COA 2009 Minutes: November 20, 2009 (Nos. 1179-1204

COA 2009 Minutes: November 20, 2009 (Nos. 1179-1204)

  • 26 decisions
  • 10 published

Published Decisions with digest and link to full text decision at AOC

1180 – REVENUE AND TAXATION, TAX NEXUS W/KENTUCKY
THE REVENUE CABINET OF KY. V. ASWORTH CORP
AFFIRMING IN PART, REVERSING IN PART, AND REMANDING ** ** ** ** **
BEFORE: CLAYTON, NICKELL, AND VANMETER, JUDGES.

VANMETER, JUDGE: The Revenue Cabinet, Commonwealth of Kentucky (n/k/a Finance and Administration Cabinet, Department of Revenue) (the Cabinet) appeals from the Franklin Circuit Court’s order reversing the order of the Kentucky Board of Tax Appeals (Board). Asworth Corporation (n/k/a Asworth, LLC), D Aviation Services, Inc. (n/k/a D Aviation Services, LLC), and HT-Forum, Inc. (n/k/a HTF, LLC), (collectively the Corporations) cross-appeal from the same order. For the following reasons, we affirm the circuit court’s order to the extent that it held that the Corporations have a tax nexus with Kentucky. We reverse insofar as it applied the three-factor apportionment method and ordered an immediate refund.

1181 – TORTS (Multiple issues arising from McDonald's Strip Search case)
MCDONALD'S CORP. V. OGBURN
AFFIRMING IN PART, REVERSING IN PART, AND REMANDING
** ** ** ** ** BEFORE: ACREE, TAYLOR AND THOMPSON, JUDGES

ACREE, JUDGE: The defendant below, McDonald’s Corporation, appeals the November 15, 2007, judgment of the Bullitt Circuit Court awarding both compensatory and punitive damages to Louise Ogborn, the plaintiff below, and Donna J. Summers, a defendant and cross-claimant below. We affirm the judgment of the Bullitt Circuit Court except as to the punitive damages awarded to Summers, which we reduce to comport with constitutional due process.

1182 – REVENUE AND TAXATION, PREVAILING WAGE RATES TO WORKERS
TECO MECHANICAL CONTRACTOR, INC. V. ENVIRONMENTAL AND PUBLIC PROTECTION CABINET

OPINION AFFIRMING IN PART, VACATING IN PART, AND REMANDING
** ** ** ** ** BEFORE: KELLER AND NICKELL, JUDGES; LAMBERT,1 SENIOR JUDGE.

KELLER, JUDGE: TECO Mechanical Contractor, Inc. (TECO), appeals from the Franklin Circuit Court’s summary judgment upholding the constitutionality of portions of Kentucky Revised Statutes (KRS) Chapter 337 (the Act) and assessing back wages and civil penalties against TECO. On appeal, TECO argues that portions of the Act are unconstitutional because there is no provision for a due process hearing regarding the classification of workers by the Environmental and Public Protection Cabinet (the Cabinet). Additionally, TECO argues the Act does not provide adequate guidance regarding the classification of workers. Furthermore, TECO argues that, if the Act is constitutional, the circuit court, in finding for the Cabinet, used the incorrect standard of proof; adopted the Cabinet’s classification method, which is contrary to law; and based its judgment on inadmissible evidence. For the following reasons, we affirm in part, vacate in part, and remand. * * * The facts are not in dispute. TECO provided mechanical contractor services to various general contractors on a number of public works projects. TECO bid and contracts were awarded based on payment of the prevailing wage as set forth in the applicable Notification of Public Works Projects documents (the Notifications). Following receipt of a complaint, the Cabinet audited TECO’s wage records from those projects and, on November 21, 2002, notified TECO that it had underpaid several of its employees by a total of $150,781.82. TECO protested, and the Cabinet conducted additional investigations, which lead to a reduction in the back wages owed to $63,494.21.
Following failed attempts to negotiate a resolution, the Cabinet notified TECO that it had until March 4, 2005, to pay a compromised amount of $51,620.65 in back wages and a civil penalty of $4,000.00. Furthermore, the Cabinet advised TECO that, if it did not pay by that date, the Cabinet would seek payment of the back wages from the appropriate general contractors.

1183 – EMPLOYMENT LAW
WATERS  V. CITY OF PIONEER VILLAGE
OPINION AFFIRMING
** ** ** ** ** BEFORE: CLAYTON, MOORE, AND VANMETER, JUDGES.

CLAYTON, JUDGE: David Waters (“Waters”) has appealed from the Bullitt Circuit Court’s order granting a judgment against him for the breach of an employment contract. Because the trial court correctly interpreted the applicable statute, we affirm.

