Did the Indiana Court of Appeals Just Rewrite Trial Rule 75(A)?

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by: Colin E. Flora

     Last week, we discussed Trial Rule 75 in the context of what constitutes a “principal office” under subdivision (A)(4). This week, we return to discuss what had appeared a settled principle—that the first nine enumerated bases for preferred venue were coequal—but what, as of yesterday, appears anything but.

     In 2006, Justice Brent Dickson, joined by Justice Robert Rucker, viewed the Indiana Supreme Court’s majority opinion in R & D Transport, Inc. v. A.H. as running against decades of caselaw dictating that none of the first nine provisions of Trial Rule 75(A) was superior to another. While it might be said that Justice Dickson’s interpretation of the majority opinion went a bit far, that dissent may well be an apt observation of the Scribbles, LLC v. Wedgewood decision from the Court of Appeals of Indiana this past week.

     Let us begin by looking at the procedural posture of Scribbles. The underlying facts are that an infant was seriously injured while at a daycare in Hendricks County. The parents of the infant brought suit against various defendants associated with the daycare, each located in Hendricks County, for the injuries to the child and also brought a claim against the Indiana Family and Social Services Administration (“FSSA”). The claim against FSSA is what complicates matters. Were the case the prototypical personal-injury claim against these particular defendants, then FSSA would not have been named and preferred venue would have unquestionably rested solely in Hendricks County. That, however, is not what happened.

     The claim against FSSA stems from the infant being a recipient of Medicaid benefits. As a recipient of those benefits, FSSA has a statutory right to assert a lien against any recovery to recoup its payments. But FSSA can choose to waive that right. So, the claim against FSSA was a declaratory judgment action asking the trial court to determine whether there was such a lien and, if so, the amount. And here is where things get tricky: they filed the case in Marion County.

     That leads us to today’s discussion. Was Marion County a preferred venue for the case? Judge Joven of the Marion County Superior Court said yes. I say yes. The Indiana Court of Appeals, however, said no. In the end, I hope the Indiana Supreme Court is given the opportunity to address this issue.

     Now, you’re likely wondering why a case that we agree would have preferred venue in Hendricks County without FSSA should also be allowed to proceed in Marion County. For starters, the answer is that preferred venue is not limited to a single county, but may lie in as many counties as meet the dictates of Trial Rule 75(A)(1)–(9). And, because it is a state governmental agency, a claim against FSSA is subject to the preferred venue dictates of subdivision (A)(5): “the county where either one or more individual plaintiffs reside, the principal office of a governmental organization is located, or the office of a governmental organization to which the claim relates or out of which the claim arose is located, if one or more governmental organizations are included as defendants in the complaint[.]” For FSSA, that county is Marion County.

     Consequently, the plain language of Trial Rule 75(A) seems to make this an easy answer: preferred venue lies both in Marion County under 75(A)(5) and in Hendricks County under 75(A)(1). But, again, the Court of Appeals disagreed and utilized an approach that necessarily runs contrary to the specific text. That approach was to determine that adhering to the text of Trial Rule 75(A) would run contrary “to the general purpose of the venue rules[.]”

     Now let us look to how the court got there. The analysis is rooted in three prior decisions. As appearing in the opinion, the first of note is Jasper County Board of County Commissioners v. Monfort, about which the court wrote, “First, it has already been held that the Uniform Declaratory Judgment Act does not create a basis for preferred venue requirements.” On quick glance, that may be mistakenly read to say that it has already been held that a declaratory judgment action tagged onto a case does not create a basis for preferred venue requirements. I do not think that is what the Scribbles court was saying because that is not what Monfort says. What Monfort says and I think the Scribbles court is saying is that the provision of the Uniform Declaratory Judgment Act that allows any court of record to issue an injunction does not supplant the Trial Rule 75(A) dictates. As a result, that does not mean that Monfort means Marion County cannot be the preferred venue; the court is simply foreclosing any argument like the one made in Monfort.

