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Indiana Supreme Court: No Private Liability for DCS in Releasing Confidential Identifying Information

On Behalf of | Aug 25, 2017 | Firm News

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Today’s discussion brings us back to a prior post, which asked “Can Indiana Department of Child Services Be Liable for Disclosing Confidential Identification Information?” There, we discussed the split decision from the Court of Appeals of Indiana in John Doe #1 v. Ind. Department of Child Services, in which the majority held that a claim could be brought against the Indiana Department of Child Services (“DCS”) for disclosing the identification information of a person who reported suspected child neglect. Yesterday, a divided Indiana Supreme Court ruled that DCS could not be held liable.

At the heart of the case is Indiana Code § 31–33–18–2 (“Section 2”), which prohibits the public release of identifying information of persons who have reported suspected child neglect. A question before the court of appeals was whether the statute itself created a right of action. The court majority, finding that there was a common-law duty opted not to decide whether there was an implicit private right of action in Section 2–it being agreed by both parties that there is no explicit private right of action in the statute. But, because the supreme court majority found no basis for liability, it had to shut the door on an implied private right.

Writing for the majority, the first portion of the analysis by Chief Justice Rush addressed the private right of action. Acknowledging that the court is reluctant to find an implied right, the court turned its attention to the purpose of the statute. The purpose, in the court’s esteem, is to protect children, but not to protect the reporters. Under Indiana law, “[w]hen a statute is designed mainly for public benefit, it implies no right of action; incidental benefits to a private party make no difference.” Under that framework, the court concluded that the thrust is to protect the subset of the public that are children, but not individuals.

That analysis was guided by the Court of Appeals decision Borne ex rel. Borne v. Northwest Allen County School Corporation from 1989. “In Borne, . . . a child-abuse victim sued an elementary-school principal for breaching his statutory duty to report abuse. Though that statutory duty would have undeniably benefited the particular child-abuse victim, the Court of Appeals refused to infer a private right of action since the statute’s ‘primary thrust’ was helping children in general.” Reasoning that the statute at issue in Borne and Section 2 have the same thrust in facilitating reporting, the majority reached the same conclusion as in Borne.

Perhaps of greater importance in the implied-private-right analysis was the fact that Section 2 has an enforcement mechanism, albeit imperfect:

Section 2 contains two alternative enforcement mechanisms. First, a public employee-including a DCS hotline worker-who “knowingly or intentionally discloses” confidential information commits a Class A infraction carrying a fine of up to $10,000. Second, that employee may also be “disciplined in accordance with the personnel policies” of their agency. DCS’s personnel policies provide that employees who breach confidentiality face a range of discipline, including dismissal.

“When a statute expressly provides one enforcement mechanism, courts may not engraft another.” Consequently, the court found no implied private right of action.

Although Justice David dissented in the result, he concurred with the majority that there is no implied private right of action. Despite my personal preference that the statute should include a private right of action, I do not disagree with the court’s analysis or result. Were I a legislator, I may support adding a private right of action to Section 2. But Indiana courts are not the General Assembly, and are, therefore, not the proper forum for amending statutes.

The next step of the analysis is where the majority and the dissent depart, the question of whether there was a common-law duty. Important to understanding this part of the analysis is to look at one crucial fact:

After talking it over with his wife, John called the DCS abuse and neglect hotline to report his suspicions. Near the end of the call, the DCS hotline employee asked for his contact information. Hesitant, John said he did not want anyone to know he called. But the operator explained, “Well, it’s confidential. Nobody will find out.” John gave his first name and phone number, then hung up.

There were three possible avenues for finding a common-law duty owed by DCS to the Does. One is through the “private duty” test. Another is through an assumed duty. And the third is under Indiana’s Webb v. Jarvis analysis, which was designed to determine whether a duty not previously recognized should be found. The majority found neither approach provided a duty.

