Case Name: Manor Care of Sunnyvale CA, LLC dba Manorcare Health Services v. James A. Phills, Jr., et al.

Case No.: 17CV317903

(1) Cross-Defendant Manor Care of Sunnyvale CA, LLC’s Demurrer to the Second Amended Cross-Complaint
(2) Cross-Defendant Manor Care of Sunnyvale CA, LLC’s Motion to Strike Portions of Second Amended Cross-Complaint for Damages

Factual and Procedural Background

Complaint

Plaintiff Manor Care of Sunnyvale CA, LLC dba Manorcare Health Services (“Manor”) is licensed as a skilled nursing facility. (Complaint, ¶1.) On or about July 6, 2016, defendant James A. Phills, Jr. aka James A. Phills’s (“Phills”) mother, Gerine Phills (“Decedent”), was admitted as a resident to plaintiff Manor’s skilled nursing facility. (Complaint, ¶5.) Decedent signed a written contract with plaintiff Manor wherein plaintiff Manor agreed to provide routine nursing and emergency care and other services to Decedent in exchange for payment. (Id.) Decedent remained a resident until July 16, 2017 incurring charges totaling $31,297.87 which remain unpaid and owing. (Id.)

On December 2, 2009, Decedent executed a durable power of attorney nominating her son, defendant Phills, to act as her attorney-in-fact. (Complaint, ¶6.) Unknown to plaintiff Manor, defendant Phills was appointed as “plenary guardian of the person and property” (conservator of the estate) of his mother, the Decedent, in Sarasota County, Florida, when Letters of Plenary guardianship were issued on August 6, 2010. (Complaint, ¶7.) The guardianship was active at the time Decedent was admitted to plaintiff Manor’s skilled nursing facility. (Id.) Defendant Phills exercised control over and managed his mother’s assets. (Id.) While Decedent was a resident at Plaintiff’s skilled nursing facility, defendant Phills knew his mother was a resident and applied for Medi-Cal benefits on her behalf. (Complaint, ¶8.)

Plaintiff Manor provided skilled nursing care and treatment to Decedent from on or about July 6, 2016 until Decedent’s death on July 16, 2017. (Complaint, ¶9.) Plaintiff Manor is owed the sum of $31,297.87 for the skilled nursing care and treatment provided to Decedent. (Complaint, ¶10.) Defendant Phills is the successor in interest to Decedent’s estate and is administering Decedent’s estate without a formal probate proceeding. (Complaint, ¶11.) Defendant Phills is personally liable for Decedent’s unsecured debts to the extent of his distribution from the assets of Decedent’s estate. (Id.)

During her residency at plaintiff Manor’s skilled nursing facility, Decedent was awarded Medi-Cal benefits to pay for a portion of her care. (Complaint, ¶12.) Decedent, and defendant Phills as her agent, was obligated to pay a share of the cost of Decedent’s medical care at plaintiff Manor’s skilled nursing facility. (Id.)

On October 23, 2017, plaintiff Manor filed a complaint against defendant Phills asserting causes of action for:

(1) Violation of Welfare and Institutions Code §14110.8 – Failure to Pay Medi-Cal Share of Cost Obligation
(2) Open Book Account
(3) Quantum Meruit – Reasonable Value of Services
(4) Damages Pursuant to Probate Code §13109

Cross-Complaint

On February 7, 2018, defendant Phills filed an answer to plaintiff Manor’s complaint and also filed a cross-complaint against Manor.

On April 26, 2018, cross-defendant Manor filed a demurrer and motion to strike portions of the cross-complaint.

On July 23, 2018, Phills filed a first amended cross-complaint (“FAXC”).

On August 23, 2018, Manor filed a demurrer and motion to strike portions of Phills’s cross-complaint.

On December 4, 2018, the court issued an order sustaining Manor’s demurrer and deeming Manor’s motion to strike moot.

On December 19, 2018, Phills filed a second amended cross-complaint (“SAXC”) which alleges on or about July 6, 2016, Phills’s elderly and infirm mother, Decedent, was admitted to Manor’s skilled nursing facility and remained there until her death on July 16, 2017. (SAXC, ¶1.) Phills is Decedent’s legal guardian, sole heir, and sole surviving relative other than Phills’s minor children. (Id.) According to the SAXC, Manor was habitually understaffed and, as a result, necessary care was regularly withheld from Decedent. (SAXC, ¶3.) Manor knew Decedent suffered from urinary incontinence, as well as spinal stenosis and osteoarthritis in the lower legs, and therefore required frequent assistance in getting from her bed to the toilet. (Id.) Despite this knowledge, Manor failed to provide adequate assistance on at least two occasions which resulted in Decedent falling and injuring herself while attempting to go to the bathroom. (Id.) Manor knew Decedent suffered from diabetes yet failed to adjust her insulin, provide an appropriate meal plan, or provide adequate monitoring by a doctor, despite dangerously high blood sugar level readings and even after Phills brought these issues to Manor’s attention. (Id.) Manor also failed to recognize and treat a lesion on Decedent’s back which became infected. (Id.) Manor made a conscious choice to disregard these risks and engaged in a course of action that posed a risk of serious danger to Decedent by withholding the level of care needed to prevent grave injury. (Id.)