     That takes us to the two cases directly analyzing Trial Rule 75(A). The first is R & D Transport. There, a child was injured in a trucking accident and the claim was filed in the county where the child lived, not where the accident occurred. While subdivision (A)(10) does allow for preferred venue in the county in which the plaintiff is located, it does so only if no other basis for preferred venue exists. When it is a motor-vehicle accident in the state, at least subdivision (A)(3)—“the county where the accident or collision occurred, if the complaint includes a claim for injuries relating to the operation of a motor vehicle or a vehicle on railroad, street or interurban tracks”—will always apply and trump resort to (A)(10). But the clever attorneys argued that the claim was not merely for the personal injuries to the child; instead, the claim also was for damage to her orthotic devices and clothing. Those items are, by legal definition, “chattel” such that subdivision (A)(2)—“the county where the land or some part thereof is located or the chattels or some part thereof are regularly located or kept, if the complaint includes a claim for injuries thereto or relating to such land or such chattels, including without limitation claims for recovery of possession or for injuries, to establish use or control, to quiet title or determine any interest, to avoid or set aside conveyances, to foreclose liens, to partition and to assert any matters for which in rem relief is or would be proper”—applies. Since the child kept her orthotic devices and clothes at her home, then the county in which her home was located was where the chattels were regularly kept.

     Before the Indiana Supreme Court, that argument did not convince three of the five justices, though it did convince two. The majority concluded that the location of chattel damaged in a motor vehicle accident in which the location of the chattel plays no role in the accident is insufficient to meet the dictates of Trial Rule 75(A)(2). Here is the analysis in full with further citations and footnotes omitted:

First,the focus of T.R. 75(A)(2) is the location of the property or activity that gives rise to a claim. Trial Rule 75(A)(2) was adopted in 1970 as part of a broader proposal by the Indiana Civil Code Study Commission to end confusion that had arisen under prior law over how to untangle questions of venue and jurisdiction. The analog of Trial Rule 75(A)(2) in prior law covered actions concerning only real property:

Actions for the following causes must be commenced in the county in which the subject of the action, or some part thereof, is situated:

First. For the recovery of real property, or of an estate or interest therein, or for the determination in any form of such right or interest, and for injuries to real property.

Second. For the partition of real property.

Third. For the foreclosure of a mortgage of real property.

Broadly categorized, the cases covered by [that section] were actions “in rem.” Actions in rem “[i]nvolv[e] or determin[e] the status of a thing, and therefore the rights of persons generally with respect to that thing.”

The new rule preserved this in rem emphasis but also added language that gives rise to the issue in this case. This new language provided that a county where “chattels or some part thereof are regularly located or kept” would be a county of preferred venue in addition to a county where “land or some part thereof is located.” The “intent [wa]s to broaden the class of local actions allowing suit to be brought in the county where the land is located.” The rule itself lists sample types of claims that a complaint may encompass, examples that clearly demonstrate that the new rule retained focus on in rem actions:

[I]njuries [to the land or chattels] or relating to such land or such chattels, including without limitation claims for recovery of possession or for injuries, to establish use or control, to quiet title or determine any interest, to avoid or set aside conveyances, to foreclose liens, to partition and to assert any matters for which in rem relief is or would be proper[.]

The Commission explained the addition of “chattels” to real property as follows: “the provision . . . is new, but can be justified to the extent that the location of personal property often is more significant than real property.” Thus, the addition of chattels to T.R. 75(A)(2) signified a broadened understanding of what kind of property might be important to determining venue, but continued to recognize the significance of real or personal property’s locationas the most important factor. In the instant case, we see the reason for this distinction. The location where Richardson usually kept her “orthotic devices” played no role in the accident itself or in the claims of the lawsuit she filed. Rather, her claim involved a motor vehicle accident; the location that played the important role was that of the actual collision.

