Torts: Bad Faith and Nonpayment or Delay of Payment of PIP benefits (MVRA)

Elements of Proof

The Kentucky Motor Vehicle Reparation Act, KRS 304.39, et seq., provides an exclusive remedy where an insurance company wrongfully delays or denies payment of no-fault benefits. There is no other Kentucky statute, regulation or case law which permits Foster to claim work loss for BRB. The MVRA is the exclusive remedy. Grzyb v. Evans, 700 S.W.2d 399 (Ky.1985), provides that where a statute both declares the unlawful act and specifies the civil remedy available, the aggrieved party is limited to the remedy provided by the statute. General damages are not available when a specific remedy is provided such as in this case. KRS 304.39–210 states that the penalty for any delay in payment of basic reparation benefits is payment of interest at the rate of 12% per annum on the delayed benefits, or 18% per annum if the delay was without reasonable foundation. Interest, which is set out in certain situations in KRS 304.39–220, and the award of attorney fees are the remedies provided to an insured if an insurance company fails to pay basic reparation benefits in a timely manner and/or without reasonable foundation.

Grzyb, supra, involves a special body of law, the Kentucky Civil Rights Act, KRS 344 et seq. FB Ins. Co. v. Jones, 864 S.W.2d 926 (Ky.App.1993), does not control because it relates to general insurance law questions. The Kentucky MVRA preempts general insurance law where an insurance claim arises as a result of physical injury caused by a motor vehicle accident and establishes remedies for violations of the statute. This can be compared to the civil rights provision of Grzyb. MVRA is a comprehensive act which not only relates to certain tort remedies, but also establishes the terms under which insurers pay no-fault benefits, and provides for the penalties to which insurers are subjected if they fail to properly pay no-fault benefits.

Here, the circuit judge dismissed the claim of Foster seeking punitive damages under the Unfair Claims Settlement Practices Act, but allowed the suit based on the MVRA to proceed to a jury trial. Because the MVRA is the exclusive remedy, the decision of the circuit judge was correct.

Foster v. Kentucky Farm Bureau Mut. Ins. Co., 189 S.W.3d 553 (SC 2006).


Torts: Breach of fiduciary duty and first party insurance claims

Elements of Proof

Punitive damages were not permitted for the breach of contract claim in Federal Kemper Ins. Co. v. Hornback, 711 SW 2d 844 (Ky. 1986).  However, Justice Liebson’s dissent is noted for future reference on the existence of a fiduciary relationship involving a first party claim.

Movant cites Anderson v. Continental Ins. Co., 85 Wis.2d 675, 271 N.W.2d 368 (1978), in which the Wisconsin court stated that an insured must prove three elements in order to prevail against an insurance company for alleged refusal in bad faith to *847 pay the insured’s claim: (1) the insurer must be obligated to pay the claim under the terms of the policy; (2) the insurer must lack a reasonable basis in law or fact for denying the claim; and (3) it must be shown that the insurer either knew there was no reasonable basis for denying the claim or acted with reckless disregard for whether such a basis existed. Subsequently, in Davis v. Allstate Ins. Co., 101 Wis.2d 1, 303 N.W.2d 596 (1981), the Wisconsin court amplified this rule, stating an insurer is, however, entitled to challenge a claim and litigate it if the claim is debatable on the law or the facts.
These guidelines as presented by the movant are a fair statement of the law. This amounts to the same standard for imposing punitive damages described by the Kentucky Court of Appeals in Feathers v. State Farm Fire and Casualty Co., Ky.App., 667 S.W.2d 693 (1983). Feathers stated that the insurance company may be liable for punitive damages where it denies payment after “the policyholder has substantially complied with the terms and conditions required by the policy, and there is no substantial or credible evidence that the policyholder directly or indirectly set fire to his property for personal gain….” 667 S.W.2d at 696.

