Indiana Law Review


A Survey of Indiana Tort Law
Michael Rosiello*

John R. Talley**

I. Introduction

Although Indiana tort law broke little new ground during the survey

period,* several subject areas received greater than routine scrutiny by

Indiana courts. This article will devote its major emphasis to decisions

clustered in six subject areas, including interpretations and applications

of (1) the Indiana Comparative Fault Act,^ ('*Act" or "Comparative

Fault Act") (2) Indiana's ''impact" requirement for recovery of emotional

distress damages, (3) punitive damages, (4) premises liability, (5) fraud

and estoppel, and (6) liability of unincorporated associations.

II. Comparative Fault

The interpretations of Indiana's Comparative Fault Act made during
the survey period are perhaps more significant for their broad application

than the novelty of the rulings.

A. Abandoning the Joint Release Rule

Typical of the analytical challenges presented by comparative fault

were Judge Barker's decisions in Fetz v. E & L Truck Rental Co.^ and
Gray v. Chacon ^ In Fetz, a case arising before the effective date of

the Comparative Fault Act, the United States District Court for the

Southern District of Indiana recognized and applied Indiana's ** well-

settled rule that the unqualified release of one joint tortfeasor acts to

release all joint tortfeasors."^ Eight months later, the court concluded

* Partner, Barnes & Thornburg, Indianapolis. A.B., Columbia University, 1973;
J.D., Stanford University Law School, 1976.

** Associate, Barnes & Thornburg, Indianapolis. B.A., Indiana University, 1982;
J.D., Indiana University School of Law—Indianapolis, 1985.

1. Approximately July 31, 1987, to July 31, 1988.

2. IND. Code §§ 34-4-33-1 to -14 (1988).
3. 670 F. Supp. 261 (S.D. Ind. 1987).

4. 684 F. Supp. 1481 (S.D. Ind. 1988).

5. 670 F. Supp. at 262. Although Judge Barker considered herself bound by the

Indiana rule, she made plain her disagreement with the rule even in a contributory negligence
case. 670 F. Supp. at 263 n.l ("[t]here is little persuasive justification for this rule").

The court held that this rule did not bar the plaintiff's claim in Fetz, because the court

found that the settling parties did not intend to release the alleged joint tortfeasors. 670

F. Supp. at 265.

503



504 INDIANA LAW REVIEW [Vol. 22:503

in Gray, an action based on comparative fault, that Indiana's "anti-

quated" joint release rule "must be abandoned."^ The difference in the

decisions reflected more than a mere change in procedure under com-

parative fault. The difference reflected the new fault philosophy reflected

by the Act.

Gray was injured when his truck coUided with a trailer left on the
roadway by Bavuso. Bavuso had rented the trailer from Jartran who
allegedly failed to provide the trailer with adequate warning lights,

reflectors or flares. Gil Chacon and Mieneke Discount Mufflers had

sold and installed Bavuso 's trailer hitch. Gray settled his claim against

Bavuso and executed a release of that claim. In his new lawsuit against
the other alleged tortfeasors. Gray admitted the release of Bavuso but

opposed the defendants' motion for summary judgment by arguing that
the joint release rule was inappropriate under the Act.

The district court, undertaking to determine how the Indiana Supreme
Court would decide the issue, explored the rationale for the rule set

forth in Bellew v. Byers'P

The reasons for this rule are obvious. First, it prevents an unfair

prejudice against the defendant by precluding the plaintiff from

recovering in excess of his injuries by successively obtaining

settlements from the various tort-feasors in return for releases.

Second, joint tort-feasors "constitute, in a sense, one entity,

each of them being jointly and severally liable for injury to the

plaintiff." A release of one joint tort-feasor in effect releases
the entire "entity." Accordingly, to release one is to release all

of the others.*

Unlike joint and several liability as interpreted in negligence context,^

comparative fault distributes liability among multiple tortfeasors. '° Be-
cause the Act both distributes and separates liability, the court found

both traditional foundations for Indiana's release rule eliminated by

operation of the Act.'^ The Act ended the risk "that an injured party

could receive more than 100% of her damages by successively recovering
from multiple tortfeasors."^^ Further, multiple tortfeasors could no longer

be considered "one entity" because each defendant would be liable only

for his proportionate share of any verdict. The court concluded that

6. Gray, 684 F. Supp. at 1485.

7. 272 Ind. 37, 396 N.E.2d 335 (1979).

8. Id. at 39, 396 N.E.2d at 336-37 (citation omitted).

9. See Gray, 684 F. Supp. at 1485.

10. Ind. Code § 34-4-33-5 (1988).
11. Gray, 684 F. Supp. at 1485.

12. Id. at 1484-85. See Ind. Code § 34-4-33-5 (1988).



1988] TORT LAW 505

"far from being 'one entity,' joint defendants in Indiana are now as
separate and independent from each other as they are from the plaintiff

herself."i3

B. Evidence of Causation by Unnamed Nonparties Is Permissible

In Moore v. General Motors Corp., Delco Remy Division, ^"^ the
court decHned to exclude causation evidence concerning conduct by

persons not named as nonparties under the Comparative Fault Act.'^

Plaintiff sought, through a motion in limine, to exclude such evidence

because a nonparty affirmative defense had not been pleaded. The court

denied the motion, finding defendants under comparative fault can in-

troduce such evidence without a nonparty defense where the evidence

relates to contested causation issues. However, because the jury could

not allocate fault to the particular nonparties in the absence of a pleaded

defense, the court warned counsel to avoid misleading or confusing the

jury regarding such an allocation.'^

The Moore court reasoned that comparative fault did not have "the
practical effect of abrogating all pre-existing negligence law," and plain-

tiff remains obligated to establish the traditional elements of a negligence

claim, including causation.'^ Although the Act did not expUcitly address

presentation of evidence concerning causation by nonparties not desig-

nated as such, the Act did expressly preserve the requirement that plaintiff

prove causation.'^ The court concluded that defendants were entitled to

contest causation by evidence of conduct by a person not pleaded as a

"nonparty" under the Act.'^ The court's holding, that that Act "did

not materially alter the law of causation, "^° required such a result.

C Nonparty as a "Person Who Is, or May Be, Liable to the
Claimant"

The Comparative Fault Act permits the defendant to plead the fault

of a "nonparty" as an affirmative defense.^' The Act contains a definition
of a "nonparty":

13. Gray, 684 F. Supp. at 1485.

14. 684 F. Supp. 220 (S.D. Ind. 1988).

15. The Comparative Fault Act, as amended in 1984, permits a defendant to "assert
as a defense that the damages of the claimant were caused in full or in part by a nonparty."

Ind. Code § 34-4-33-10(a) (1988). See also Ind. Code § 34-4-33-2(a) (1988) (definition
of "nonparty"). However, the defendant "must affirmatively plead the defense," Ind.

Code § 34-4-33-10(b) (1988), within the time Hmitations set forth in the statute. See Ind.
Code § 34-4-33-10(c), (d) (1988).

16. Moore, 684 F. Supp. at 222.

17. Id. at 221-22.

18. Id. See Ind. Code § 34-4-33-10(b) (1988).
19. Moore, 684 F. Supp. at 221.

20. Id.

21. Ind. Code § 34-4-33-10(a) (1988).



506 INDIANA LAW REVIEW [Vol. 22:503

"Nonparty" means a person who is, or may be, liable to
the claimant in part or in whole for the damages claimed but

who has not been joined in the action as a defendant by the
claimant. A nonparty shall not include the employer of the
claimant. ^^

Three cases have addressed whether a potentially immune defendant is
within this definition.

In Huber v. Henley,^^ the plaintiff alleged personal injuries from a
highway accident. In this opinion, the court granted one defendant leave

to amend its answer to assert the State of Indiana as a "nonparty" on
the ground that the State was negligent "in the maintenance of the

highway and the highway shoulder. "^"^ Plaintiff could not sue the State

because plaintiff had failed to give notice within 180 days as required

by the Tort Claims Act.^^

The court recognized that the current version of the "nonparty"

definition was intended to exclude persons who were immune from suit.^^
The court held, however, that the State was a proper nonparty. The

court drew a distinction between a person who is immune from suit
and a person against whom plaintiff has merely forfeited his claim:

A reasonable interpretation of the phrase, "a person who
is, or may be, liable to the claimant" is one against whom the
plaintiff would have had a right to relief. A judge acting within
her official capacity would, for example, be outside this definition

because against her a claimant would have no right to relief.

A state official performing a discretionary function likewise
cannot be held liable for errors, mistakes of judgment, or unwise

decisions made in the exercise of that discretion. On the other
hand, a claimant does generally have a right to recover against

governmental entities but can forfeit that right by failing to give

the prescribed notice.

Because the plaintiff had a right to recover against the

Department of Highways and merely forfeited that right, the

22. IND. Code § 34-4-33-2(a) (1988).
23. 656 F. Supp. 508 (S.D. Ind. 1987), clarified in Huber v. Henley, 669 F. Supp.

1474 (S.D. Ind. 1987). See infra text accompanying notes 42-50.

24. 656 F. Supp. at 509.

25. Id at 510. See Ind. Code §§ 34-4-16.5-1 to -21 (1988). In Huber, the 180-day
period had passed before the defendant filed its original answer. 656 F. Supp. at 512.