Second, consistent with the rule’s stress on the location of the property or activity giving rise to a claim, we have long had special venue rules for motor vehicle accidents. Though T.R. 75(A) codified Indiana’s venue approach to such accidents, pre-1970 law contained special reference to them as well. For example, [the] former section [ ] contained this rule:

[A]ny action brought against the owner, driver or operator of any motor vehicle arising out of and by reason of the operation, management and control of such motor vehicle may be brought in the county where the action arose or in the county of residence of any of the defendants against whom the action is brought.

The earlier rule put preferred venue for motor vehicle accidents either in the county where the accident occurred or in a county where the defendants resided. The current T.R. 75(A) retains these options, though it separates them between subsections (1), (3), and (4). Subsection (3), as set forth supra, provides that preferred venue is in “the county where the accident or collision occurred, if the complaint includes a claim for injuries relating to the operation of a motor vehicle or a vehicle on railroad, street or interurban tracks.” This motor-vehicle-specific rule maintains the approach of the prior rule that gave preferred venue status to the location of motor accidents.

Third, we note the rule’s language about the relationship between plaintiffs and venue. Subsection (10) of the rule allows for the plaintiff’s home county to be a preferred venueif“the case is not subject to the requirements of subsections (1) through (9) of [T.R. 75(A)] or if all the defendants are nonresident individuals or nonresident organizations without a principal office in the state.” This rule highlights another purpose behind the new version of T.R. 75: “to allow an action to be brought in any court in the state, subject to the right of an objecting party to transfer the case to a proper county or court as provided by this rule.” The plaintiff may make the first choice of venue in a case, but the defendant may choose another venue if the plaintiff has not chosen a venue listed in subsections (1) through (9). A defendant is required to remain in the plaintiff's home county (if that is where the plaintiff initially files suit) only if the defendant is not a resident of Indiana. 

The text of subsection (10) suggests that, in most cases, the plaintiff's home county has secondary status when it comes to preferred venue. We decline to allow T.R. 75(A)(2) to serve as the means to bypass the clear intent of the rule’s overall text. Most people “regularly ke[ep]” their car and other chattels that travel with them in their cars in their home counties. The preferences expressed by subsections (1), (3), (4), and (10) are easily defeated by the broad interpretation of subsection (2) given by the Court of Appeals. Subsections (1), (3), (4), and (10) may not be so readily avoided, although we do emphasize, as discussed supraand as noted in the Commission’s comments, that the preferred venue subsections work in concert.

     But the Court of Appeals in Scribbles read R & D Transport more broadly than I think merited:

The Indiana Supreme Court agreed with the defendants and concluded that, although technically permitted under Trial Rule 75(A)(2), basing preferred venue on the existence of A.H.’s chattels in that instance was inappropriate because those chattels, such as the orthotics, “played no role in the accident itself or in the claims of the lawsuit that [Mother] filed. Rather, her claim involved a motor vehicle accident; the location that played the important role was that of the actual collision.” The Indiana Supreme Court explained that to decide otherwise would defeat the purpose of Trial Rule 75(A) and “allow T.R. 75(A)(2) to serve as the means to bypass the clear intent of the rule’s overall text.” 

     The Scribbles analysis overlooks the history and interplay of subdivision (A)(2) with the specific setting of motor-vehicle accidents. In so doing, the Court of Appeals interprets R & D Transport as concluding that (A)(2) did not apply because to do otherwise would undermine the total spirit of Trial Rule 75(A). But that does not appear to be the focus. Instead, by marching through the history of venue for in rem actions, the specific focus was whether the chattel provision of subdivision (A)(2) was discordant with the other provisions intended to encompass in rem actions and specifically those in the motor-vehicle setting. That is, the issue was the specific attempt to game subdivision (A)(2) to try and sneak the disfavored venue of the plaintiff’s home into one that could be utilized in most every motor-vehicle accident. Mind you, though the argument was about clothes and orthodontic devices, the exact same argument would apply as to the vehicle itself. That is, the plaintiff’s chattel—the car—would also regularly be kept at the plaintiff’s home and, therefore, supply the basis for preferred venue.

