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PUBLISHED DECISIONS OF COA:
910. SUBJECT MATTER JURISDICTION.
BIRCHWOOD CONSERVANCY, A CALIFORNIA CORPORATION, ET AL.
UNITED BROTHERHOOD OF CARPENTERS
OPINION AFFIRMING IN PART, REVERSING IN PART, AND REMANDING
ACREE (PRESIDING JUDGE)
DIXON (CONCURS) AND NICKELL (CONCURS)
TO BE PUBLISHED
ACREE JUDGE: Birchwood Conservancy, Lucinda Christian, Evan Blakeny, and Robert Christian appeal the Scott Circuit Court’s July 2, 2009 Opinion and Order Dismissing their complaint against the United Brotherhood of Carpenters (the Union). For the following reasons, we affirm in part, reverse in part, and remand.
STDS OF REVIEW: APPELLATE REVIEW OF TRIAL COURT SUBJECT-MATTER JURISDICTION.
Whether a court had subject-matter jurisdiction over the case is a question of law; therefore our review is de novo. Floyd County Bd. of Educ. v. Ratliff, 955 S.W.2d 921 (Ky. 1997). Likewise, whether a court may exercise personal jurisdiction presents a question of law subject to de novo review. Hinners v. Robey, 336 S.W.3d 891, 895 (Ky. 2011) (citing Appalachian Regional Healthcare, Inc. v. Coleman, 239 S.W.3d 49, 53-54 (Ky. 2007)). Similarly, when a defendant moves to dismiss a complaint for failure to state a claim, “the circuit court is not required to make any factual determination; rather, the question is purely a matter of law.” James v. Wilson, 95 S.W.3d 875, 884 (Ky. App. 2002). A court is not required to make any findings of fact for any of these rulings. Because the case sub judice presents all three of these issues, our review is entirely de novo.
To some degree, we can attribute the confusion of subject-matter- jurisdiction concepts and capacity concepts to jurisprudence that evolved prior to the rules of modern pleading; however, such jurisprudence is no longer followed.
Some early decisions suggested that a defect in capacity deprives the court of subject-matter jurisdiction, since a real case or controversy does not exist when one of the parties is incapable of suing or being sued, [footnote omitted] although more recent authority has rejected that characterization. [Brown v. Keller, 274 F.2d 779 (6th Cir. 1960), cert. denied, 363 U.S. 828, 80 S. Ct. 1599, 4 L. Ed. 2d 1523 (1960).] To treat capacity problems as subject-matter jurisdiction defects seems to exaggerate their significance . . . . In Van Dusen v. Barrack,[376 U.S. 612, 84 S. Ct. 805, 11 L. Ed. 2d 945 (1964),] the Court . . . indicates that capacity is not a jurisdictional issue . . . .
6A Wright, Miller, Kane, and Marcus, Fed. Prac. & Proc. Civ. § 1559 (3d ed. & 2011 Supp.).7 Our own Supreme Court agreed with this analysis in Baker v. Fletcher, where that Court said, “Failure to join a proper party is not jurisdictional, thus does not warrant a sua sponte dismissal. The same holds true for allegedly suing an improper party. CR 9.01[.]” 204 S.W.3d 589, 600 (Ky. 2006) (emphasis added).
In this case, subject matter jurisdiction was never a real issue. “[S]ubject matter does not mean ‘this case’ but ‘this kind of case.’ ” Harrison v. Leach, 323 S.W.3d 702, 705 (Ky. 2010) (citation omitted). The Scott Circuit Court, as a court of general jurisdiction, has been vested with subject-matter jurisdiction over just such cases as Birchwood brought – contract disputes and suits in equity. Ky. Const. §§ 109 & 112(5); Kentucky Revised Statutes (KRS) 23A.010; Peter v. Gibson, 336 S.W.3d 2, 5 (Ky. 2010).
The Scott Circuit Court “acquired jurisdiction of the subject-matter [of Birchwood’s claims] when the petition [or, as in this case, the complaint] was filed and summons issued[.]” Hudson v. Manning, 250 Ky. 760, 63 S.W.2d 943, 945 (1933). There is no merit in the argument that the circuit court was not vested with subject matter jurisdiction. We move on to the issue of the lack of personal jurisdiction of the Union.
911. TORTS. PREMISES LIABILITY ( NOT "SLIP AND FALL"). EXPOSURE TO ABSESTOS BY FORD TO CONTRACTORS ON PREMISES. ADMISSIBILITY OF OLD NEWSPAPER STORIES; EXPERT TESTIMONY. DAUBERT.
REHM (DEBBIE ELLEN), ET AL.
FORD MOTOR COMPANY, ET AL.
