23 Kan. App. 2d 812
No. 75,665
DEANNA ROBINSON, Appellant, v. NASREEN B. SHAH, M.D., Appellee.
SYLLABUS BY THE COURT
1. In Kansas, where a person has a cause of action against another and is misled by the fraud and misrepresentation of such other person to the extent that the injured party permits the statute of limitations to bar his or her action, such injured party may sue the perpetrator for fraud and deceit, not on account of the original negligence but on account of the subsequent fraud and misrepresentation which deceived the injured party with the consequence that the time bar ran against the original action.
2. Fraud is discussed and defined.
3. Fraudulent actions by a physician taken in order to deceive the patient from discovering the physician's malpractice is not malpractice; it is fraud and should be treated as such.
4. Where a patient has a cause of action against a physician for negligence or malpractice and is deceived by the intentional and knowing lies and fraud of the physician to the extent that the patient, in reliance on the fraudulent concealment by the physician, does not bring an action for malpractice within the period of the applicable statute of limitations, the patient may maintain an action for fraud against the physician, not on account of the original negligence or malpractice, but on account of the fraud of the physician which deceived the patient with the consequence that the time bar ran against the original action.
5. The statute of limitations in an action for relief on the ground of fraud does not start to run until the plaintiff discovers the fraud or until the plaintiff learns such facts as would lead a reasonably prudent person to investigate.
6. Fraudulent concealment of the true facts by the perpetrator of a fraud will also toll the running of the 10-year statute of repose to the same extent and on the same conditions as such fraudulent concealment tolls the statute of limitations.
7. The doctrine of equitable estoppel is discussed and applied.
8. A defendant in a malpractice case may not take advantage of a defense based on the statute of limitations or the statute of repose where the defendant's own intentional, knowing, and fraudulent concealment of facts from his or her patient has resulted in the patient's failure to bring the action within the period required by the statute of limitations and the statute of repose. Under such facts, a defendant will be equitably estopped from raising otherwise valid defenses such as the statute of limitations and/or the statute of repose.
Appeal from Pawnee District Court; J. BYRON MEEKS, judge. Opinion filed April 18, 1997. Reversed and remanded.
Thomas E. Hayes and Benjamin M. Kieler, of Hayes & Kieler, L.L.C., of Overland Park, for the appellant.
William Tinker, Jr., of McDonald, Tinker, Skaer, Quinn & Herrington, P.A., of Wichita, for the appellee.
Before LEWIS, P.J., KNUDSON, J., and JOHN J. BUKATY, JR., District Judge, assigned.
LEWIS, J.: The plaintiff appeals from a ruling by the trial court that her fraud and medical malpractice causes of action against the defendant were barred by the statute of limitations. The trial court's ruling was accompanied by the realization of all concerned that this case required the attention of the appellate courts. The facts in this action are particularly egregious and call into question the relationship between fraud and the statute of limitations. Procedurally, the plaintiff's lawsuit was dismissed as barred by the statute of limitations prior to a trial on the merits. Under those circumstances, all of the parties agree that we must accept the facts as presented by the plaintiff as true. Those facts are set out in the trial court's journal entry and have been adopted by this court as true and correct for the purposes of this appeal. We hasten to point out, however, that no trial on the merits has been had. It is possible, therefore, that the actual facts as proven at trial may not be precisely as we must assume them to be at this point. Nevertheless, for the purposes of this appeal, the plaintiff's version of the facts is assumed to be true and correct.
The plaintiff was a longtime patient of Dr. Nasreen B. Shah, M.D., hereinafter referred to as the defendant, and placed her physical well-being in the hands of that physician from 1975 to 1986. During that period of time, the defendant treated the plaintiff for various gynecological disorders.
On November 9, 1983, the defendant performed a total abdominal hysterectomy and bilateral salpingo-oophorectomy on the plaintiff. Approximately 1 week after the surgery, the plaintiff was discharged from the hospital and was assured that there were no complications or potential problems which might arise as a result of the surgery.
On the day after the plaintiff was discharged from the hospital, she began to experience abdominal distress. She consulted the defendant about these symptoms, and the defendant ordered x-rays to be taken of the plaintiff's kidneys, ureter, and bladder in an effort to explain her discomfort.
