Kentucky Court Report - SCOKY & COAKY

TORTS: Bohl v. City of Cold Spring (COA 11/13/2009)

Bohl v. City of Cold Spring
2008-CA-002162 11/13/09 2009 WL 3786633

Opinion by Senior Judge Lambert; Judges Nickell and VanMeter concurred.

The Court affirmed a summary judgment in favor of the appellee city on appellant’s claims for disability discrimination, retaliation, constructive discharge, intentional infliction of emotional distress (IIED), and disability harassment. The Court ultimately held that summary judgment was properly granted.

In reaching that conclusion the Court first held that the trial court correctly granted summary judgment on appellant’s disability discrimination claim. Although appellant made a prima facie showing that he was “otherwise qualified” to perform his job when he produced evidence that he continued to perform his job to the satisfaction of the employer after he was diagnosed with multiple sclerosis (MS) and that he suffered an adverse employment action due to the disability when he was removed from his shift as detective, he failed to provide any proof that the city’s explanation that it had a legitimate business purpose in acting for the safety of appellant, other police officers and the community, in removing appellant from his shift was false.

The Court next held that summary judgment on the IIED claim was proper because the IIED claim was subsumed by the KRS Chapter 344 claims of disability discrimination, retaliation and disability harassment.

The Court next held that summary judgment was proper on the retaliation claim when appellant failed to overcome appellee’s proof that it had a legitimate, non-discriminatory reason for its actions.

The Court next held that the trial court properly granted summary judgment on the disability harassment claim because the actions complained of did not create a pervasive abusive work atmosphere.

The Court finally held that the trial court properly granted summary judgment on the claim for constructive discharge because the conditions complained of were not intolerable and did not compel appellant’s resignation.

EMPLOYMENT: Teco Mechanical Contractor, Inc. (COA 11/20/2009)

Teco Mechanical Contractor, Inc.
2008-CA-000305 11/20/09 2009 WL 3877578
Opinion by Judge Keller; Judge Nickell and Senior Judge Lambert concurred.

The Court affirmed in part, and vacated in part and remanded, a summary judgment upholding the constitutionality of portions of KRS Chapter 337 and assessing back wages and civil penalties against the appellant contractor.

The Court first held that although the trial court cited to the wrong review process, it reached the correct conclusion that the Act provided a process for aggrieved parties to be heard.
The Court then held that although the Act did not specifically provide for the filing of a direct action in circuit court by an aggrieved party, that right was inherent that aggrieved parties could file an original action in circuit court, not an appeal from an administrative adjudication. Therefore, from a due process standpoint, the Act was constitutional.

The Court next held that the Act did not improperly delegate judicial power to the Cabinet as the Cabinet was performing an administrative function when it issued citations or sought back wages for employees. Further, KRS 337.505(1) and KRS 337.520(3) did not leave the Cabinet with unfettered discretion regarding job classifications. Even so, because the Act provided for judicial review of the Cabinet’s actions, even if the Cabinet were exercising judicial authority, there was a sufficient safeguard against abuse of discretion.

The Court next held that the trial court used the incorrect standard of review. Because appellant did not receive a full hearing at the Cabinet level, the court should have reviewed the matter de novo.

The Court next held that on remand the trial court must review de novo the Cabinet’s use of the “work incident to a trade” method to classify employees to determine whether or not it was reasonable. Although, the Court rejected appellant’s argument that the method ran afoul of statutes requiring certain tradesmen to be licensed because the legislature did not tie payment of various wage rates to licensing.

The Court finally held that the Cabinet’s audit reports were generated with the intent to make a case against appellant and although they did not contain quotes, statements, or opinions of third parties, they were based on information obtained from employees. As such the audit forms amounted to inadmissible hearsay as to the employees who did not testify.

EMPLOYMENT - Kentucky Disability Retirement: Kentucky Retirement Systems v. Robb (COA 11/25/2009)

Kentucky Retirement Systems v. Robb
2009-CA-000437 11/25/09 2009 WL 4060881

Opinion by Judge Dixon; Judges Clayton and Thompson concurred.

The Court affirmed a decision of the circuit court reversing a decision of the Kentucky Retirement Systems denying an employee’s application for disability retirement. The employee preschool bus driver was unable to renew her Commercial Driver’s License because of mobility issues related to bilateral osteoarthritis of the knees. The Court held that, although the trial court may have exceeded the scope of its review, the evidence compelled a decision in the employee’s favor. The Court concluded that obesity could not constitute a pre-existing condition to preclude retirement disability benefits when there was no evidence that the worker suffered osteoarthritis of the knees prior to her employment. Thus, the evidence compelled a finding that the employee did not suffer a pre-existing condition and that she was physically incapacitated from performing her job or a job of like duties.

