Appeals Court Discusses Jurisdiction over Nonresidents and Forum Non Conveniens

September 17, 2007

The Court of Appeals recently published Elder, et. al v. Perry Co. Hospital, et. al, a medical malpractice case involving Kentucky residents and Indiana residents. The parents of the deceased were Kentucky residents who had their son treated in Indiana, where the medical negligence was alleged to have occurred. The case had been pending for six years and at least one appeal to the Supreme Court over jurisdictional issues and the proper forum. The issues decided in this case are numerous but center on whether the Kentucky Courts could exercise personal and subject matter jurisdiction over the Indiana residents and if so, whether the doctrine of forum non conveniens applied.

In considering jurisdiction challenges for lack of personal jurisdiction the main issue is the minimum contacts requirement set forth by the US Supreme Court. (Remember the Volkswagen case from civil procedure?) Of course the purpose is to insure that constitutional protections of due process aren’t violated. According to the Court of Appeals, the minimum contacts were met by the defendants actions in the Commonwealth.

In considering the lack of subject matter jurisdiction challenge presented, the issue raised was really not one of subject matter jurisdiction but one of choice of law. Kentucky Courts have subject matter jurisdiction over medical malpractice cases. However, since nonresident defendants were involved and the tort occurred outside of Kentucky the choice of law question is a valid one, although improperly labeled. The Court of Appeals found that Indiana’s Medical Malpractice Act violated Kentucky public policy, did not provide appropriate protection of Kentucky residents, and likely violated Kentucky’s Constitution; therefore, Kentucky law applied.

Forum non conveniens can still apply, even if jurisdiction is established, if the forum chosen by the Plaintiff is “seriously inconvenient” and another more appropriate forum is still available. The Court discussed factors that made it just as convenient for the defendants to litigate the case in Louisville, as in Tell City, Indiana. It also believed that the Indiana forum was no longer available due to statute of limitations issues. (Despite the trial court’s attempts to prohibit that issue from being raised in Indiana’s courts.) Given the time that had passed before the issue was raised and the lack of an alternative forum, the Court held the doctrine did not apply.

The real issue in this opinion is whether the Plaintiffs were going to be required to pursue two separate actions for malpractice in two separate states with two entirely separate sets of laws. The trouble apparently began when Perry County Hospital sought dismissal of the action. When this was granted, the Plaintiff’s faced the unenviable task of two separate lawsuits. Instead they sought to have Norton dismissed on the same grounds. Norton actually argued against dismissal. Eventually, the trial court dismissed both defendants on forum non conveniens grounds prompting this appeal. The effect of this decision is to overturn the dismissal of Perry County Hospital, allowing the Plaintiffs’ to pursue their malpractice action in Jefferson County, Kentucky against an Indiana resident corporation that never “practiced” in Kentucky but had the minimum contacts to warrant Kentucky exercise of personal jurisdiction.

This case raises all sorts of interesting civil procedural issues. The personal jurisdiction issue should have been reviewed, but the standard “minimum contacts”, means just that, “minimum.” It’s a low standard only meant to insure that a court’s acceptance of jurisdiction does not offend notions of fair play and due process. This minimum contacts inquiry is incorporated into Kentucky’s long arm statute KRS 454.210 as are the other factors identified by the court. In today’s world, it is difficult to find a large corporation that does not meet this requirement, especially ones such as these practicing on the border between Indiana and Kentucky that advertise in Kentucky for business from Kentucky residents.

One interesting question not addressed in this opinion is the issue of venue. Lack of venue is grounds for dismissal. If personal jurisdiction is authorized by Kentucky’s long arm statute, the appropriate venue is either the county where the plaintiff resides or where the cause of action arose. KRS 454.210(4).

So, even if venue is appropriate against Norton due to its relationship to Jefferson County, that does not mean Jefferson County is appropriate for Perry County Hospital or the other nonresident defendants. If personal jurisdiction is exercised over these nonresident defendants the appropriate Kentucky forum is Hancock County, Kentucky where the plaintiffs reside. In fact, the minimum contacts evaluated by the court occurred in Hancock County. Unfortunately, it does not appear the venue issue was ever raised, so it was not discussed by the court of appeals.

However, in Copass v. Monroe Medical Foundation, Inc. 900 S.W.2d 617 (Ky.App. 1995), the court of appeals held that it was not proper to include nonresident defendants in an action in a neighboring county where other defendants were located. This case dealt solely with Kentucky residents. In this case the other defendants are Indiana residents. The appropriate venue for these defendants is not Jefferson County. The true issue for the Indiana residents, aside from the personal jurisdiction inquiry, is the improper venue of the case in Jefferson County, not the inconvenient forum of an otherwise proper venue.

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