The case involves Marvin and Gwendolyn McNeary, who filed a lawsuit against multiple defendants, including Baptist Memorial Hospital and various medical personnel, following complications during the delivery of their daughter, Kayla. The trial court dismissed one defendant due to lack of personal jurisdiction, concluding that the McNearys failed to properly serve process, that neither the statute of limitations nor the statute of repose saved their claim, and that they were not entitled to relief based on allegations of fraud or misrepresentation. The appellate court affirmed the trial court's decision and remanded for further proceedings.
The McNearys allege that during Gwendolyn's delivery on June 25, 1999, her blood pressure dropped, leading to significant fetal distress for Kayla, who suffered permanent brain damage as a result. The complaint claims negligence by Dr. Rouselle and the nursing staff, asserting failures in monitoring and timely intervention during the delivery process. The legal representation for the appellants and appellees is noted, along with the details of the procedural history leading to the appeal.
The McNearys allege that Jeff Harmon, CRNA, fell below the standard of care by improperly administering an epidural, resulting in Mrs. McNeary’s low blood pressure and oxygen levels, which they claim caused brain damage to their child, Kayla. Summonses for all defendants were issued on June 30, 2005, but Harmon was not served as he could not be found in the county. The McNearys reissued the summons on the same day; however, there is no clarification in the record regarding the server’s claim of Harmon’s absence. An amended complaint was filed on August 18, 2005, adding Dr. Vijaya L. Duggirala and Metropolitan Anesthesia Alliance as defendants. The amended complaint alleges Harmon was employed by Duggirala/MAA during Kayla’s birth. A court order on September 16, 2005, stayed all matters pending a Supreme Court ruling but exempted service of process from the stay. A summons for Harmon from the amended complaint was issued on October 21, 2005, but was incorrectly served on Jennifer Marie Harmon, not the defendant. Dr. Duggirala and MAA responded on July 21, 2006, confirming MAA employed Harmon at the relevant time. The stay was lifted on October 5, 2007, and the McNearys successfully served Harmon on April 30, 2008, although this was the first time he received the complaint and related documents. On May 28, 2008, Harmon filed a motion to dismiss, citing lack of personal jurisdiction, insufficient process and service, failure to state a claim, and arguing that the action is time-barred under the three-year statute of repose. He contests the adequacy of service, personal jurisdiction, and the applicability of the statute of limitations and repose.
On September 24, 2008, the McNearys opposed Defendant Harmon’s motion to dismiss, asserting that their action commenced before December 9, 2005, with Harmon served within the statute of limitations, which extends to June 25, 2018, as per Calaway ex rel. Calaway v. Schucker. The trial court indicated it would grant the motion to dismiss on October 3, 2008, citing the McNearys' noncompliance with Tennessee Rules of Civil Procedure 3 and 4. After the McNearys requested a reconsideration, the court delayed the written order until a hearing on January 20, 2009. Proceedings were stayed due to a potential review by the Tennessee Supreme Court regarding Crespo v. McCullough, which was ultimately denied on February 23, 2009. Following this, the trial court postponed the hearing until April 16, 2009, and later denied the motion to reconsider on June 5, 2009, thereby granting Harmon’s motion to dismiss.
The court’s order detailed critical findings: 1) The McNearys filed their initial complaint on June 20, 2005, but service on Harmon was never completed. 2) An amended complaint was filed on August 18, 2005, without reissuing process for Harmon. 3) Service returned as 'incomplete' on October 21, 2005, leading to a reissuance that also went unserved. 4) After the stay was lifted, a new service was issued on April 22, 2008, but the effective service occurred only on April 30, 2008, more than two years after the initial attempts. Based on these findings, the court concluded that the McNearys failed to properly commence their cause of action against Harmon, rendering prior service ineffective and resulting in a dismissal with prejudice. The court ruled it lacked personal jurisdiction over Harmon due to the McNearys' failure to comply with procedural requirements. The Calaway decision did not aid the McNearys, as they did not meet the necessary service stipulations.
