KAREN R. BAKER, Justice.
This appeal from the circuit court's dismissal of a medical-malpractice action involves whether vicarious-liability principles
The underlying facts in this case are not in dispute. Ernest Henry suffered severe injuries in an automobile accident that occurred on October 29, 2007, in Eureka Springs, Arkansas. Mr. Henry was transported to Washington Regional where he was treated for his injuries and subsequent complications until his death on November 11, 2007. Appellant, as the court-appointed personal representative and surviving spouse of Mr. Henry, filed a medical-malpractice suit on October 9, 2009, against Defendants, as well as the five treating physicians and three independent medical clinics with which the physicians were associated.
On November 17, 2009, an answer was filed on behalf of Defendants. In their answer, Defendants admitted certain critical issues: (1) De La Cruz and Hefner were at all times relevant to this action employed by Washington Regional and were acting within the course and scope of their employment; (2) Washington Regional is a nonprofit corporation organized under the laws of the State of Arkansas, and enjoys charitable immunity; and (3) Continental was the primary liability carrier for Washington Regional at all relevant times. In their original answer, Defendants stated as follows:
The answer preserved the nurses' defenses under Rule 12(b) of the Arkansas Rules of Civil Procedure, including insufficiency of process and insufficiency of service of process. On May 19, 2010, Defendants moved to dismiss the complaint. Defendants alleged that because the nurses were not served within 120 days of filing the complaint,
On June 3, 2010, appellant responded to the motion to dismiss by simultaneously filing a motion to dismiss her claims against Washington Regional and the nurses without prejudice and a second amended complaint. Appellant stated in her motion to dismiss that based on Defendants' admissions that Washington Regional was immune and that the direct-action statute applied, Washington Regional and the nurses were not proper parties to the action. Appellant moved to dismiss these parties and proceed solely against Continental under the direct-action statute.
On June 16, 2010, Defendants filed an answer to the second amended complaint and a motion to dismiss. Defendants denied that Continental could be held liable for the alleged negligence of Washington Regional's employees, including the alleged negligence of De La Cruz and Hefner, and asserted that appellant's failure to timely serve the nurses, or any other allegedly negligent agent or employee of Washington Regional, extinguished any vicarious-liability claims against Continental. In its motion to dismiss, Defendants argued that under principles of vicarious liability, once an employee has been released or dismissed, the employer's liability is likewise extinguished, and that because Continental stands in the shoes of the employer, no cause of action can be maintained against it.
After a July 13, 2010 hearing on both motions to dismiss, the circuit court entered an order on July 22, 2010, granting Defendants' motion to dismiss with prejudice. The circuit court specifically found (1) that service of process against De La Cruz and Hefner was not obtained and the statute of limitations had expired with respect to appellant's claims against the nurses, requiring the court to dismiss the complaint with prejudice as to these nurses, and (2) that "[u]nder Arkansas law, an employer's vicarious liability arises directly from the alleged negligence of the employee, and where the allegedly negligent employee has been released or dismissed, any vicarious liability that could be imputed to the employer is likewise eliminated," requiring the court to dismiss appellant's claims against Washington Regional and Continental.
In reviewing a court's decision on a motion to dismiss, we treat the facts alleged in the complaint as true and view them in the light most favorable to the plaintiff. Downing v. Lawrence Hall Nursing Ctr., 2010 Ark. 175, 369 S.W.3d 8. In testing the sufficiency of a complaint on a motion to dismiss, all reasonable inferences must be resolved in favor of the complaint, and all pleadings are to be liberally construed. Id. However, when a complaint is dismissed on a question of
In addition, the circuit court's grant of Defendants' motion to dismiss was based on its interpretation of the relationship between the direct-action statute and common-law negligence principles of vicarious liability. We review issues of statutory construction de novo. Couch v. Farmers Ins. Co., 375 Ark. 255, 289 S.W.3d 909 (2008). It is for this court to decide what a statute means, and we are not bound by the circuit court's interpretation. Id. The basic rule of statutory construction to which all other interpretive guides must yield is to give effect to the intent of the General Assembly. Dachs v. Hendrix, 2009 Ark. 542, 354 S.W.3d 95. Where the language of a statute is plain and unambiguous, we determine legislative intent from the ordinary meaning of the language used. Id. In considering the meaning of a statute, we construe it just as it reads, giving the words their ordinary and usually accepted meaning in common language. Id. We construe the statute so that no word is left void, superfluous or insignificant, and we give meaning and effect to every word in the statute, if possible. Id. In ascertaining legislative intent, we look to the statutory language, subject matter, object to be accomplished, purpose to be served, remedy provided, legislative history, and other appropriate matters. Rogers v. Tudor Ins. Co., 325 Ark. 226, 925 S.W.2d 395 (1996).
