From the desk of Kyle Riley: Generally, parties are not permitted to seek tort damages when their duties are governed by contract. The independent duty doctrine (formerly the economic loss rule) allows recovery in tort, even when the parties duties are governed by contract, when the tortfeasor owes a separate legal duty outside of the parties’ contractual relationship. The Supreme Court of Washington specifically prohibits its application to torts without prior approval, and it has mainly been used in the context of actions relating to construction and sales of real estate. With regards to the application of the independent duty doctrine to other services, what is the state of the law? A recent case demonstrates the state of flux in which this area of the law lies.
Claims Pointer: Insurers should be aware that outside of construction of real estate and real estate sales, the independent duty doctrine has not been applied to allow recovery in tort, when the damages are based on a breach of contract. Since contract damages are typically less than those awarded in tort actions, whether the Supreme Court will approve the use of this doctrine outside of construction defect and real estate sales could either greatly increase or reduce the amount of recovery plaintiffs in such a situation may recover.
Hendrickson v. Tender Care Animal Hospital, Corp., 312 P.3d 52 (2013).
On March 16, 2007, Hendrickson brought her golden retriever, Bear, to Tender Care to have him neutered and micro chipped. After the procedure, Bear’s abdomen looked swollen, and the veterinarian ordered an x-ray to ensure that Bear did not have a life threatening accumulation of gas and/or fluid in his stomach. The x-ray did not show an accumulation of deadly gas. When Hendrickson picked up Bear, a desk employee informed her that he had vomited but that he was doing much better. When Hendrickson brought Bear back to her home, she did not give him the anti-bloating medicine that the veterinarian had given her, but instead gave him homeopathic medicine. Shortly thereafter, Bear’s condition worsened and he passed away.
Hendrickson sued for professional negligence, negligent misrepresentation, lack of informed consent and reckless breach of bailment contract. She also sought damages for emotional distress arising out of the breach of a bailment claim. Tender Care moved for partial summary judgment, claiming that Hendrickson could not prove by clear and convincing evidence that Tender Care misrepresented Bear’s condition. Tender Care also argued that claims for lack of informed consent do not apply to cases involving animals, as they are considered “goods” under Washington law, making damages for Bear’s loss purely economic which cannot be recoverable under the economic loss rule.
The trial court partially granted Tender Care’s summary judgment motion, dismissing Hendrickson’s tort claims and claims for emotional distress, damages and reckless breach of bailment contract claim. Hendrickson appealed the trial court’s summary dismissal of these claims. The Court of Appeals accepted discretionary review of the case. On appeal, Hendrickson argued that the trial court erred in denying her reckless breach of bailment and emotional distress damages and that the trial court erred in dismissing her tort based claims based on the economic loss rule. While appeal was pending, the Washington Supreme Court ruled that the economic loss rule should be replaced by the independent duty doctrine, as the former suggests that anytime there is economic loss, there is never recovery in tort.
The Court of Appeals held that a pet owner has no right to emotional distress or damages for loss of a human bond based on negligent death or injury to a pet, and that, historically, no damages have been available for this type of loss. The Court of Appeals also held that the trial court erred in dismissing Hendrickson’s tort claims under the economic loss rule, as the independent duty doctrine now applied. In doing so, the court also noted that the Washington Supreme Court has specifically prohibited the lower courts from applying the independent duty doctrine unless the Washington Supreme Court specifically approved its application to a particular tort. Procedurally, however, the Court of Appeals felt it was proper to remand the case to the trial court to apply the independent duty doctrine.
Case updates are intended to inform our clients and others about legal matters of current interest. It is not intended as legal advice Readers should not act upon the information contained in this email without seeking professional counsel.