Kentucky Court Report - SCOKY & COAKY

Stds of Review: Disability Retirement Benefits

From, West v. Kentucky Retirement System, COA, NPO, 7/15/2011

Upon review of the denial of disability retirement benefits, we accept the agency’s findings of fact as true as long as they are supported by substantial evidence. Bowling v. Natural Resources and Environmental Protection Cabinet, 891 S.W.2d 406 (Ky. App. 1995). Substantial evidence is such evidence as would “induce conviction in the minds of reasonable [persons].” Owens-Corning Fiberglas Corp. v. Golightly, 976 S.W.2d 409, 414 (Ky. 1998). Where it is determined that the agency’s findings are supported by substantial evidence, the court must then ask whether the agency has correctly applied the law. Kentucky
Unemployment Insurance Commission v. Landmark Community Newspapers of Kentucky, Inc., 91 S.W.3d 575, 578 (Ky. 2002). A reviewing court may also reverse a final order of an administrative agency, in whole or in part, where it is found that the agency’s order violates statutory or constitutional provisions, is in excess of the agency’s authority as granted by statute, or is deficient as otherwise provided by law. KRS 13B.150(2).

Open Records Requests and Disclosure to Parties in Litigation

The following SCOKY decision addressed open records requests by parties involved in litigation:

Department of Revenue, Finance and Administration Cabinet, Commonwealth of Kentucky, et al. v. Mitzi D. Wyrick

2008-SC-000468-DG October 21, 2010 2009-SC-000543-DG October 21, 2010

Opinion of the Court by Justice Schroder.  All sitting; all concur.  The Supreme Court interpreted the “civil litigation limitation” to the Open Records Law, found in KRS 61.878(1).  The Court held that a request for open records should be evaluated independently of whether the requester is a party or potential party to litigation.  The civil litigation limitation applies only to documents otherwise excluded from disclosure by KRS 61.878(1)(a)-(n).  It is not an exception to an agency’s duty to disclose nonexempted records.  A court of competent jurisdiction, upon request, may grant disclosure of documents excluded from disclosure under KRS 61.878(1)(a)-(n) with one qualification:  if the document pertains to civil litigation, the court cannot order disclosure beyond that which is provided by the Rules of Civil Procedure governing pretrial discovery.

CIVIL (INTERNET DOMAINS): Commonwealth of Kentucky, ex rel. J. Michael Brown, Secretary, Justice & Public Safety Cabinet v. Interactive Media Entertainment & Gaming Assn., Inc., et al. (SC 3/18/2010)

Commonwealth of Kentucky, ex rel. J. Michael Brown, Secretary, Justice & Public Safety Cabinet v. Interactive Media Entertainment & Gaming Assn., Inc., et al.
2009-SC-000043-MR March 18, 2010 Opinion by Justice Noble. All sitting; all concur.

Petitioners filed for a writ from the Court of Appeals to stop Commonwealth from seizing the Internet domain names of gambling websites. The Court of Appeals granted the writ after concluding that the circuit court was acting outside its jurisdiction. The Supreme Court reversed the Court of Appeals, holding petitioners lacked standing to challenge the forfeiture. Some of the counsel for petitioners claimed to represent the domain names themselves. The Court held that in in rem litigation such as this, only those with an interest in the property have an interest in the litigation. Since the property can have no interest in itself, it had no interest in contesting the forfeiture.

Furthermore, the Court held that two gaming trade associations who purported to represent the remaining petitioners also lacked standing. The Court noted that these trade associations have standing only if its members could have sued in their own right. Since neither trade association would identify which domain name registrants it claimed to represent, the Court held the associations could not meet their burden of showing they had standing. The Court declined to reach the merits of the case and remanded to the Court of Appeals with instructions to dismiss the petition for a writ.

GOVERNMENT (whistleblower): Northern Kentucky Area Planning Commission v. Cloyd (COA 1/15/2010)

Northern Kentucky Area Planning Commission v. Cloyd
2008-CA-001104 01/15/2010 2010 WL 134592

Opinion by Judge Acree; Judge Lambert and Senior Judge Harris concurred. The Court affirmed in part and reversed in part orders of the circuit court denying motions for summary judgment on appellee’s claims that he was wrongfully discharged by his supervisor and the area planning commission in violation of Kentucky’s Whistleblower Act, KRS 61.101-61.103; in violation of two provisions of the state building code - 198B.130 and KRS 198B.140; and for the tort of public policy wrongful discharge. The Court first held that the area planning commission was a political subdivision of the Commonwealth and as such, was an employer for purposes of the Whistleblower Act. Therefore, the circuit court properly denied the commission’s and supervisor’s motion for summary judgment on that claim. The Court next held that the trial court erred in denying the motion for summary judgment on the other claims because the commission was entitled to governmental immunity because of its parent body and functions and the supervisor derived official immunity from his status with the commission.

GOVERNMENT - Ethics: Turbyfill v. Executive Branch Ethics Commission (COA 11/20/2009)

Turbyfill v. Executive Branch Ethics Commission
2008-CA-001394 11/20/09 2009 WL 3878046

Opinion by Judge Wine; Judges Nickell and Thompson concurred.