OPINION AFFIRMING THE APPEAL AND CROSS-APPEAL
COMBS (PRESIDING JUDGE)
CAPERTON (CONCURS IN PART, DISSENTS IN PART AND FILES SEPARATE OPINION ) AND THOMPSON (CONCURS IN RESULT AND FILES SEPARATE OPINION)
TO BE PUBLISHED
COMBS, JUDGE: Debbie Ellen Rehm, individually and as Executrix of the Estate of James David Rehm; Nicholas James Rehm; and Christina Marie Rehm (the Rehms) appeal from the judgment of the Jefferson Circuit Court following a jury verdict in favor of Ford Motor Company in a premises liability lawsuit. Ford Motor Company cross-appeals. Following our review of the extensive record, the facts, and the law, we affirm both as to the appeal and as to the cross-appeal.
DAUBERT AND EXPERTS.
The Rehms’ next arguments are related to the trial court’s allowing testimony from Ford’s expert witness, Dr. Robert Morgan, an occupational epidemiologist. Dr. Morgan offered his theory that James had developed mesothelioma as a result of household exposure to his own father’s work clothes. The elder Mr. Rehm had worked as an elevator mechanic, and Dr. Morgan speculated that he could have carried home asbestos in his hair and on his clothing. Dr. Morgan also mentioned that James had been exposed to asbestos in plants other than Ford as possible alternate sources of contamination.
The Rehms argue that Dr. Morgan’s household exposure theory is speculative and without foundation because James’s father testified that he had never been exposed to asbestos during his work as an elevator mechanic. They also contend that the testimony was prejudicial in giving the jury the suggestion that James’s own work as an elevator mechanic could have been the source of his exposure to asbestos.
Rehm also contends that Dr. Morgan’s testimony about the household exposure was unreliable. KRE 702 sets forth the standards for expert testimony as follows:
If scientific, technical, or other specialized knowledge will assist the trier of fact to understand the evidence or to determine a fact in issue, a witness qualified as an expert by knowledge, skill, experience, training, or
education, may testify thereto in the form of an opinion or otherwise, if:
(1) The testimony is based upon sufficient facts or data;
(2) The testimony is the product of reliable principles and methods; and
(3) The witness has applied the principles and methods reliably to the facts of the case.
Additionally, the Supreme Court of the United States has provided a list of factors to assist the trial court in its determination: 1) whether the expert’s theory can be or has been tested; 2) whether the expert’s theory has been published or subject to peer review; 3) a scientific technique’s potential rate of error and standards for its operation; and 4) the general acceptance of the theory in the scientific community. Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S. 579, 593-94, 113 S. Ct. 2786, 2796-97, 125 L. Ed. 2d 469 (1993).
In its restatement of Daubert, the Supreme Court of Kentucky has admonished that the standard is flexible – “a court may consider one or more or all of the factors mentioned in Daubert, or even other relevant factors, in determining the admissibility of expert testimony.” Toyota Motor Corp. v. Gregory, 136 S.W.3d 35, 40 (Ky. 2004) (quoting Johnson v. Commonwealth, 12 S.W.3d 258, 264 (Ky. 2000)).
Our Supreme Court has recently evaluated a case very much like the one before us, Burton v. CSX Transp., Inc., 269 S.W.3d 1 (Ky. 2008). In Burton, as in this case, the trial court was not assessing the reliability of a “particular theory or technique” as indicated by Daubert. Instead, Ford presented general theories of a causal link between domestic exposure and mesothelioma and of higher risk in elevator mechanics. In Burton, the court held that when expert testimony was based on literature, the expert must be “sufficiently qualified in the proper field of study to offer an opinion that is helpful to decide the specific questions presented.” Id. at 7. If the expert is qualified, then the testimony will “pass muster under the Daubert rubric.” Id.
914. ATTORNEYS FEES. RENTAL AGREEMENTS.
LEXINGTON REAL ESTATE COMPANY, LLC.
OPINION AND ORDER REVERSING AND REMANDING
LAMBERT (PRESIDING JUDGE)
CAPERTON (CONCURS) AND COMBS (CONCURS)
TO BE PUBLISHED
LAMBERT, SENIOR JUDGE: Richard O’Rourke appeals from the trial court’s denial of his motion to reconsider the award of attorney’s fees in favor of Lexington Real Estate Co., LLC. Upon review, we reverse and remand to the trial court for further consistent proceedings.
Generally, with respect to attorney’s fees, Kentucky follows the American Rule of individual party responsibility rather than the fee shifting practice of some states and some other nations. Louisville Label, Inc. v.Hildesheim, 843 S.W.2d 321, 326 (Ky. 1992). See Knott v. Crown Colony Farm, Inc., 865 S.W.2d 326, 331 (Ky. 1993), holding that without an attorney’s fees statute, any such recovery must derive from the underlying contract. However, the Kentucky General Assembly has created a limited statutory exception to the general rule. That exception provides that if “noncompliance is willful the landlord may recover actual damages and reasonable attorney’s fees.” KRS 383.660(3). “’Willful’ means with deliberate intention, not accidentally or inadvertently, and done according to a purpose.” KRS 383.545(17).