CONTRACTS - Public employment: Waters v. City of Pioneer Village (COA 11/20/2009)

Waters v. City of Pioneer Village
2008-CA-000837 11/20/09 2009 WL 3877596
Opinion by Judge Clayton; Judges Moore and VanMeter concurred.

The Court affirmed an order of the circuit court granting a judgment to the appellee city on its claim against appellant for breach of an employment contract.

The Court first held that KRS 70.290, which allows a law enforcement agency to require a newly appointed officer to enter into an employment contract for no longer than three years from the date of graduation from the Criminal Justice Training Academy, did not prohibit the city from seeking repayment of the amounts owed under the contract. The statute did not provide the sole means of reimbursement to the City for expended training costs. While the statute placed a duty on an agency to pay the agency that paid for the training, it did not place a duty on the first agency to obtain the payment from the second.

The Court then held that because the City was entitled to be reimbursed under the employment contract, rather than under the statute, the amount recovered was properly calculated pursuant to the contract.

EMPLOYMENT - Whistleblower Act: Powers v. Lexington-Fayette Urban County Government (COA 10/30/2009)

Powers v. Lexington-Fayette Urban County Government
2008-CA-000081 10/30/09 2009 WL 3486423
Opinion by Judge Acree; Chief Judge Combs and Senior Judge Buckingham concurred.

The Court affirmed a judgment of the circuit court entered pursuant to a jury verdict in favor of an employer on an employee’s claim that her employment was terminated in violation of the Whistleblower Act, KRS 61.101 et seq. On cross-appeal, the Court first held that the employer was not entitled to a directed verdict as appellant reported a co-worker’s alleged violations to her own agency, which was an appropriate authority under the statute. On direct appeal, the Court then held that the evidence that appellant’s employment was terminated because her services were no longer needed was sufficient to support the jury verdict finding that her whistleblowing activity was not a material factor in the decision to terminate her employment. Therefore, the trial court did not err in denying appellant’s motions for directed verdict and judgment notwithstanding the verdict. The Court finally held that because the jury’s verdict was supported by substantial evidence, the denial of appellant’s motion for a new trial was not clearly erroneous.

EMPLOYMENT - Ky Civil Rights Act, discrimination, prima facie case: Woods v. Western Kentucky University (CA 9/11/2009)

Woods v. Western Kentucky University
2008-CA-001825 9/11/09 2009 WL 2901520 DR pending

Opinion by Judge VanMeter; Judges Keller and Stumbo concurred. The Court affirmed a directed verdict in favor of Western Kentucky University on appellant’s claim that the change in the qualifications for a director’s position for which she applied was racially motivated in violation of the Kentucky Civil Rights Act (KCRA).

The Court held that under the burden-shifting approach of McDonnell Douglas Corp. v. Green, 411 U.S. 702, 93 S.Ct. 1817, 36 L.Ed.2d 668 (1973), and Kentucky Ctr.For the Arts v. Handley, 827 S.W.2d 697 (Ky. App. 1991), appellant was unable to meet the burden of establishing a prima facie case of discrimination. She was objectively unqualified for the position since she did not possess a doctorate degree or faculty experience at the time she applied. Even so, the University offered legitimate, nondiscriminatory reasons for changing the qualifications. Appellant’s own opinions about her work qualifications did not sufficiently cast doubt on the reasons proffered by the University.

EMPLOYMENT - Workers compesation, retaliatory discrimination, attorneys fees: Colorama, Inc. v. Johnson (COA 9/4/2009)

Colorama, Inc. v. Johnson

2008-CA-000443 9/4/09 2009 WL 2834950 Released for pub. Opinion by Judge Caperton; Judges Thompson and Wine concurred. The court affirmed a judgment entered subsequent to a jury verdict finding that the employer retaliated or discriminated against a worker for filing a workers’ compensation claim

The Court first held that the worker met his burden to establish a prima facie case of discrimination Filing the workers’ compensation claim was an activity expressly protected under KRS 342.197, the employer knew that he had done so, the jury’s factual finding that the worker was terminated was not clearly erroneous, and the worker presented sufficient evidence for the jury to believe he was terminated in retaliation for seeking workers’ compensation benefits. The Court distinguished the case from Wymer v. JH Properties, Inc., 50 S.W.3d 195 (Ky. 2001), because the worker in the instant case was released to return to work without restriction, he said he wanted to try to perform the work and he may have been able to assume a light duty position. While the evidence might have been conflicting, it was for the jury to weigh the evidence and reach a conclusion. Therefore, the Court did not err in denying the employer’s motion for a directed verdict. The Court finally held that the award of attorney fees and costs were authorized by KRS 342.197(3) and the trial court did not abuse its discretion in making the award. Even so, the employer’s failure to name the worker’s attorney as a party to the appeal ultimately precluded review of the issue.

