Type: Law Bulletins
Date: 04/06/2016

Asbestos Claims and the Indiana Supreme Court: A Tale of Little Repose

Injuries caused by asbestos do not manifest until many years after exposure. Given this long latency period, the Indiana Supreme Court and General Assembly have frequently grappled with how to appropriately ensure that asbestos plaintiffs get a day in court while also ensuring that manufacturers are not forced to defend stale claims. The ongoing dialogue between the court and legislature on this topic has charted a meandering course leaving litigants unsure of the value of their claims and defenses. Much to the chagrin of potential plaintiffs and defendants alike, limits on asbestos actions were invalidated, resurrected and then finally invalidated again in Myers v. Crouse-Hinds Div. of Cooper Indus., Inc., ___ N.E.3d ___, Nos. 49S00–1502–MI–119, 49S00–1501–MI–35, 49S00–1501–MI–36, 2016 WL 825111 (Ind. Mar. 2, 2016).

The common law knew no limits on when an action could be brought. Kissel v. Rosenbaum, 579 N.E.2d 1322, 1327 (Ind. Ct. App. 1991). Thus, the Indiana General Assembly has attempted to set limits on actions for asbestos-related injuries. These limits include a two-year statute of limitations for product liability claims that runs from the accrual of the claim, Ind. Code § 34-20-3-1(b)(1),1 as well as a 10-year statute of repose that runs starting at “the delivery of the product to the initial user or consumer.” Ind. Code § 34-20-3-1(b)(2).2

The Indiana Supreme Court invalidated the statute of repose as applied to asbestos claims in Covalt v. Carey Canada, Inc., 543 N.E.2d 382 (Ind. 1989). Writing for the court, Justice Pivarnik explained that the statute of repose is “inapplicable to cases involving protracted exposure to an inherently dangerous foreign substance which is visited into the body.” Id. at 385. Justice Pivarnik distinguished asbestos claims, which involve an inherently dangerous product that always causes harm, from other product liability claims that stem from an otherwise safe product that fails.

Both Chief Justice Shepard and Justice Dickson dissented. Chief Justice Shepard chided the majority for “rewriting a statute that is a model of legislative clarity.” Id. at 388 (Shepard, C.J., dissenting). Chief Justice Shepard also warned that the court “will spend years explaining why victims of other defective products cannot seek damages even though victims of asbestos can.” Id. at 387. (Little did he know that eventually the court would also need to explain why asbestos claims were permitted, barred and then permitted again.) Justice Dickson, foreshadowing what was to come, lamented that the court was unable to review the constitutionality of the statute under Article 1, Section 12 (the Right to Remedy Clause) and Article 1, Section 23 (the Equal Privileges and Immunities Clause) of the Indiana Constitution. Id. at 390 (Dickson, J., dissenting).

While Covalt was pending, the Indiana General Assembly adopted Indiana Code § 34-20-3-23, which created a new limitations period that applied only to certain asbestos cases. The new section eliminated the 10-year statute of repose and allowed the asbestos claimant to bring an action within two years of the accrual of the cause of action. Ind. Code § 34-20-3-2(a). The only catch was that the new section applied narrowly to two classes of defendants, those “persons who mined and sold commercial asbestos” or those persons who had set aside funds (either in bankruptcy or to avoid bankruptcy) for the payment of asbestos claims. Ind. Code § 34-20-3-2(d).

The Indiana Supreme Court addressed this new section in AlliedSignal Inc. v. Ott, 785 N.E.2d 1068 (Ind. 2003), where the court upheld the validity of the statute. The court interpreted the statute to apply only to persons who both mined and also sold (as opposed to those who mined or sold) raw asbestos (as opposed to those who sold asbestos-containing products). Then the court turned to the constitutional claims and determined that the statute did not violate Article 1, Section 234 of the Indiana Constitution, which provides that “the General Assembly shall not grant to any citizen, or class of citizens, privileges or immunities, which, upon the same terms, shall not equally belong to all citizens.”

Writing for the majority, Justice Sullivan found that the statute “creates a distinction between asbestos victims and other victims under the product liability act.” Ott, 785 N.E.2d at 1077. The court found it “unnecessary to determine whether the distinction is constitutionally permissible because the classification resulting from the distinction … works in favor of asbestos plaintiffs.” Id. Finally, the court determined that Covalt was decided before the new statute was enacted and did not apply to the new statutory scheme. Thus, the court applied the 10-year statute of repose to bar the plaintiffs’ claims.

This ruling again drew a dissent from Justice Dickson, whicj was joined by Justice Rucker. Justice Dickson had a broader reading of the statute and would have applied the statute to persons who mined and persons who sold (rather than only persons who mined and sold) asbestos-containing products (rather than just raw asbestos). Justice Dickson also took a different view of the constitutional questions. Rather than creating a distinction between asbestos plaintiffs and other products liability plaintiffs, Justice Dickson believed the statute “unconstitutionally grants unequal treatment to those employees who contract asbestos-related diseases from exposure to raw asbestos in contrast to those whose diseases result from exposure to asbestos-containing products.” Id. at 1083 (Dickson, J., dissenting).