From the record, we are unconvinced that any act or failure to act by O’Rourke meets the required statutory standard. Although O’Rourke appears to have made unkept promises of future rental payment and appears to have left the vacated property in less than perfect condition, his noncompliance with the terms of the rental agreement was not “willful” as that term is defined in KRS 383.545(17).
Ordinarily, the failure to pay rent when due, accompanied by requests for extensions of time and promises of future payment, falls short of the statutory standard. Likewise, tasteless apartment decoration is hardly the type of willful conduct the statute envisions. To compensate the landlord for such matters as these, the lease agreement must be the basis for recovery, and a substantial recovery for past due rent and property damage was allowed here. O’Rourke’s tenancy prevailed for five years and substantial sums were awarded in damages under the contract. From the evidence we conclude that the additional award of attorney’s fees was erroneous.
We have not overlooked Batson v. Clark, 980 S.W.2d 566 (Ky.App. 1998), in which this Court correctly noted that attorney’s fees are not ordinarily allowable as costs in the absence of a statute or an express contract provision. However, the Batson Court went on to recognize an indistinct trial court discretion based on equity and particular circumstance. In this case, however, we need not explore the contours of whatever discretion there may be, for the General Assembly has spoken clearly to the issue in KRS 383.570 and KRS 383.660(3). With respect to rental agreements, there can be no attorney’s fees contract provision, for it is forbidden in KRS 383.570. In view of the statutory enactments cited and quoted herein, we see no room for trial court discretion in this arena except as provided in KRS 383.660(3). The limited exception found in KRS 383.660(3) reflects the will of the General Assembly, and we discern no discretionary authority vested in the Court of Justice to go beyond what the Legislature plainly said.
Moreover, for another sound reason the attorney fees claim against O’Rourke must fail. In the complaint, a party must state in plain and adequate terms the basis for any claim. Caldwell v. Frazier, 304 S.W.2d 922 (Ky. 1957). CR 8.01 provides that a claim “shall contain (a) a short and plain statement of the claim showing that the pleader is entitled to relief, and (b) a demand for judgment for the relief to which he deems himself entitled.” Our review of the complaint filed herein reveals that Lexington Real Estate failed to properly plead any claim for attorney’s fees, and certainly no claim under KRS 383.660(3). Although the complaint requested an award of attorney’s fees in the ad damnum clause, it failed to state any claim for attorney’s fees in the body of the complaint. CR 8.01 requires notice of the claim, and O’Rourke was not given notice of any acts or omissions alleged against him that would authorize application of KRS 383.660(3). Although KRS 383.660(3) creates a limited exception to the general rule that each party shall pay its own attorney’s fees, to invoke that exception notice of the claim must be pled to join the issue. See Pike v. George, 434 S.W.2d 626 (Ky.App. 1968).
916. LIS PENDENS. UNJUST ENRICHMENT.
GUERIN (GERALDINE M.)
LAMBERT (PRESIDING JUDGE)
TAYLOR (CONCURS) AND STUMBO (CONCURS)
TO BE PUBLISHED
LAMBERT, SENIOR JUDGE: Geraldine M. Guerin appeals from the Hart Circuit Court’s entry of summary judgment as to her claim of unjust enrichment brought against Appellee Charles Fulkerson. Because Appellant failed to produce evidence that genuine issues of material fact existed as to the merits of this claim, summary judgment was appropriate. Thus, we affirm.
CAUSE OF ACTION. LIS PENDENS.
Lis pendens is defined as “[a] notice, recorded in the chain of title to real property, … to warn all persons that certain property is the subject matter of litigation, and that any interests acquired during the pendency of the suit are subject to its outcome.” Greene v. McFarland, 43 S.W.3d 258, 260 (Ky. 2001), quoting BLACK’S LAW DICTIONARY 943 (7th ed. 1999); see also KRS 382.440. “A lis pendens notice is appropriate in situations where the title to property is at stake (actions for partition, quiet title, and will contests, for example), and it serves as notice that the purchaser takes the title subject to the same restrictions as would apply to the seller.” Greene, 43 S.W.3d at 260. Consequently, “in order to invoke the doctrine of lis pendens, it is not sufficient that a property be the source out of which the plaintiff will be compensated. Rather, the property that is described for the purpose of invoking the doctrine must be at the very essence of the controversy between the litigants.” 51 Am.Jur.2d Lis Pendens § 19 (2000) (footnote omitted).
Because of this, “[a]ctions for general debt do not give rise to valid lis pendens actions because there is no actual lien or interest in the real property.”
