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The Delaware Supreme Court has ruled that negligence claims against employees tossed out as filed too late do not automatically absolve their employers of all liability, in a decision overturning its own 26-year-old precedent.

The ruling, from a full panel of the state high court, revived a medical malpractice lawsuit by the daughter of Bridget Verrastro, which aims to hold Bayhealth Hospitalists liable for medical negligence for the alleged failure of two doctors to diagnose a tumor that caused her mother’s death.

According to court documents, Nicole Verrastro sued the Dover-based health care system in 2014, just outside the two-year statute of limitations that typically applies to medical negligence claims in Delaware. Verrastro, who is represented by Hudson & Castle Law, however, tried to toll the statute by sending notices to both Bayhealth and the two doctors, Rebekah Boenerjous and Tricia Downing.

Though Bayhealth received its notice within the statutory window, neither Boenerjous nor Downing still worked for the hospital, and both their notices went undelivered.

In 2015, a Superior Court judge dismissed the case against the two doctors on statutory limitation grounds. The court later reasoned that vicarious liability claims against Bayhealth were no longer viable, citing the state high court’s 1993 ruling in Greco v. University of Delaware, which held that an employer could not be sued if its employees were not liable for negligence claims.

On appeal, Justice Gary F. Traynor said that Greco was based on the notion that dismissal of time-barred negligence claims against doctors, or agents, qualified as a ruling “on the merits,” which in turn nixed any related claims against their employer, or principal.

However, Traynor said, that approach was no longer in line with the court’s view of respondeat superior, which was not intended to encompass “procedural dismissals that do not adjudicate the wrongfulness of the agent’s conduct.”

“To the extent that Greco is read—as the Superior Court did in this case—to eradicate otherwise timely claims against a principal because claims based on the same facts would be time-barred if made against the principal’s agent, we overrule it,” Traynor wrote in a 20-page opinion.

“We hold that, in a negligence action against a principal based on the doctrine of respondeat superior, the dismissal of the agent on defenses personal to the agent does not automatically eliminate the principal’s vicarious liability,” he said.

Bruce L. Hudson, who represented Verrastro, said Tuesday that the ruling was “clearly the correct decision,” saying that a literal reading of Greco, as it was written, would lead to “absurd results.”

“It would have created a lot of confusion in the future if Greco were allowed to stand as stated,” he said. “It would have meant you would have had to name every potential employee that would have been negligent in the complaint.”

An attorney for Bayhealth did not immediately return a call seeking comment.

Verrastro was represented by Hudon and his late partner Ben T. Castle, who argued the case appeal before his passing earlier this year.

Bayhealth was represented by Gregory S. McKee and Lauren C. McConnell of Wharton Levin Ehrmantraut & Klein.

The case, on appeal, was captioned Verrastro v. Bayhealth.