The McNearys sought permission to appeal under Tennessee Rule of Appellate Procedure 9, which the trial court granted on June 5, 2009. They subsequently filed an application for interlocutory appeal on June 10, 2009, but this was denied by the appellate court on July 1, 2009. On September 25, 2009, the trial court issued an order reaffirming its June 5 findings and included language under Tennessee Rule of Civil Procedure 54.02, rendering the judgment against Defendant Harmon final and appealable. The appellate record was submitted on October 20, 2009.
During a November 23, 2009 meeting, Defendant Harmon’s counsel claimed ignorance of service on Jennifer Marie Harmon, which prompted McNearys’ attorney, Duncan Ragsdale, to accuse them of fraud based on responses from Dr. Duggirala and MAA that implied Harmon was an employee at the time of the alleged incident. Ragsdale contended he was unaware of improper service until April 2008. Despite no answer being filed by Harmon and no default judgment sought by the McNearys, they filed a Rule 60.02 motion for relief from judgment on November 25, 2009, citing the alleged fraud. The appellate court remanded for a hearing on this motion, which was ultimately denied by the trial court on June 21, 2010.
The McNearys raised eleven issues on appeal, summarized as follows: 1) whether the trial court erred in dismissing their complaint against Harmon due to lack of personal jurisdiction; 2) whether the three-year statute of repose for medical malpractice barred their claim; 3) whether the trial court abused its discretion in denying the Rule 60.02 motion; and 4) the applicability of judicial estoppel. The case had been decided under a Rule 12 motion to dismiss, but the trial court considered matters outside the pleadings, which typically requires a conversion to a summary judgment motion per Rule 12.03. However, the Tennessee Supreme Court has ruled this does not apply to jurisdictional issues, indicating the trial court’s treatment of the motion as a summary judgment was harmless error.
Under the Nicholstone holding, the trial court appropriately classified the matter as a motion to dismiss, despite neither party disputing this classification. A Tenn. R. Civ. P. 12.02 motion evaluates the legal sufficiency of a complaint, accepting all relevant allegations as true but determining they fail to establish a legal claim. The examination is confined to the complaint itself, which must be interpreted liberally in favor of the plaintiff.
Personal jurisdiction can be challenged under Tennessee Rules of Civil Procedure, which allow dismissal based on lack of jurisdiction, insufficiency of process, or insufficiency of service. A court gains personal jurisdiction when the defendant is served. The commencement of civil actions requires filing a complaint with the court clerk, which starts the statute of limitations, regardless of whether process is issued. If process is unissued or unserved after 90 days, the original filing does not toll the statute of limitations unless new process is obtained within one year.
Tenn. R. Civ. P. 4 outlines service of process requirements, stating that proof of service must be made promptly to the court. If a summons is not served within 90 days, it must be returned with reasons for the failure. The plaintiff can obtain new summonses if previous ones remain unserved. Tennessee Rules 3 and 4 must be read together, indicating that 'process' refers to a summons and setting a 90-day period for service following issuance, with reissuance rules applicable thereafter.
Civil actions in Tennessee circuit court typically commence by filing a complaint with the court clerk, irrespective of whether process has been issued or served. However, if process is unissued or not served within 90 days, the plaintiff must obtain new process within one year to toll the statute of limitations. In this case, the initial summons issued on June 25, 2005, was never served, and a second summons issued on October 21, 2005, was also not served on the intended defendant, Jennifer Marie Harmon. The McNearys issued a third summons on April 22, 2008, which was served on April 30, 2008, nearly three years after the suit was filed and over two years after the second summons. Due to this significant delay in reissuing and serving process, the trial court ruled that service on Harmon was invalid, leading to her dismissal from the case for lack of personal jurisdiction.