Greene, 43 S.W.3d at 260.3 This fact is fatal to Appellant’s lis pendens claim since the pending litigation had no direct nexus at all to the real property at issue. Instead, it is obvious that Appellant had nothing more than a general creditor’s claim against Commodore Masterson’s estate. Indeed, she acknowledged in her deposition that the lis pendens notice was based upon her belief that “the property was part of the estate … and I had a claim against the estate. That’s where that comes from.” Thus, Appellant’s claim against Appellee did not have a direct attachment to the real property itself, and the recording of a lis pendens was inappropriate and ineffective in terms of encumbering a sale of the property to Appellee.4 Id. at 261. Therefore, to the extent that Appellant believes her filed lis pendens notice somehow precluded the entry of summary judgment herein, she is mistaken.
A lis pendens notice also does not independently create a lien against property. Strong v. First Nationwide Mortg. Corp., 959 S.W.2d 785, 787-88 (Ky. App. 1998); Leonard v. Farmers & Traders Bank, Shelbyville, 605 S.W.2d 770, 772 (Ky. App. 1980).
CAUSE OF ACTION. UNJUST ENRICHMENT.
Appellee was erroneously dismissed via summary judgment. For a party to prevail under the theory of unjust enrichment, she must prove three elements: “(1) benefit conferred upon defendant at plaintiff’s expense; (2) a resulting appreciation of benefit by defendant; and (3) inequitable retention of benefit without payment for its value.” Jones v. Sparks, 297 S.W.3d 73, 78 (Ky. App. 2009); see also Guarantee Electric Co. v. Big Rivers Electric Corp., 669 F.Supp. 1371, 1380–81 (W.D. Ky. 1987).
918. PROFESSIONAL LEGAL NEGLIGENCE. WHO IS THE CLIENT? MINOR, YES. ESTATE BENEFICIARIES? YES.
ANDERSON (MALIK), ET AL.
PETE (MICKIEL), ET AL.
OPINION REVERSING AND REMANDING
WINE (PRESIDING JUDGE)
TAYLOR (CONCURS) AND MOORE (CONCURS)
TO BE PUBLISHED
WINE, JUDGE: Michael Anderson, Jr. and Malik Anderson, a minor, by and through his guardian and mother, Elizabeth Anderson, appeal from a summary judgment of the Jefferson Circuit Court dismissing their professional negligence claims against the Honorable Mickiel Pete and the law firm of Cochran, Cherry, Givens, Smith, Sistrunk & Sams, P.C. (hereinafter, “Pete”) with prejudice. Upon a review of the record, we reverse the summary judgment.
Our Supreme Court has recently laid to rest any dispute over whether an attorney may have an attorney-client relationship with a minor in the case of Branham v. Stewart, 307 S.W.3d 94, 95 (Ky. 2010). In Branham, the high Court held that an attorney representing a minor’s next friend on behalf of a minor is in an attorney-client relationship with the minor as a real party in interest and owes professional duties to the minor. Id. at 95. The minor is also said to be in privity with the attorney, despite their minority. Id. at 99.
Thus, the question in this case is whether Pete was representing the Estate and Elizabeth personally, as well as next friend of Michael and Malik. Since Pete sought and was granted a protective order from discovery, it is unclear whether there was a written contract in the original client file, and, if so, whether the terms of the contract would have established if Pete was representing the Estate and Elizabeth solely or also as next friend to the children.2 The only facts available at present are Elizabeth’s statements in her affidavit. Elizabeth set out facts in her affidavit establishing that she believed Pete to be representing the children as well. Thus, the only remaining question is whether such a belief was reasonable. In the present circumstances, since Michael and Malik stood to be awarded one-half of any damages recovered in the wrongful death action, it seems quite reasonable that Elizabeth would have believed that Pete was representing the children and raising any and all available claims on their behalf.
As such, we are compelled to reverse the trial court’s summary judgment. It is of little concern for our purposes today that after discovery is allowed to proceed on remand, it may actually appear from documents in the original client file that the Estate and Elizabeth were being represented solely and not as next friend to the children. Summary judgment is not appropriate where a genuine question of material fact exists.
When an attorney is retained to file a wrongful death action by the administrator of an estate, the attorney clearly intends to benefit both the client estate and the individuals in the estate who will receive a share of the damages under KRS 411.130 should he successfully defend the suit. They are two sides of one coin that cannot be logically divided from one another. Indeed, the individuals named in KRS 411.130(2) are the real parties in interest in such a suit. Vaughn’s Adm’r, 179 S.W.2d at 445.
Thus, on remand, even if Pete is found not to be in privity with Michael and Malik because discovery reveals that the parties contracted for him to represent Elizabeth solely and not the children, he will still have owed duties to Michael and Malik as intended beneficiaries of the wrongful death action. Thus, the result is inescapable that Pete owed a duty to Michael and Malik – whether as attorney to client or as attorney to intended beneficiary.