26. Under the original Comparative Fault Act, a "nonparty" was defined as "any

person who is not a party to the litigation." Ind. Code § 34-4-33-5(b)(l) (Supp. 1983).
"The 1984 amendment ameUorated this result somewhat by specifying that a nonparty to
whom a jury may attribute fauh must be a 'person who is, or may be liable to the
claimant."' 656 F. Supp. at 510.



1988] TORT LAW 507

Department of Highways can be a nonparty in this case as one

*'who is, or may be, hable to the claimant. "^^

In Hill V. Metropolitan Trucking, Inc.,^^ plaintiffs were State em-

ployees who were injured on a State highway. The defendants named
other State employees as nonparties. ^^ The court held, on two grounds,

that these persons were not proper nonparties under the Comparative

Fault Act.30

First, the court held that the State employees could not be liable

to plaintiffs because plaintiffs' sole remedy against them is under the

worker's compensation statute. ^^ Second, and contrary to the holding in

Huber v. Henley, the Hill court ruled that the State employees could
not be nonparties because plaintiffs had failed to give timely notice

under the Tort Claims Act:

Further, it appears that each of the would-be nonparties

would fall within the coverage of Indiana's Tort Claims Act

Ind. Code 34-4-16.5-1 et seq (sic), which requires that notice
of intent to sue be given within 180 [days] of the injuries being

incurred. Ind. Code 34-4-16.5-7. The would-be nonparties are
immune from suit absent such notice. The record does not suggest
that the Hills or Mr. demons' representatives gave such notice;
accordingly, the record does not reflect that the would-be non-

parties are or may ever be liable to the plaintiffs.
Because Mr. Hill and Mr. Clemons are not, and cannot be,

Hable to each other for any part of the damages the other claims,

and because Mr. Forney, Mr. Shaw and Trooper Rissot are not,
and cannot be, liable to either Mr. Hill or Mr. Clemons for

any part of the damages either claims, the plaintiffs' motion to

strike those portions of the contentions of defendants Rabayev

and Metropolitan dealing with the nonparty defenses should be

granted. 32

The nonparty issue arose again in Farmers & Merchants State Bank
V. Norfolk & Western Railway Co.^^ This was an action by three minor

27. 656 F. Supp. at 511 (citations omitted).

28. 659 F. Supp. 430 (N.D. Ind. 1987).

29. Id. at 431.

30. The court also rejected plaintiffs' argument that no employee of the State
could be named as a nonparty because the Act excludes "the employer of the claimant"
from the definition of a nonparty. 659 F. Supp. at 434. See Ind. Code § 34-4-33-2(a)
(1988).

31. Hill, 659 F. Supp. at 434.

32. Id. at 434-35.

33. 673 F. Supp. 946 (N.D. Ind. 1987).



508 INDIANA LAW REVIEW [Vol. 22:503

siblings who were injured in a train crossing accident. The railroad
asserted an affirmative defense naming as a nonparty plaintiffs' father,

who was driving the car at the time of the accident. Plaintiffs moved
to strike the defense, arguing that the father could not be a nonparty

because any claim against him was barred by the parental immunity

doctrine.
^"^

The district court, noting that there was no Indiana state court

authority interpreting the nonparty provision, relied upon Huber v.
Henley and Hill v. Metropolitan Trucking. ^^ After discussing both cases,

the court stated: ''The conclusion that Judges Barker and Miller both

reached then, was that a person who is immune from suit cannot be
a nonparty under Indiana's Comparative Fault Statute because such a

person cannot be *a person who is, or may be, liable to the claimant. '"^^

The court did not point out that the two earlier cases reached different

results on the specific issue of naming a State entity or employee as a

nonparty where no timely notice was given under the Tort Claims Act.

On the facts of the case, the court denied the motion to strike. The
court acknowledged that the father could not be a nonparty if he were

wholly immune from suit by plaintiffs. ^^ Here, however, the father did
not have complete immunity. "Indiana's Guest Statute . . . creates an

exception to the parent-child immunity doctrine in the case of motor

vehicle accidents. "^^ Under the Guest Statute, a parent may be Uable
to a child for "wanton or willful misconduct. "^^ Because there was

possible parental liability, the court denied plaintiffs' motion to strike

the nonparty defense. "^ The court stressed that the defendant would bear

the burden of proving at trial that the father was guilty of "wanton

or willful misconduct."'*'

The general principle enunciated in the three cases—that the validity
of a nonparty defense turns upon whether the nonparty is immune from
suit by plaintiff—appears sound. Additional decisions are necessary,
however, to demarcate the precise limits of the nonparty defense. In

particular the conflict between the specific holdings of Huber v. Henley
and Hill v. Metropolitan Trucking will have to be resolved by the Indiana

courts.

34. Id. at 947.

35. Id. at 948.

36. Id. (emphasis in original) (quoting Ind. Code § 34-4-33-2 (Supp. 1984)).
37. Id. at 948-49.

38. Id. at 949. See Ind. Code § 9-3-3-l(b) (1988).
39. Ind. Code § 9-3-3-l(b)(3) (1988).
40. Farmers, 673 F. Supp. at 949.

41. Id. at n.2.



1988] TORT LAW 509

D. Nonparties and the Statute of Repose

In the second published Huber v. Henley decision/^ the court clarified
its prior decision/^ discussed in the preceding section, which granted

defendants leave to amend their answer to assert a nonparty defense.
The defendants claimed fault by the State of Indiana in the design,

construction, and maintenance of the roadway on which plaintiff's ac-

cident had occurred. Plaintiff's time for a notice of a tort claim against

the State had expired. The first Huber decision held that ''[b]ecause the
plaintiff had a right to recover against the Department of Highways

and merely forfeited that right, the Department of Highways can be a

nonparty" as defined in the Act."^"^

Plaintiff then filed a motion for partial summary judgment on the
nonparty defense because Indiana's ten-year statute of repose for im-

provements to real estate"*^ shielded the State from liability, thus taking

it outside the Act's definition of a "nonparty. '"^^ The court's second

decision agreed in concept with plaintiff's argument that if an applicable

statute of repose barred plaintiff's action the State could not be a non-

party, and distinguished its earlier holding with respect to notice under

the Tort Claims Act:

[T]he statute of repose, had it apphed, would have barred the

plaintiff's cause of action at the instant of its accrual. The state
would not have been "a person who is, or may be, Hable" to
the plaintiff. The plaintiff would not have forfeited his right to
recovery (as he did by not giving tort claim notice within 180

days); he simply would have had no right. ''^

Nonetheless, the court denied the summary judgment motion on the
ground that the cited real estate improvement statute of repose did not

apply."^^ The statute of repose provides that it may not be raised as a
defense "by any person in actual possession or the control of real
property, either as owner, tenant or otherwise.'"*^ The court held that
this Hmitation applied to the State, because "the state stands in the

position of owner of the pubhc roadways. "^°

42. 669 F. Supp. 1474 (S.D. Ind. 1987).

43. 656 F. Supp. 508 (S.D. Ind. 1987).

44. 669 F. Supp. at 1478 (quoting 656 F. Supp. at 511). See supra text accompanying

notes 23-27 (discussion of the holding in the first Huber decision).
45. Ind. Code § 34-4-20-4 (1988).
46. 669 F. Supp. at 1478.

47. Id. at 1479.

48. Id.

49. Ind. Code § 34-4-20-4 (1988).
50. 669 F. Supp. at 1479.



510 INDIANA LAW REVIEW [Vol. 22:503

E. Allocations of Fault to Dismissed Parties

In Bowles v. Tatom,^^ the court reversed an allocation of fault that

did not reflect evidence of fault by a defendant who had been dismissed
from the action at the close of plaintiff's case. Tatom was injured in
a car accident after Bowles failed to obey a stop sign covered by dense

foliage. Tatom sued Bowles, the City of Bedford, its mayor, and the
adjacent property owners.

At trial, plaintiff presented no evidence to establish liability by the

city, the mayor, or the adjacent landowners. After plaintiff rested his

case, the court dismissed claims against each of those parties pursuant

to Indiana Trial Rule 50(A). ^^ In her case, however, Bowles testified

and introduced evidence of fault by some or all the dismissed parties.

Specifically, Bowles produced evidence that the disregarded stop sign

had been obscured by foliage. After hearing all evidence, the trial court

entered a judgment in favor of Tatom, finding Bowles one hundred

percent at fault and assessing damages accordingly.

Bowles' undisputed evidence of the obscured stop sign led the court

of appeals to find clearly erroneous the trial court's assessment of one

hundred percent fault against Bowles. Although the appellate court held

in Walters v. Dean^^ that fault may not be allocated to a nonparty
where the defense is not properly pleaded, the landowners and city were

parties in Bowles. Thus, under the plain terms of the statute, a nonparty

defense could not have been pleaded against those co-defendants.^"* Bowles

characterized Walters as based on a policy of providing to a plaintiff

fair notice of possible empty-chair defenses so those nonparties could

be added as defendants if still feasible. ^^ Bowles distinguished that rea-

soning from the Act's allocation of fault between named parties in a
lawsuit. ^^ Because *'[a] defendant does not have to point at another

pleaded party to invoke the fault allocation process of the Comparative

Fault Act," the court found the dismissal of the adjacent landowners

and City resulted "merely in a bar to Tatom's obtaining a judgment

against those defendants" rather than a finding on the merits that they

were not, and could not be, at fault.^^

In dissent. Judge Conover argued that the city, the mayor, and the

adjacent landowners did not meet the statutory nonparty definition. ^^

51. 523 N.E.2d 458 (Ind. Ct. App. 1988).