     That is not, however, what was going on in Scribbles. No one was gaming one subdivision over another. Instead, the utility of subdivision (A)(5) stemmed from the fact that FSSA was a defendant. Simply by being a defendant in the case subdivision (A)(5) allowed for the claim to be in Marion County. It was not an attempt to place the case in the plaintiff’s home county by trying to elevate the regular locus of chattel over the specific locus of the motor vehicle accident with the attending history behind that. At worst, naming FSSA was a tactical game to get the case in Marion County. But, as we will see, it was not an impermissible game; FSSA properly remains a defendant in the case.

     Finally, we move to the last case that shaped the Scribbles analysis: Salsbery Pork Producers, Inc. v. Booth. There, a driver got into an accident in Tipton County and sued the defendants involved in the accident along with the state of Indiana and Tipton County for negligence in the design, maintenance, and signage of the road. Because the state was a defendant, the case was filed in Marion County. But, before the pleadings were closed, Tipton County answered that it was responsible for maintaining the roads not the state, which rendered the state a party that should be released from the case. The court concluded:

Yet under these circumstances, where the County has submitted evidence and argument taking upon itself the duty of care at issue, and where—before the pleadings were closed—the State should have been dropped from the case as a party, we cannot conclude that a Marion County venue is appropriate. Moreover, a Marion County venue for the case is discordant with the general purpose of the venue rules, which is to allow trial in the county where the events giving rise to a dispute or where the greatest amount of evidence with respect to the dispute will likely be found.

Thus, because the State should have been dropped as a party, Marion County is not a preferred venue. The collision that injured Booth occurred in Tipton County; Booth, the majority of the defendants, and the County all reside in or are headquartered in Tipton County. We therefore reverse the trial court and remand with instructions to transfer this action to Tipton County.

     Interestingly, in discussing the “general purpose of the venue rules” the Salsbery Pork decision states that the plaintiff is located in Tipton County. But the location of the plaintiff is the utmost disfavored basis for preferred venue. Still, the specific basis stated in the Salsbery Pork decision was that “the State should have been dropped as a party[.]” The rest, though discussed, is dicta.

     Of Salsbery Pork, the Scribbles decision says:

We reached a similar result in Salsberry Pork Producers, Inc. v. Booth. Booth was a passenger involved in a motor vehicle accident in Tipton County. The driver of the other vehicle was a resident of Tipton County acting within the scope of his employment with a Tipton County employer. Booth filed a negligence action against both drivers, the employer, the Tipton County Commissioners, and the Indiana Department of Transportation (“IDOT). Booth filed the action in Marion County based upon the count against IDOT, which is headquartered there. The other defendants filed a motion to transfer the case to Tipton County, which the trial court denied.

On appeal, this Court pointed out that a “Marion County venue for the case [was] discordant with the general purpose of the venue rules, which [was] to allow trial in the county where the events giving rise to a dispute or where the greatest amount of evidence with respect to the dispute [would] likely be found.” We noted that the “collision that injured Booth occurred in Tipton County; Booth, the majority of the defendants, and the County all reside[d] in or [were] headquarter[ed] in Tipton County,” and concluded that Marion County was not a preferred venue. We therefore reversed the trial court and remanded the case with instructions to transfer it to Tipton County.