The McNearys argued that Kayla McNeary's status as a minor excused them from following the requirements of Tennessee Rules of Civil Procedure 3 and 4, but they provided no supporting case law, and the rules contain no such exemption. Furthermore, they contended that Rule 4.01(3), which addresses intentional delays in the issuance of service, should protect them from dismissal; however, the defendants did not claim that the McNearys had intentionally delayed the issuance. The trial court's dismissal was based on the McNearys' failure to comply with the procedural rules, not on any finding of intentional delay. Thus, their arguments regarding Rule 4.01(3) were found to be irrelevant. The conclusion was that the McNearys did not properly issue and serve process on Harmon according to Tennessee Rules of Civil Procedure.
Service of process was not completed within the ninety-day requirement following the initial complaint filing under Tennessee Rule of Civil Procedure 3, nor did the McNearys obtain new process issuance within one year of filing, resulting in the trial court lacking personal jurisdiction over Defendant Harmon. The trial court ruled that the McNearys could not invoke the Calaway v. Schucker exception to toll the statute of repose for their claim, as the case was not properly commenced against Harmon. The injury in question occurred on June 25, 1999, and the court noted that the Calaway decision clarified that the medical malpractice statute of repose, which is three years, is not tolled by a plaintiff's minority. The Calaway case overruled prior precedents allowing such tolling, asserting that the statute of repose serves a distinct purpose that should not be undermined. Although the McNearys argued both at trial and on appeal that their case falls under the Calaway exception because it was filed before December 9, 2005, and that both the statute of limitations and statute of repose were tolled, the court disagreed. It emphasized that, under Tennessee law, an action is not considered commenced until both a complaint is filed and process is served, referencing Cline v. Lazy Eights Flight Center to support this interpretation.
The plaintiff attempted to re-file a case relying on the saving statute but was denied because they did not comply with Tennessee Rules of Civil Procedure 3 and 4 regarding service of process. The court affirmed the trial court’s dismissal of the case, highlighting that mere filing of a complaint does not commence an action without proper issuance of a summons. The Tennessee Supreme Court's decision in Frye v. Blue Ridge Neuroscience Center established that reliance on the saving statute requires strict compliance with Rule 3 for proper service. The initial filing date cannot toll the statute of limitations if service is incomplete. In this case, the McNearys’ action was not considered commenced due to failure in serving the complaint, thus barring their claims against Defendant Harmon under the statute of repose. The court clarified that the statute of repose limits the filing period for medical malpractice claims, which is unaffected by the plaintiff's minority status. Consequently, the McNearys' claims are barred since the case did not commence before the statute of repose deadline of December 9, 2005, rendering the statute of limitations irrelevant.
Tennessee Rule of Civil Procedure 60.02 permits a court to relieve a party from a final judgment or order due to reasons such as fraud, misrepresentation, or misconduct by an opposing party. The rule aims to mitigate the impact of unjust final judgments while balancing the principles of finality and justice. Relief is not intended for cases where a party's circumstances change post-judgment or for mere dissatisfaction with the outcome. Instead, it applies in limited situations that meet specific criteria, described as an "escape valve" for potential inequities arising from strict adherence to finality.
A party seeking relief under Rule 60.02 must demonstrate entitlement by clear and convincing evidence, which means the evidence must eliminate substantial doubt about the facts' correctness and make the truth highly probable. The decision to grant or deny relief is within the trial judge's discretion, and appellate review is limited to whether that discretion was abused. This deferential standard acknowledges the variety of acceptable alternatives available to the trial court and discourages second-guessing its decisions, although it does not exempt such decisions from meaningful scrutiny.
An abuse of discretion by a court occurs when it fails to adhere to legal standards or neglects relevant factors in its discretionary decision-making. It can manifest through (1) incorrect legal standards, (2) illogical or unreasonable conclusions, or (3) a clearly erroneous assessment of evidence. Reviewing courts assess a lower court's discretionary decisions by verifying the factual basis is supported by evidence, ensuring proper identification and application of legal principles, and confirming the decision falls within acceptable alternatives. When reviewing these decisions, factual findings are evaluated using the preponderance of the evidence standard, while legal determinations are scrutinized de novo without presumption of correctness.