The x-rays were taken at St. Joseph Memorial Hospital and were read and interpreted by Dr. C. J. Cavanaugh, presumably a radiologist associated with that facility. Dr. Cavanaugh was of the opinion, after reading the x-rays, that they showed the presence of surgical sponges which had been left in the plaintiff's abdomen after surgery. Dr. Cavanaugh called the defendant and reported the findings of the x-rays and, in addition, sent to the defendant a copy of a written report which also reflected those findings.
Incredibly and shamefully, the defendant fraudulently concealed from the plaintiff the findings of these x-rays. Instead of being truthful, the defendant deliberately lied to the plaintiff and told her the x-rays were negative and that there were no apparent or unusual complications from the recent abdominal surgery, and she assured the plaintiff that she did not require further treatment. At no time did the defendant reveal to the plaintiff the fact that she had left surgical sponges in the plaintiff's abdomen after the most recent surgery.
Over the next several years, the plaintiff continued to see the defendant for gynecological check-ups. She continued to experience abdominal pain and discomfort. The defendant, however, continued to conceal from the plaintiff the existence of the surgical sponges left in the plaintiff's abdomen.
The plaintiff ceased seeing the defendant as her physician in 1986. However, she consulted other physicians and continued to experience frequent pain and discomfort in her abdomen as well as intestinal, urological, and gynecological problems. Although the plaintiff brought her complaints to the attention of other physicians, no one was able to diagnose the source of her problems.
In 1993, one of the physicians attending to the plaintiff's problems diagnosed a pelvic mass, which he felt could be causing some discomfort. On August 11, 1993, the plaintiff underwent pelvic sonograms and x-rays, which revealed the existence of retained surgical sponges.
The plaintiff contends the defendant, from and after November 18, 1983, had actual knowledge of the presence of retained surgical sponges in the plaintiff's abdomen and well knew the potential of future complications which could arise from this condition. Despite this knowledge, the plaintiff contends, the defendant fraudulently concealed the existence of this condition from the plaintiff.
The trial court found that the plaintiff was unable to discover the fact that the defendant had negligently left surgical sponges in her abdomen and that this fact was fraudulently concealed from the plaintiff, who did not discover the defendant's fraud until August 11, 1993.
This action was filed on August 16, 1994.
The plaintiff's legal problems are obvious. According to her factual contentions, in 1983, the defendant left surgical sponges in the plaintiff's abdomen and knew she had done so no later than November 18, 1983. Despite such knowledge, the defendant fraudulently concealed the existence of the retained sponges from the plaintiff and lied to her about the nature of her condition. It was not until August 11, 1993, that the plaintiff knew or could have known what the defendant had done. This is a passage of nearly 10 years. All of the related statutes of limitations and statutes of repose had expired. The plaintiff was without a remedy, and the defendant was home free unless an exception exists to preserve her causes of action against the defendant. If no such exception exists, the defendant will be rewarded for her fraud in concealing from the plaintiff that surgical sponges had been left in her abdomen. Over 10 years have passed since the defendant's act of fraudulent concealment. The trial court held that all of the plaintiff's potential legal remedies against the defendant have been outlawed by the statute of limitations. This decision is a direct result of the defendant's fraudulent concealment of the plaintiff's condition. The defendant now seeks to use the statute of limitations as a shield from the consequences of her negligence and her fraud. This is an intolerable situation which we ought not ignore. We do not believe the law is powerless to correct such an injustice. We must decide whether the defendant is to be rewarded for her fraudulent conduct.
STATUTES OF LIMITATION
As we view this lawsuit, the following statutes of limitation and statutes of repose are relevant:
K.S.A. 60-513:
| "(a) The following actions shall be brought within two years:
. . . .
"(7) An action arising out of the rendering of or failure to render professional services by a health care provider, not arising on contract.
. . . .
"(c) A cause of action arising out of the rendering of or the failure to render professional services by a health care provider shall be deemed to have accrued at the time of the occurrence of the act giving rise to the cause of action, unless the fact of injury is not reasonably ascertainable until some time after the initial act, then the period of limitation shall not commence until the fact of injury becomes reasonably ascertainable to the injured party, but in no event shall such an action be commenced more than four years beyond the time of the act giving rise to the cause of action." (Emphasis added.)
|
K.S.A. 60-513:
| "(a) The following actions shall be brought within two years:
. . . .