Manor also engaged in a pattern of verbal and psychological abuse by harassing Decedent regarding her outstanding bill. (SAXC, ¶4.) Manor knew that Decedent relied on Medi-Cal, had been improperly denied Medi-Cal benefits, and had no other means of payment, Manor repeatedly threatened to call the sheriff on Decedent; to evict Decedent from the facility and to “put her on the street.” (Id.) At the time of this abuse, Manor had knowledge that Decedent had been declared incompetent by a Florida court and Phills had been appointed plenary guardian of Decedent’s person and property. (Id.) Manor also knew Decedent suffered from delusional parasitosis for which Decedent was treated with antipsychotic drugs. (Id.) Manor knew Decedent was cognitively and legally incapable of responding to demands. (Id.)

Phills spent extensive time and effort providing financial records and information in support of Manor’s efforts to secure approval of Medi-Cal coverage for Decedent. (SAXC, ¶5.) Phills and Manor were ultimately successful in doing so and Manor received reimbursement for Decedent’s care. (Id.) Phills received no compensation or other consideration for performing his role as Decedent’s guardian and supporting Manor’s efforts to secure Medi-Cal reimbursement. (Id.)

Manor failed to replace an empty oxygen container causing Decedent to suffer from “air hunger” and ultimately to suffocate to death in the presence of Phills. (SAXC, ¶6.) On the day of Decedent’s death, Phills observed his mother displaying signs of discomfort and physical suffering, including grimacing and gurgling, which Phills recognized to be an indication that Decedent had fluid in her airway and required suctioning, something Manor never performed. (Id.) Later, Phills noticed Decedent’s oxygen saturation was decreasing and brought this to Manor’s attention. (Id.) Manor replaced the equipment which helped momentarily but Decedent’s condition rapidly declined as her chest began heaving and Decedent ceased breathing altogether. (Id.) During Decedent’s final moments of respiratory distress, Phills looked at the oxygen machine and could see oxygen was no longer flowing and was immediately aware that some failure of custodial authorities to respond significantly to symptoms obviously requiring immediate medical attention had caused Decedent to suffocate. (Id.) Phills summoned a nurse and pointed out to the nurse that it appeared oxygen was not flowing from the machine. (Id.) the nurse examined the empty oxygen container, broke into tears, and admitted to Phills that the tank had run out of oxygen. (Id.)

Phills’s SAXC against Manor asserts causes of action for:

(1) Elder Abuse
(2) Negligent Infliction of Emotional Distress

On January 17, 2019, Manor filed the two motions now before the court, a demurrer to the SAXC and a motion to strike portions of the SAXC.

I. Cross-defendant Manor’s demurrer to the SAXC is SUSTAINED, in part, and OVERRULED, in part.

A. Elder abuse.

“The purpose of the [Elder Abuse Act] is essentially to protect a particularly vulnerable portion of the population from gross mistreatment in the form of abuse and custodial neglect.” (Delaney v. Baker (1999) 20 Cal.4th 23, 33 (Delaney).) “The elements of a cause of action under the Elder Abuse Act [Welfare and Institutions Code sections 15600, et seq.] are statutory, and reflect the Legislature’s intent to provide enhanced remedies to encourage private, civil enforcement of laws against elder abuse and neglect.” (Intrieri v. Superior Court (2004) 117 Cal.App.4th 72, 82.) Because we test for liability under the Elder Abuse Act, a statutory cause of action, we apply “the general rule that statutory causes of action must be pleaded with particularity.” (Covenant Care, Inc. v. Superior Court (2004) 32 Cal.4th 771, 790 (Covenant Care).) “[Where] recovery is based on a statutory cause of action, the plaintiff must set forth facts in his [or her] complaint sufficiently detailed and specific to support an inference that each of the statutory elements of liability is satisfied. General allegations are regarded as inadequate. [Citations.]” (Mittenhuber v. City of Redondo Beach (1983) 142 Cal.App.3d 1, 5.)

