Kentucky

TORT REPORT: COA 2010 Minutes July 9, 2010 (Nos. 657-672)

By Michael Stevens

TORT REPORT:
COA 2010 Minutes July 9, 2010 (Nos. 657-672)

• Above link to minutes is full text of minutes with link to full text of each decision.
• Total number of decisions:  16
• Published Decisions: 2 (658, 661)
• Tort Decisions:  661, 662,
• Workers Comp:  671

TORT DECISIONS (CIVIL, INSURANCE, TORTS):

661. JURORS (CHALLENGE FOR BIAS, POLICY HOLDERS OF DEFENDANT); HEARSAY
GIBSON (ROY), ET AL. VS. KENTUCKY FARM BUREAU MUTUAL INSURANCE COMPANY, ET AL.
OPINION AFFIRMING IN PART, REVERSING IN PART AND REMANDING
ACREE (PRESIDING JUDGE)
COMBS (CONCURS) AND WINE (CONCURS)
2009-CA-000048-MR
TO BE PUBLISHED
JEFFERSON

ACREE, JUDGE: Appellants Roy Gibson and Clinton Bowman appeal the October 3, 2008 judgment of the Clay Circuit Court entered upon a jury?s verdict finding them liable for fraud and ordering them to pay $43,778.53 to Appellee Kentucky Farm Bureau (KFB) and $14,000 to Appellee Gary Speth. For the following reasons we affirm in part, reverse in part, and remand for additional findings.

On June 24, 2005, Gibson and Bowman reported to KFB their 2000 Ford F150 had been stolen approximately three weeks earlier; KFB established the date of the loss as June 1, 2005. At the request of KFB, Gibson and Bowman filed a police report. Because they no longer possessed the vehicle?s certificate of title, they also obtained a duplicate title. In accordance with the terms of their KFB insurance policy covering theft of the insured vehicle, Gibson and Bowman soon received a check in the amount of $17,291.50.

In late 2005, an individual named Rogelio Mendez attempted to register the vehicle. He presented the original certificate of title to the clerk; the back of the certificate showed that on March 22, 2005, Gibson and Bowman had executed an assignment of the title to Mendez and their signatures were notarized.1 However, because the vehicle had been reported stolen, the clerk refused to permit Mendez to register the vehicle in his name. Police seized the truck and returned it to KFB. The insurer sold the truck for approximately $7,200.

Believing it had been defrauded, KFB filed a complaint seeking a declaration of rights to the truck as against Sanchez and Speth and asserting a fraud claim against Gibson and Bowman. Gibson and Bowman were represented in the action by counsel and defended against the fraud claim. Speth appeared pro se with the benefit of some assistance from KFB?s counsel. Sanchez was never served and did not appear in the action.

Following trial, a jury determined Gibson and Bowman had defrauded KFB and awarded KFB $43,778.53. The jury also awarded Speth $14,000.3    This appeal followed.

Gibson and Bowman claim the circuit court erred as follows: (1) by failing to strike for cause jurors who were policyholders of insurance issued by KFB; (2) by admitting hearsay testimony of out-of-court statements made by Sanchez; (3) by awarding KFB costs of investigating and prosecuting the claim; and (4) by awarding damages to Speth in absence of a finding he was defrauded and without proof of his loss. We address those assignments of error in that order.

Jury Selection.  Gibson and Bowman claim the circuit court erred by overruling their motion to strike for cause prospective jurors who were also holders of KFB polices.   The argument Gibson and Bowman present is that no KFB policyholder was capable of sitting as an unbiased juror in this case. That is, they argue the policyholders? status alone required striking them for cause. True, by statute, certain persons are subject to challenge for cause merely because of their status. Howell v. Commonwealth, 489 S.W.2d 21, 22-23 (Ky. 1972)(Former Kentucky Revised Statute (KRS) 29.025, now KRS 29A.080(2)(b), disqualifies felons from jury service; ?a juror in such status is subject to challenge for cause?). However, this panel may not, by creating the bright line test suggested by this argument, take from the province of the trial court the discretion to determine the qualifications of any jurors in the venire not otherwise disqualified by KRS 29A.080(2).
We do not exclude the possibility that one or more jurors in this case may have had such a concern about their relationship with KFB that they might be deemed biased. However, we can only speculate as to the existence of actual bias because Gibson and Bowman simply did not inquire further into the matter during voir dire either with any individual juror or with the venire. Relevant inquiries could have determined whether any particular juror had a concern that a judgment in the case would affect them personally. In this case, the only information about the juror-policyholders available to the trial court was that the potential for bias existed. Absent further indication from the voir dire that any juror, because of his or her relationship with KFB, was actually biased or would have difficulty fairly Deciding the case, we cannot label the trial court?s refusal to strike any jurors for cause an abuse of discretion.