TN. Tennessee Decision relies upon Kentucky Decision (Knotts v. Zurich Ins. Co., 197 S.W.3d 512 (Ky.2006) to conclude insurer’s duty of good faith continues into litigation

Here is a link to an article posted at Property Insurance Coverage Law Blog by Brandee Bower

From Property Insurance Coverage Law Blog, Merlin Law Group:

Litigation does not end the continuing duty of good faith

In a recent case in Tennessee, homeowners suffered a fire loss and filed a claim with their insurance company, Anpac.1 The insurance company investigated the loss and found that the homeowners intentionally set the fire and denied coverage. It then filed a declaratory judgment action. The homeowners filed counterclaims for breach of contract, unfair claims practices and bad faith. They alleged that the insurance company ignored evidence that showed they did not set the fire. In Tennessee, a statute allows insureds to seek a penalty of up to 25% of the total liability where a claim is denied in bad faith.2 When an insurance company refuses to pay a claim within 60 days of a demand, it must pay an additional 25% if the refusal was not in good faith and caused the insureds additional damages.

Insurers have a duty to act in good faith and no law or statute indicates this is severed by litigation. The trial court looked to rulings from appellate courts in other states: Kentucky Supreme Court (holding that duties of fair dealing did not end after litigation commenced,3 and an insurer’s refusal to settle after liability became clear is basis of bad faith4); Supreme Court of California (litigation did not terminate the duty of good faith because it did not end the contractual relationship5); Montana Supreme Court (insurers duty of fair dealing and not to withhold payment of valid claims does not end when a Complaint is filed6); Arizona Court of Appeals (failure of insurer to investigate while declaratory judgment action was pending could be basis of breach of good faith7); and the Georgia Court of Appeals (litigation does not end duty to reasonably investigate8).

After reviewing holdings in these jurisdictions, the court found that the insurance company had a good faith duty to consider evidence that came to light during the litigation, and if that evidence made clear that the homeowner did not destroy their home and that they were due payment under the policy, it should have paid their claims.

Case Note: Roniesha Adams, Mother and Guardian of Minor Child B.A. v. State Farm Mutual Automobile Ins. Co., COA Published, 6/12/2015

Reparations obligor needed court order for examination under oath on minor's application for PIP benefits

The “EUO” or examination under oath in insurance policies have often been the tools of the SIU or special investigation units.  Or as so aptly stated in the following decision on behalf of Ms. Adams – “EUOs are often used as a tool to harass, annoy, embarrass or oppress claimants in opposition to the purpose of the MVRA. Adams also contends that State Farm is attempting to supersede the MVRA with its policy provisions.”  An even greater abuse would be for the reparations obligor to use the EUO as its basis for getting particular information under threat of loss of benefits for failure to cooperate and in defense of an action should the claimant file suit.  Yes, it is a dark and dirty little tool that is more a post-claims underwriting trick rather than information gathering.

In the following decision,Roniesha Adams, Mother and Guardian of Minor Child B.A. v. State Farm Mutual Automobile Ins. Co., COA Published, 6/12/2015, the Court of Appeals put the brakes on this practice within the context of the motor vehicle reparations act (KRS Sec. 304.39-280(3) which provides that –

In case of dispute as to the right of a claimant or reparation obligor to discover information required to be disclosed, the claimant or reparation obligor may petition the Circuit Court in the county in which the claimant resides for an order for discovery including the right to take written or oral depositions.

Judge Clayton stated it succinctly in one paragraph:

In Miller v. United States Fidelity & Guaranty Co., 909 S.W.2d 339, 341 (Ky. App. 1995), a panel of our Court held that “[t]he circuit court may not enter an order for an examination without rhyme or reason, thereby entitling a reparation obligor to an examination simply upon demand.” In a case such as this, where there were medical reports and police reports indicating injuries and the events that occurred, a policy clause which required an EUO prior to payment of the claim and as a bar to the claim should one not be done, would be in direct opposition to the purpose of the MVRA. Should State Farm wish to obtain a statement from Adams, its remedy would be to seek a court order requiring Adams to submit to discovery. The trial court, therefore, erred in granting declaratory and summary judgment on this issue. We, therefore, reverse the decision of the trial court and remand this action for further proceedings including discovery.

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OP-ED: Six Traps You Should Watch Out for in Auto Accident Releases, or Get Ready To Stand Up to A Bully

man in hood at night, want to break the shutter


Here are six TRAPS to watch out for when the liability insurer wants to settle and your client is anxious for the money.  Items in a release the liability insurer may present in a brute show of force, stealthily added to the release when never discussed,  or just assumed that’s they way all their releases must be signed.  Oh yeah, get ready for the old saw that “everyone else signs them” so what’s your problem.

This post is not exhaustive; nor are all the traps shown or even addressed in detail.  But, just keep an eye on those good neighbors who are always by your side all around Kentucky.