(3) An action for relief on the ground of fraud, but the cause of action shall not be deemed to have accrued until the fraud is discovered.
. . . .
"(b) Except as provided in subjection (c), the causes of action listed in subsection (a) shall not be deemed to have accrued until the act giving rise to the cause of action first causes substantial injury, or, if the fact of injury is not reasonably ascertainable until some time after the initial act, then the period of limitation shall not commence until the fact of injury becomes reasonably ascertainable to the injured party, but in no event shall an action be commenced more than 10 years beyond the time of the act giving rise to the cause of action." (Emphasis added.)
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The plaintiff's causes of action against the defendant are based on medical malpractice and fraud. It is perfectly obvious from a reading of the statutes that each cause of action must be brought within 2 years of its accrual and that the medical malpractice statute of repose is 4 years, whereas the fraud statute of repose is 10 years. It does not require great legal insight to realize that the plaintiff is dead in the water unless the fraudulent conduct on the part of the defendant either tolled or somehow extended the periods of limitations.
IS THERE A CAUSE OF ACTION FOR FRAUD?
The relevant portions of count II of the plaintiff's petition read as follows:
| "2. That defendant Shah fraudulently concealed the finding of sponges in the plaintiff's November 18th, 1983, x-ray, breached her fiduciary duty of full disclosure and made affirmative misrepresentations to plaintiff that there were no complications or potential complications resulting from the November 9, 1983 surgery, when, in fact, defendant Shah had actual knowledge of the presence of surgical sponges in the [plaintiff's] abdomen and of the potential [of] future complications resulting from this condition.
"3. That the above referenced tortious conduct of defendant deprived plaintiff of her right to prompt medical treatment, thereby causing her prolonged and severe pain, suffering, physical disabilities, and related loss of time, income and enjoyment of life. Further, defendant's tortious conduct deprived plaintiff of her right to timely seek and recover legal damages for the defendant's medical negligence causing her the loss in opportunity to utilize and invest such damages."
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We see no reason why a defendant should not be held responsible for a fraud which caused a patient to allow his or her malpractice cause of action to become barred by the statute of limitations. We further see no reason why a defendant should not be held responsible for fraudulently causing a patient not to seek prompt medical treatment for his or her condition, which results in his or her suffering needless years of prolonged, severe, and unnecessary pain and discomfort. The plaintiff's petition alleges that the defendant's fraud caused her those damages.
In this opinion, for obvious reasons, we will focus on the fact that the defendant fraudulently caused the plaintiff to lose her malpractice cause of action.
The law in Kansas has long permitted a party who has lost a cause of action by virtue of the fraud of another to maintain an action for fraud against the perpetrator for the loss of a cause of action. In Clark v. Amos, 144 Kan. 115, 116, 58 P.2d 81 (1936), our Supreme Court dealt with such a cause of action. The court commented as follows:
| "Touching the trial court's ruling on defendants' demurrer, it is the law that where a person has a cause of action against an adversary and is duped through misrepresentation of fact by the latter whereby the injured party permits the statute of limitations to bar his action, he can maintain an action for deceit against the wrongdoer under some circumstances, not on account of the original negligence but on account of the subsequent wrongdoing--the misrepresentation of fact which deceived the injured party--with the consequence that the time bar ran against the original action. (Pierson v. Holdridge, 92 Kan. 365, 140 Pac. 1032; Cramer v. Railways Co., 112 Kan. 298, 211 Pac. 118.) While there is a diversity of opinion on this subject (L. R. A. 1917F 720) the Kansas view accords with Rochester Bridge Co. v. McNeil, 188 Ind. 432, 122 N.E. 662; Urtz v. N. Y. C. & H. R. R. R. Co., 202 N. Y. 170, 95 N. E. 711, and Hobaica v. Byrne, 214 N. Y. S. 759, 761; Desmarais v. Company, 79 N. H. 195, 107 Atl. 491." (Emphasis added.) |
See Annot. 33 A.L.R.3d 1077, 1085.
The plaintiff seeks to prosecute the type of cause of action approved in Clark v. Amos. If she is not permitted to do so, injustice is the result. As our Supreme Court said in Cramer v. Railways Co., 112 Kan. 298, 304, 211 Pac. 118 (1922): "Public policy should, and we think does, prevent such an injustice." We agree.