922. REVENUE AND TAXATION.
COMMONWEALTH OF KENTUCKY, FINANCE AND ADMIN. CABINET
SAINT JOSEPH HEALTH SYSTEM, INC., ET AL.
LAMBERT (PRESIDING JUDGE)
ACREE (CONCURS) AND WINE (CONCURS)
TO BE PUBLISHED
LAMBERT, SENIOR JUDGE: In this appeal and two cross-appeals, we are asked to interpret and apply Kentucky’s utility gross receipts license tax (“utility tax”), a mechanism for funding schools authorized by KRS 160.593 and KRS 160.613 et seq., and the exemption for institutions of purely public charity found in Section 1702 of the Kentucky Constitution. Specifically, we are asked to determine whether: (1) the legal incidence of the utility tax levied by the Board of Education of Fayette County (“Board”) falls upon Saint Joseph Health System, Inc. (“Saint Joseph”), a nonprofit hospital corporation, on natural gas it buys from Constellation New Energy – Gas Division, LLC (“Constellation”)3 for two hospitals it operates in Lexington, Kentucky, or upon Constellation, a broker that furnishes natural gas to Saint Joseph; and, (2) if the legal incidence of the utility tax falls upon Saint Joseph, whether it is exempt from paying the levy as an institution of purely public charity.
The genesis of this appeal is an opinion and order entered by the Fayette Circuit Court on May 13, 2010, following argument on Saint Joseph’s motion for summary judgment. The circuit court found: (1) Constellation is not liable for the utility tax because it is not a utility and, (2) natural gas purchased by Saint Joseph from Constellation is subject to imposition of the utility tax because Section 170 exempts public charities only from real property taxes and the utility tax is an excise tax.4 As a result of these findings, the circuit court ordered Saint
Joseph to reimburse5 Constellation for any utility tax it had paid on natural gas it had furnished to Saint Joseph.
On appeal, the Commonwealth of Kentucky Finance and Administration Cabinet, Department of Revenue (“Department”) argues Constellation, as a utility services provider furnishing natural gas to Saint Joseph, is liable for payment of the utility tax authorized by KRS 160.593 and 160.613. The Board filed a cross-appeal echoing the Department’s argument that the circuit court erred in finding Constellation is not a utility and therefore is not exempt from paying the utility tax. Saint Joseph also filed a cross-appeal, but in contrast to the Department and the Board, it challenges the circuit court’s finding that based on Children’s Psychiatric Hospital of Northern Kentucky, Inc. v. Commonwealth of Kentucky Revenue Cabinet, 989 S.W.2d 583, 585 (Ky. 1999), the Section 170 exemption for institutions of purely public charity applies only to the taxation of property. Saint Joseph claims that had the circuit court relied instead upon Marcum v. City of Louisville Municipal Housing Commission, 374 S.W.2d 865, 866 (Ky. 1963) (institution of purely public charity exempt from paying Kentucky use tax on utilities but not sales tax), it would have correctly concluded that an institution of purely public charity, such as Saint Joseph, is exempt from more than
just property taxes. Having considered the briefs, the record and the law, we reverse.
934. CRIMINAL SENTENCING.
COMMONWEALTH OF KENTUCKY
LAMBERT (PRESIDING JUDGE)
CAPERTON (CONCURS) AND KELLER (CONCURS)
TO BE PUBLISHED
LAMBERT, JUDGE: Melissa Arnett entered a conditional guilty plea to one count of first-degree sexual abuse for criminal acts committed against one of her students, receiving an agreed sentence of imprisonment for forty months. She now appeals whether the trial court may probate her sentence.
TORT REPORT FOR NONPUBLISHED DECISIONS (MINUS WORKERS COMP):
IF YOU WANT
- WORKERS COMPENSATION LAW UPDATES, I RECOMMEND YOU GO TO THE COMP ED WEB SITE AT http://www.comped.net/.
- FAMILY LAW UPDATES, I RECOMMEND YOU GO TO Diana Skaggs' Divorce Law Journal at http://www.divorcelawjournal.com
920. TORTS. OUTRAGE. INTENTIONAL INFLICTION OF EMOTIONAL DISTRESS. RETALIATORY DISCHARGE FOR MAKING WORKERS COMPENSATION CLAIM.
SAPPHIRE COAL COMPANY, ET AL.
WINE (PRESIDING JUDGE)
LAMBERT (CONCURS) AND NICKELL (CONCURS)
NOT TO BE PUBLISHED
WINE, JUDGE: Timothy Collins appeals from a summary judgment by the Letcher Circuit Court which dismissed his wrongful discharge and intentional infliction of emotional distress claims against Sapphire Coal Company and United Coal Company (“Sapphire”). Collins argues that Sapphire wrongfully fired him because he pursued a civil claim and a workers’ compensation claim against it.
