Standard of Review: Rule 11 Sanctions Imposed by Trial Court

Persels & Associates LLC v. Capital One Bank
OA PUB 2/14/2014 (Presiding Judge Clayton)
Daviess County, Trial Judge Joseph Castlen, III

CLAYTON, JUDGE: Persels & Associates, LLC appeal the Daviess Circuit Court’s findings and imposition of sanctions based on the trial court’s determination that the respondents violated Kentucky Rules of Civil Procedure (CR) 11. After careful consideration, we affirm.

Appellate review of a trial court’s actions related to CR 11 requires a multi-standard approach, that is, a clearly erroneous standard to the trial court’s findings in support of sanctions, a de novo review of the legal conclusion that a violation occurred, and an abuse of discretion standard on the type and/or amount of sanctions imposed. Clark Equipment Co., Inc. v. Bowman, 762 S.W.2d 417, 421 (Ky. App. 1988). 

The next issue consists of a de novo review of the legal issues involved in the determination that a violation has occurred under CR 11. We begin by observing that CR 11 does not provide substantive rights to litigants but is a procedural rule designed to curb abusive conduct in the litigation process. Lexington Inv. Co. v. Willeroy, 396 S.W.3d 309, 312 (Ky. App. 2013).

The legal questions are answered by CR 11 itself. The rule provides:

Every pleading, motion and other paper of a party represented by an attorney shall be signed by at least one attorney of record in his individual name, whose address shall be stated. A party who is not represented by an attorney shall sign his pleading, motion, or other paper and state his address. . . . The signature of an attorney or party constitutes a certification by him that he has read the pleading, motion or other paper; that to the best of his knowledge, information, and belief formed after reasonable inquiry it is well grounded in fact and is warranted by existing law or a good faith argument for the extension, modification or reversal of existing law, and that it is not interposed for any improper purpose, such as to harass or to cause unnecessary delay or needless increase in the cost of litigation.

The plain meaning of the rule is that pleadings must be signed by the attorney that prepares them.

Persels’ practice of providing limited representation to its clients does not abrogate this obligation under the Kentucky Rules of Civil Procedure nor did Persels offer any legal authority from Kentucky or otherwise to support its position that limited representation changes the effect of this civil rule or any other. Moreover, because the clients entered into a contract that specified Persels attorneys would not sign pleadings or make an appearance, it is not sufficient to change the requirements under CR 11. It is indisputable that a court cannot enforce an illegal contract. S.J.L.S. v. T.L.S., 265 S.W.3d 804, 821 (Ky. App. 2008). Any contract that ignores or changes the application of the civil rules is not legal. Thus, in contravention to Persels’ position, we hold that pursuant to CR 11, the attorneys who prepared the pleadings must sign them.

Std. of Review: Administrative Decisions, Statutory Interpretation

Ford Contracting, Inc. v. Kentucky Transportation Cabinet
COA PUB 2/7/2014

ACREE, CHIEF JUDGE: Ford Contracting, Inc. appeals the February 21, 2012 order of the Franklin Circuit Court reversing in part and affirming in part the 2010 Final Order of the Kentucky Transportation Cabinet. Having carefully reviewed the record and the arguments of the parties, we affirm in part, reverse in part, and remand for additional proceedings.

* * *

Ford is correct that judicial review of an administrative decision focuses on arbitrariness. Kaelin v. City of Louisville, 643 S.W.2d 590, 591 (Ky. 1982). One component of arbitrariness review is “whether determinations are supported by substantial evidentiary support.”10 Hilltop Basic Resources, Inc. v. County of Boone, 180 S.W.3d 464, 467 (Ky. 2005). Thus, this Court generally confines its review to: (1) whether the findings of fact are supported by substantial evidence of probative value; and (2) whether the administrative agency applied the correct rule of law to the facts. Board of Com’rs of City of Danville v. Davis, 238 S.W.3d 132, 135 (Ky. App. 2007). While we are bound by the subordinate facts found by the hearing officer, we are not bound by the hearing officer’s legal conclusions. See id.

The other two considerations are: “(1) whether an action was taken in excess of granted powers[; and] (2) whether affected parties were afforded procedural due process[.]” Hilltop, 180 S.W.3d at 467. Neither of these is at issue in this case.