52. Ind. R. T. P. 50(A) (1988) (Judgment on the Evidence).

53. 497 N.E.2d 247 (Ind. Ct. App. 1986).

54. Ind. Code § 34-4-33-2(a) (1988).
55. Bowles, 523 N.E.2d at 461.

56. Id.

57. Id.

58. Id. at 462 (Conover, J., dissenting).



1988] TORT LAW 511

The Act defines a ''nonparty" as "a person who is, or may be, Uable
to the claimant. "^^ Judge Conover stated that the trial court's Trial

Rule 50(A) judgment "amounted to a determination of zero percent

fault as to each such defendant as a matter of law."^^ Accordingly,

Judge Conover reasoned that those parties could not be nonparties

because they could not be Hable to the claimant.^^

The authors of this Article believe that Bowles was correctly decided.

As the court noted, dismissal at the close of plaintiff's case is only a

ruling that plaintiff cannot recover from the dismissed defendant. The

apportionment of fault is an analytically different issue, which remains

whether or not the defendant is dismissed. In addition, Judge Conover's

position could lead to unfair results. The co-defendant cannot control

plaintiff's presentation of evidence. There is no reason to penalize the

co-defendant—who may have ample evidence that the dismissed defendant
was at fault—because plaintiff failed (or chose not) to present that
evidence. ^^ The result, under the dissent's analysis, would be to exempt

the dismissed defendant from the allocation of fault. Apart from the

possible unfairness to co-defendants, this does not seem to square with

the Legislature's intent in passing the Comparative Fault Act—to ap-
portion fault among all persons involved in an accident."

F. Inconsistent Allocations of Fault on Related Claims

The effect of inconsistent allocations of fault was at issue in Paul

V. Kuntz.^"^ Mark Paul and Bill Kuntz, both minors, were injured when
the automobile in which they were riding struck a tree. Paul sued Kuntz,

59. IND. Code § 34-4-33-2(a) (1988).
60. 523 N.E.2d at 462 (Conover, J., dissenting).

61. Id.

62. One can imagine how a plaintiff could take unfair advantage of the dissent's
position. Assume there are four possible parties at fault. Three are judgment-proof; the

fourth is a deep pocket. The plaintiff sues all four but purposely presents no evidence

at trial as to the impecunious trio, all of whom are dismissed at the close of plaintiff's
case. The solvent defendant would be deprived of the opportunity of reducing his Uabihty

by establishing the fault of the co-defendants.

63. Moreover, Trial Rule 50(A) can be applied reasonably and fairly in a comparative

fault action. The ultimate reduction in plaintiff's recovery made possible where a dismissal
is granted need not foreclose the granting of such a motion at the close of a plaintiff's

case. Plaintiff's burden is merely to produce sufficient evidence from which a particular

co-defendant could be found liable for at least some fault allocation. Such a threshold

is not high, but a judgment on the evidence should be granted for failure to meet the

threshold. Thorough discovery should reveal whether one defendant claims that another

defendant is at fault and what evidence, if any, exists of that fault. Accordingly, plaintiff's

failure to present adequate proof of a defendant's fault can fairly result in a Trial Rule

50(A) dismissal.

64. 524 N.E.2d 1326 (Ind. Ct. App. 1988).



512 INDIANA LAW REVIEW [Vol. 22:503

claiming Kuntz had been driving the automobile. Kuntz counterclaimed,

claiming that Paul had been driving. Trial was to the court, which made
special findings of fact on the complaint and counterclaim. The trial

court determined Kuntz was the driver, but on Paul's complaint deter-

mined that Paul was 54 percent at fault and Kuntz 38 percent at fault.

A non-party was assigned 8 percent fault. On the Kuntz counterclaim,
the court determined that Kuntz was 54 percent at fault and Paul was

46 percent at fault. Accordingly, the court entered judgment against

Paul on his complaint and against Kuntz on his counterclaim, so that

neither party was awarded any recovery.

On appeal, Paul argued the inconsistent fault allocations were er-
roneous. Kuntz defended the allocations, arguing the findings of fault

on the counterclaim were not binding as findings of fault on the com-

plaint.

Finding the judgment to contain irreconcilable differences arising

from a common set of facts, the court of appeals reversed, reasoning
that "a factfinder on a single set of facts and circumstances cannot

reach two different conclusions of fact as expressed in its findings or

verdicts that will support vaUd judgments if the opposite, inconsistent

conclusions are irreconcilable."^^ Because the trial court's special findings

and conclusions failed to disclose any factual basis for the facial dis-

crepancy in the allocations of fault, the appellate court held that new
findings of fact and a consistent allocation of fault were required. ^^

The same principle would seem to apply in a jury trial. The Com-
parative Fault Act has a specific provision on inconsistent verdicts, but

it addresses "verdicts in which the ultimate amounts awarded are in-

consistent with [the jury's] determinations of total damages and per-

centages of fault. "^^ The statute directs the trial court to inform the

jury of the inconsistencies and to direct the jury to resume dehberations

to cure them.^ This would appear to be the correct approach in the

trial court if the jury returns verdicts that are "inconsistent" in the

different sense at issue in Paul v. Kuntz. If, however, the trial court

discharges the jury without correcting inconsistent allocations of fault

on different claims arising from the same incident, then it appears that

a new trial would be necessary.

65. Id. at 1329 (citing Fanning v. McCarry, 2 111. App. 3d 650, 275 N.E.2d 897

(1971)).

66. 524 N.E.2d at 1329.

67. IND. Code § 34-4-33-9 (1988). See also Ind. Code § 34-4-33-5 (1988) (describing
how the jury allocates fault and determines damages); Ind. Code § 34-4-33-6 (1988) (forms
of verdicts).

68. Ind. Code § 34-4-33-8 (1988).



1988] TORT LAW 513

III. Recovery of Damages for Emotional Distress

Despite continued adherence to the formal rule that emotional distress

damages may be awarded only where the plaintiff suffers a contem-
poraneous physical injury, Indiana courts slowly but steadily have ex-

panded the number of cases in which plaintiff can recover emotional

distress damages. In 1976, Indiana created an exception to the rule for

cases involving intentional infliction of emotional distress where circum-

stances indicated emotional trauma was foreseeably and "inextricably

intertwined" with the deliberate wrong.^^ This exception has been appHed

to an increasingly broad range of conduct, including fraud actions where

no physical sign of mental distress was shown.^°

In 1978, the Indiana Court of Appeals questioned the soundness of

the contemporaneous physical injury rule while holding that a needle

prick satisfied the requirement of contemporaneous physical injury.^^ The

rule quickly became known as an "impact rule" rather than solely as
a "physical injury rule."^^ At least one subsequent interpretation left

open the question of whether only "impact," rather than injury, is

required.^^ In 1981, Justice Hunter noted in a dissent to denial of transfer

that only five other American jurisdictions regard the impact rule "as

a viable proposition of law."^"^ Since 1981, at least two of those juris-

dictions have abandoned the rule.^^

During the survey period, the "impact rule" was interpreted in a

decision holding that one suffering an impact could recover for the

emotional distress caused by witnessing injury to another^^ and in a

decision allowing recovery in a "garden variety" fraud case where plain-

tiffs presented no evidence of physical symptoms of mental anguish. ^^

A third decision took a more conservative view of the impact rule.^^

69. Charlie Stuart Oldsmobile v. Smith, 171 Ind. App. 315, 327, 357 N.E.2d 247,

254 (1976), vacated in part on other grounds on reh'g, 175 Ind. App. 1, 369 N.E.2d 947

(1977). See infra text accompanying note 99.

70. Groves v. First Nat'l Bank of Valparaiso, 518 N.E.2d 819 (Ind. Ct. App.

1988).

71. Kroger Co. v. Beck, 176 Ind. App. 202, 208 n.5, 375 N.E.2d 640, 645 n.5

(1978) (the needle was in a steak; plaintiff's injury was a throat puncture wound).

72. Little V. Williamson, 441 N.E.2d 974, 975 (Ind. Ct. App. 1982).

73. Id. at n.3 (avoiding issue of whether the rule "requires actual harm or if mere
physical contact is sufficient").

74. Elza V. Liberty Loan Corp., 426 N.E.2d 1302, 1308 (Ind. 1981) (Hunter, J.,
dissenting to denial of transfer).

75. See Pieters v. B-Right Trucking, Inc., 669 F. Supp. 1463, 1471-72 (N.D. Ind.

1987).

76. Id.

11. Groves v. First Nat'l Bank of Valparaiso, 518 N.E.2d 819 (Ind. Ct. App.

1988).

78. Wishard Memorial Hosp. v. Logwood, 512 N.E.2d 1126 (Ind. Ct. App. 1987).



514 INDIANA LAW REVIEW [Vol. 22:503

Discussion of these decisions follows, but reconciliation will require

further court interpretation,

A. Recovery for Witnessing Injury to Another

The impact rule was interpreted to allow damages for the mental

distress suffered in witnessing injury to another in Pieters v. B-Right

Trucking, Inc.^^ Karey Pieters and her fiancee were in a car that crashed,

in the dark, into a truck parked on the road. The truck had been

abandoned in the traveled portion of the road apparently without flares,

reflectors, or other types of warning devices behind or beside the trailer.

Karey Pieters suffered a broken thumb and injured hip. Her fiancee

died several hours after the crash.

Shortly before trial, defendant filed two motions in limine seeking

to exclude emotional distress evidence. After an extensive analysis of

the history and policy foundations for the impact rule, the court held

that plaintiff could recover damages for the emotional distress she suf-

fered from witnessing her fiancee's death and thus denied the motions

in limine.