Hearsay evidence
At trial KFB introduced certain of Sanchez?s statements through its investigator, Keller, because Sanchez was unavailable to testify.  Additionally, the statements made by Sanchez to the investigator were not used against Sanchez. Rather, they were used against Gibson and Bowman in prosecution of the fraud claim. KFB never claimed that Sanchez had defrauded anyone. Therefore, Sanchez?s out-of-court statements could not be permissibly introduced pursuant to this rule. 

In the context of Keller?s interview with Sanchez, it becomes clear the statements at issue were actually self-serving. Keller was conducting the interview to determine which scenario was accurate: (1) that Sanchez stole the truck and then used it as collateral on a $7,000 loan, or (2) that Gibson had legally conveyed the truck to Sanchez and then fraudulently reported it stolen. Given those options, it was decidedly in Sanchez?s interest to state he acquired the truck from Gibson in a legal manner and then left it with Speth. The conversation with Keller was therefore inadmissible as statements against the declarant?s interest.
In light of the other evidence of fraud, however, any error in admitting Sanchez?s statements to KFB?s investigator was harmless.

662. FORESEEABILITY ON INJURIES (ASSAULT); INSURANCE COVERAGE FOR ASSAULT AND OCCURRENCE; DIRECTED VERDICT AND FUTURE MEDICAL EXPENSES
ELLISON (NELLIE) VS. KENTUCKY FARM BUREAU MUTUAL INSURANCE COMPANY , ET AL.
OPINION AFFIRMING
ACREE (PRESIDING JUDGE)
CAPERTON (CONCURS) AND THOMPSON (CONCURS)
2009-CA-000116-MR
NOT TO BE PUBLISHED
FLEMING

ACREE, JUDGE: Nellie Ellison appeals three decisions of the Fleming Circuit Court. First, she asserts the circuit court improperly granted summary judgment in favor of the Fleming County Little League. Second, she claims the circuit court erred by granting summary judgment in favor of Kentucky Farm Bureau Mutual Insurance Company. Lastly, she asserts the circuit court erred by entering a directed verdict in favor of the remaining defendant and refusing to instruct the jury as to future medical expenses. We affirm.

On July 9, 2005, a physical altercation erupted between Andrew Jones, then president of the Fleming County Little League, and Nellie Ellison, grandmother of a little league softball participant. As a consequence of the altercation, the Commonwealth of Kentucky filed criminal charges against Jones who pleaded guilty to first-degree wanton endangerment and fourth-degree assault. Ellison subsequently filed her complaint in this civil action in December of 2005. Ellison sought recovery from Jones, but also from the Fleming County Little League.
The cause of action against the Little League initially alleged that it failed to provide adequate security. However, she replaced this claim in an amended complaint and alleged negligent employment and/or retention of Jones as Little League President. On August 8, 2008, the circuit court entered summary judgment in favor of the Little League.

The action against Jones went to trial and the jury returned a verdict in favor of Ellison. The only issue arising from the trial is whether it was proper for the circuit court to refuse to instruct the jury as to future medical expenses and instead granting directed verdict on that issue.

Ellison asserts the Little League negligently hired and retained Jones as president. There is considerable question as to whether Jones was an employee given that he was an uncompensated volunteer selected by Little League parents to serve on the board of directors, and by the board to head the league. Nevertheless, Even if he is considered an employee for purposes of our review, Jones? actions were not foreseeable.

An employer?s liability for negligent hiring and retention is based on the employer?s negligence in failing to exercise reasonable care in the selection and hiring of its employees. Ten Broeck Dupont, Inc. v. Brooks, 283 S.W.3d 705, 732 (Ky. 2009). Thus, Ellison must establish that the Little League owed her a duty of care, that the duty was breached as a result of the Little League?s hiring and retention of Jones, and that the breach of that duty caused her injury.
The primary issue here is whether the Little League owed a duty to Ellison. Ellison asserts the existence of a universal duty of care that required the Little League to protect her from Jones? actions.