1186 – GOVERNMENT ETHICS, VIOLATIONS AND EFFECTS OF GOVERNOR'S PARDON
TURBYFILL V. EXECUTIVE BRANCH ETHICS COMMISSION
OPINION AFFIRMING
** ** ** ** ** BEFORE: NICKELL, THOMPSON AND WINE, JUDGES.

THOMPSON, JUDGE: The issue in this appeal is whether the Kentucky Executive Branch Ethics Commission (EBEC) has authority to pursue an administrative proceeding for the purpose of sanctioning Basil Turbyfill, who was previously pardoned by Governor Ernie Fletcher. Turbyfill moved to dismiss the proceeding on the basis that Governor Fletcher’s pardon was a full pardon precluding any criminal or civil action against him arising from any alleged violations of the Kentucky merit system laws prohibiting employment decisions based on political activities. The circuit court denied Turbyfill’s petition for judicial review and declined to order dismissal of the administrative proceeding, ruling that the pardon did not apply to the EBEC proceeding. We agree with the circuit court and affirm.

1188 – TORTS, SLIP AND FALL, SUMMARY JUDGMENT
FALLER V. ENDICOTT-MAYFLOWER, LLC
OPINION AFFIRMING
** ** ** ** ** BEFORE: COMBS, CHIEF JUDGE; NICKELL AND TAYLOR, JUDGES.

NICKELL, JUDGE: Rhoda Faller (Rhoda) fell and sustained injuries while exiting Buck’s Restaurant in Louisville, Kentucky. She appeals from the Jefferson Circuit Court’s award of summary judgment to Rader Enterprises, Inc., d/b/a Buck’s Restaurant (Rader); Endicott-Mayflower, LLC (Mayflower); and Professional Property Managers, LLC (PPM) (collectively referred to as appellees). Because there are no genuine issues of material fact, and Rhoda cannot prove any act or omission by an appellee substantially caused her to fall, we affirm the circuit court judgment.

1193 – CRIMINAL LAW
MUNCY V. COMMONWEALTH OF KY
OPINION AFFIRMING
** ** ** ** **

BEFORE: NICKELL AND VANMETER, JUDGES; LAMBERT,1 SENIOR JUDGE.
VANMETER, JUDGE: Eddie Dwayne Muncy (Muncy) appeals from the final judgment of the Bell Circuit Court sentencing him to ten years’ imprisonment for two counts of first-degree trafficking in a controlled substance. For the following reasons, we affirm.

1195 – FAMILY LAW, CHILD SUPPORT
ARTERBURN V. FIRST COMMUNITY BANK
OPINION AFFIRMING
** ** ** ** ** BEFORE: CLAYTON, MOORE, AND VANMETER, JUDGES.

VANMETER, JUDGE: Michael S. Finck appeals from an order entered by the Jefferson Circuit Court, Family Division, regarding his child support obligation. We affirm.

1198 – CORPORATIONS, PIERCING CORPORATE VEIL
INTER-TEL, INC. VS. LINN STATION PROPERTIES, LLC
OPINION AFFIRMING
** ** ** ** ** BEFORE: CAPERTON AND DIXON, JUDGES; HENRY,1 SENIOR JUDGE.

HENRY, SENIOR JUDGE: Inter-Tel, Inc. (“Inter-Tel”) and Inter-Tel Technologies, Inc. (“Technologies”) appeal from an opinion and order of the Jefferson Circuit Court granting a motion for summary judgment brought by Linn Station Properties, LLC. Inter-Tel is
the parent corporation of Technologies, which was in turn the parent corporation of Integrated Telecom Services Corporation (“ITS”). ITS is now defunct. The sole issue on appeal is whether the circuit court correctly determined that the corporate veil of ITS may be pierced and that Inter-Tel and Technologies are consequently liable for a default judgment that Linn Station obtained against ITS. Having reviewed the circuit court’s decision, we affirm.

1201 – REAL ESTATE MORTGAGE, SURETY, SUPERSEDEAS BOND
LAWYERS MUTUAL INS. CO. OF KY. VS. STEWART
OPINION AFFIRMING
** ** ** ** ** BEFORE: NICKELL AND WINE, JUDGES; HARRIS, SENIOR JUDGE.

WINE, JUDGE: Lawyers Mutual Insurance Company of Kentucky (“Lawyers Mutual”) appeals a final order of the Knox Circuit Court denying its motion for enforcement of a supersedeas bond against the surety thereon. The issue presented is whether a surety upon a supersedeas bond can escape liability thereon without further order of the court when its principal purpose has been extinguished. For the reasons set forth herein, we find that a surety cannot be bound when a supersedeas bond fails to stay execution of a judgment.

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