AT WILL EMPLOYEES AND TERMINATION.
However, Sapphire was entitled to discharge Collins for filing the civil claim and he presented no evidence that his discharge was substantially motivated by the filing of his workers’ compensation claim. Collins also argues that his supervisor at Sapphire engaged in a pattern of harassment and intimidation which amounted to intentional infliction of emotional distress. We agree with the trial court that Collins failed to establish that the conduct was outrageous in character or that he suffered severe emotional distress as a result. Hence, we affirm the trial court’s dismissal of both claims.
RETALIATORY DISCHARGE FOR WORKERS COMPENSATION CLAIM.
Collins argues that Sapphire wrongfully discharged him in retaliation for filing civil litigation and the workers’ compensation claim against it. Ordinarily, an employer may discharge an at-will employee for good cause, for no cause, or for a cause that some might view as morally indefensible. Firestone Textile Co. Div., Firestone Tire and Rubber Co. v. Meadows, 666 S.W.2d 730, 731 (Ky. 1983). However, a discharge of an at-will employee may be unlawful if it violates a constitutionally protected right implicit in a statute. Id. at 731.
Sapphire admits that it fired Collins for filing a civil action against it for the damage caused when it undermined his property. As the trial court recognized, an employer has the right to discharge an employee who brings private litigation against the employer seeking damages for an incident not related to his employment unless the discharge is related to a statutory or constitutional provision which explicitly or implicitly creates a public policy exception. Boykins v. Housing Authority of Louisville, 842 S.W.2d 527, 530 (Ky. 1992). Collins maintains that the civil action was related to his employment, but he provides no citations to the record showing how it was related to his employment. Thus, we agree with the trial court that Collins may not maintain a claim for wrongful discharge on this basis.
Collins also contends that Sapphire wrongfully discharged him because he filed several workers’ compensation claims. Kentucky Revised Statute(s) (“KRS”) 342.197(1) prohibits an employer from retaliating against an employee for filing a lawful workers’ compensation claim. See also Firestone, supra, at 731. To establish a cause of action for retaliatory discharge, “it is incumbent on the employee to show at a minimum that he was engaged in a statutorily protected activity, that he was discharged, and that there was a connection between the ‘protected activity’ and the discharge.” Bishop v. Manpower, Inc. of Cent. Kentucky, 211 S.W.3d 71, 76 (Ky. App. 2006), quoting Willoughby v. GenCorp, Inc., 809 S.W.2d 858, 861 (Ky. App. 1990). The employee need not show that retaliation was the sole or even the primary motivating factor for the discharge, but only that retaliation for filing or pursuing a workers' compensation claim was a substantial motivating factor in causing his discharge. Bishop, supra, citing First Property Management Corp. v. Zarebidaki, 867 S.W.2d 185, 188 (Ky. 1993).
As noted above, Collins filed five workers’ compensation claims against Sapphire in 2006 for workplace injuries allegedly occurring on May 9, 2006, June 28, 2006, August 9, 2006, September 12, 2006, and October 21, 2006, respectively. Although the last claim was denied, Collins argues that a fact-finder could reasonably infer that Sapphire fired him in retaliation for filing these claims. Collins further argues that the denial of the October 21, 2006, claim does not preclude a finding that Sapphire retaliated against him for exercising his right to file lawful claims.
Enacting KRS 342.197(1) was to protect persons who are entitled to benefits under the workers' compensation laws and to prevent them from being discharged for taking steps to collect such benefits. Overnite Transp. Co. v. Gaddis, 793 S.W.2d 129, 130 (Ky. App. 1990). Since the statute protects the employee’s right to pursue such benefits, it is not necessary that an employee actually have filed a claim at the time the discharge occurred. Id. at 130-31. See also Bishop, supra, at 77. (Employer began closely scrutinizing employee’s absentee record after employee inquired about workers’ compensation benefits). Likewise, we conclude that the public policy expressed in KRS 342.197(1) protects an employee who has filed a claim for benefits in good faith even if that claim is ultimately denied.
Nevertheless, we agree with the trial court that Collins presented no evidence of a causal relationship between his discharge and his filing of his most recent workers’ compensation claim.
BIGGS (DOUGLAS RANDALL) SR.
BEARD (JAMES), ET AL.
OPINION REVERSING AND REMANDING
DIXON (PRESIDING JUDGE)
MOORE ( CONCURS) AND THOMPSON (DISSENTS BY SEPARATE OPINION)
NOT TO BE PUBLISHED
DIXON, JUDGE: Appellant Randall Biggs appeals from a judgment of the Taylor Circuit Court, pursuant to a jury verdict, awarding Appellees, James and Marvelle Beard, $82,000. For the reasons set forth herein, we reverse the judgment and remand this matter to the trial court for further proceedings.