In asserting their detrimental-reliance claim, the Does invoke the “private duty” test from Mullin v. Municipal City of South Bend, and Koher v. Dial. In Mullin, after a mother lost her son to a house fire, she sued the city for breaching its “private duty” to dispatch an ambulance. On appeal, we adopted a three-part private-duty test rooted in detrimental reliance: (1) the government must give “explicit assurance” that it will assist the plaintiff, (2) it must know that inaction could harm the plaintiff, and (3) the plaintiff must justifiably and detrimentally rely on the government’s affirmative undertaking. We held, however, that the mother’s claim failed the test because the city never promised an ambulance and because she gave no evidence of detrimental reliance. In other words, if there is no promise or no detrimental reliance, there can be no private duty.

Though broadly worded, Mullin’s private-duty test was quickly confined to its original emergency-dispatch context. In Benton v. City of Oakland City, a man broke his neck diving into a lake and sued the city for breaching a duty to post shallow-water warnings. The Court of Appeals affirmed summary judgment for the city since it never assumed any “private duty.” On transfer, we agreed because the private-duty test applies only to situations like the one in Mullin–where a governmental unit is alleged to have breached a duty to provide “emergency services.”

The majority determined that the “private duty” test did not apply because the Does did not seek an “emergency service.” Specifically, the representations at issue were that DCS would keep their identities confidential, not that they would send emergency services to their aid.

That left the assumed duty and Webb v. Jarvis analysis. There is no need to conduct the Webb v. Jarvis analysis if a duty exists under another method. So the court first looked to assumed duty. In the court of appeals, Chief Judge Vaidik argued that there could be no assumed duty because the DCS phone operator did nothing more than parrot to the Does what the statute required. The majority agreed.

Indiana common law recognizes that one may gratuitously assume a duty by conduct. But we impose these duties “cautiously,” and have adopted the demanding test in the Restatement (Third) of Torts section 42, which requires a specific “undertaking”:

An actor who undertakes to render services to another and who knows or should know that the services will reduce the risk of physical harm to the other has a duty of reasonable care to the other in conducting the undertaking if:

(a) the failure to exercise such care increases the risk of harm beyond that which existed without the undertaking, or

(b) the person to whom the services are rendered or another relies on the actor’s exercising reasonable care in the undertaking.

This “undertaking” element sets a high bar, requiring “affirmative, deliberate conduct.”

Critical here, this high bar is not cleared when the defendant merely references some type of pre-existing rule-like a regulation, policy, or statute. In [Yost v. Wabash College], for example, a college freshman suffered an injury during a fraternity hazing event and sued the college, arguing that it had assumed a duty to protect him in part because it had disseminated an anti-hazing policy. But we disagreed, finding this “do[es] not rise to the level of a specific undertaking that demonstrate[s] a special relationship.” Communicating a rule was not enough.

Nor did merely communicating a rule pass muster in Lanni v. NCAA. There, a spectator at a college fencing match took a saber to the face and sued the NCAA, arguing that it had assumed a duty-by, among other things, setting boundaries around the fencing area-to prohibit spectators from standing too close to the action. But, relying on Yost, the Court of Appeals disagreed, reasoning that communicating a rule for bystanders’ safety does not “rise to the level of assuring [bystanders’] protection.” In short, conveying existing rules without an accompanying specific undertaking does not trigger liability.

And that is all the DCS hotline employee did here. By informing John that his report was confidential, the employee did no more than the college in Yost or the NCAA in Lanni–she simply communicated an existing rule. Granted, the employee did summarize Section 2 using her own words: “[I]t’s confidential. Nobody will find out.” But given the demanding standard for “specific undertaking,” and given our caution in finding gratuitously assumed duties, we cannot read the hotline worker’s words as an offer to take on additional common-law liability.

Finally, the majority turned to the Webb v. Jarvis analysis. “When determining a duty’s existence for the first time, we often look to our three-part test in Webb: balancing (1) the parties’ relationship, (2) the foreseeability of harm, and (3) public policy.” The court found the second prong, foreseeability, easily met. Where the majority clearly thought the analysis failed however, is at the parties’ relationship. The majority found that there was not a sufficient relationship when the DCS phone operator merely relayed an existing rule.

Justice David, however, disagreed, and would have found a duty under Webb. The key distinction for Justice David was that John Doe relied upon the representations of the DCS phone operator. But for the representation of confidentiality, John Doe may not have provided his identifying information. Justice David found that a meaningful distinction from Yost because there was no showing in Yost that the plaintiff was hesitant to join the fraternity until he was provided the anti-hazing policies. That is, there was nothing to indicate that he relied on the anti-hazing policies in choosing to join the fraternity.