Our review, however, is altered when the agency denies relief to the party saddled with the burden of proof. Bourbon County Bd. of Adjustment v. Currans, 873 S.W.2d 836, 838 (Ky. App. 1994). In such a case, “the failure to grant administrative relief to one carrying the burden is arbitrary [only] if the record compels a contrary decision in light of substantial evidence therein.” Id.

Not infrequently, contestants appear at the judicial level arguing that the administrative decision is not supported by substantial evidence when the board has offered no relief in the first instance. In other words, the board has ruled that the one having the burden of proof— usually the applicant—has failed. In such cases, attention should be directed to the administrative record in search of compelling evidence demonstrating that the denial of the relief sought was arbitrary. The argument should be that the record compels relief. The argument that there is no substantial evidence to support nonrelief is an anomaly.

Id. Evidence is compelling if it is so overwhelming that no reasonable person could fail to reach the same conclusion. Greene v. Paschall Truck Lines, 239 S.W.3d 94, 108 (Ky. App. 2007) (citation omitted).

Furthermore, it is basic hornbook law that the “trier of facts is afforded great latitude in its evaluation of the evidence heard and the credibility of witnesses appearing before it.” Bowling v. Natural Resources and Environmental Protection Cabinet, 891 S.W.2d 406, 409-10 (Ky. App. 1994). “To put it simply, ‘the trier of facts in an administrative agency may consider all of the evidence and choose the evidence that he believes.’” Id. (citation omitted). This Court may not reconsider or “pass upon the credibility of witnesses, and the weight of the evidence” for these functions rest within the “exclusive province of the administrative trier of fact.” Id.

Finally, statutory interpretation is an issue of law and, accordingly, we review the circuit court’s statutory construction de novo. See Cumberland Valley Contractors, Inc. v. Bell County Coal Corp., 238 S.W.3d 644, 647 (Ky. 2007).

Stds. of Review: Statutory Interpretation


USCA Statutes on shelf

Stephanie Foster v. Jennie Stuart Medical Center
Christian County, Judge John L. Atkins
Court of Appeals, Published 9/20/2013

“[W]e have a duty to accord to words of a statute their literal meaning unless to do so would lead to an absurd or wholly unreasonable conclusion.” Bailey v. Reeves, 662 S.W.2d 832, 834 (Ky. 1984)(citing Department of Revenue v. Greyhound Corp., 321 S.W.2d 60 (Ky. 1959)). “A legislature making no exceptions to the positive terms of a statute is presumed to have intended to make none.” Bailey, at 834 (quoting Commonwealth v. Boarman, 610 S.W.2d 922, 924 (Ky. App. 1980)). “It is to be presumed . . . that the legislature is acquainted with the law, that it has knowledge of the state of the law on subjects on which it legislates, and that it is informed of previous legislation and the construction that previous legislation has received.” Boarman, at 924. In this case, KRS 216B.165, does not allow protection for someone who is not the whistleblower. The language of the statute is not ambiguous and it does not require interpretation. “If the language is clear and unambiguous and if applying the plain meaning of the words would not lead to an absurd result, further interpretation is unwarranted.” Gilbert v. Commonwealth, Cabinet for Health and Family Services, 291 S.W.3d 712, 716 (Ky. 2008). Although we may believe that it would be reasonable to apply protection to individuals who were not the actual whistleblowers, the legislature has made a decision not to allow recovery pursuant to this statute. It is the legislature that must provide recovery to Oliver. Interestingly, KRS 61.102(2), the Kentucky Whistleblower Act, specifically states that:

(2) No employer shall subject to reprisal or discriminate against, or use any official authority or influence to cause reprisal or discrimination by others against, any person who supports, aids, or substantiates any employee who makes public any wrongdoing set forth in subsection (1) of this section.

(Emphasis added.) If the legislature had intended to allow this same protection under the provisions of the Kentucky Patient Safety Act, it easily could have done so.

Std. of Review: Summary Judgment on Appeal and Opposing Party Presenting Some Affirmative Evidence

902.  Summary Judgment Reversed on Appeal; Torts. Slip and Fall, Premises Liability, Ice and Natural Hazards
Ollie Barker vs. John D. Northcutt
Rowan County, Judge William Evans Lane
Not to be Published, 9/20/2013

Here is the summary judgment portion of the opinion detailing the standard and the opposing party’s burden:

At the outset we note that the applicable standard of review on appeal of a summary judgment is, “whether the trial court correctly found that there were no genuine issues as to any material fact and that the moving party was entitled to judgment as a matter of law.” Scifres v. Kraft, 916 S.W.2d 779, 781 (Ky. App. 1996). Summary judgment “shall be rendered forthwith if the pleadings, depositions, answers to interrogatories, stipulations, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law.” Kentucky Rules of Civil Procedure (CR) 56.03. The trial court must view theecord “in a light most favorable to the party opposing the motion for summary judgment and all doubts are to be resolved in his favor.” Steelvest v. Scansteel Service Center, Inc., 807 S.W.2d 476, 480 (Ky. 1991). Summary judgment is proper only “where the movant shows that the adverse party could not prevail under any circumstances.” Id. However, “a party opposing a properly supported summary judgment motion cannot defeat that motion without presenting at least some affirmative evidence demonstrating that there is a genuine issue of material fact requiring trial.” Hubble v. Johnson, 841 S.W.2d 169, 171 (Ky. 1992), citing Steelvest, supra. See also O’Bryan v. Cave, 202 S.W.3d 585, 587 (Ky. 2006); Hallahan v. The Courier Journal, 138 S.W.3d 699, 705 (Ky. App. 2004).

Since summary judgment involves only legal questions and the existence of any disputed material issues of fact, an appellate court need not defer to the trial court’s decision and will review the issue de novo. Lewis v. B & R Corporation, 56 S.W.3d 432, 436 (Ky. App. 2001). With this in mind we now turn to the issues raised by the parties.

CAPERTON, JUDGE: Ollie Barker appeals from the grant of summary judgment in favor of John D. Northcutt and Northcutt & Son Home For Funerals, Inc. (hereinafter “Northcutt”). After our review of the parties’ arguments, the record, and the applicable law, we agree with Barker that a genuine issue as to a material fact exists precluding summary judgment. Thus, we reverse and remand this matter for further proceedings.

The facts of this case revolve around a slip and fall outside of Northcutt’s Home for Funerals.

On appeal, Barker argues that the trial court erred in granting summary judgment. Northcutt argues: (1) based on longstanding Kentucky law regarding naturally occurring outdoor hazards, the grant of summary judgment was correct; and (2) Barker’s interpretation of Kentucky River Medical Center v. McIntosh, 319 S.W.3d 385 (Ky. 2010) is misplaced.1 With these arguments in mind we turn to our jurisprudence.

In Kentucky, a danger is “obvious” when “both the condition and the risk are apparent to and would be recognized by a reasonable man in the position of the visitor exercising ordinary perception, intelligence, and judgment.” Bonn v. Sears, Roebuck & Co., 440 S.W.2d 526, 529 (Ky. 1969) (citations omitted). “Whether a natural hazard like ice or snow is obvious depends upon the unique facts of each case.” Schreiner v. Humana, Inc., 625 S.W.2d 580, 581 (Ky. 1981).

Barker was aware of the inclement weather.  Contrary to the arguments of Northcutt this awareness by itself does not mandate summary judgment. Unlike the plaintiff in Green, it was not until after he fell that Barker could see that ice was present, that it had mounded2 up and that it was plainly visible. We believe that under these facts summary judgment was premature because there is an issue regarding the obviousness of the hazard prior to Barker’s falling. As such, we reverse and remand this matter for further proceedings.

Standards of Review: Motion to set aside judgment (Bailey v. Bailey, COA, 5/10/2013 Published)


On appeal, Buddy argues that the trial court’s June 13, 2011, order should not have been set aside and that the trial court failed to rule on his motion for attorney’s fees.

In his brief to this Court, Buddy fails to cite to any legal authority in support of his argument that the trial court should not have set aside its June 13, 2011, order. Kentucky law has long held that an alleged error may be waived when an appellant fails to present any authority in support of his argument advanced on appeal. Hadley v. Citizen Deposit Bank, 186 S.W.3d 754, 759 (Ky. App. 2005). Specifically, the court in Hadley opined:

Our courts have established that an alleged error may be deemed waived where an appellant fails to cite any authority in support of the issues and arguments advanced on appeal. See Pierson v. Coffey, 706 S.W.2d 409, 413 (Ky. App. 1986). “[W]ithout any argument or citation of authorities, [an appellate] [c]ourt has little or no indication of why the assignment represents an error.” State v. Bay, 529 So.2d 845, 851 (La. 1988). It is not our function as an appellate court to research and construct a party’s legal arguments, and we decline to do so here.