In this case, the McNearys claim that certain statements made by the defendants' attorneys and Dr. Duggirala in court filings were misrepresentations that they relied on detrimentally, alleging these statements constitute fraud. They highlight six specific statements, including Dr. Duggirala’s admission regarding employment and assertions about the administration of anesthesia during Gwendolyn McNeary's cesarean section on June 25, 1999. The McNearys argue that the statements made by the defendants' attorneys were knowingly false or made without regard to their truthfulness. They assert that William Jeffrey Harmon, not J.M. Harmon or Jim Harmon, was the actual provider of anesthesia, rendering the latter names non-entities. The McNearys contend they relied on these statements, which led to procedural missteps in serving the proper parties.
Positive fraud requires three elements: 1) a false and material representation regarding an existing fact; 2) knowledge of the representation's falsity, either knowingly, without belief in its truth, or recklessly; and 3) reasonable reliance on the misrepresentation by the aggrieved party to their detriment. A motion to set aside a judgment for fraud under Rule 60.02 can cite either intrinsic or extrinsic fraud. The McNearys claim intrinsic fraud, which involves deception occurring within the litigation process, such as falsified evidence or perjured testimony. The court is tasked with determining whether it erred in denying relief based on the alleged fraud by the Defendants' attorneys, despite not explicitly stating its reasoning.
Defendant Harmon denies any misrepresentation, asserting that the attorneys believed J.M. Harmon was the CRNA who treated Mrs. McNeary, based on the name tag and their understanding of the name. The attorneys only realized the name was incorrect after the pleadings were filed. They were also unaware that the McNearys had served process on Jennifer Marie Harmon until a later date, which, according to Harmon, negates any claim of deceit, as there was no intention to mislead without knowledge of the misrepresentation.
Defendant Harmon contends that the contested pleadings merely acknowledged MAA's employment of the CRNA who treated Mrs. McNeary. The record indicates that at the time the pleadings were filed, there was no tactical advantage for Dr. Duggirala or MAA in concealing Defendant Harmon's identity. Notably, Dr. Duggirala's counsel was retained only in May 2008, prior to which they were unaware of any representation for Defendant Harmon. An affidavit from Jennifer Marie Harmon confirms she was served on October 29, 2005, and informed the McNearys’ attorney that she was not the correct defendant, following which she was instructed to return the summons and complaint. This is undisputed, and the McNearys were made aware that the CRNA was male, while service had been incorrectly made on a female, Jennifer Marie Harmon. The McNearys, therefore, should have recognized the error. The court concluded that the McNearys failed to provide clear evidence of fraud or deception regarding service of process and did not demonstrate detrimental reliance on any alleged misrepresentations. Consequently, the trial court's denial of the McNearys' Rule 60 relief was upheld, rendering any claims for sanctions under Tennessee Rule of Civil Procedure 11 moot. Additionally, the McNearys’ request for judicial estoppel against Defendants Duggirala, MAA, and Jeff Harmon was deemed improperly raised in this appeal.
Estoppel was not raised until after the final dismissal order, and the trial court did not address it. Established precedent holds that issues not presented at the trial court level cannot be introduced on appeal, as confirmed in Lawrence v. Stanford, 655 S.W.2d 927 (Tenn. 1983). Consequently, the Court will not consider the estoppel issue. The McNearys contested the correctness of the Final Judgment by citing statements from the order, but their claims were merely restatements of previously addressed issues. The Court declines to revisit these matters to avoid redundancy. Therefore, the trial court's dismissal of Defendant Harmon is affirmed, and the case is remanded for any necessary proceedings. Appellants Marvin L. McNeary and Gwendolyn McNeary, along with their surety, are responsible for the costs of this appeal.