We agree with the circuit court that Ellison?s injuries were not foreseeable. ?Foreseeability is to be determined by viewing facts as they reasonably appeared to the party charged with negligence, not as they appear based on hindsight.? James v. Wilson, 95 S.W.3d 875, 891 (Ky.App. 2002).

* * *

The circuit court determined that Jones? Farm Bureau homeowner?s policy did not extend coverage to damages resulting from the altercation between Jones and Ellison. The circuit court reasoned that Ellison?s harm was either intended or expected and coverage was excluded under the policy. As noted above, the decision of the circuit court is reviewed de novo.

The Farm Bureau policy extends coverage to bodily injury caused by an ?occurrence.? An ?occurrence? requirement, there is also an applicable exclusion. Specifically, the policy does not apply to bodily injury that is ?intended.? Therefore, the policy only covers occurrences (accidents) that are not intended.?occurrence? is defined as an ?accident.?ones? actions were clearly not an ?accident? and the criminal conviction and award of punitive damages in this case refute the legitimacy of Jones? claim of self-defense. Thus, it was not necessary to submit the issue of self defense to the jury and coverage is excluded.

* * *

Ellison?s claim against Jones was the only cause of action that proceeded to trial. The circuit court concluded that Ellison failed to present sufficient evidence on the issue of future medical expenses and entered a directed verdict. Ultimately, the jury returned a verdict awarding Ellison $60,298.29 for past medical expenses, $20,000 for past and future pain and suffering, and $150,000 in punitive damages. Ellison now asserts that the circuit court?s directed verdict and prohibition on an instruction for future medical expenses was in error. She avers that the jury should have been allowed to consider the requested $7,900 of future medical expenses.

The only evidence of future medical expenses came via the testimony
of Dr. Lawson, Ellison?s treating physician. Dr. Lawson indicated that Ellison suffered multiple fractures in her face including a broken nose, septum, and permanent nerve damage. Ellison had to have reconstructive surgery to repair her jaw, nose, and eye socket at a cost of $7,900. However, when asked if Ellison would require future surgeries Dr. Lawson indicated that there was ?no way to know? and he ?had no idea what might happen in the future.?
Evidence of future medical expenses must be ?positive and satisfactory.? Howard v. Barr, 114 F. Supp. 48, 50 (W.D.Ky. 1953). Speculation and supposition are insufficient to justify submission of a case to the jury. Chesapeake & Ohio Ry. Co. v. Yates, 239 S.W.2d 953, 955 (Ky. 1951). If a physician testifies that he does not know the need, length, or cost of future medical expenses then no instruction should be given. See Walton v. Grant, 302 Ky. 194, 199, 194 S.W.2d 366, 368 (1946)(where doctor had no way of anticipating the cost, need, or length of future medical treatment, there was no evidence to warrant a finding for future medical bills), overruled on other grounds by Rankin v. Green, 346 S.W.2d 477 (Ky. 1960); see also Terminal Railroad Co. v. Mann, 312 S.W.2d 451, 454 (Ky. 1958)(physician?s testimony that boy would need the services of a companion from time to time for the rest of his life was insufficient). The trial court correctly prevented the jury from engaging in speculation by granting the directed verdict as to future medical costs.
For the foregoing reasons, we affirm.

671. WORKERS COMP
PALM BEACH COMPANY VS. TARTAR (NORMA), ET AL.
OPINION AFFIRMING
DIXON (PRESIDING JUDGE)
KELLER (CONCURS) AND LAMBERT (CONCURS)(SENIOR STATUS JUDGE)
2009-CA-002309-WC
NOT TO BE PUBLISHED
WORKERS' COMP

DIXON, JUDGE: Palm Beach Company seeks review of a decision of the Workers? Compensation Board. The Board affirmed an ALJ?s order sustaining a medical fee dispute in favor of Palm Beach?s former employee, Norma Tartar. Finding no error, we affirm.

Full post as published by Kentucky Cases on July 25, 2010 (boomark / email).