Pieters discussed the three different rules utilized by state courts in

deciding whether emotional distress damages should be awarded: (1) the

zone of danger rule, (2) the foreseeability rule, and (3) the impact rule.^^

The zone of danger rule allows emotional distress damages to be recovered

only by plaintiffs who were within the range of ordinary physical peril.
The foreseeability analysis is the least restrictive and allows recovery if

defendant should have foreseen the possibility of fright or shock severe

enough to cause substantial injury in a normal person. The impact rule

requires contemporaneous physical injury before emotional distress dam-

ages may be recovered.^*
Indiana adopted the impact rule in 1897,^^ and it "has steadfastly

been adhered to since. "^^ There was no dispute that plaintiff had suffered

contemporaneous physical injuries.^"* The issue was whether she could
recover damages for the emotional distress caused by the fact that she

witnessed the injuries to her fiancee. The court held that:

A thorough review of Indiana's other impact cases convinces
the court that the impact rule, as applied by Indiana courts.

79. 669 F. Supp. 1463, 1466 (N.D. Ind. 1987).

80. Id.

81. Id.

82. Id. (citing Kalen v. Terre Haute & I.R.R., 18 Ind. App. 202, 47 N.E.2d 694
(1897)).

83. 669 F. Supp. at 1466 (citing. Captain & Co., Inc. v. Stenberg, 505 N.E.2d
88, 100 (Ind. App. 1987)).

84. 669 F. Supp. at 1467.



1988] TORT LAW 515

has not been used to preclude recovery for emotional distress

due to another's injuries when the plaintiff has suffered an

impact and contemporaneous physical injury and when the other

injuries and the plaintiff's injuries result from the same impact. ^^

In addition to discussing the prior cases, ^^ the court noted that its holding

was consistent with the three policies underlying the impact rule:

First, courts feared that absent impact, claims for emotional

distress would flood the courts with litigation. Second, courts

feared that the absence of an impact requirement would spawn

fraudulent claims. Third, courts feared that it would be too

difficult to prove the causal connection between the damages

claimed and the defendant's negligence.^^

Here, *'[t]he plaintiff already has a claim for emotional distress for her

own injuries, "^^ ''[tjhere is no suggestion that her claim is fraudulent, "^^

and *'[p] roving damages will be no more difficult if she recovers for

the distress caused by her fiance's injuries and death. "^^ The court

concluded that, "the recovery [under the court's holding] will certainly

be more accurate and complete, which is precisely the kind of recovery

the law ought to give."^'

The court then surveyed cases from other jurisdictions, noting that

most jurisdictions would allow plaintiff to recover emotional distress

damages based upon the injuries suffered by her fiancee.^^ "The trend
in this area of the law clearly favors recovery. "^^

Until Indiana state courts address the Pieters holding, the decision

will remain controversial. The defendants in Pieters argued that Boston

V. Chesapeake & Ohio Railway,^'^ an Indiana Supreme Court decision.

85. 669 F. Supp. at 1469 (citations omitted); see also id. at 1473 (holding restated).

86. Id. at 1467-70.

87. Id. at 1470.

88. Id. at 1470-71.

89. Id. at 1471.

90. Id.

91. Id. The court also noted that "scholars agree that the fears which form the

foundation of the [impact] rule have httle basis in reality." Id. (citations omitted).

The court simply points out the fact that the reasons for the rule, even if taken

as true, do not prevent recovery in this case. The reasons for the rule essentially

relate to the question of when damages for emotional distress are recoverable,

i.e., upon impact. Once a plaintiff meets this test the reasons for the rule fall

away and cannot be resurrected to raise an artificial wall. It makes no sense

to use the rule in that way.

Id.

92. 669 F. Supp. at 1471-73.

93. Id. at 1473.

94. 223 Ind. 425, 61 N.E.2d 326 (1945).



516 INDIANA LAW REVIEW [Vol. 22:503

limited mental anguish damages to those directly resulting from the

physical injury suffered. The Pieters court correctly noted that Chesa-

peake does not expressly exclude damages arising from witnessing injury

to another. ^^ Such a result, however, can be fairly inferred from the

Chesapeake ruHng.^^ Indeed, only one month before the Pieters decision,
the Indiana Court of Appeals in Wishard Memorial Hospital v. Log-

wood,^^ stated the impact rule as follows: "In Indiana, the general rule

is that a person can recover damages for mental anguish only when it
is accompanied by, and results from, a physical injury. "^^

The distinction between allowing damages which **result from" an

impact, as described in Logwood and Chesapeake, and allowing an
action for all mental distress caused after impact is the issue upon which

Pieters will remain controversial. Only further clarification of Indiana's

impact rule will settle the issue of whether recoverable damages for

mental distress are those directly arising from the injuries suffered.

B. Recovery of Emotional Distress Damages in Intentional Tort
Actions

Indiana's exception to the rule for some intentional torts originated

in Charlie Stuart Oldsmobile, Inc. v. Smith,^^ where the court recognized

an exception to the general rule of the requirement of an impact:

Indiana courts have awarded compensatory damages for mental

anguish unaccompanied by physical injury in certain tort actions

involving the invasion of a legal right which by its very nature

95. 669 F. Supp. at 1469.

96. The Chesapeake court stated that "the complete rule would add that before

recovery can be had for mental injury, including every form of distress, brooding, or

fright, it must appear to be the natural and direct result of the physical injury, and not

merely a remote consequence thereof." 223 Ind. at 428-29, 61 N.E.2d at 327 (emphasis

added).

97. 512 N.E.2d 1126 (Ind. Ct. App. 1987).

98. Id. at 1127 (emphasis added) (citing Boston v. Chesapeake & O. Ry., 223 Ind.
425, 428-29, 61 N.E.2d 326, 327 (1945)). Pieters, ironically, appears to recognize a right

to recovery that would not be allowed in California, the jurisdiction long considered the

most liberal in allowing emotional distress damages. In Elden v. Sheldon, 46 Cal. 3d 267,

758 P.2d 582, 250 Cal. Rptr. 254 (1988), the California Supreme Court held a plaintiff

could not recover damages for witnessing the death of a live-in girlfriend because there

was no legally-recognized family relationship between the parties. The Elden court spe-

cifically disapproved the holding in Ledger v. Tippitt, 164 Cal. App. 3d 625, 210 Cal.

Rptr. 814 (1985), allowing emotional distress damages based upon injury to a fiancee. 46

Cal. 3d at , 758 P.2d at 588, 250 Cal. Rptr. at 260. In Pieters, the court did not

expressly consider a requirement of family relationship.

99. 171 Ind. App. 315, 357 N.E.2d 247 (1976), vacated in part on other grounds

on reh'g, 175 Ind. App. 1, 369 N.E.2d 947 (1977).



1988] TORT LAW 517

is likely to provoke an emotional disturbance. False imprisonment

and assault actions are examples of instances in which a disa-

greeable emotional experience would normally be expected to be

inextricably intertwined with the nature of the deliberate wrong

committed, thereby lending credence to a claim for mental dis-

turbance. The conduct of defendant in such circumstances is

characterized as being willful, callous, or malicious, which may
produce a variety of reactions, such as fright, shock, humiliation,

insult, vexation, inconvenience, worry, or apprehension.'^

In Baker v. American States Insurance Co.,'°' the court added fraud to

the type of actions in which damages could be recovered for mental

anguish absent a showing of contemporaneous physical injury. '^^

During the survey period, the Indiana Court of Appeals allowed

recovery of damages for mental anguish in a fraud case without a

contemporaneous physical injury, and without subsequent physical symp-

toms, although the court ultimately reversed the $100,000 award for

mental anguish as excessive.

The plaintiffs in Groves v. First National Bank of Valparaiso^^^ had
purchased real estate from the First National Bank of Valparaiso. The
Bank had represented that it had clear title to the realty. The Groves
invested substantial time and money making improvements to the realty
and were ''frightened and angry" when they learned they had not received
good title. '^"^ However, the Groves did not introduce "any evidence that

they experienced any physical manifestations, sleeplessness, depression,

or other observable indicia of emotional distress. "'^^ Despite the lack

of physical symptoms, the court concluded emotional distress damages

properly could be awarded, although "in the absence of evidence of

any physical or psychological manifestation of mental anguish, the award

100. Id. at 327, 357 N.E.2d at 254.

101. 428 N.E.2d 1342 (Ind. Ct. App. 1981).

102. The Baker court reversed the dismissal of an action claiming fraud in connection

with a workers compensation claim. On the claim for emotional distress, the court stated:
The tort of fraud, if proven, would clearly constitute an invasion of a legal

right. Furthermore, the question of whether this kind of intentional invasion of

a legal right is likely to cause an emotional disturbance is for the trier of fact.

We cannot say as a matter of law that Baker could not, under the allegations
of his amended complaint, show that his claim falls within the exception to the

impact rule.

428 N.E.2d at 1349-50. Fraud had been mentioned in Charlie Stuart as one of the examples

of intentional torts for which other jurisdictions allowed recovery. 171 Ind. App. at 327,
357 N.E.2d at 254.

103. 518 N.E.2d 819 (Ind. Ct. App. 1988).