ATTORNEY CLIENT AND CONFLICT OF INTEREST. PERCEPTION OF DISLOYALTY.
Randall argues that the trial court erred in refusing to disqualify Spalding based upon the conflict of interest created by his representation of the Beards and Mary Ellen. Randall contends that because the instant action was clearly adverse
to Mary Ellen, his representation of the Beards violated Kentucky Supreme Court Rules (SCR) 3.130(1.7) and 3.130(1.9). Further, Randall claims that the trial court’s and Spalding’s assistance to Mary Ellen during the trial was erroneous. After reviewing the record and video of the trial, we must agree.
SCR 3.130(1.7) states:
(a) Except as provided in paragraph (b), a lawyer shall not represent a client if the representation involves a concurrent conflict of interest. A concurrent conflict of interest exists if:
(1) the representation of one client will be directly adverse to another client; or
(2) there is a significant risk that the representation of one or more clients will be materially limited by the lawyer's responsibilities to another client, a former client or a third person or by a personal interest of the lawyer. (b) Notwithstanding paragraph (a), a lawyer may represent a client if:
(1) the lawyer reasonably believes that the lawyer will be able to provide competent and diligent representation to each affected client;
(2) the representation is not prohibited by law; (3) the representation does not involve the assertion of a claim by one client against another client represented by the lawyer in the same litigation or other proceeding before a tribunal; and
(4) each affected client gives informed consent, confirmed in writing. The consultation shall include an explanation of the implications of the common representation and the advantages and risks involved.
With respect to former clients, SCR 3.130(1.9) states, in pertinent part:
(a) A lawyer who has formerly represented a client in a matter shall not thereafter represent another person in the same or a substantially related matter in which that person's interests are materially adverse to the interests of the former client unless the former client gives informed consent, confirmed in writing.
(c) A lawyer who has formerly represented a client in a matter or whose present or former firm has formerly represented a client in a matter shall not thereafter:
(1) use information relating to the representation to the disadvantage of the former client except as these Rules would permit or require with respect to a client, or when the information has become generally known; or
(2) reveal information relating to the representation except as these Rules would permit or require with respect to a client.
There is no dispute that at the time the Beard’s complaint was filed in 2005, Spalding was representing Mary Ellen in her divorce proceedings. Although the divorce was finalized in 2006, various motions were subsequently filed regarding Randall’s failure to pay maintenance. However, it is unclear from the record if any motions or proceedings were pending at the time the instant trial commenced in 2010. Nevertheless, the Beards contend that whether Mary Ellen was a current or former client was irrelevant since Spalding’s conduct did not violate either rule.
In Lovell v. Winchester, 941 S.W.2d 466, 468 (Ky. 1997), our Supreme Court observed that “[t]he lawyer/client relationship can arise not only by contract but also from the conduct of the parties. Courts have found that the relationship is created as a result of the client's reasonable belief or expectation that the lawyer is undertaking the representation. Such a belief is based on the conduct of the parties.” It is abundantly clear from our review of the trial video that Mary Ellen believed Spalding was still her attorney. And, despite the fact that when Spalding was questioned about the apparent conflict at the beginning of trial he was quick to point out that he was not representing her in the instant matter, we are not convinced that she truly understood that fact. Mary Ellen’s conduct during her own testimony was that of a client answering her own attorney’s questions. The Beards even acknowledge that Mary Ellen was their key witness. Ironically, opposing counsel’s objection to Spalding’s leading questions was overruled on the grounds that Mary Ellen was an “adverse” witness.
In their brief to this Court, the Beards contend that even if Mary Ellen was considered Spalding’s client at the time of trial, the matters in which he represented her were wholly unrelated to the case at hand. However, the Commentary to SCR 3.130(1.7) provides, in pertinent part:
(6) Loyalty to a current client prohibits undertaking representation directly adverse to that client without that client's informed consent. Thus, absent consent, a lawyer may not act as an advocate in one matter against a person the lawyer represents in some other matter, even when the matters are wholly unrelated.
We find no persuasive evidence that Mary Ellen consented, or even understood, that Spalding was undertaking representation directly adverse to her interests.
We are of the opinion that the situation herein creates a perception of betrayal and disloyalty which cannot be condoned. In so doing, we are not expressing an opinion as to whether Spalding engaged in intentionally egregious conduct. However, regardless of whether this matter fits within the guise of SCR 3.130 (1.7) or (1.9), the goal of maintaining public confidence in our system of justice demands that courts prevent even the appearance of impropriety. In doing so, the client's perception of events is of paramount importance and overshadows the details of his attorney's conduct.