Thus, arguably under Hadley, Buddy’s failure to cite any legal authority in support of his argument that the trial court erred in setting aside the June 2011 order waives his arguments on appeal. However, we will nonetheless briefly address the merits of Buddy’s argument.

A trial court’s ruling on a motion made pursuant to CR 59.05 is reviewed under an abuse of discretion standard. Bowling v. Kentucky Dept. of Corrections, 301 S.W.3d 478, 483 (Ky. 2009). CR 59.05 provides that “[a] motion to alter or amend a judgment, or to vacate a judgment and enter a new one, shall be served not later than 10 days after entry of the final judgment.” Generally, a trial court has unlimited power to amend and alter its own judgments. Gullion v. Gullion, 163 S.W.3d 888, 891-892 (Ky. 2005).

Although CR 59.05 does not specifically set forth the grounds for relief under the rule, the Supreme Court of Kentucky has cited to its federal counterpart, Federal Rules of Civil Procedure 59(e), in limiting the grounds to the following:

There are four basic grounds upon which a Rule 59(e) motion may be granted. First, the movant may demonstrate that the motion is necessary to correct manifest errors of law or fact upon which the judgment is based. Second, the motion may be granted so that the moving party may present newly discovered or previously unavailable evidence. Third, the motion will be granted if necessary to prevent manifest injustice. Serious misconduct of counsel may justify relief under this theory. Fourth, a Rule 59(e) motion may be justified by an intervening change in controlling law.

Gullion, 163 S.W.3d at 893, quoting 11 Wright & Miller, Federal Practice and Procedure: Civil (2d Ed.) § 2810.1. A CR 59.05 motion may be granted on the basis of newly discovered evidence or evidence that was not available at the time of trial. Id. at 894. Unavailable evidence must be evidence that existed at the time of the trial. Id.

Standards of Review: Published decision addresses motions for JNOV and Directed Verdict (Moloney vs. Becker, COA, PUB, 4/19/2013)

Here is another decision by the Court of Appeals addressing the standard of review of a motion for directed verdict or JNOV, but this time it is in a published decision.  Although the law is the law, a decision that has been “published” carries more weight than those that have not been published.


VANMETER, JUDGE: The Estate of Mabel C. Moloney (“Estate”) appeals from the Bracken Circuit Court judgment, as well as its order denying the Estate’s motion for a judgment notwithstanding the verdict (JNOV), resulting in the dismissal of its complaint alleging negligence against John Becker. For the following reasons, we affirm. ***

On appeal, the Estate argues the trial court erred by denying its motions for a directed verdict and JNOV because the evidence demonstrated that John engaged in the unauthorized practice of law, prohibited by KRS1 524.130, and thus, he was negligent per se. We disagree.

The standard of review regarding a motion for a directed verdict or JNOV has been described as a difficult one for an appellant to meet. Peters v. Wooten, 297 S.W.3d 55, 65 (Ky. App. 2009). Our court in Taylor v. Kennedy, 700 S.W.2d 415 (Ky. App. 1985) described it as follows:

In ruling on either a motion for a directed verdict or a motion for a [JNOV], a trial court is under a duty to consider the evidence in the strongest possible light in favor of the party opposing the motion. Furthermore, it is required to give the opposing party the advantage of every fair and reasonable inference which can be drawn from the evidence. And, it is precluded from entering either a directed verdict or [JNOV] unless there is a complete absence of proof on a material issue in the action, or if no disputed issue of fact exists upon which reasonable men could differ.

Id. at 416 (citation omitted). We may not disturb the ruling unless the decision is clearly erroneous. Peters, 297 S.W.3d at 65 (citation omitted). As such, a denial of a directed verdict or JNOV “should only be reversed on appeal when it is shown that the verdict was palpably or flagrantly against the evidence such that it indicates the jury reached the verdict as a result of passion or prejudice.” Id. (citation omitted).

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Standards of Review: Motion for JNOV and Directed Verdict: Marlow vs. Buck, COA, NPO 4/12/2013

The following decision addressed the appellate standard of review of a denial by the trial court of a motion for judgment notwithstanding the verdict (JNOV) and motion for directed verdict.