As we perceive it, the question here is why a physician cannot be sued for defrauding a patient out of a cause of action. In count II of the plaintiff's cause of action, she seeks recovery not for the original negligence or malpractice by the physician but for the fraud of the physician who deceived her "with the consequence that the time bar ran against the original action." Clark, 144 Kan. at 115. As we view it, the fraudulent concealment in this case was not malpractice, it was fraud, pure and simple. For this reason and the reasons which follow, we conclude the trial court erred in dismissing the plaintiff's lawsuit as untimely as to the cause of action for fraud, and we reverse that decision and remand the matter for a trial on the merits.
In Umbehr v. Board of Wabaunsee County Comm'rs, 252 Kan. 30, Syl. ¶ 4, 843 P.2d 176 (1992), fraud is defined as follows: "A fraudulent act generally is comprised of anything calculated to deceive, including all acts, omissions, and concealments involving a breach of legal or equitable duty, trust, or confidence justly reposed, resulting in damage to another." See Tetuan v. A. H. Robins Co., 241 Kan. 441, Syl. ¶ 3, 738 P.2d 1210 (1987); Goben v. Barry, 234 Kan. 721, Syl. ¶ 8, 676 P.2d 90 (1984).
In Moore v. State Bank of Burden, 240 Kan. 382, 389, 729 P.2d 1205 (1986), we find the following:
| "The broad outlines of fraud are said to include any cunning, deception, or artifice used, in violation of legal or equitable duty, to circumvent, cheat, or deceive another. The forms it may assume and the means by which it may be practiced are as multifarious as human ingenuity can devise, and the courts consider it unwise or impossible to formulate an exact, definite, and all-inclusive definition of the action. It is synonymous with, or closely allied to, other terms indicating positive and intentional wrongdoing, but is distinguishable from mistake and negligence. Citizens State Bank v. Gilmore, 226 Kan. 662, Syl. ¶ 2, 603 P.2d 605 (1979). Actual fraud is an intentional fraud, and the intent to deceive is an essential element of the action. Constructive fraud, however, is a breach of a legal or equitable duty which, irrespective of moral guilt, the law declares fraudulent because of its tendency to deceive others or violate a confidence, and neither actual dishonesty of purpose or intent to deceive is necessary. Andres v. Claassen, 238 Kan. 732, Syl. ¶ 2, 714 P.2d 963 (1986). A suppression or concealment of the truth is not at all times such fraud or deceit as will be relieved against. DuShane v. Union Nat'l Bank, 223 Kan. 755, 760, 576 P.2d 674 (1978). There must be a concealment of facts which the party is under a legal or equitable duty to communicate and in respect of which he could not be innocently silent. DuShane v. Union Nat'l Bank, 223 Kan. at 759." (Emphasis added.) |
In Albers v. Nelson, 248 Kan. 575, Syl. ¶ 5, 809 P.2d 1194 (1991), the court defined fraud as follows:
| "Actionable fraud includes an untrue statement of fact, known to be untrue by the party making it, which is made with the intent to deceive or recklessly made with disregard for the truth, where another party justifiably relies on the statement and acts to his or her injury and damage." |
See Slaymaker v. Westgate State Bank, 241 Kan. 525, Syl. ¶ 2, 739 P.2d 444 (1987).
We believe that the allegations set forth in count II of the plaintiff's petition set forth a classic cause of action for fraud. It is beyond question that the defendant's lies to the plaintiff were made to deceive her and conceal the defendant's negligence. It cannot be seriously argued that the defendant did not have a legal and an equitable duty to tell the plaintiff the truth. This duty was breached. The breach of this duty by the defendant caused, the plaintiff alleges, the plaintiff to lose a valuable cause of action and suffer 10 years of needless pain and discomfort.
We think it is important to note that the defendant in this case is not alleged to either have been mistaken or negligent in her failure to disclose the truth to her patient. She is accused of deceit and lies amounting to positive and intentional wrongdoing. As pointed out above, not every concealment of the truth is actionable. However, when such concealment violates a legal or equitable duty, it becomes actionable and fraudulent.