104. Id. at 831.

105. Id.



518 INDIANA LAW REVIEW [Vol. 22:503

of nearly $100,000 is so high as to demonstrate passion or prejudice

on the part of the jury."^^^

As the Groves decision points out, damages for emotional distress
have *'no precise standards of measurement. "^°^ Further, "[p]hysical and

mental pain are, by their very nature, not readily susceptible to quan-

tification, and, therefore, the jury is given very wide latitude in deter-

mining these kinds of damages. "'°^ Despite the range of jury discretion

permitted, Groves demonstrates that an appellate court can retain control

of excessive awards. After consideration of similar damage awards and

the extent of the emotional distress evidence presented, the court reversed

the jury's award for mental anguish. ^^^

Groves is notable for allowing recovery in an ordinary fraud case

in the absence of physical indicia of mental distress. Emotional distress

damages awarded on this basis are, in effect, a type of punitive damages.

The authors believe that emotional distress damages should be reserved

for cases where there is probative evidence of a true emotional trauma.

Requiring proof of some physical effect is a reasonable requirement,

particularly where the alleged mental distress arises from a commercial

transaction. Misapplication of the Charlie Stuart exception opens emo-

tional distress to virtually any action in which some type of intentional

or willful misconduct is alleged.

IV. Punitive Damages

In Bud Wolf Chevrolet, Inc. v. Robertson, ^^^ the supreme court held
that proof of malice is not an essential element in recovering punitive

damages in Indiana, under either tort or contract theories.^^^ The court

further approved a punitive damages instruction given to the jury and

affirmed a substantial punitive damages award. '^^

The Robertsons had purchased a truck from Bud Wolf Chevrolet
after being told it was "new" and had only been used by a salesman
to drive back and forth to work. The Robertsons were not told that

the truck had been involved in an accident prior to sale which had bent

the frame cross rail and resulted in numerous other repairs. After a

jury trial in the Marion Circuit Court, judgment was entered for the

Robertsons in the amount of $3,500 in compensatory damages and

106. Id. at 832.

107. Id. at 831.

108. Id.

109. Id. at 832. The court ordered a new trial on the issue of damages.

110. 519 N.E.2d 135 (Ind. 1988).

111. Id. at 137.

112. Id. at 138.



1988] TORT LAW 519

$75,000 in punitive damages. '^^ The court of appeals initially affirmed

the compensatory damage award and reversed the punitive damage

award. ^•'^ The appeals court held: "The evidence, though permitting a
conclusion of tortious conduct sufficient to support compensatory dam-

ages, does not permit a conclusion of malice sufficient to support an

award of punitive damages. "^'^ On rehearing,''^ the court of appeals
reinstated the punitive damage award, on the ground that Bud Wolf
Chevrolet had not objected to the punitive damages instruction and the

award was appropriate under that instruction. '^^ The appeals court ac-

knowledged that this change in result created a conflict with the decision

of another district. ^^^

The supreme court granted defendant's petition to transfer,''^ vacated

the court of appeals' ruling on punitive damages, '^^ and affirmed the

trial court on this issue. '^^ The court noted that existing Indiana law

relating to recovery of punitive damages in a contract action requires

(1) proof of "a serious wrong, tortious in nature, "'^^ (2) proof that

"the public interest will be served by the deterrent effect of the punitive

damages, "'^^ and (3) "further evidence 'inconsistent with the hypothesis

that the tortious conduct was the result of a mistake of law or fact,

honest error of judgment, overzealousness, mere negligence or other

noniniquitous human fainng.'"'^"^ The supreme court rejected the court
of appeals' holding on malice, stating that: "[I]n both tort and contract

actions, while proof of malice may be relevant to show the obduracy
necessary for punitive damages, the element of malice is a mere alter-

113. Id. at 135.

114. Bud Wolf Chevrolet, Inc. v. Robertson, 496 N.E.2d 771, 777 (Ind. Ct. App.

1986), modified on reh'g, 508 N.E.2d 567 (Ind. Ct. App. 1987).

115. 496 N.E.2d at 777.

116. Bud Wolf Chevrolet, Inc. v. Robertson, 508 N.E.2d 567 (Ind. Ct. App. 1987),
vacated, 519 N.E.2d 135 (Ind. 1988).

117. 508 N.E.2d at 570-71.

118. Id. at 571 (noting the conflict with Martin Chevrolet Sales, Inc. v. Dover, 501

N.E.2d 1122 (Ind. Ct. App. 1986)).

119. See Ind. R. App. P. 11(B)(2)(c) ("[ejrrors upon which a petition to transfer

shall be based may include . . . that there is a conflict between the opinion or memorandum
decision and a prior opinion of the Court of Appeals").

120. 519 N.E.2d at 138.

121. Id.

122. Id. at 136 (quoting Vernon Fire & Casualty Ins. Co. v. Sharp, 264 Ind. 599,
608, 349 N.E.2d 173, 180 (1976)).

123. 519 N.E.2d at 136-37 (quoting Art Hill Ford, Inc. v. Callender, 423 N.E.2d

601, 602 (Ind. 1981)).

124. 519 N.E.2d at 137 (quoting Travelers Indem. Co. v. Armstrong, 442 N.E.2d

349, 362 (Ind. 1982)).



520 INDIANA LAW REVIEW [Vol. 22:503

native, not an essential prerequisite, to obtain punitive damages. "'^^ The

court went on to decide:

In the present case, the jury could have found by clear and

convincing evidence both (1) that Bud Wolf's conduct, even if
not proven to be malicious, nevertheless constituted fraud, gross

negligence or oppressiveness, and (2) that Bud Wolfs conduct
was inconsistent with any contention of mistake of law or fact,

honest error of judgment, overzealousness, mere negligence, or

other such noniniquitous human faihng.^^^

The court also addressed the *' public interest" issue, and it appears
clear from its discussion that the court considered this an important

issue in light of the facts of the case: "We agree with Robertson that
public pohcy cannot condone a dealer taking a vehicle that has been

extensively damaged, repair it so as to conceal the damage, and then

sell it as new at full price with impunity. "'^^

Also noteworthy in the Bud Wolf Chevrolet decision is the Indiana
Supreme Court's approval of a jury instruction which includes a definition

of "clear and convincing evidence," the standard of proof necessary to

recover punitive damages. Under the approved instruction: "[c]lear and

convincing evidence may be defined as an intermediate standard of proof
greater than a preponderance of the evidence and less than proof beyond

a reasonable doubt and requires the existence of a fact be highly

probable."^28

Although the supreme court affirmed a punitive damage award in
Bud Wolf Chevrolet, the authors do not believe that the decision itself
made any fundamental change in Indiana punitive damages law. The
facts in Bud Wolf Chevrolet appear to have been egregious. The supreme
court's ruHng on those facts, therefore, is consistent with the recent

trend of supreme court cases holding, in substance, that punitive damage
awards are to be limited to the relatively few cases where extreme wrongful

conduct is clearly proved. '^^

V. Premises Liability

Perhaps the most remarkable feature of premises liability law in

Indiana is the amount of attention and time required from Indiana

125. 519 N.E.ld at 137.

126. Id.

127. Id.

128. M at 138 (quoting trial court's jury instructions).
129. See, e.g., Orkin Exterminating Co. v. Traina, 486 N.E.2d 1019, 1022-23 (Ind.

1986); Travelers Indem. Co. v. Armstrong, 442 N.E.2d 349, 358-61 (Ind. 1982).



1988] TORT LAW 521

courts to interpret it.'^^ During the survey, probably as much appellate

court energy was devoted to interpreting Indiana's law of premises liability

as to any other substantive area of tort law. One reason the topic might
take so much judicial time could be Indiana's cumbersome three-part
duty analysis, which requires classification of persons as invitees, licensees

or trespassers. The harshness of Indiana's rule that a landowner owes

a licensee only the duty to keep from willfully or wantonly hurting him

has spurred considerable judicial effort in creating "impUed invitees, "'^^

"business visitors, "^^^ "public invitees,"*" "business invitees, "'^'^ and

fact issues over whether a person is an invitee.'"

A. Prior Law: "Intention" Versus "Foreseeability" in Determining

Premises Liability

The confusing and convoluted nature of Indiana law on the topic

is illustrated by J. C. Penney Co. v. WesolekJ^^ Ruth Wesolek fell on

an escalator that malfunctioned in a J. C. Penney Store. The trial court

instructed the jury on the duty owed to a licensee. After the jury returned

a verdict for J. C. Penney, the trial court granted a new trial, ruHng

that it should have instructed the jury that Wesolek was an invitee. The

difference in classification was vital—if Wesolek was a Hcensee, J. C.
Penney needed only to refrain from willfully or wantonly injuring her;

if an invitee, J. C. Penney had to exercise due care to keep its property

in a reasonably safe condition for her. On appeal, rather than adopting
a position that all customers or potential customers are invitees, the

Wesolek court found that the question of whether plaintiff was an invitee

or a licensee depended in part on her purpose for being in the store. '^^

130. At least seven appellate decisions were published on this subject in the survey

period. In addition to the cases discussed below, see generally Morris v. Scottsdale Mall

Partners, Ltd., 523 N.E.2d 457 (Ind. Ct. App. 1988); Sowers v. Tri-County Tel. Co.,

512 N.E.2d 208 (Ind. Ct. App. 1987); Howard v. H. J. Ricks Constr. Co., 509 N.E.2d
201 (Ind. Ct. App. 1987).

131. See, e.g., Hoosier Cardinal Corp. v. Brizuis, 136 Ind. App. 363, 371, 199

N.E.2d 481, 485 (1964).