     While Scribbles is correct in what it says, it is misleading in that it makes no mention of the specifically asserted conclusion in Salsbery Pork: “because the State should have been dropped as a party, Marion County is not a preferred venue.” The only way Salsbery Pork supports the Scribbles conclusion is if it could fairly be said of Salsbery Pork that even had the state been properly named, Marion County would not have been an appropriate venue. That is an impossible conclusion to make from the face of the decision, especially since it says the exact opposite, saying that it is because the state is not properly a defendant that preferred venue did not rest in Marion County. Of course, a keen observer may note that Judge Bailey authored Salsbery Pork and joined the unanimous decision in Scribbles. So, it may be said that Judge Bailey may have agreed with that conclusion in Salsbery Pork. But had he pushed for such a conclusion, we cannot infer that the concurring judges, Judges Baker and Darden, would have joined it.

     Lastly, mirroring the decision, after marching through the caselaw analysis, we turn to the specific conclusion of Scribbles:

Here, as in R & D and Salsbery, FSSA has an incidental connection to the subject matter of the litigation, which is insufficient to support preferred venue. Specifically, as in R & D, FSSA played no role in the underlying litigation, which involved an alleged catastrophic brain injury to an infant. Further, the alleged injury occurred in Hendricks County. In addition, all of the Plaintiffs and Defendants resided in or were headquartered in Hendricks County. Under these circumstances, we agree with the Defendants that Marion County is not a preferred venue. To decide otherwise would defeat the purpose of T.R. 75(A) and allow T.R. 75(A)(5) to serve as the means to bypass the clear intent of the rule’s overall text.

     On that conclusion, I absolutely cannot agree. To say that “FSSA has an incidental connection to the subject matter of the litigation” is wrong. The subject matter of the litigation is two-fold: liability for the infant’s injuries and whether FSSA will assert a lien. They are distinct issues with the same catalyst, i.e. the infant being injured. Resolution of the FSSA declaratory judgment action does not necessarily have anything to do with Hendricks County, as that determination is one done through FSSA, which is, by law, subject to preferred venue in Marion County. If joinder of the two claims in one action is impermissible, then let them be severed and send the injury claim to Hendricks County while keeping the lien claim in Marion County. But, if joinder is permissible, then there is no basis for disregarding the text of Trial Rule 75(A) simply because it would seem Hendricks County is the more reasonable of the two options. The venue rules do not require the most reasonable venue, just one that meets the dictates of Trial Rule 75(A).

     The only way to reach the conclusion that the Court of Appeals did is to determine that there is a basis for departing from the text of Trial Rule 75(A) when it appears most just to do so. I do not think that is what the Indiana Supreme Court was doing in R & D Transport; I think it was construing the specific language of subdivision (A)(2) in a manner that would not have the effect of functionally elevating subdivision (A)(10) in all motor-vehicle cases. What Scribbles does and Salsbery Pork suggested doing is to change the analysis away from the text of Trial Rule 75(A) and take a form of common-law analysis as to which county makes the most sense—i.e. an indefinite standard of “the general purpose of the venue rules.” That is not how the rules are written, that is not how R & D Transport analyzed them, and that is not how this case ought to have been resolved.

     I think I would have sided with the R & D Transport majority; but Salsbery Pork’s dicta and now Scribbles’ holding have taken R & D Transport beyond what the majority did and marched directly into what Justices Dickson and Rucker accused the R & D Transport majority of doing: rewriting Trial Rule 75(A) in a way that can only be done through the rules amendment process.

     I commend the Court of Appeals on its thorough attention and analysis, but I hope the Indiana Supreme Court is asked to and does grant transfer in this case.

     Join us again next time for further discussion of developments in the law.

**UPDATE**

     Transfer to the Indiana Supreme Court was sought but denied by majority vote, with Chief Justice Rush and Justice David voting to grant transfer.

Sources

*Disclaimer: The author is licensed to practice in the state of Indiana. The information contained above is provided for informational purposes only and should not be construed as legal advice on any subject matter. Laws vary by state and region. Furthermore, the law is constantly changing. Thus, the information above may no longer be accurate at this time. No reader of this content, clients or otherwise, should act or refrain from acting on the basis of any content included herein without seeking the appropriate legal or other professional advice on the particular facts and circumstances at issue.