Justice Dickson got his third crack at the asbestos statute of repose when he authored the majority opinion in Myers v. Crouse-Hinds Division of Cooper Industries, Inc., ___ N.E.3d ___, Nos. 49S00–1502–MI–119, 49S00–1501–MI–35, 49S00–1501–MI–36, 2016 WL 825111 (Ind. Mar. 2, 2016). This time, the Indiana Supreme Court invalidated the new statute of repose under Article 1, Section 23. The plaintiffs argued that the statute “draws a constitutionally impermissible distinction between asbestos plaintiffs who both mined and sold raw asbestos and asbestos plaintiffs who were injured by defendants outside that category.” Id. at *2. According to Justice Dickson, this was a different Article 1, Section 23 claim than the majority analyzed in Ott where Justice Sullivan examined only the disparity between asbestos plaintiffs and other products liability plaintiffs.

Thus, the majority now sided with the plaintiffs and invalidated Indiana Code § 34- 20-3-2(d). That section included a nonseverability clause, resulting in the invalidation of the entire section. Ind. Code § 34- 20-3-2(e); Myers, 2016 WL 825111 at *5. Because all of Indiana Code § 34- 20-3-2 was invalidated, Indiana Code § 34- 20-3-1 again became the statute of limitation and repose for asbestos product liability claims. Because this was the situation when Covalt was decided, the court then resurrected and applied Covalt to hold that the 10-year statute of repose did not apply to asbestos claims. Myers, 2016 WL 825111 at *5.

Chief Justice Rush and Justice Massa dissented, with separate opinions. Chief Justice Rush was primarily troubled by the majority’s abandonment of stare decisis. Id. at *6. Chief Justice Rush stated that she may well have joined the Justice Dickson’s Ott dissent had she been on the court at that time. But, Ott was now the law, and Chief Justice Rush was not convinced by Justice Dickson’s assertion that the Myers plaintiffs’ argument was not addressed in Ott. She wrote that “[p]recisely the same view failed to garner a majority in Ott, despite being ably advanced in the dissent.” Id. at *7. Thus, Justice Rush felt the court should continue to apply Ott.

Justice Massa agreed with Chief Justice Rush’s position but also had three additional concerns with the Myers decision

  • First, Justice Massa was concerned with the “unusual act of defiance in the trial court,” which refused to apply Ott and instead applied the Ott dissent. Myers, 2016 WL 825111 at *8, *8 n.2 (Massa, J. dissenting). The Supreme Court further compounded this problem by bypassing the Court of Appeals and allowing direct review in the Supreme Court under Appellate Rule 56(A).
  • Second, like Chief Justice Rush, Justice Massa believed that the majority’s constitutional analysis did not reach a “new” question, as the Ott dissent had previously addressed it. Rather, the court “engaged in stealth overruling to the detriment of the public, confusing the law and eliminating transparency and predictability.” Id. at *9. Like Chief Justice Rush, Justice Massa noted “[t]he only thing that is new is the make-up of our Court and that dissenting viewpoint garnering a third vote.” Id.
  • Third, Justice Massa felt that the Indiana General Assembly had simply limited the pool of defendants who could be sued after 10 years, which it was constitutionally permitted to do. 

Three reversals on the same point of law in less than 20 years is atypical for the Indiana Supreme Court, which is normally a model of stability. Although the court does not hesitate to change common law when the time is right, see, e.g., Hubbard Mfg. Co. v. Greeson, 515 N.E.2d 1071 (Ind. 1987) (discarding ancient rigid choice-of-law rules that lead to anomalous results), it does not usually chart the circular course it has taken with the asbestos statute of repose. Chief Justice Rush and Justice Massa both pointed out that the only change between Ott and Myers was the composition of the court and that there will be additional changes in the very near future with Justice Dickson’s imminent retirement. Myers, 2016 WL 825111 at *7 (Rush, C.J., dissenting); Id. at *9 (Massa, J., dissenting).

This decision certainly opens the Indiana courts to hearing claims that would have previously been barred by the 10-year statute of repose and will result in a new flood of asbestos litigation. As the number of these cases increases, so will the number of opportunities to relitigate this statute of repose issue. As time goes by and new justices join the court, it will be interesting to see whether Myers stands the test of time or goes the way of Ott. As Justice Massa pointed out, this case also “may invite re-examination of other precedents of this Court as its membership evolves.” Id. at *8 (Massa, J., dissenting). 

_________________________________________________________

1This section was previously codified as Indiana Code § 33-1-1.5-5.
2Statutes of limitation require that a lawsuit be brought within a specific time period after a legal right accrues. Kissel v. Rosenbaum, 579 N.E.2d 1322, 1326 (Ind. Ct. App. 1991). A statute of repose bars actions brought after a specific time period that begins to run from some event other than the accrual of the legal claim. Id.
3This section was previously codified as Indiana Code § 33-1-1.5-5.5.
4The court also evaluated and rejected claims under Article 1, Section 12 of the Indiana Constitution.  

In This Article

You May Also Like