132. See, e.g., Fleischer v. Hebrew Orthodox Congregation, 504 N.E.2d 320, 322
(Ind. Ct. App. 1987) (citing MuUins v. Easton, 176 Ind. App. 590, 376 N.E.2d 1178

(1978); Restatement (Second) of Torts § 332 (1965)).
133. See, e.g.. City of Bloomington v. Kuruzovich, 517 N.E.2d 408, 412-13 (Ind.

Ct. App. 1987).

134. See, e.g.. Sowers v. Tri-County Tel. Co. Inc., 512 N.E.2d 208, 210 (Ind. Ct.

App. 1987).

135. See, e.g., J.C. Penney Co. v. Wesolek, 461 N.E.2d 1149, 1152-53 (Ind. Ct.

App. 1984).

136. 461 N.E.2d 1149 (Ind. Ct. App. 1984).

137. Id. at 1153. Plaintiff's status also depended in part upon J.C. Penney's purpose

for holding its store open to the public and whether plaintiff's purpose for entering the

premises corresponded with that purpose. Id.



522 INDIANA LAW REVIEW [Vol. 22:503

Consequently, "[w]hether Ruth made a purchase in Penney's before her
fall is crucial to the determination of her status at the time of her

fall. . . . [ijf not, her status was that of a licensee. "'^^

The Wesolek decision avoided the more difficult issue: whether stores

should owe a reasonable duty of care to all persons in traveled areas
during business hours. The Wesolek decision reduced the determination

to an examination of whether the customer was browsing, shopping, or

just passing through. Yet, whether Ruth Wesolek make a purchase or
was just passing through the store to a common mall area, the danger
she encountered was the same. More importantly, there is no question
that J. C. Penney encouraged, and benefited from the presence of,

persons entering or passing through the store for any reason. In addition,

because there are "invitees" in J. C. Penney's stores throughout the

business day, the finding that some shoppers are mere ''licensees" would

do nothing to reduce the cost to J. C. Penney of meeting its duty to

protect invitees. For all of these reasons, the shopper's intention does

not appear to be a rational basis for determination of the store's liability

concerning the danger.

Not all Indiana cases rely on artificial distinctions as the court did

in Wesolek. In Ember v. BFD, Inc.,^^^ the court of appeals ruled that
premises liability could be extended for a condition off the premises of

the landowner. ^"^^ A bar patron sued after being injured and assaulted
in a parking lot across from the bar. The bar's co-manager admitted

receiving complaints prior to the assault concerning excessive noise, crowd

problems, and criminal activity on the streets adjacent to the bar. The

bar's management also had been aware of at least five or six violent

incidents inside or outside the tavern. The bar employed two uniformed
police officers, including one posted outside the bar. To quell neigh-
borhood complaints, the bar distributed a flyer to the local neighborhood

advising individuals to call the bar regarding problems or to call city

police if their complaint concerned a serious incident. The bar did not
own or lease the parking lot on which the assault occurred. ^"^^

The trial court granted summary judgment for the bar. The court
of appeals reversed, basing its decision on two alternative grounds: (a)

the bar gratuitously might have assumed the duty to patrol adjacent

areas; and (b) the responsibility of a landowner could extend beyond

the land owned. '"^^

138. Id.

139. 490 N.E.2d 764 (Ind. Ct. App. 1986).

140. Id. at 772.

141. Id. at 766-68.

142. Id. at 773.



1988] TORT LAW 523

As to the latter ground, the court held that '*[a] duty of reasonable

care may be extended beyond the business premises when it is reasonable
for invitees to believe the invitor controls premises adjacent to his own
or where the invitor knows his invitees customarily use such adjacent

premises in connection with the invitation/''"*^ The court further found

that

''[wjhen the activities conducted on the business premises affect

the risk of injury off the premises, the landowner may be under
a duty to correct the condition or guard against foreseeable

injuries. . . . The polestar of liability, as in other negligence

actions, is the foreseeable risk of harm created by the invitor 's

activities.
^"^

Perhaps the most interesting aspect of Ember is its reliance on the
*

'polestar" of foreseeability. Foreseeability plays only a Umited role in

Indiana's traditional analysis of a landowner's duty. Proof of foresee-

ability is of absolutely no assistance to a trespasser and of only limited

solace to a licensee. '"^^ Yet, Ember concludes that foreseeability plays a
central role in premises liability analysis where plaintiff is held to be

an invitee.

B. Adoption of the *'Public Invitee" Test

In City of Bloomington v. Kuruzovich,^"^^ the Fourth District of the

Indiana Court of Appeals adopted the ''pubHc invitee" test as set forth

in the Restatement (Second) of Torts. Under the Restatement provision:

**A public invitee is a person who is invited to enter or remain on land
as a member of the public for a purpose for which the land is held
open to the public."'"*^ The "public invitee" test, adopted by the Third

District of the Indiana Court of Appeals in Fleischer v. Hebrew Orthodox
Congregation, ^"^^ expands the definition of potential invitees by recognizing

143. Id. at 772.

144. Id. (emphasis added).

145. Trespassers and licensees take the premises as found. See Gaboury v. Ireland

Rd. Grace Brethen, 446 N.E.2d 1310, 1314 (Ind. 1983); Barbre v. IndianapoUs Water

Co., 400 N.E.2d 1142, 1146 (Ind. Ct. App. 1980). In addition, some Indiana cases suggest

a landowner has only the duty not to injure a trespasser after discovering his presence.

Chicago, S.S. & S.B.R. v. Sagala, 140 Ind. App. 650, 654, 221 N.E.2d 371, 374 (1966);
Standard Oil Co. of Indiana, Inc. v. Scovilie, 132 Ind. App. 521, 524, 175 N.E.2d 711,

713 (1961).

146. 517 N.E.2d 408 (Ind. Ct. App. 1987).

147. Restatement (Second) of Torts § 333(2) (1965).
148. 504 N.E.2d 320 (Ind. Ct. App. 1987). In Fleischer, the plaintiff had been

injured while attending a service in a synagogue. Id. at 321. The court of appeals reversed

summary judgment for the defendant synagogue on the ground that the plaintiff was a
"public invitee." Id. at 324.



524 INDIANA LAW REVIEW [Vol. 22:503

a landowner can be liable under the invitee standard to one whose

presence on the property is not necessarily for the economic benefit of

the landowner.

In Kuruzovich, plaintiff was injured while warming up for a Softball

game on property maintained as a park by the City of Bloomington.

While backing up to catch a fly ball, Kuruzovich tripped over a raised

manhole cover located near the ball field. After concluding that the City

of Bloomington retained control over the park, the court addressed

Kuruzovich's status on the property. The court noted that the facts

presented the issue of whether one could ever be an invitee absent an

economic benefit to the defendant.'"*^ The court declared that Fleischer's

adoption of the public invitee rule was a "salutary development in the

law of this state, "^^° and held that "when one invites the public or a
large segment thereof, on to property for a particular purpose, he is

liable to those he invites on to the land for any hazardous conditions

he causes or negligently allows to remain on the land."*^'

Adoption of the public invitee doctrine was crucial to the outcome

of the Kuruzovich case. If Kuruzovich had been found to be a licensee,

the City of Bloomington should have prevailed because a licensee takes

the premises as found. The City of Bloomington would have had no

affirmative duty to keep the property safe for Kuruzovich, and the

unconcealed nature of the raised manhole would have been his respon-

sibility to detect and heed.

In another court of appeals decision, the first district addressed, but

did not expressly adopt the "public invitee" test.^" The Supreme Court

of Indiana will ultimately have to decide whether the "pubUc invitee"

doctrine is recognized by Indiana law. Although neither court of appeals'

decision addressed the issue specifically, there seems to be little doubt

that adoption of the "public invitee" doctrine would reject the rationale

and overrule the result of cases like /. C Penney Co, v. Wesolek.^^^
As noted in a comment to the Restatement:

149. 517 N.E.2d at 413.

150. Id.

151. Id.

152. French v. Sunburst Properties, Inc., 521 N.E.2d 1355 (Ind. Ct. App. 1988).

See the discussion of French in Part V(E), infra notes 166-72 and accompanying text. In

French, the court rejected the plaintiff's claim that he was a public invitee because he

had entered the defendant's apartment complex (chasing his dog) "for his own conven-
ience," id. at 1356, and not "for a purpose for which the land is held open to the

public," as required by section 332(2) of the Restatement. Restatement (Second) of

Torts § 332(2) (1965). In light of this holding, it was not necessary for the court to

decide whether it would adopt the "pubhc invitee" doctrine, but nothing in the opinion

indicated any inclination to reject it.

153. 461 N.E.2d 1149 (Ind. Ct. App. 1984).



1988] TORT LAW 525

[T]he fact that a building is used as a shop gives the public

reason to beheve that the shopkeeper desires them to enter or

is willing to permit their entrance, not only for the purpose of

buying but also for the purpose of looking at goods displayed

therein or even for the purpose of passing through the shop.

This is true because shopkeepers as a class regard the presence

of the public for any of these purposes as tending to increase

their business.'^"*

Future decisions from the Indiana courts will determine the standards

applicable to determining "invitee" status, and will thereby estabhsh the

extent of landowners' duties.

