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Car Crash Lawsuit Defendant May Be Estopped From Pursuing Public Agency Defense – Schoettmer v. Wright

By September 6, 2013July 17th, 2019Auto Accidents

When I represent clients pursuing a personal injury claim against a government agency, I always start by warning them that they have an unusually hard job ahead of them. That’s because public agencies have what’s called “sovereign immunity” to injury lawsuits. As government agencies, they have the extra privilege of being able to limit how and when they are sued. Because many plaintiffs don’t realize this, they can wait too long, realize they need to exhaust the administrative process and ultimately miss the deadline to sue. A version of that happened in Schoettmer v. Wright, an Indiana Supreme Court case arising out of a traffic accident. John Schoettmer sued Jolene Wright and her employer, South Central Community Action Program, after a car crash, only to discover that South Central was considered a state agency. The Indiana high court ultimately agreed that South Central might be estopped from using this as a defense.
Wright was working when she collided with Schoettmer in Indianapolis, making South Central vicariously liable. Schoettmer rejected the settlement offer by their insurance company, and ultimately sued for injuries not specified in this opinion. Several months after their original answer to the complaint, the defendants amended their answer to assert a new defense: that South Central is a community action agency and thus technically a political subdivision of the state of Indiana. As such, it would fall under the Indiana Tort Claims Act, which requires litigants like Schoettmer to file notice before suing. In defense, Schoettmer and his wife suggested that South Central’s failure to timely raise the defense constituted either a waiver or a reason for estoppel. The trial court ultimately granted summary judgment to South Central and Wright. The Court of Appeals divided on the issue but ultimately affirmed the trial court.
The Indiana Supreme Court reversed, saying the issue was not appropriate for summary judgment. The Indiana Tort Claims Act requires notice of a claim within 180 days of the loss. It is not disputed that the Schoettners failed to meet that deadline, but they raised four theories that would allow them to proceed: South Central waived the requirement by failing to timely raise it; they provided substantial notice by cooperating with South Central’s insurance company; the insurance company was constructively South Central’s agent; and equitable estoppel should bar the defense because the Schoettners were unaware that South Central was a government agency. The high court rejected the first three, but agreed that estoppel may apply. The evidence shows Schoettner didn’t know about South Central’s status and relied in good faith on his dealings with the insurance company. Thus, the high court said, there are genuine issues of material fact enough to defeat summary judgment. It remanded the case.
One way to define equitable estoppel is “stopping something because it’s unfair.” In this case, the high court thinks a court could find it was unfair for South Central to attempt settlement negotiations with Schoettner for roughly two years without mentioning its legal status as a branch of government. Indeed, the Indiana high court noted that South Central made its first settlement offer after the expiration of the 180-day period required by the Indiana Tort Claims Act, raising the specter that South Central could have dragged its feet on purpose. This kind of argument is by no means a “slam dunk,” but it can be a lifeline for plaintiffs in auto accident injury lawsuits who have been misled by circumstances or active deceit.

If you or someone you love suffered serious injuries in a car crash that was not your fault, you should contact Carey, Danis & Lowe for a free consultation. You can send us a message through our website or call toll-free at 1-877-678-3400 today.
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