In order to prove fraud, the following facts must be shown: (1) an untrue statement known to be untrue by the party making it and made with the intent to deceive; (2) justifiable reliance by the victim on the truth of the statement; (3) damages as a result of that reliance. See Albers, 248 Kan. at 579; Slaymaker, 241 Kan. 526.
The plaintiff's petition sets forth sufficient allegations to state a cause of action for actual fraud against the defendant. We refuse to recognize any distinction between the fraud which separates the victim from his or her money and the fraud which deprives a victim of a cause of action for malpractice.
The defendant argues, however, that one cannot have a fraud cause of action against a physician. The premise for this argument is that when a physician defrauds a patient out of a cause of action for malpractice, it is not fraud, it is simply more malpractice. Thus, according to the defendant, the physician may hide behind his or her fraudulent conduct and enjoy the benefits of that fraud because it is not fraud, it is malpractice.
We do not concede that the law is so unjustly weighted on the side of the wrongdoer. It seems senseless for defendant to argue that the "gravamen" of the plaintiff's cause of action is malpractice when that action, according to the defendant, has been eliminated by the lies and fraud of the defendant herself. The plaintiff seeks to recover damages caused by the fraudulent loss of her cause of action for malpractice.
The most recent decision in this area is that written by Justice Abbott in Bonin v. Vannaman, 261 Kan. 199, 929 P.2d 754 (1996). The defendant strongly urges us to conclude that Bonin controls and requires us to affirm the decision of the trial court. We do not agree, and we decline the invitation.
In Bonin, the plaintiff sued a physician for malpractice and fraud and sued her parents for negligence. The basis for the allegations of fraud was the failure of the physician to diagnose a condition known as scoliosis. There were no allegations in Bonin that the defendant had deliberately lied to the plaintiff or had fraudulently deceived the plaintiff out of improper motives. There was no element of scienter in Bonin. There were no facts indicating any motivation for the defendant to lie in Bonin. There were no benefits flowing to the defendant from lying to the plaintiff in Bonin. The condition of the plaintiff was not caused by the negligence of the physician, and the disclosure of that condition would not have placed the physician in jeopardy of being sued. In short, defendant in Bonin did not lie to avoid responsibility for his own fault, and did not lie at all. Bonin differs significantly factually from this case and does not control.
In Bonin, as here, the issue was the statute of limitations. Eighteen years had passed from the alleged accrual of the cause of action and the filing of the petition. The trial court concluded that Bonin was actually a malpractice action, grounded in negligence, and not a cause of action for fraud. The Supreme Court agreed, and we agree with the Supreme Court in its decision in Bonin.
The Supreme Court in Bonin concluded only that Bonin's cause of action was grounded in negligence and not in fraud. The court did not hold that a physician can never be liable for fraud. Quite the contrary, Justice Abbott carefully limited the decision when he said:
| "This does not mean that a doctor can never be liable for fraud or breach of contract. Instead, this simply means that a fraud or breach of contract cause of action can only be based upon a physician's misconduct if that misconduct is beyond a breach of the legal duty which every doctor has the obligation to uphold. [Citation omitted.]" (Emphasis added.) 261 Kan. at 210. |
The fact is, there were no allegations of actual fraud in Bonin. The plaintiff's cause of action was grounded in negligence, and the claims of fraud were merely a lawyer's attempt to avoid the statute of limitations. The "fraud" of the defendant in Bonin was a failure to diagnose the plaintiff's scoliosis. The claim was clearly grounded in the defendant's negligence in failing to diagnose.
That is not true in the instant matter. This is not a case which involves the failure to diagnose a condition shown by the x-ray report. This is a case where the defendant lied to the plaintiff with the intent to deprive the plaintiff of a malpractice action. The falsehoods have been successful to this date, the fraud has been complete to this date, and in our judgment, it was actionable.
Our decisions have indicated that substance prevails over form. Travis v. Bishoff, 143 Kan. 283, 285, 54 P.2d 955 (1936). What this means is that if the cause of action is really one for malpractice, just calling it a cause of action for fraud does not change its true nature. This is illustrated in Malone v. University of Kansas Medical Center, 220 Kan. 371, 374-76, 552 P.2d 885 (1976), in which a tort action was being called a contract action:
| "The nature of a claim--whether it sounds in tort or contract--is determined from the pleadings [citations omitted] and from the real nature and substance of the facts therein alleged. 1 C.J.S. Actions, § 35, p. 1076. . . .