The Elder Abuse Act does not apply to simple or gross negligence by health care providers. [Citations.] To obtain the enhanced remedies of section 15657, “a plaintiff must demonstrate by clear and convincing evidence that defendant is guilty of something more than negligence; he or she must show reckless, oppressive, fraudulent, or malicious conduct.” [Citation.] “ ‘Recklessness’ refers to a subjective state of culpability greater than simple negligence, which has been described as a ‘deliberate disregard’ of the ‘high degree of probability’ that an injury will occur [citations]. Recklessness, unlike negligence, involves more than ‘inadvertence, incompetence, unskillfulness, or a failure to take precautions’ but rather rises to the level of a ‘conscious choice of a course of action … with knowledge of the serious danger to others involved in it.’ [Citation.]” [Citation.]

(Worsham v. O’Connor Hospital (2014) 226 Cal.App.4th 331, 336-37; see also Delaney, supra, 20 Cal.4th at pp. 31 – 32.)

Manor demurs to the first cause of action on the ground that Phills has not sufficiently stated this statutory claim for elder abuse and that the allegations sound in negligence. Phills contends the allegations are sufficient to allege recklessness. As noted above, “Recklessness” refers to a subjective state of culpability greater than simple negligence, which has been described as a “deliberate disregard” of the “high degree of probability” that an injury will occur. (Delaney, supra, 20 Cal.4th at pp. 31 – 32.) Recklessness, unlike negligence, involves more than “inadvertence, incompetence, unskillfulness, or a failure to take precautions” but rather rises to the level of a “conscious choice of a course of action . . . with knowledge of the serious danger to others involved in it.” (Id.)

Although Phills employs conclusory allegations of “willful neglect,” “reckless neglect,” and “malicious pattern,” there are at least some factual allegations which go beyond mere negligence. For example, Phills’s allegation that Manor “repeatedly threatened to … ‘put [Decedent] out on the street’” when questioning Decedent about her outstanding bill knowing that Decedent was seriously mentally ill and “incapable of responding to these demands” suggests a state of culpability greater than simple negligence and may rise to the level of malicious conduct. (See SAXC, ¶4.) So too does the allegation that Manor “continued to engage in this [conduct] after being reminded … that Decedent was incapable of understanding or responding to these threats.” (Id.)

Regardless of whether Phills has sufficiently alleged recklessness or malice, Manor argues additionally that under Welfare and Institutions Code section 15657, subdivision (c), “[t]he standards set forth in subdivision (b) of Section 3294 of the Civil Code regarding the imposition of punitive damages on an employer based upon the acts of an employee shall be satisfied before any damages or attorney’s fees permitted under this section may be imposed against an employer.” Civil Code section 3294, subdivision (b) states that “[a]n employer shall not be liable for [punitive damages] based upon acts of an employee . . . unless the employer had advance knowledge of the unfitness of the employee and employed him or her with a conscious disregard of the rights or safety of others or authorized or ratified the wrongful conduct for which the damages are awarded or was personally guilty of oppression, fraud, or malice. With respect to a corporate employer, the advance knowledge and conscious disregard, authorization, ratification or act of oppression, fraud, or malice must be on the part of an officer, director, or managing agent of the corporation.” In other words, to hold Manor, a corporate entity, liable for elder abuse based upon the acts of its employees, Phills must allege facts showing that an officer, director, or managing agent of Manor had advance knowledge and conscious disregard, authorized, or ratified the employees’ conduct or was personally guilty of oppression, fraud, or malice. Here, the SAXC does not include any allegations which would satisfy this requirement and Phills does not address this point in opposition.

Accordingly, Manor’s demurrer to the first cause of action in Phills’s SAXC on the ground that the pleading does not state facts sufficient to constitute a cause of action [Code Civ. Proc., §430.10, subd. (e)] for elder abuse is SUSTAINED with 10 days’ leave to amend.

B. Negligent infliction of emotional distress.

“One observation is necessary at the beginning of any case involving an emotional distress claim based on negligence. When courts use the acronym ‘NIED’ for ‘negligent infliction of emotional distress’ (and they commonly do) they are in danger of falling into a semantic trap.” (Lawson v. Management Activities, Inc. (1999) 69 Cal.App.4th 652, 656 (Lawson).) “At the outset we must remind ourselves that, however handy the acronym, as our Supreme Court has made abundantly clear, there is no such thing as the independent tort of negligent infliction of emotional distress.” (Lawson, supra, 69 Cal.App.4th at p. 656.) “The negligent causing of emotional distress is not an independent tort, but the tort of negligence.” (Burgess v. Superior Court (1992) 2 Cal.4th 1064, 1072.)

“The law of negligent infliction of emotional distress in California is typically analyzed by reference to two ‘theories’ of recovery: the ‘bystander’ theory and the ‘direct victim’ theory. We have repeatedly recognized that the negligent causing of emotional distress is not an independent tort, but the tort of negligence. The traditional elements of duty, breach of duty, causation and damages apply. Whether a defendant owes a duty of care is a question of law. Its existence depends upon the foreseeability of the risk and a weighing of policy considerations for and against imposition of liability.” (Fluharty v. Fluharty (1997) 59 Cal.App.4th 484, 490 (Fluharty).)