After Coleman vs. Bee Line’s pronouncement by the Kentucky Supreme Court, it is pretty easy to get the insurers to make sure the release excludes PIP and does not include indemnification for PIP.

However be ever vigilant since some of the following issues were/are never brought up when reaching a settlement number, and it might even be wise to include express language in your settlement demands to insure some of these items stay off the negotiating table.

Such areas include attempts by the liability insurer to include

  • Waiver of PIP benefits;
  • Release of consortium claims when not representing the spouse;
  • Global releases of “any and all other” persons etc.;
  • Indemnity language of claims against the tortfeasor by persons other than the settling claimant;
  • Non-negotiated indemnity language, period:
  • Attorney agreeing to indemnify (ru serious??);
  • Confidentiality and non-disclosure clauses;
  • Additional items so no “meeting of the minds” or a suit needed to enforce the agreement.

I consider these clauses to be objectionable and potentially bad faith or a breach of fiduciary duty by their very terms or the manner in which they end up in the release submitted with the check.

After the fact insertion of language which was not agreed upon is a no brainer violation, but the sneaky trick can be a problem when a client thinks the case has settled and just say “show me the money!”

Most recently, the Kentucky Department of Insurance came down hard on liability insurers who attempt to obtain waivers of reparation benefits as part of the liability settlement.  Such moves should always be reported to the Department of Insurance, at a minimum; and may put the claimant’s attorney in a position to advise her client of the potential claim too.  However, that is a decision each attorney must make for themselves.

Click here for DOI Complaint Information.

Here are six items to watch out for in those darn releases, most of which are boilerplate with the adjuster either not knowing the consequences of the terms or not having the authority on his/her own to redact certain language.  Thus adding delay to getting the client the agreed upon settlement sums.

1.  Waiver of PIP benefits.

These should never be in a release, and with the publication of Advisory Opinion 15-02m must be reported; and if you think it amounts to a bad faith violation or a breach of the Unfair Claims Settlement Practices Act, then another whole can of worms is opened through no fault other than the insurer (liability, UM, UIM).

The DOI Opinion added regulatory muscle to the complaints of many claimants’ counsel when it addressed the illegal practice of some liability insurers attempting to sneak a release of PIP (reparation benefits) as part of a personal injury liability settlement in a car accident case.

For the complete text of Advisory Opinion 15-02, then click here for our earlier post which contains the entire opinion and which is a must read for injury lawyers and insurance lawyers alike.  Insurance defense lawyers would be doing a disservice if they did not update their clients of the consequences of this explicit instruction.

Furthermore, the vast majority of bodily injury (“BI”) settlements involve third parties. By requiring that the injured person give up any claim to BRB, the insurer insists that the injured person forego the rights to a benefit the injured person paid for and is provided by the injured person’s own insurer. This has the effect of forestalling subrogation by the injured person’s insurance company through the Kentucky Insurance Arbitration Association. Such action has nothing to do with the injured party’s case, or the compensation the at-fault party’s insurer is legally obligated to pay. Subrogation rights for BRB payments belong to the BRB obligor (the injured party’s insurer). Furthermore, pursuant to KRS 304.39-140(3) collection of damages from the liability of a second person, a self-insurer or an obligated government shall have priority over the rights of the subrogee for its reimbursement of BRB. Liability coverage is all that should be at issue in a settlement of a BI case. The Department discourages efforts to abrogate an individual’s ability to get medical treatment by employing such a practice. This is particularly troubling in light of the fact that health insurance will not pay for treatment where other insurance is, or should be, available.

Additionally, contract case law is clear that if there exists no “meeting of the minds,” a settlement document or any other contract could be declared invalid. Breach of contract law would apply in this situation, especially if the insurer inserts this clause into a release document when no such provision had been agreed upon by the parties. This could be construed as a potential violation of the Kentucky Insurance Code, especially in the case of an unrepresented party who trusts that the language in the release reflects the settlement agreement.

2.  Loss of Consortium Claims.

If you do not represent the spouse of the injured claimant, then what is the basis for a liability insurer requiring as part of the settlement agreement that the unrepresented spouse sign the release or even the settlement check?  None.  But this goes back to an old insurance axiom that a closed file is a happy file, and apparently closing by means of making a claimant and their attorney do the liability insurer’s bidding.