When asked to review a trial court’s denial of JNOV, “we are to affirm . . . ‘unless there is a complete absence of proof on a material issue in the action, or if no disputed issue of fact exists upon which reasonable men could differ.’” Fister v. Commonwealth, 133 S.W.3d 480, 487 (Ky. App. 2003) (quoting Taylor v. Kennedy, 700 S.W.2d 415, 416 (Ky. App. 1985)) (emphasis added). Further, “‘[t]he trial court is vested with a broad discretion in granting or refusing a new trial, and this Court will not interfere unless it appears that there has been an abuse of discretion.’” Id. (quoting Whelan v. Memory–Swift Homes, Inc., 315 S.W.2d 593, 594 (Ky. 1958)). “The reason appellate courts defer to the trial court’s decision to grant a new trial is because the decision may depend on factors that do not readily appear in the appellate record, such as witness demeanor and observations of the jury.” CertainTeed Corp. v. Dexter, 330 S.W.3d 64, 74 (Ky. 2010).

In reviewing a denial of a motion for a directed verdict or for JNOV, an appellate court must reverse if it is shown that the verdict was either flagrantly or palpably contradictory to the evidence since such would indicate the jury reached the verdict through passion or prejudice. Lewis v. Bledsoe Surface Min. Co., 798 S.W.2d 459, 461 (Ky. 1990) (citing NCAA v. Hornung, 754 S.W.2d 855, 860 (Ky. 1988)). Evidence in support of the prevailing party must be considered to be true. The reviewing court may not make determinations regarding credibility nor the weight of the evidence, as such is within the purview of the jury. Kentucky & Indiana Terminal R. Co. v. Cantrell, 298 Ky. 743, 184 S.W.2d 111 (Ky. 1944), and Cochran v. Downing, 247 S.W.2d 228 (Ky. 1952). With these standards in mind, we now consider the issues presented for our review.

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STDS OF REVIEW: Contract interpretation

Furthermore, “[i]t is well established that construction and interpretation of a written instrument are questions of law for the court.” Cinelli, 997 S.W.2d at 476 (citing Morganfield Nat’l. Bank v. Damien Elder & Sons, 836 S.W.2d 893 (Ky. 1992)). Because we review questions of law de novo, we afford no deference to the interpretation of the trial court. Cinelli, 997 S.W.2d at 476 (citing Louisville Edible Oil Products, Inc. v. Revenue Cabinet Commonwealth of Kentucky, 957 S.W.2d 272 (Ky.App. 1997)).

From Spears v. Kentucky Ins. Agency, COA, PUB, 10/12/2012

STDS OF REVIEW: Motion to Dismiss CR 12.02

When a trial court is presented with a Kentucky Rules of Civil Procedure (CR) 12.02 motion to dismiss, the court must take every well-pleaded allegation of the complaint as true and construe it in the light most favorable to the opposing party. Gall v. Scroggy, 725 S.W.2d 867 (Ky.App. 1987). As such, “[t]he court should not grant the motion unless it appears the pleading party would not be entitled to relief under any set of facts which could be proved in support of his claim.” Pari–Mutuel Clerks’ Union of Kentucky, Local 541, SEIU, AFL–CIO v. Kentucky Jockey Club, 551 S.W.2d 801, 803 (Ky. 1977).

See, Norton v. Perry, COA, Pub. 10/12/2012

Stds of Review – Appeals: Raising issues first time on appeal (Grant v. Warren County, COA, NPO, 8/10/2012)

This nonpublished decisions addresses failure to preserve error and raise it on appeal for the first time:

Grant v. Warren County, COA, NPO, 8/10/2012

As a general rule, a party is not permitted to raise an issue for the first time on appeal. “The Court of Appeals is one of review and is not to be approached as a second opportunity to be heard as a trial court. An issue not timely raised before the circuit court cannot be considered as a new argument before this Court.” Lawrence v. Risen, 598 S.W.2d 474, 476 (Ky. App. 1980). However, there are circumstances where unpreserved issues may be raised, such as in situations addressing subject-matter jurisdiction. See Hisle v. Lexington– Fayette Urban County Gov’t, 258 S.W.3d 422, 430–31 (Ky. App. 2008) (because subject-matter jurisdiction concerns the nature and origin of a court’s power to act, it may not be waived and may be raised at any time in the proceeding). While Kentucky has not directly addressed this point, it has been stated in the federal context that sovereign immunity is a type of subject-matter jurisdiction. F.D.I.C. v. Meyer, 510 U.S. 471, 476, 114 S.Ct. 996, 127 L.Ed.2d 308 (1994). Nevertheless, because of the circumstances by which Appellant’s claim against the County was dismissed, we decline to review the matter herein and believe it is best remanded to the lower court for proper consideration of the merits of the County’s motion to dismiss.