. . . .
"Certain duties and obligations are imposed upon physicians and hospitals by law. Breach of such duty by a physician is malpractice, and an action for damages for malpractice is one in tort, even though there was a contract, express or implied, for employment. [Citation omitted.] Similarly an action for damages against a hospital for negligence, i.e., for breach of duties imposed by law, sounds in tort. This is true though there may be a contract between the parties.
. . . .
"In Tefft v. Wilcox, 6 Kan. 46, 61 [1870], this court held that a physician is obligated to his patient under the law to use reasonable and ordinary care and diligence in the treatment of cases he undertakes, to use his best judgment, and to exercise that reasonable degree of learning, skill, and experience which is ordinarily possessed by other physicians in the same or similar locations. We have continued to impose those duties upon physicians. See PIK Civil 15.01 and cases there cited. A physician also has the duty to make a reasonable disclosure to the patient of pertinent facts within his knowledge relating to proposed treatment, in order that the patient may intelligently consent or refuse the treatment. [Citation omitted.]
. . . .
". . . What plaintiffs are complaining about is that the treatment provided was negligent--all of the needed treatment was not furnished, and that which was furnished was incomplete, incompetent, and unauthorized. In other words, the hospital and the physicians failed to exercise that reasonable care, skill, and diligence which the law requires of hospitals and physicians--regardless of any express contract therefor between the parties.
"Clearly the action sounds in tort, and under that theory the defendants are immune from liability. The general rule is that a plaintiff will not be permitted to characterize a tort action as one in contract in order to avoid the bar of the statute of limitations or governmental immunity. Travis v. Bishoff, 143 Kan. 283, 54 P.2d 955 [1936]; Talbot v. Waterbury Hospital Corp., 20 Conn. Sup. 149, 164 A.2d 162 (1960); Billings v. Sisters of Mercy of Idaho, 86 Idaho 485, 389 P.2d 224 [1964]; Mamunes v. Williamsburg Gen. Hosp., 28 App. Div. 2d 998, 283 N.Y.S.2d 457 [1967]; and, see, Yeager v. National Cooperative Refinery Ass'n, [205 Kan. 504, 470 P.2d 797 (1970)]."
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See Bonin, 261 Kan. at 209.
The plaintiff in count II is not complaining about negligence, incompetence, or unauthorized treatment. She is complaining about being lied to and misled by someone she trusted and by someone who was obligated to tell her the truth. It should not matter if that someone is a physician, lawyer, banker, or magazine salesman. Fraud is fraud, and we reject the notion that physicians are not answerable for it as are the other members of our society.
The obligation to tell the truth to people who depend on you to do so is not an exclusive obligation of a physician. It is an obligation shared with fiduciaries, with bankers, with lawyers, with shoe salesmen, and with myriad other members of our society. We reject the notion that because a physician has an obligation to tell his or her patients the truth that any suit against a physician for violating that duty can only be one for malpractice and not for fraud.
There is no logic and no justice in a conclusion that when a physician misleads someone, it is malpractice, but when a banker does so, it is fraud. The duty to speak honestly to those who trust you and to not engage in fraud or deception are duties shared by the medical profession with myriad members of our society. Physicians are not immune from the consequences of their fraudulent conduct.
We hold that where a patient has a cause of action against a physician for malpractice and has been duped by the intentional and knowing lies of the physician to the extent the patient in reliance on the fraudulent misrepresentation permits the statute of limitations to bar his or her action, the patient can maintain an action for fraud against the physician, not on account of the original negligence or malpractice but on account of the fraudulent actions of the physician which deceived the patient with the consequence that the time bar ran against the original action.
STATUTE OF LIMITATIONS AS TO FRAUD
Having held that the plaintiff has set forth a valid cause of action for fraud against the defendant, the next question is whether the cause of action was timely filed.
K.S.A. 60-513(a)(3) establishes a limitation of 2 years within which to bring an action for relief on the ground of fraud. It goes on to provide that such a cause of action shall not be "deemed to have accrued until the fraud is discovered." In this case, the cause of action was filed w