C "Ongoing Business Relation" Makes Plaintiff an Invitee
In Stainko v. Tri-State Coach Lines, Inc.,^^^ a salesman for a company

selling bus maintenance items sued after injury in a bus terminal. Stainko

had an ongoing relationship with Tri-State and had visited its garage

several times to sohcit business and make deliveries. Typically, Stainko
entered the garage through a side door or an overhead door and walked

to the parts department to meet Tri-State' s purchasing agent. After the

meeting, Stainko would leave by the same route. '^^

On January 27, 1982, Stainko made a sales call to the Tri-State
garage. The purchasing agent was not in his usual place at the parts

department, but his secretary told Stainko to go out in the garage to

find him. The garage was dark. The only light provided was far to the

back of the garage where a mechanic was working. Stainko had done

business with that mechanic before and began to walk towards him. On
his way, Stainko fell into an uncovered, unlighted and unguarded pit.'^^

The trial court granted summary judgment for Tri-State. The court of
appeals reversed.

Tri-State argued that Stainko was a mere licensee as a matter of

law. Because a licensee under Indiana law "takes the premises as he

finds them,"^^^ Tri-State argued Stainko was barred from recovery. The

court rejected that proposition, on the ground that "Stainko and Tri-

State had an ongoing business relationship to the economic benefit of

both parties. "^^^ The "ongoing business relationship" was sufficient to

154. Restatement (Second) of Torts § 332 comment c (1965).
155. 508 N.E.2d 1362 (Ind. Ct. App. 1987).

156. Id. at 1363.

157. Id.

158. Id. at 1364. See also Barbre v. Indianapolis Water Co., 400 N.E.2d 1142,
1146 (Ind. Ct. App. 1980).

159. Stainko, 508 N.E.2d at 1364.



526 INDIANA LAW REVIEW [Vol. 22:503

allow Stainko to be considered an invitee regardless of the fact that he

was not on the property to buy a ticket or to ride a bus, the primary

business of Tri-State.^^

D. '^Fireman's Rule" Extended to Police Officers

In Sports Bench, Inc. v. McPherson,^^^ the court extended the
*

'fire-

man's rule" to policemen. The "fireman's rule" provides that "profes-

sionals, whose occupations by nature expose them to particular risks,

may not hold another negligent for creating the situation to which they
respond in their professional capacity. "^^^ Plaintiffs, who were deputy
sheriffs, were shot by a patron of the defendant bar while they were

off duty. Plaintiffs had arrived at the bar and were told that the assailant

had been there earlier and had threatened to return with a gun. When
the assailant returned, plaintiffs attempted to arrest him. The court of

appeals reversed the trial court's denial of defendant's motion for sum-

mary judgment. The court characterized the fireman's rule as classifying

firemen, policemen and other officers who responded in their official
capacities as licensees for purposes of landowner Uability.^" "Accordingly,

firemen, policemen, and other officers incur the inherent risks of the

situation when they act in their professional capacities."'^ Because in
Indiana the determination of whether or not an officer is performing

official, professional duties "does not depend on whether he is on or

off duty,"'^^ the court used the fireman's rule to apply licensee status

to plaintiffs even though they had been off duty at the time of the

incident.

E. Licensee Bears Risk of Dangers on Property

In French v. Sunburst Properties, Inc.,^^^ the court considered the

scope of public invitation for property left open to the public. French

was injured when he tripped over a cable strung between a series of

posts on the edge of an apartment complex. French was not a resident

of the apartment complex but had entered the complex during early-

morning darkness to search for his lost dog. The trial court determined

that French was a mere licensee and granted summary judgment for the
defendant apartment complex.

160. Id.

161. 509 N.E.2d 233 (Ind. Ct. App. 1987).

162. Id. at 235 (quoting Keohn v. Devereaux, 495 N.E.2d 211, 215 (Ind. Ct. App.

1986)).

163. 509 N.E.2d at 235.

164. Id.

165. Id.

166. 521 N.E.2d 1355 (Ind. Ct. App. 1988).



1988] TORT LAW 527

On appeal, the court affirmed. First the court rejected the plaintiff's
claim that he was a "public invitee" under the Restatement (Second)

of Torts. ^^^ Without expressly adopting the **public invitee" doctrine,

the court held that the plaintiff failed to meet the criteria of a "public

invitee":

[T]he test "require[s] that the visitor enter the premises for the

particular purpose for which the occupant has encouraged the

public to do so." If the visitor meets the requirement of a public

invitee, then the occupant owes him a duty of reasonable care

to keep the premises safe for him.^^^

The court concluded that "the trial court properly determined, as a

matter of law, that [plaintiff] enjoyed only licensee status. "^^^

The court noted the definition of the duty owed a licensee:

The only affirmative duty a landowner owes to a licensee is to

refrain from willfully or wantonly injuring him or acting in a

way which would increase the licensee's peril. A showing by the
licensee of mere negligence on the part of the landowner will

not be enough to insure him recovery. ^^^

The court stated that because there was no evidence that the apart-

ment complex "impliedly invited or encouraged pet owners from sur-

rounding areas to enter its premises in order to engage in the nocturnal

pursuit of their wayfaring pets,"'"^' French was a mere licensee. Con-

sidering the licensee status, the court stated: "[U]nless Sunburst acted

to create a concealed danger, unavoidable even by the exercise of rea-

sonable skill and care, it cannot be held liable for French's injuries. "'^^

Landowner liability cases decided during the survey period continued

to apply Indiana's traditional distinctions based on the plaintiff's status

upon the property at the time of the accident. Although Ember appeared
to signal a change in landowner liability law toward giving greater

consideration to the foreseeabihty of injury, subsequent decisions have

not expanded that analysis.

167. Id. at 1356-57 (discussing Restatement (Second) of Torts § 332 (1965)). See

the discussion of the "pubhc invitee" issue in Part V(B), supra notes 146-54 and accom-

panying text.

168. 521 N.E.2d at 1356 (quoting Fleischer v. Hebrew Oithodox Congregation, 504
N.E.2d 320, 323 (Ind. Ct. App. 1987)).

169. 521 N.E.2d at 1356-57.

170. Id. at 1356 (quoting Barbre v. Indianapolis Water Co., 400 N.E.2d 1142, 1146

(Ind. Ct. App. 1980)).

171. 521 N.E.2d at 1356.

172. Id. at 1357.



528 INDIANA LAW REVIEW [Vol. 22:503

VI. Fraud and Estoppel

The Indiana Court of Appeals addressed the elements of constructive

fraud from two different perspectives during the survey period. In Sanders

V. Townsend,^^^ the court considered the elements of constructive fraud

in the context of an attorney-client relationship. In Reeve v. Georgia-

Pacific Corp. , ^'^^ the court addressed the elements of a claim for equitable

estoppel based on a misrepresentation of law, which it stated were

essentially the same as the elements for constructive fraud.

A. Constructive Fraud

The Sanders were disgruntled personal injury plaintiffs who sued
their former attorneys, alleging that "they were coerced into an inad-

equate and unfair settlement. "'^^ The trial court granted summary judg-
ment for defendants.

On appeal, the court upheld the dismissal of the negligence claims
because plaintiffs failed to present evidence that any settlement or verdict

award without the alleged negligence would have been greater than the

settlement actually received. '^^ The court reversed, however, the lower

court's summary judgment on the constructive fraud claim.
In considering the elements of constructive fraud, the court discussed

the standard of care for those in a fiduciary relationship as much higher
than parties who negotiate at arm's length. The court stated:

In cases of constructive fraud, intent to deceive is not required

because the parties involved are not at arm's length. The element

of intent is replaced by the element of the special relationship

between the parties as, for example, the fiduciary relationship.

Thus, although the tort of actual fraud vindicates the moral

principle, one should refrain from representations intended to

work a fraud, the tort of constructive fraud vindicates the

principle that, in the special relationship encompassed within the

purview of the tort, the dominant party must take care not to

injure, even inadvertently, the rights of the weaker party, who
has relied on the dominant party for expertise, skill, abilities

and guidance in an area in which the weaker party is unversed. '^^

Having thus distinguished constructive fraud and legal malpractice,

the court further distinguished the type of damage suffered: "[I]n a

173. 509 N.E.2d 860 (Ind. Ct. App. 1987).

174. 510 N.E.2d 1378 (Ind. Ct. App. 1987).

175. Sanders, 509 N.E.2d at 862.

176. Id. at 863-65.

177. Id. at 866.



1988] TORT LAW 529

legal negligence claim, the injury is the loss of the worth of the underlying

claim; but, with respect to constructive fraud where fiduciary duties are

breached, the primary injury is the loss of rights belonging to the weaker

party."'^»

Although the court found the injury suffered to be "the deprivation

of the right to choose between trial or settlement, or rejection of one

settlement offer in hopes of a better offer, "'^^ the court gave little

guidance in deciding how to value such damage. The court noted that
loss of value of the underlying claim is not the exclusive measure of

damages and that nominal damages may be awarded. '^^ The court also
noted, however, that ''more than nominal damages may be appropriate.
For example, forfeiture of attorneys fees may be appropriate."'^' In
dicta, the court described a Minnesota case finding an attorney who
breaches a fiduciary duty to a client forfeits his right to compensation

without any requirement that the client prove special damages and without

regard to whether the fraud was intentional or only constructive.'^^

B. Equitable Estoppel

In Reeve v. Georgia-Pacific Corp.,^^^ the court noted that the elements

which comprised the equitable estoppel defense are "essentially those

which would give rise to a claim for actual or constructive fraud. "'^''

The court stated that negligence can be the basis of estoppel. '^^ Fur-

thermore, although the general rule is that estoppel arises on misrep-

resentation of past or existing facts and not upon promises to be
performed in the future, expressions of opinion, or misrepresentations

as to the state of the law, the court held that '*[o]ne of the exceptions

to the general rule is where a party expressing the opinion claims or

expresses a special knowledge, "'^^ and "[e]xpression of an opinion as

to the law is part of the rule concerning expressions of opinion. "'^^

Georgia-Pacific had entered into an agreement to pay Reeve and

her minor son based on the work-related death of Reeve's husband.