He also found strong public policy in favor of finding a duty:

If the identity of the reporting source is not protected, this may chill reporters from coming forward at all. This is true despite the statutory mandate for those who have reason to suspect child abuse or neglect to come forward. Indeed, John stated in his deposition that if he were to see child abuse or neglect in the future, he “[doesn’t] think [he] could call [DCS] again.” Thus, there is strong public policy supporting maintaining confidentiality for the reporting source because the goal is to encourage reporting and thereby, protect children.

The majority provided a rebuttal.

The dissent’s “special relationship” analysis–“perhaps the crux” of its argument–focuses on detrimental reliance, arguing that John detrimentally relied on DCS’s “extra, explicit and specific assurance” that no one will learn his identity. Yet Indiana’s common law already provides detrimental-reliance theories, and the Does do not satisfy the elements. The assumed-duty doctrine, for example, requires a “specific undertaking”; here there was none. Actual fraud requires a material misrepresentation of “past or existing facts”; here the promise concerned only the future. And constructive fraud requires either a material misrepresentation of “past or existing facts” or silence “when a duty to speak exists”; here there was neither. Our common law has thus carefully defined liability for promises, and this case-though distressing-does not warrant an ad hoc exception.

I side with Justice David on this one. The rebuttal that the law has existing theories of detrimental reliance does not alter that. Indeed, the fact that the court cited more than one such theory is an acknowledgment that detrimental reliance is a core principal of the law that merits protection, or else it would not have been incorporated into more than one such theory. Mind you, Justice David advanced the detrimental reliance as part of the Webb v. Jarvis analysis, which is intended to aid courts in recognizing previously unrecognized duties by applying a framework that approximates the historical structure that has led to the current state of tort law.

I reiterate my critique of Chief Judge Vaidik’s dissent, which was largely the basis for the majority’s conclusion on the Webb v. Jarvis analysis:

I also disagree with the Chief Judge’s conclusion that there is no common law duty. Were the defendant anyone other than an instrumentality of the government, the law would not hesitate to find an assumed duty when the DCS employee told Doe that his identity would be confidential. If Doe had volunteered his identification information prior to the statement from the employee, then there would be no duty; there would be no reliance by Doe. But instead, the only reason he provided the information was because he was assured that it was to be confidential. Further, the point that all the employee did was repeat the statute has superficial appeal but does not, in my opinion, withstand the weight of scrutiny. If Section 31–33–18–2 did not exist, what then would happen? If Section 31–33–18–2 did not exist, then the employee was not simply telling Doe what the statute required. An argument could certainly be made that such a representation alone would still not be enough, and I expect the Chief Judge would come to that same conclusion, but in the absence of any indication that Section 31–33–18–2 was to abrogate the common law, I see no distinction between the statement and attributing the statement to merely repeating what the statute says.

I think my point unaltered by Lanni or Yost. In Lanni, there was no specific representation that the spectator would not be stabbed in the face with a saber. Similarly, in Yost the anti-hazing policy did not say to Yost that “he would not be hazed,” it stated the school’s policy against hazing. Here, Doe was told, “Well, [your identification information is] confidential. Nobody will find out.” The representation was affirmative. Were Section 2 non-existent and Doe had been told the same thing, would not the entire analysis be different? Of course, the obvious retort is that “ignorance of the law is no defense.” Certainly true, but what if the dictates of Section 2 had merely been an informal, internal policy of DCS. That would be akin to the private, non-statutory policies of both Yost and Lanni, so it has nothing to do with ignorance of the law. The distinction seems to be simply that because it was a policy of DCS and not the singular statement of the phone operator, that it is different. But why? The theory of liability is fundamentally respondeat superior, which would impart the actions of the phone operator to DCS. Thus, the actions of the operator are already imparted onto DCS just the same as if DCS had itself come up with the policy.

Put simply, I see no reason that the mere existence of a policy, or, in this case, statute, should play any role in the analysis. But, as four out of five Indiana Supreme Court justices agree, that is not the law in Indiana.

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


*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.