In addition, no contract means no authority for the unrepresented spouse.  I won’t even go into the ethical issues, but the simple contractual requirements creating the legal representation not to mention the requirement of “actual” authority to settle a claim as required in Clark v. Burden, 917 S.W.2d 574 (Ky. 1996).

 And to add insult to malpractice, all this bidding would be expected at no cost to the insurer for crying out loud.

3.  The Global Release of all other persons.

It is clear that a release of all other persons is a release of all other persons per Nationwide vs. Abney.  This language usually surfaces for the first time when the boilerplate release is tendered with the check.  Fortunately, after Abney, there is usually little pushback by the insurer when caught.

Of course, I have always wondered about the potential quicksand for the insurer who shows more concern about non-claimant third parties then their own insureds when concluding a case.  Of course, the higher the amount of the settlement (and especially when limits are exhausted) means the greater exposure for any breach.  But, for the very, very small settlements, then why bother with the risk?

In any event, this language finds its way in releases to this day; and especially in those insurers outside the Commonwealth.

4.  Indemnity against claims by other claimants.

Indemnification has the potential of Alice Looking through the Looking Glass with indemnity, upon indemnity which then swallows up the entire settlement and potentially the claimant taking over the obligation of the liability insurer.  Rarely happens, or can even potentially happen, but why risk it.  Any indemnification should be negotiated specifically since indemnity is not a release.   See Frear vs. P.T.A. Industries, 103 S.W.3d 99 (Ky. 2003).

The inclusion of an indemnity clause started the problems in Coleman vs. Bee Line Courier Service, 284 S.W.3d 123 (Ky. 2009).

And, Crime Fighters Patrol v. Hiles, 740 S.W.2d 936 (Ky. 1987) highlights how indemnity upon indemnity is a dangerous thing.

Now, limited indemnification for certain claims and caps on the amount are another thing when addressing government super liens but always think about the risk that indemnity might exceed the client’s total settlement amount.  Ouch.

5.  Attorney personally agreeing to indemnification.

There are several ethics opinions condemning this practice (eg., Arizona; Connecticut;  Montana; Illinois; IndianaOklahoma; Ohio; Tennessee;  W.Va.;  DRI Article on MSP and Indemnity).  Some of these opinions even specifically address AND prohibit attorney from personal indemnification in MSPRC/Medicare subrogation liens..

6.  Confidentiality clauses.

Two problems with this one.  Ethically and taxability, plus potential of losing entire settlement recovery following a casual conversation while in line at the super market.

The Kentucky Supreme Court has already expressed a distaste for these clauses:

Kentucky Bar Association v. Unnamed Attorney 

2012-SC-000388-KB December 19, 2013 

Opinion of the Court. All sitting. Minton, C.J.; Keller, Noble and Venters, JJ., concur. Abramson, J., concurs by separate opinions. Scott, J., concurs in part and dissents in part by separate opinion in which Cunningham, J., joins.

During the court of Unnamed Attorney’s representation of a fellow attorney in a disciplinary matter, Unnamed Attorney negotiated a settlement between his client and the complaining party. The terms of the negotiated settlement resulted in charges of professional misconduct against Unnamed Attorney because the terms of the settlement agreement required the complaining party to refuse to cooperate voluntarily with the Kentucky Bar Association in any investigation into the matter. The Trial Commissioner adjudged Unnamed Attorney guilty of professional misconduct for entering into such an agreement with a witness but the KBA Board of Governors overturned that determination on appeal. Neither party appealed but the Court exercised its discretion to review under SCR 3.370(8). On review, the Court reversed, in part, and affirmed, in part, the decision of the Board of Governors, finding Unnamed Attorney guilty of violating SCR 3.130-3.4(g) but not guilty of violating SCR 3.130-3.4(a) and issuing a private reprimand.

Taxability:  See, Amos v. Commissioner, T.C. Memo. Docket No. 13391-01, 2003-329, December 1, 2003 (

For more reasons why Confidentiality Clauses are not a good thing, then read this Article from the American Bar Association:  “Confidentiality in Settlement Agreements Is Bad for Clients, Bad for Lawyers, Bad for Justice”

Do what you may, but hope this spurs some thoughts and maybe even some DOI complaints when necessary.

Now, there are more, many more traps in settlements, and this only scratches the surface.  And much can be said about Coots vs. Allstate and UIM releases and notices.  But that’s another day.