The payments were to continue over time until the son achieved majority
or finished school. In the spring of 1983, Reeve inquired of Georgia-

178. Id.

179. Id. at 867.

180. Id.

181. Id.

182. Id. (discussing Rice v. Perl, 320 N.W.2d 407 (Minn. 1982)).
183. 510 N.E.2d 1378 (Ind. Ct. App. 1987).

184. Id. at 1382.

185. Id. at 1383.

186. Id.

187. Id.



530 INDIANA LAW REVIEW [Vol. 22:503

Pacific what affect, if any, remarriage would have on her and her son's

benefits. Georgia-Pacific wrote a letter teUing Reeve her son would

continue to receive benefits. Four months later. Reeve remarried, and

Georgia-Pacific subsequently tried to revoke payments. '^^

The Industrial Board found the benefits could be revoked; the court

of appeals reversed. Because Georgia-Pacific had superior knowledge as

to the rights to benefits, the appellate court held that Reeve could assert

equitable estoppel based on Georgia-Pacific's admitted misrepresentation

of law.*^^ The appellate court also rejected arguments by Georgia-Pacific

that estoppel was not applicable because the misrepresentation was not

one of existing fact or condition but was a future promise. Noting that

*'[t]he doctrine of promissory estoppel exists in Indiana. . . [a]s an

exception to the general rule,"^^° the court held that Reeve's remarriage

in reliance on Georgia-Pacific's representations was sufficient to give

rise to estoppel. '^^

VII. Pre-Existing Mental Weakness

In Brokers, Inc. v. White, ^^^ the Indiana Court of Appeals held that

a tortfeasor is responsible for complications resulting from a pre-existing

mental weakness as well as pre-existing physical weaknesses.

White fell in a supermarket and was taken to a hospital complaining

of neck and lower back pain and numbness in the lower extremities.

Her doctor observed a bruise on her lower back but found no spinal
injury which would prevent her from walking. Nevertheless, White left

the hospital in a wheelchair and claimed to be unable to walk. White

was examined eventually by a psychiatrist, who concluded that she was
suffering from a "conversion reaction." The psychiatrist testified at trial

that a person manifesting a "conversion reaction" or "conversion hys-

teria" turns her mental anxiety into a physical disturbance such as

paralysis of the arms or legs.^^^ Other expert witnesses testified that

White was predisposed to a conversion reaction. '^"^

After a jury verdict for the grocery store, White moved to correct
errors based on the refusal of the trial court to give an instruction that

a negligent party is not relieved from liability merely because of a pre-

existing condition of the injured party which made her more susceptible

188. Id. at 1379-80.

189. Id. at 1384.

190. Id.

191. Id

192. 513 N.E.2d 200 (Ind. Ct. App
193. Id. at 202.

194. Id.

1987).



1988] TORT LAW 531

to injury. The trial court granted the motion to correct errors and the

grocery store appealed. ^^^

On appeal, the grocery store argued that the pre-existing condition
rule applied only to pre-existing physical weaknesses rather than mental

weaknesses. ^^^ The court affirmed the granting of a new trial, concluding

that the pre-existing condition rule applies to mental weaknesses as well

as physical weaknesses. The court analyzed the issue as a question of

proximate cause: '*[I]f the negligent conduct causes any physical injury,

and if there is any evidence that a mental condition resulted therefrom,

the issue whether the mental illness is a natural and direct result of

such physical injury is a question of fact."^^"^ The court noted that:

"The jury question of proximate cause remains even where the jury is

instructed that the defendant is not relieved from liability merely because

a pre-existing condition of the plaintiff makes him more susceptible to

injury.
"^^^

Brokers does not appear to extend the law concerning pre-existing

weaknesses, but clarifies that such arguments apply to both mental and

physical conditions.

VIII. Liability of an Unincorporated Association to Its
Members

During the survey period, the Indiana Supreme Court in Calvary

Baptist Church v. Joseph^^^ reaffirmed the common law rule that a
member of an unincorporated association cannot sue the association for
tortious conduct of another member. Although the court recognized

certain limited exceptions to this rule, the court overruled an Indiana

Court of Appeals precedent to the contrary that had stood for ten

years.^^

James Joseph was a member and deacon of the Calvary Baptist
Church. Joseph volunteered to help other members of the church fix

195. Id.

196. Id. at 204. The grocery store relied on the following language: "It is clear

that a tortfeasor takes the person he injures as he finds him. The tortfeasor is not relieved

from liability merely because a pre-existing physical condition of the injured party makes

him more susceptible to injury." Id. (quoting Johnson v. Bender, 174 Ind. App. 638,

644, 369 N.E.2d 936, 940 (1977) (emphasis added)).

197. 513 N.E.2d at 204. The court cited and relied upon emotional distress cases,

noting that there was no dispute that plaintiff had suffered a contemporaneous physical

injury. Id. See also Part III of this Article, supra notes 69-109 and accompanying text.

198. 513 N.E.2d at 205.

199. 522 N.E.2d 371 (Ind. 1988).

200. Id. at 373, overruling O'Bryant v. Veterans of Foreign Wars, 176 Ind. App.

509, 376 N.E.2d 521 (1978).



532 INDIANA LAW REVIEW [Vol. 22:503

the roof of the church building. While on the roof, another member
moved the ladder to the roof and apparently left it on an unsolid footing.
When Joseph stepped on the ladder to descend, he fell and was injured.
The trial court granted summary judgment to the defendant church, and
the court of appeals reversed. The supreme court vacated the court of

appeals and affirmed the trial court.^^^

The court of appeals, although noting that the common law rule
followed by a majority of jurisdictions would bar the plaintiff's suit by

a member against an unincorporated association, followed O'Bryant v.
Veterans of Foreign Wars,^^^ which held that Indiana had rejected the

common law rule.^°^ O'Bryant had considered the effect of Indiana Trial
Rule 17(B) and 17(E), which both provide that an "unincorporated

association may sue or be sued in its common name."^^ Because the
rules were adopted by both the legislature and the Indiana Supreme

Court, O'Bryant reasoned that the rules changed prior contrary sub-

stantive Indiana law on the issue. ^^^

In Calvary Baptist Church v. Joseph,^^ the Indiana Supreme Court

expressly overruled O'Bryant and followed the common law principle
that a member of an unincorporated association cannot recover in a
tort action from the association. The court explained the rationale of

the rule:

The theory of the general rule is that the members of an un-
incorporated association are engaged in a joint enterprise. The

negligence of each member in the prosecution of that enterprise
is imputable to each and every other member so that the member
who has suffered damages through the tortious conduct of an-
other member of the association may not recover from the
association for such damages. It would be akin to the person

suing himself as each member becomes both a principal and an
agent as to all other members for the actions of the group

itself.207

In rejecting the basis of the 0*Bryant holding, the court stated: "We
do not see that it was the intention of the legislature nor this court in

authorizing [Trial Rules 17(B) and 17(E)] to change the substantive rule

201. Id. at 372.

202. 176 Ind. App. 509, 376 N.E.2d 521 (1978).

203. Joseph v. Calvary Baptist Church, 500 N.E.2d 250, 252 (Ind. Ct. App. 1986).

204. Ind. R. T. P. 17(B) (Capacity to Sue or Be Sued) and 17(E) (Partnerships

and Unincorporated Associations).

205. 176 Ind. App. at 513, 376 N.E.2d at 523.

206. 522 N.E.2d 371 (Ind. 1988).

207. Id. at 374-75.



1988] TORT LAW 533

of non-liability of association to members for torts committed by other

members. "^°^

Although the supreme court held that the common law rule is still
in effect in Indiana, the court noted that exceptions to the rule are

possible: "[W]e recognize the wisdom of applying an exception to the

general rule in the case of large unincorporated associations such as

labor unions having a hierarchy of structure that drastically changes the

relationship of membership to association and the control that a member
has in its affairs. "^^^

The Calvary Baptist Church decision relied heavily on a theory that

members of an unincorporated association are engaged in a "joint

enterprise. "^*° To the extent that factual issues arise in a case as to
whether or not the unincorporated association falls within the rules, a

practitioner would be well advised to look to arguments concerning

whether the "joint enterprise" policy basis of the rule has been met.

IX. Conclusion

During the survey period, interpretations of the Comparative Fault

Act continued to be the most-watched developments in Indiana's tort

law. The decisions during the survey period help in interpreting the Act,

but numerous questions remain and substantial uncertainty exists with

respect to nonparty practice and other issues.

In other areas of tort law, there were no decisions announcing

fundamentally new tort doctrines. In the areas of recovery for emotional

distress and premises liability, Indiana courts continued to explore the

Umits of older doctrines and suggested that those doctrines may have
to be recast. Indeed, that process already may be underway. On the
other hand, the supreme court rejected an attempt by the court of

appeals to adopt a new rule on liability of unincorporated associations,
reaffirming the traditional legal rule. The year's decisions in tort cases
thus demonstrated the ebb and flow of the common law, the constant
process of accretion by which legal doctrines are formed and changed.

208. Id. at 373.

209. 522 N.E.2d at 375.

210. Id. at 374.