“To summarize, a party may recover for negligent infliction of emotional distress as a bystander if he: (1) is closely related to the injury victim, (2) is present at the scene of the injury-producing event and is aware it is causing injury to the victim, and (3) suffers emotional distress beyond that anticipated in a disinterested witness. As a direct victim, a party may recover strictly emotional distress damages, i.e., absent physical injury or impact, where a duty arising from a preexisting relationship is negligently breached. Under such circumstances, the defendant’s conduct need not be ‘outrageous,’ only negligent.” (Fluharty, supra, 59 Cal.App.4th at p. 493; emphasis and internal citations omitted.)

Phills’s second cause of action is based on the allegation that, “[o]n the day of Decedent’s death, [Phills] observed his mother displaying signs of discomfort and physical suffering, including grimacing and gurgling, which [Phills] recognized to be an indication that Decedent had fluid in her airway and required suctioning of the airway—something which [Manor] never performed. Later, [Phills] noticed that Decedent’s oxygen saturation was decreasing and brought this to [Manor’s] attention. A Manor Care employee adjusted Decedent’s oxygen saturation, but still [Phills] observed Decedent’s breathing worsening. [Phills] raised his concerns to [Manor] about how much oxygen Decedent was receiving, and in response, [Manor’s] employee replaced the equipment, which monetarily seemed to improve Decedent’s breathing. However, some time later [Phills] witnessed his mother’s condition rapidly decline as her chest began heaving and she ultimately ceased breathing altogether. During Decedent’s final moments of respiratory distress, [Phills] looked at the oxygen machine and could see that oxygen was no longer flowing, and [Phills] was immediately aware some ‘failure of custodial authorities to respond significantly to symptoms obviously requiring medical attention’ had caused Decedent to suffocate to death. … [Phills] summoned a nurse, pointed out the machine to her and asked if there was an issue because it appeared that oxygen was not flowing from the machine. The nurse examined the empty oxygen container, broke into tears, and admitted to [Phills] that the tank had run out of oxygen some time prior to Decedent’s passing, confirming with absolute certainty [Phills’s] deduction that [Manor’s] failure to respond to symptoms that required immediate medical attention had caused Decedent’s suffering and traumatic death.” (SAXC, ¶6; emphasis added.)

In demurring, Manor contends Phills has not adequately alleged that he was aware of the connection between the injury-producing event and Decedent’s injuries at the time of the incident. “One takes a giant leap beyond that point, however, by imposing liability for NIED based on nothing more than a bystander’s ‘observation of the results of the defendant’s infliction of harm,’ however ‘direct and contemporaneous.’ [Citation.] Such a rule would eviscerate the requirement … that the plaintiff must be contemporaneously aware of the connection between the injury-producing event and the victim’s injuries.” (Bird v. Saenz (2002) 28 Cal.4th 910, 921.)

In Keys v. Alta Bates Summit Medical Center (2015) 235 Cal.App.4th 484, 489 (Keys) the court upheld a judgment for negligent infliction of emotional distress based on a finding that a reasonable inference could be drawn from evidence that the plaintiffs were aware that defendant hospital’s inadequate response to their sister and mother’s respiratory distress was the cause of death.

The evidence here showed that plaintiffs were present when Knox, their mother and sister, had difficulty breathing following thyroid surgery. They observed inadequate efforts to assist her breathing, and called for help from the respiratory therapist, directing him at one point to suction her throat. They also directed hospital staff to call for the surgeon to return to Knox’s bedside to treat her breathing problems. These facts could be properly considered by the jury to demonstrate that plaintiffs were contemporaneously aware of Knox’s injury and the inadequate treatment provided her by defendant.

To sufficiently allege a claim for negligent infliction of emotional distress under a bystander theory, Phills must allege his contemporaneous awareness that Manor’s failure to maintain the oxygen container was the cause of Decedent’s death. Phills has now adequately alleged such contemporaneous awareness based on the highlighted language above which this court must accept as true for purposes of demurrer. This allegation is not overcome by Phills’s subsequent allegation that he “deduced” the connection between the injury-producing event and the injury because the full sentence states that the nurse’s admission confirmed his earlier contemporaneous understanding and awareness.

Accordingly, Manor’s demurrer to the second cause of action in Phills’s SAXC on the ground that the pleading does not state facts sufficient to constitute a cause of action [Code Civ. Proc., §430.10, subd. (e)] for negligent infliction of emotional distress and on the ground that the pleading is uncertain [Code Civ. Proc., §430.10, subd. (f)] is OVERRULED.

II. Cross-defendant Manor’s motion to strike portions of the SAXC is moot.

In light of the court’s ruling on Manor’s demurrer, the court deems the accompanying motion to strike moot.