Insurance: DOI Slams a Liability Insurer’s “Attempt At Forced Settlement Of Basic Reparation Benefits” – Department of Insurance Advisory Opinion 15-02, approved 3/20/2015

folder marked with regulations

The Department of Insurance has issued an advisory opinion (Attempt At Forced Settlement Of Basic Reparation Benefits 15-02) highlighting an insurance company practice of offering a bodily injury BI settlement to a claimant only if the claimant will give up his rights to any further BRB benefits undermines the purpose of the MVRA, and is against public policy.

If you encounter the following described abuse by an insurance company, the adjuster and the carrier should be reported to the Department of Insurance.  Click HERE for information on filing a complaint.  When a insurance company engages in this practice, they deny policy holders of protections they have paid for, adversely affect the insured getting their health insurance benefits, and deny/delay/interfere with subrogation by other insurers as provided by law.

As stated further in the advisory opinion:

the vast majority of bodily injury (“BI”) settlements involve third parties. By requiring that the injured person give up any claim to BRB, the insurer insists that the injured person forego the rights to a benefit the injured person paid for and is provided by the injured person’s own insurer.

* * *

Liability coverage is all that should be at issue in a settlement of a BI case. The Department discourages efforts to abrogate an individual’s ability to get medical treatment by employing such a practice. This is particularly troubling in light of the fact that health insurance will not pay for treatment where other insurance is, or should be, available.

* * *

At the very least this behavior is against public policy and could trigger a review of the insurer’s actions by the Department of Insurance in order to evaluate any potential violations of the Kentucky.

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Case Notes: Plaintiff prevails in excluding evidence at trial but loses $1.9 million verdict on appeal when it should have come in – Motorists Mutual Ins. Co. vs. Gypsie Thacker (COA, NPO 2/6/2015)

Adair Court House, built 1886 but with enlarged portion.  Image provided courtesy of Keith Vincent -

Adair Court House, built 1886 but with enlarged portion. Image provided courtesy of Keith Vincent –

Trying cases is tough.  You are in the arena which can seem like a war zone, making decisions in a blink of an eye, but always keeping the other eye looking to preserve errors for appeal so when the case is “tried” again on appeal.

However, this preservation of error can, and does, carry with it the potential of cutting both ways.  Plaintiff’s attorney, in this case, kept out the unfavorable evidence, the trial judge agreed, but the three judge panel from the Court of Appeals deemed otherwise, and ruled against the Plaintiff.

With nearly $2 million at stake, this is not over at the appellate level.  A petition for rehearing has been filed as of February 24, 2015 with no decision made as of the time of this post, and after that, let us not forget a Motion for Discretionary Review (MDR).

For those curious about the appellate jousting, click here for the case information page at the Court of Appeals on this case.

For the techno-curious and who might even be interested in some shape or fashion including links to case information at the COA or SC in their own web sites or blogs, here are two little behind the scene tricks I am willing to share with you:

All you need do is insert the case number minus the hyphens for your case at the point noted by italics above and copy into your browser or in your “link”.

Ditto for the insertion of case number.

Here is a squib of the decision followed by extracts, then links to the full text at the AOC.  Click on continue reading to, uh uh, continue reading.

In Motorists Mutual Ins. Co. vs. Gypsie Thacker (NPO), the Court of Appeals reversed and remanded a $1.9 million verdict for an uninsured motorist benefits suit from a Florida car accident when the trial court ruled in Plaintiff’s favor and denied defendant insurer access to plaintiff’s psychotherapy records after judge’s in camera review.  The trial judge ruled there was no information relevant to injury plaintiff’s claims nor would it lead to discovery of relevant evidence.   Thus, you can win the battle but lose the war.

Case Notes: Of bad faith and duties to defend, investigate and indemnify – Demetre vs. Indiana Insurance Co., COA Published, Jan. 30, 2015

Bad faith synonyms in a non-legal context should help provide context for this delict.

Bad faith synonyms in a non-legal context should help provide context for this delict. Screen capture from

Is a reservation of rights and providing the insured counsel, a defense to statutory and contractual bad faith claims?  The Court of Appeals basically said – nope, it ain’t.  The following opinion by Judge Thompson provides not only a tight and succinct analysis of bad faith law, with a little bit of history Justice Leibson’s dissent in Federal Kemper, but one of the best explanations I have read on how emotional damages in the Osborne v. Keeney, 399 S.W.3d 1 (Ky. 2012) decision fit in to all of this.