We must first examine the direct-action statute, codified at Ark.Code Ann. § 23-79-210, which states as follows:
Ark.Code Ann. § 23-79-210(a). In Low v. Insurance Co. of North America, 364 Ark. 427, 220 S.W.3d 670 (2005), we opined that where a charitable organization is immune from an action in tort, its liability insurance carrier is subject to a direct action under Ark.Code Ann. § 23-79-210.
We have noted that injured parties can bring an action directly against the immune charitable organization's insurance carrier under the direct-action statute, as well as against individual employees of the charitable organization who are not immune to suit. Sowders v. St. Joseph's Mercy Health Ctr., 368 Ark. 466, 247 S.W.3d 514 (2007) (citing Low, supra; and Helton v. Sisters of Mercy, 234 Ark. 76, 351 S.W.2d 129 (1961)).
Appellees argue that the direct-action statute does not act to overrule common-law principles of vicarious liability. They assert that this court should apply the rationale expressed in Hartford Ins. Co. v. Mullinax, 336 Ark. 335, 984 S.W.2d 812 (1999). Mullinax is distinguishable from the instant case on several points. Notably, Mullinax did not involve the application of our remedial direct-action statute, but involved the underinsured motorist coverage statute.
Because direct-action statutes are remedial in nature, we liberally construe them for the benefit of the injured parties and to effectuate the intended purposes. Rogers, 325 Ark. at 234, 925 S.W.2d at 399 (citing 12A Couch on Insurance 2d §§ 45:798, 45:800, at 455, 458 (1981)). Looking at the plain language of the statute, it is clear that the legislature sought to provide a plaintiff a right to directly pursue an insurer in situations where the injury is caused by the negligence of a nonprofit organization or its employees who are acting within the scope of their employment.
Broadly construing the statute, it does not impose a new requirement that employees or agents of the immune, charitable organization must be joined.
Reversed and remanded.
CORBIN, DANIELSON, and HENRY, JJ., dissent.
PAUL E. DANIELSON, Justice, dissenting.
Because the circuit court in no way erred when it followed this court's precedent in dismissing the complaint with prejudice, I would affirm and therefore respectfully dissent. The majority's reversal in this case demonstrates a complete disregard for this court's longstanding adherence to one of the basic principles of vicarious liability, as set forth in Hartford Insurance Co. v. Mullinax, 336 Ark. 335, 984 S.W.2d 812 (1999), specifically, that "[w]hen the employee has been released or dismissed and the employer has been sued solely on a theory of vicarious liability, any liability of the employer likewise is eliminated." 336 Ark. at 344, 984 S.W.2d at 816-17 (citing Barnett v. Isabell, 282 Ark. 88, 666 S.W.2d 393 (1984); Davis v. Perryman, 225 Ark. 963, 286 S.W.2d 844 (1956); 27 Am.Jur.2d. Employment Relationship, §§ 469-70 (1996) (currently § 387 (2011))).
The majority attempts to distinguish the instant case on the basis that it involved a direct action pursuant to Arkansas Code Annotated § 23-79-210 (Supp.2009); however, no distinction can be had. This court has made it exceedingly clear that the direct-action statute is merely a remedy that permits allegations of injury by a charitable organization, not subject to an action in tort, to be made in a suit against the charity's liability insurer. See Neal v. Sparks Reg'l Med. Ctr., 375 Ark. 46, 289 S.W.3d 8 (2008). It is remedial, or procedural in nature, and does not create a substantive right in a claimant to sue the insurance company. See Archer v. Sisters of Mercy Health Sys., 375 Ark. 523, 294 S.W.3d 414 (2009).