The Court affirmed an order of the circuit court denying appellant’s petition for judicial review and declining to order dismissal of administrative proceedings opened by the Kentucky Executive Branch Ethics Commission (EBEC) for the purpose of sanctioning appellant. Although, appellant had been previously pardoned by the Governor, the EBEC filed “Allegations of Violations” in which it sought to fine appellant and publicly reprimand him for violating KRS 11A.020. The Court held that the allegation that appellant violated KRS 11A.020 was not criminal in nature and was collateral to the criminal proceedings for which he was pardoned. Therefore, the EBEC proceedings were not subject to the pardon.

The Court further held that the statutory scheme was not so punitive in purpose or effect so as to transform it into a criminal penalty. The Court rejected appellant’s argument that the pardon could not preclude civil actions by private individuals but could preclude civil actions by a state agency seeking to enforce violations of state law. First, because the EBEC proceeding was a collateral civil action, the pardon could not preclude its action. Second, the language of the pardon itself did not purport to include EBEC administrative actions.

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.

PROPERTY - KRS 67.0802 exchanges w/federal gov't: Southside Real Estate Developers, Inc. v. Pike County Fiscal Court (COA 9/4/2009)

Southside Real Estate Developers, Inc. v. Pike County Fiscal Court
2008-CA-001534 9/4/09 2009 WL 2835138 Released for pub.

Opinion by Judge VanMeter; Judges Lambert and Moore concurred. The Court affirmed an order of the circuit court finding that a county fiscal court’s failure to comply with the requirements of KRS 67.0802 in its decision to exchange property conveyed to it from the federal government, after completion of a flood control project prevented appellant from maintaining an action to compel conveyance of the property from the fiscal court.

The Court first held that the trial court properly concluded that the decision to exchange the property did not comply with statute, which required either a transfer to another governmental agency or a public sale by auction or sealed bid. The Court then held that the requirements of the statute were not preempted by federal law so that the only requirement for transfer of the property would be the approval of the federal government. The Energy and Water Development Appropriation Act, under

which the flood control project was initiated, did not manifest Congressional intent to preempt state requirements on the transfer of real estate owned by counties; no express preemption existed; and compliance with both federal and state requirements concerning the transfer of real property was not physically impossible.

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.

GOVERNMENT IMMUNITY - Lexington Airport Authority coverered by gov't immunity for Comair crash negligence: Comair, Inc.; and Comair Services, Inc. v. Lexington-Fayette urban County Airport Corporation et. Al (SC 10/1/2009)

Comair, Inc.; and Comair Services, Inc. v. Lexington-Fayette urban County Airport Corporation et. Al
2007-SC-000602-TG October 1, 2009
Opinion by Justice Noble. All sitting; all concur.

The estates of persons killed in a commercial airplane crash sued Comair, the flight operator. Comair then filed a third-party complaint against the Lexington-Fayette Urban County Government Airport Board, the LFUCG Airport Corporation and members of the board in their official capacities alleging negligence in operation of the airport where the accident occurred. The circuit court granted the third-party defendants motion to dismiss, holding they were entitled to immunity. Comair appealed and the Supreme Court transferred the case to its docket from the Court of Appeals.

The Court affirmed, holding that the airport board and airport corporation were both agencies of the LFUCG, exercising a function integral to state government by providing essential transportation infrastructure—and thus immune from suit. In reaching this decision, the Court moved away from the two-pronged test for sovereign immunity set forth in Berns (1: direction and control by central state government; 2: supported by funds from the state treasury).

The Court concluded the Berns test was overly simple and limiting and that it did not lend itself to analyzing municipal entities. Instead, the Court held a preferable approach is a case-by-case analysis of a) the origins of the organization seeking immunity (i.e. state, county, municipal) to determine the level of immunity enjoyed by the “parent” entity; and b) whether the organization exercised a function integral to state government. The Court rejected Comair’s argument that the airport board was engaged in a purely proprietary function—distinguishing providing transportation services from providing transportation infrastructure (terminals, runways, etc.). The Court concluded that the latter was a “quintessentially governmental function.”

GOVERNMENT IMMUNITY - Gov't vs. proprietar function re housing provided to mainentance person working for school board: Breathitt County Board of Education v. Dot Prater (SC 8/27/2009)

Breathitt County Board of Education v. Dot Prater
2008-SC-000041-DG August 27, 2009
Opinion by Justice Abramson; all sitting.

As part of her compensation for providing security and maintenance services at an elementary school, the school board allowed an employee to live in a house located on school grounds. Prater was visiting the employee at the house when she suffered a permanent injury. Prater sued the school board, alleging negligence in the maintenance of the house. The board moved for dismissal, claiming it was absolutely immune from damage claims brought in court. The trial court denied the motion on the grounds that the board’s maintenance of the house served a proprietary function rather than a governmental function.

The Supreme Court noted that denials of motions to dismiss are typically not final and thus not subject to appellate review. However, since immunity is meant to shield its possessor not just from liability, but from the costs and burdens of litigation as well, a denial of immunity is subject to interlocutory appeal. The Court also concluded that the board’s furnishing of a residence was a governmental function because it furthered the board’s educational mission and was thus within the scope of governmental immunity.

Justice Venters dissented, taking the position that “maintaining the personal, private house for the use of a school maintenance worker and her social guests has nothing to do with the school district’s educational mission.”