 (2010). The court did not agree with State Farm’s assertion that collateral estoppel must apply to the circuit court action as it is a separate judicial proceeding on issues presented before the OAH.  The court looked at the requirements for a CJP § 3-1701 action including receiving a final decision under IN § 27-1001. To receive a final decision under IN § 27-1001, one must either: (1) not appeal to OAH within 30 days of a MIA decision or (2) appeal to OAH and wait for a final decision. CJP § 3-1701 does not distinguish between either of these final decisions, therefore the statute allows a cause of action under CJP § 3-1701 regardless of which path the insured takes.

The Appellate Court of Maryland then examined whether the circuit court abused its discretion in denying Browne’s motion for summary judgment. State Farm argued that Browne’s subsequent surgical treatment was negligent and, thus, a superseding cause. Browne argued that the automobile collision was the cause of her injuries, and the surgery should be included as it was an attempt to treat her original injuries. The court ultimately reversed the denial of Browne’s motion for summary judgment and provided guidance to the circuit court through § 457 of the Restatement (Second) of Torts, and Maryland case law requiring medical bills to be fair, reasonable, and necessary.

The subsequent negligence doctrine, as defined in Section 457, explains that negligent actors are subject to liability for any additional harm resulting from third parties’ normal efforts to tender aid regardless of if the acts are done properly or negligently. Per the comments to Section 457, if a person’s actions cause harm requiring medical intervention, the negligent actor remains liable for harm resulting from the medical services. The purpose for this rule is that the original tortfeasor should be held responsible for the inherent risks in treatment of injuries. The key question in subsequent negligent medical treatment cases is whether the original tortfeasor should have foreseen the general harm, not the specific manifestation of that harm.

The Appellate Court of Maryland looked to other jurisdictions for guidance to determine the extent of fair, reasonable, and necessary medical treatment, and bills. The court ruled that plaintiffs must first have proper foundation to introduce medical bills as evidence of damages. This is usually done by expert testimony discussing the bills’ fairness, reasonableness, and necessity. Once the evidence is admitted, the necessity of medical treatment is a question of fact for a jury. The jury can determine that the plaintiff was feigning injury, the treatment was for an ailment unrelated to the original tort, or the treatment goes beyond what is required by the injury.

On remand, the Appellate Court of Maryland provided some additional guidance to the circuit court. The burden is on the defendant to assert and provide evidence of subsequent negligent medical treatment. As such, the defendant must show that the subsequent negligence was so extraordinary or unusual that it is a superseding cause alleviating the defendant’s liability. Ultimately, the court identified five (5) instances where subsequent negligent treatment could be beyond the scope of the original tortfeasor’s liability: (1) extraordinary misconduct by medical professionals, (2) intentional torts committed by medical professionals against the victim, (3) a victim’s elected treatment of an ailment known to be unrelated to the injuries caused by the negligent actor, (4) treatment by a medical professional the victim was negligent in selecting, and (5) aggravation of the injury due to the victim’s negligence in carrying out the treatment of their injures.

- Sean Delaney, Law Clerk