The COA referenced the crux of Indiana’s defense – “Indiana Insurance argues it cannot be liable as a matter of law under any theories advanced because it provided defense counsel to Demetre and indemnification in compliance with the insurance policy provisions. To the extent it relies solely on its satisfaction of the express policy provisions, Indiana Insurance’s argument misses the mark. This is not a breach of contract action but is premised on three theories of bad faith, two based on statutory law and one on common law.”

Please look closely at the bad faith analysis and how Indiana Insurance Company treated its insured poorly by its conduct upon filing the claim by Demetre and its lack of investigation into the claim while hiding under a reservation of rights.  Briefly, “We have previously held an insurer cannot shield itself from its own bad faith actions by retaining legal counsel for its insured. “[I]t remains ultimately responsible for its own non-delegable statutory duty to properly investigate claims -19-and adjust them in harmony with the terms and conditions of its policy.” Hamilton Mut. Ins. Co. of Cincinnati v. Buttery, 220 S.W.3d 287, 294 (Ky.App. 2007). It was the conduct of Indiana Insurance, not the adequacy of Schenkel’s representation, that evidenced bad faith.”

However, I wish to highlight for you the emotional damages analysis of Osborne v. Keeney, 399 S.W.3d 1 (Ky. 2012) in the context of this decision.  No experts needed if the mental anguish and anxiety are damages from the cause of action, but experts ARE needed if the mental anguish and anxiety is an element of proof in the cause of action.  That makes a lot of sense to me.

The question is whether the heightened proof requirements in Osborne extends to bad faith claims under the Unfair Claims Settlement Practices Act where damages for mental anguish and anxiety have been traditionally permitted without an impact and without expert testimony. As noted in FB Ins. Co. v. Jones, 864 S.W.2d 926, 929 (Ky.App. 1993), the Unfair Claims Settlement Practices Act prohibits behavior that is egregious. Consequently, damages are available as permitted by KRS 446.070 which states: “A person injured by the violation of any statute may recover from the offender such damages as he sustained by reason of the violation, although a penalty or forfeiture is imposed for such violation.” In FB Insurance, the Court held those damages include damages for anxiety and mental anguish in claims pursuant to KRS 304.12-230. FB Insurance, 864 S.W.2d at 929.

In Motorists Mutual Ins. Co. v. Glass, 996 S.W.2d 437, 454 (Ky. 1997), the Court not only confirmed that damages for anxiety and mental anguish are recoverable in statutory bad faith claims, but it also set forth the proof required: 1 Indiana Insurance cites unpublished federal decisions applying Osborne in contexts other than statutory bad faith claims. We are not bound by those decisions predicting how Kentucky appellate courts would rule and do not find them persuasive on a factual basis. -26-“[E]ntitlement to such damages requires either direct or circumstantial evidence from which the jury could infer that anxiety or mental anguish in fact occurred.” Id.

Although written in the context of a violation of the Kentucky Civil Rights Act, our Supreme Court has distinguished between statutory actions where emotional distress damages are recoverable and the elements of the tort of IIED which requires the distress be severe. In Childers Oil Co., Inc. v. Adkins, 256 S.W.3d 19, 28 (Ky. 2008), the Court expressly rejected any requirement that the plaintiff prove her emotional distress was severe. It pointed out the action was not filed as an IIED claim but was an action under the Kentucky Civil Rights Act. It held the plaintiff’s testimony alone supported an award for anxiety and mental anguish and, because such damages were permissible, the question was simply whether the damages were excessive. Id.

Osborne did not alter the law cited. A claim brought under the Unfair Claims Settlement Practices Act is not a NIED or an IIED claim; it is a claim under the Act for compensatory damages, which include damages for emotional distress. In other words, emotional pain and suffering, stress, worry, anxiety or mental anguish are not elements of the cause of action but are consequences of the insurer’s violation of the Act for which the insured is entitled to be compensated.


Case Notes: Wrongful death claim accrued from date no later than defendant’s indictment (Flick vs. Estate of Christina Wittich; COA Published 2/6/2015)

Harlan County Court House, 1886. Photo from old postcard captured by Keith Vincent.  These and others can be found at his web site for all 50 states!