932. ENFORCING SETTLEMENT. CLARK V. BURDEN ISSUE AND ATTORNEY AUTHORITY.
OPINION VACATING AND REMANDING
COMBS (PRESIDING JUDGE)
CAPERTON (CONCURS) AND THOMPSON (DISSENTS AND FILES SEPARATE OPINION)
NOT TO BE PUBLISHED
COMBS, JUDGE: Kevin Prescott appeals an order of the Bullitt Circuit Court granting the motion of Alton Cannon, Administrator De Bonis Non, of the Estate of Robert V. Denk, to enforce a settlement of the parties’ claims. After our review, we vacate and remand for further proceedings.
By its order entered on August 24, 2010, the trial court granted the administrator’s motion to enforce the settlement. The court found that Prescott had given Esmailzadeh express authority to settle the parties’ claims and that the failure to enforce the agreement would have a substantial and adverse effect on the beneficiaries of the Denk estate since the estate would incur the expense of trial preparation for a second time and suffer further delay. This appeal followed.
In his brief to this court, Esmailzadeh continues to represent his client’s interests vigorously. Citing Clark v. Burden, 917 S.W.2d 574 (Ky.1996), Esmailzadeh challenges the trial court’s order to enforce the settlement by contending that he (Esmailzadeh) lacked the authority necessary to settle any claims on his client’s behalf. He contends that the trial court erred by finding authorization where none existed. Esmailzadeh also contends that the trial court erred by finding that the decedent’s estate would be substantially and adversely affected if the settlement were not enforced. The administrator of the decedent’s estate contends that the record supports its position that the settlement is indeed enforceable against Prescott. However, the attorney for the estate candidly acknowledges that Esmailzadeh has been put in an untenable position — both as advocate for and as witness against his client.
When determining whether to settle a claim, our courts recognize that final decision-making authority rests with a client — not with his attorney. Clark, 917 S.W.2d at 575. Without his client’s express authority, an attorney generally has no authority to bind his client to a settlement or compromise. Id. at 576. Kentucky’s Rules of Professional Conduct mandatorily direct that an attorney “shall abide by a client’s decision whether to accept an offer of settlement . . . .” Rule[s] of the Supreme Court (SCR) 3.130-1.2(a). (Emphasis added.)
In Clark v. Burden, 917 S.W. at 577, the Supreme Court of Kentucky directed that where a dispute erupts as to whether a client has given settlement authority to his attorney, “the trial court shall summarily decide the facts.” In such a proceeding, the attorney-client privilege will not prevent the attorney from testifying as to the client’s instructions regarding settlement. Id. Whether Prescott gave Esmailzadeh express authority to settle the matter was the critical issue at the court’s hearing. Esmailzadeh’s testimony was material to the interests of both parties and was critical to a resolution of this central issue of authorization. However, SCR 3.130-3.7(a) specifically provides that a “lawyer shall not act as advocate at a trial in which the lawyer is likely to be a necessary witness. . . .”1 Comment 5 to SCR 3.130-3.7 indicates that where there is likely to be substantial conflict between the testimony of the client and that of the lawyer, the representation is improper. The comment also provides that the problem can arise whether the lawyer is called as a witness on behalf of the client or is called by the opposing party.
Although our Rules of Professional Conduct indicate that determining whether such a conflict exists is primarily the responsibility of the lawyer involved, courts have an abiding and independent interest in assuring that representation of litigants is not compromised by an improper conflict of interest. Under the circumstances presented here — where an attorney was required to continue in the representation despite a patent conflict of interest, the integrity of both the court and the attorney was undermined. While neither of the parties on appeal was in a position to have raised the issue of the unadjudicated conflict of interest before this court, the error has grave implications beyond the Bullitt Circuit Court, these attorneys, and these parties. Therefore, we hold that the court erred in failing to enter an order permitting Esmailzadeh to withdraw from the representation.2 We remand for a re-trial on the merits of the case.
The order of the Bullitt Circuit Court enforcing the alleged settlement is vacated. This matter is remanded for further proceedings consistent with our opinion.
935. TORTS. INTENTIONAL INFLICTION OF EMOTIONAL DISTRESS VS. FUNERAL DIRECTOR FOR IMPROPER CREMATION.
CANIFF FUNERAL HOME, INC.
KELLER (PRESIDING JUDGE)
CLAYTON (CONCURS) AND MOORE (CONCURS)
NOT TO BE PUBLISHED
KELLER, JUDGE: Brenda Childers (Childers) appeals from the circuit court's summary judgment in favor of Caniff Funeral Home, Inc. (the Funeral Home). On appeal, Childers argues that genuine issues of material fact exist regarding her claims that the Funeral Home improperly arranged for the cremation of the remains of her mother, Pauline Moore Lemaster (Pauline). The Funeral Home argues that it does not fall within the statute regulating cremation; that it has immunity; and that its actions or inactions did not rise to the level sufficient to support Childers's claim of intentional infliction of emotional distress. Having reviewed the record, we affirm.