Here, the Estate's substantive right to sue Washington Regional is based on the doctrine of respondeat superior, under which an employer can be held vicariously liable for the tortious conduct of an employee or agent if the evidence shows that the conduct was committed within the employee's scope of employment. See Cooper Clinic, P.A. v. Barnes, 366 Ark. 533, 237 S.W.3d 87 (2006). While Washington Regional is not subject to an action in tort due to its charitable status, its liability insurance carrier is subject to such a suit and is subject to the legal principles of vicarious liability. Merely because the suit is permitted directly against the insurer rather than the employer itself is of absolutely no moment.
The Estate elected to bring suit against the nurses and their employer, who was immune from suit; therefore, the Estate was permitted to bring suit against the hospital's insurance carrier. The Estate, however, also elected to dismiss the nurses, resulting in a dismissal with prejudice. Indeed, there was no requirement that the nurses be joined; but where they were and were released or dismissed, the principles of vicarious liability result in the extinguishment of any claim against their employer, charitable or not. The majority's attempt to evade this principle solely on the basis that the action is one under the direct-action statute is simply illogical.
CORBIN and HENRY, JJ., join.
Appellant appeals the circuit court's order dismissing with prejudice a medical-malpractice action brought against Continental Casualty Company (Continental) pursuant to the direct-action statute found at Arkansas Code Annotated section 23-79-210 (Supp.2009). In reversing the circuit court's order of dismissal and remanding for further proceedings, the majority opinion appears to abolish our well-established, common-law principles of vicarious liability when an aggrieved party files a negligence action against a tort-immune hospital and, more importantly, its employees. I disagree with the majority's holding and respectfully dissent.
The issue in this case is whether the circuit court correctly applied the principles of vicarious liability in appellant's negligence action whereby, pursuant to the direct-action statute, appellant named Continental as a defendant as the insurer of Washington Regional Medical Center (WRMC), which is immune from suit. Appellant alleged that WRMC, and thus Continental, was vicariously liable for the conduct of two nurses, Irma De La Cruz and Amber Hefner, who were also named as defendants in the lawsuit. Continental moved to dismiss, alleging that appellant failed to obtain service of process on the two nurses and that the statute of limitations expired with respect to any claims against them. Further, based upon principles of vicarious liability, Continental contended that the required dismissal of the nurses with prejudice worked to absolve Continental of any liability.
The circuit court granted Continental's motion to dismiss, agreeing with Continental's arguments. The circuit court ruled that, because of the nurses' dismissal, any vicarious liability could not be imputed to Continental. In its decision, the circuit court relied upon a vicarious-liability theory articulated by this court in Hartford Insurance Company of the Midwest v. Mullinax, 336 Ark. 335, 984 S.W.2d 812 (1999). In Mullinax, we stated,
Mullinax, 336 Ark. at 344, 984 S.W.2d at 816-17. In Mullinax, we concluded that any potential subrogation claim against Jim Bottin, an appellee, by Hartford Insurance, appellant, ended when appellee's employee was dismissed from the litigation with prejudice.
In my opinion, the circuit court properly dismissed appellant's complaint based upon the vicarious-liability principles articulated in Mullinax. The majority attempts to distinguish Mullinax, without overruling it, by claiming that it did not involve "the application of our remedial direct-action statute." However, the fact that the direct-action statute was not at issue in Mullinax is a distinction without a difference. The holding in Mullinax rests
Further, we have held that a legislative act (i.e., the direct-action statute) will not be construed as overruling a principle of common law (i.e., vicarious liability) "unless it is made plain by the act that such a change in the established law is intended." Mullinax, 336 Ark. at 343, 984 S.W.2d at 816. We strictly construe statutes in derogation of the common law. Id. In my view, we should not eviscerate our common-law principles of vicarious liability; rather, we should read them harmoniously with the direct-action statute. To reverse this case would be in derogation of our well-established, common-law principles of vicarious liability and would eliminate any available defenses to future insurer-defendants.
CORBIN and DANIELSON, JJ., join.