Harlan County Court House, 1886.
Photo from old postcard captured by Keith Vincent. These and others can be found at his web site for all 50 states!

COA, Published 2/6/2015

MAZE, JUDGE: Michael Joseph Flick appeals from a judgment of the Fayette Circuit Court finding him liable for the wrongful death of Christina Wittich andawarding compensatory and punitive damages to Wittich’s Estate. Flick primarily argues that the trial court erred by denying his motion to dismiss because the complaint was filed beyond the one-year statute of limitations for wrongful death provided under KRS 1 413.140(1). We conclude that the cause of action against Flick accrued no later than the date of his indictment, and, by operation of KRS 413.180, the Estate had two years from that date to bring the complaint. Since this action was not brought within that time, the trial court erred by denying the motion to dismiss. Hence, we reverse the judgment and remand for entry of an order dismissing the complaint.

* * *

As noted above, it is well-established that an action for wrongful death is subject to the one-year statute of limitations in KRS 413.140(1). Conner, 834 S.W.2d at 653-54. Under KRS 413.180, the action must have been brought within one year from the appointment of the personal representative, but not more than two years from the date the cause of action accrued. KRS 413.190 allows the limitations period to be tolled for any period that the defendant “abscond[s] or conceal[s] himself or by any other indirect means obstructs the prosecution of the action ….” Thus, the statute of limitations did not accrue until the Estate knew or had reason to know of both the injury (Wittich’s death), and that it may have been caused by Flick’s conduct. Perkins v. Northeastern Log Homes, 808 S.W.2d 809, 819 (Ky. 1991).

* * *

Given the facts of the current case, we need not decide the precise date when the cause of action accrued. But under the circumstances, we conclude that the Estate had to know of its claim against Flick no later than the date of the indictment. At that point, the grand jury found probable cause to charge Flick with the murder. Furthermore, the grand jury was not bound by any prior probablecause determination in district court. Commonwealth v. Yelder, 88 S.W.3d 435, -7-437 (Ky. App. 2002). Thus, the Estate had until no later than July 18, 2007, to bring this action. The court in DiGiuro reasoned that the limitations period should be tolled because any civil claim would have to be stayed until the defendant was convicted of the murder. However, the Kentucky Supreme Court has recognized that certain civil claims may have to be brought before the related criminal charges are resolved. See Dunn v. Felty, 226 S.W.3d 68 (Ky. 2006), holding that the statute of limitations for false imprisonment accrues upon termination of the wrongful imprisonment, rather than on the date when the criminal charges are dismissed. Id. at 73-74. In such cases, the civil claim should be held in abeyance pending the outcome of the criminal trial. Id. at 74. We also note that Lambirth filed his civil claim against Flick within one year of the assault, although the action was held in abeyance until after Flick was convicted. Flick v. Lambirth, 2010 WL 4740292 (Ky. App. 2010)(2009-CA-001679-MR), at *3. We see no reason to apply a different standard to the current case.

Continue reading below for full text of this decision.

Cause of Action. Kentucky is not a “direct action” state. Insurance company not proper defendant in wrongful death claim resulting in dismissal withOUT prejudice (Estate of Moore vs. Kentucky Farm Bureau Mutual Ins. Co. COA, NPO 2/21/2014)

Estate of Moore vs. Kentucky Farm Bureau Mutual Ins. Co
COA, NPO 2/21/2014 PJ Caperton Affirming in Part, Reversing in Part, and Remanding
Allen County
Affirmed dismissal of wrongful death claim (but without prejudice) asserted against insurer rather than insureds.

Dr. Ephraim McDowell, Danville,Kentucky marker in front of his home. Picture of home next post.

Dr. Ephraim McDowell, Danville,Kentucky marker in front of his home. Picture of home next post.

CAPERTON, JUDGE: The Appellant, Dovie Moore, Administrator of the Estate of Peyton Spencer Green (hereinafter “Moore”), appeals the February 5, 2013, order of the Allen County Circuit Court, dismissing her wrongful death claimagainst the Appellee, Kentucky Farm Bureau Mutual Insurance Company (hereinafter “Farm Bureau”). Upon review of the record, the arguments of the parties, and the applicable law, we affirm. However, because we also conclude that the dismissal should be without prejudice, we reverse that portion of the order and remand for entry of an order dismissing without prejudice.