GOVERNMENT CONTRACTS - Firefighters, collective bargaining agreement: Metro Louisville/Jefferson County Government v. Abma (COA 9/4/2009)

Metro Louisville/Jefferson County Government v. Abma
2007-CA-001417 9/4/09 2009 WL 2837355 Rehearing pending

Opinion by Judge Nickell; Judges Acree and Senior Judge Knopf concurred.

The Court affirmed in part and vacated in part and remanded orders of the circuit court related to breach of contract claims by two groups of firefighters against the City of Louisville.

The Court held that the trial court properly granted summary judgment to the firefighters after finding that the City breached its contract with the union. The Court first held that the firefighters could maintain a contract action separate from their wage and hour complaint. Although the wage and hour law filled any gaps in the Collective Bargaining Agreement (CBA), the City’s obligation to pay overtime was stated in the CBA negotiated between the City and the union. The Court then held that the trial court correctly found that the City had breached the CBA based on the CBA language, the intent of the parties under the CBA and well-settled caselaw. The Court next held that the judgment was not interlocutory. While the judgment reserved some issues for the taking of proof or later determination, it did specify the formula the City was to use in calculating the additional overtime pay. Further, by certifying the judgment as final on some but not all of the pending issues, the trial court enabled the City to perfect an appeal and to proceed in calculating damages. The Court also held that the firefighters could recover damages under both the contract and wage and law causes of action but that they could not recover twice for the same damage. The Court next held that the applicable statue of limitations was 15 years, as provided in KRS 413.090(2) for actions on written contract, not five years under KRS 413.12(2) for statutory violations, as the underlying cause of action was for breach of contract. The Court next held that although sovereign immunity could be asserted for the first time on appeal, the defense could not be asserted by the newly merged government to avoid a contractual obligation resulting from an agreement entered into by one of its predecessors.

ADMINISTRATIVE LAW - Gov't disability retirement and workers compensation benefits: Mitchell Metzinger v. Kentucky Retirement Systems, et al. (SC 8/27/2009)

Mitchell Metzinger v. Kentucky Retirement Systems, et al.
2007-SC-000363-DG August 27, 2009
Opinion by Justice Scott. All sitting; all concur.

Metzinger, an electrician employed by the city of Louisville, was injured on the job. He applied for disability retirement and workers’ compensation benefits and filed a civil suit against the tortfeasor--Louisville Gas & Electric. As part of a global settlement, LG&E and the city agreed to purchase an annuity for Metzinger. Later, when Kentucky Retirement Systems calculated Metzinger’s monthly disability retirement award, it reduced the award by the amount on the monthly annuity payment. Metzinger objected, but the award was upheld by the Board, the circuit court and the Court of Appeals. On appeal, Kentucky Retirement Systems argued that KRS 61.607 permits it to take into account monthly workers’ compensation benefits therefore, any payments that were voluntarily exchanged for a right to payment to monthly workers’ compensation benefits should also be taken into account.

The Supreme Court reversed, holding that Kentucky Retirement Systems’ interpretation of the statute was contrary to its plain language. The Court noted that if the General Assembly has intended to broaden the scope of the agency’s consideration of workers’ compensation benefits under KRS 61.607, it could have done so.

UNEMPLOYMENT INSURANCE - Leaving employment voluntarily and early retirement: Les Brownlee, Acting Secretary, U.S. Dept. of the Army; and United States of America v. Commonwealth of Kentucky, Unemployment Insurance Commission; et al. (SC 6/25/2009)

Les Brownlee, Acting Secretary, U.S. Dept. of the Army; and United States of America v. Commonwealth of Kentucky, Unemployment Insurance Commission; et al.
2007-SC-000126-DG June 25, 2009
Opinion by Justice Noble. All sitting; all concur.

In 2002, the Army decided to hire a private contractor to perform the job functions of 160 civilian employees. These employees were offered continued employment for the following year and a half with no guarantees after that. Alternatively, employees were offered an early retirement package, which included a $25,000 incentive payment. The Appellees in this case were all employees who accepted early retirement and then sought unemployment benefits. The benefits were initially denied, but the employees prevailed on appeal before the KUIC, Circuit Court and Court of Appeals.

The Supreme Court reversed, noting the general rule that employees who leave employment voluntarily cannot receive unemployment benefits except upon “good cause attributable to the employment.” In Murphy, the Court defined the phrase to mean “circumstances so compelling as to leave no reasonable alternative but loss of employment.” The Court observed that Murphy had been applied inconsistently in the past and held that a showing of “good cause attributable to the employment” must amount to constructive discharge for the claimant to prevail. The Court held Appellees’ voluntary decision to leave employment with the Army did not amount to “good cause attributable to the employment,” therefore they were not entitled to unemployment benefits.