Kentucky Law Review

CIVIL: "Forum Non Conveniens Again?"

An inconvenient truth may be a problem, but an incovenient forum runs the risk of a lost cause.  Here is a post from the Kentucky Tort and Insurance Law Blog by Edward Brutscher digesting and analyzing a recent Kentucky Supreme Court decision.  Click on the heading for his entire post and commentary.  Fortunately for the injured plaintiff, the Kentucky Supreme Court applied the Kentucky savings statute to save a cause of action dismissed for forum non conveniens. 

Forum Non Conveniens Again?
The Supreme Court has published Dollar General Stores, Ltd. v. Smith, another case dealing with the little known and seldom used doctrine of forum non conveniens. The court had previously held that the savings provision of KRS 413.270 applied to save cases filed in the improper venue, as well as, those filed in the wrong jurisdiction. The Court had not previously decided whether the savings statute applied when the case was dismissed on the grounds of forum non conveniens from a proper venue. The Court believed this issue was before them. . . .

Chief Justice Lambert writing for the majority applied the savings statute (KRS 413.270) to save the claim and toll it so that it was not barred as untimely filed in the proper jurisdiction. 

With the enactment of KRS 452.105, the General Assembly made it clear that venue should be transferred in a proper case, and that the action should not be dismissed. We now hold that the same rule applies where the trial court determines that another forum would be a more convenient place for the litigation.

Newly-appointed Justice Abramson perplexingly straddled the fence on this one by concurring in the result (not wishing to penalize the claimant for her counsel's "overly broad reading of the saving statute") but siding with the analysis of the dissenting opinion by Justice Minton who read the statute more narrowly and making distinctions between venue and jurisdiction being outcome determinative in this situation.

I concur in the result reached by the majority only because I agree that we ought not to penalize the plaintiff, Mabel Smith, for her counsel's reliance on the overly broad reading of the saving statute, KRS 413.270, which the Sixth Circuit Court of Appeals propounded in Shircliff v. Elliott. 384 F.2d 947 (6' Cir. 1967), and which this State's highest Court suggested in D. & J. Leasing, Inc. v. Hercules Galion Products, Inc., 429 S .W .2d 854 (Ky. 1968). I agree with Justice Minton, however, that that broad reading does not comport with the statutory language, and so henceforth would limit application of KRS 413.270 and KRS 452.105 to the circumstances the General Assembly has specified . In short, the dissent reflects what I believe is the correct interpretation of the two statutes.

Although Justices Minton and Abramson would make up at least two who would not prospectively apply the holding in this case, they are clearly in the minority as Justices Cunningham, Minton, Scott, and Schroder joined the Chief Justice in both the result and the analysis.

SCOKY CASES: Court with Proper Venue without Dismissing.

Lawreader discusses SCOKY decision on venue and SOL decided Nov. 2:

Court with Proper Venue without Dismissing.A case decided by the Ky. Supreme Court on Nov. 1, 2007 deals with situations where a statute of limitations has tolled and subsequently the court in which the case is pending rules that the venue is improper.  In Dollar Genera v. Smith, . . . .

More on "COA NPO Decision re: Sanctions for Failure to Attend Mediation by Agreement seem flawed in light of no agreement"

We previously posted on the not for publication Court of Appeals decision affirming a trial judge's sanctions charging a pro se litigant the cost of a mediator when the litigant did not tell the other side he was not coming.

Although the legal issues remain unchanged, the facts are a little more interesting if not perplexing since the "pro se" litigant was actually a retired attorney involved in the client!  Thus the appellate decision's silence on this must mean the failure to notify rests with the litigant and not his counsel.

Here is the report from the Kentucky Trial Court Review on the underlying trial (compliments of Shannon Ragland, editor).  The plaintiff's claim for "interstate flim-flamming" did not survive a motion to dismiss.

3233 - Auto Negligence - In a significant lane incursion crash, a Louisville jury rejected the claim of a pro se attorney
Sullivan v. Anderson, 05-3500
Plaintiff:    Pro se
Defense:    Curt L. Sitlinger, Sitlinger
McGlincy Theiler & Karem, Louisville
Verdict        Defense verdict on damages
Circuit:    Jefferson, J. Mershon, 2-1-06

It was 9-22-04 and Ralph Sullivan, an elderly retired attorney, traveled on Preston Highway near the Liquor Palace – suddenly a vehicle driven by Antoinette Anderson struck his vehicle, encroaching his lane.  The impact resulted in moderate damage to Sullivan’s 80's era Ford sedan.  Fault was no issue.

At the scene of the crash, Sullivan was gravely injured – he recalled that his heart came to a stop.  Sullivan fortunately was able to resuscitate himself by pounding on his chest.  His heart now beating again solidly, Sullivan did not seek any medical treatment.

That however was not the end of his turmoil.  He has since complained of emotional suffering and has been afraid to drive.  When he appeared downtown for a deposition, to avoid driving, he even rode the bus. 

In this lawsuit, Sullivan sought to recover losses associated with the wreck.  That included: (1) a damaged coat valued at $150, (2) his license and registration that were lost – $15.00, (3) property damage to the car of $2,100, and finally (4) $90,000 for his pain and suffering. [There were no medical bills.]

Beyond his claim against Anderson, he also sought to impose fault against her passenger.  It was Sullivan’s argument that the passenger had engaged in a joint enterprise with Anderson – the passenger and Anderson were then on the way to Gold’s Gym.  The court rejected this argument and the passenger was dismissed.  Sullivan also raised an unusual count, arguing that the defendant had engaged in the tort of interstate flim-flamming.  The flim-flamming count did not go to the jury.  Anderson defended the case and minimized the claimed injury. 

Anderson conceded fault and the jury only considered damages – it elected to award Sullivan nothing for every claimed element.  Sullivan subsequently sought a new trial, calling the award inadequate, particularly in light of the vehicle damage.  Motion denied.

The court has also since assessed him with costs associated with missing a mediation.  Sullivan protested vehemently that he only agreed to a mediation if retired judge Thomas Knopf presided – when Knopf was unavailable, the deal was off and thus there was no obligation for him to attend.

And here is our earlier post - COA NPO Decision re: Sanctions for Failure to Attend Mediation by Agreement seem flawed in light of no agreement.

COA NPO Decision re: Sanctions for Failure to Attend Mediation by Agreement seem flawed in light of no agreement

Upon further reflection (and getting a lesson on Contracts 101), I must confess I have some additional problems with the Court of Appeals nonpublished decision in Sullivan v. Anderson rendered Apr. 20, 2007 which is an example of bad facts, bad reasoning, and bad law.  See, COA affirms trial court's award of mediation fees for party failing to attend (NPO COA Decision).

Although I believe there should be some sanctions regarding behavioral issues in mediation which are objective and do not go to the privileged and evidentiary aspects of the mediation, the Sullivan case should not serve as the "poster child" for this point since there never was an "agreement" to mediate in the first place.  Once there is an agreement (be it mutual or court-ordered), then the parties, counsel, and adjuster with settlement authority present and available and not by telephone.

In Sullivan v. Anderson, a pro se plaintiff was facing an insurance defense lawyer representing the defendant.  As most lawyers have experienced, it is much easier to try a case against a competent, qualified, and professional attorney, and when the other side is representing themselves pro se and are not an attorney, then it can get real difficult.  There is a reason lawyers spend seven years in college and law school, plus pass a difficult bar examination, for the honor and privilege of practicing in this profession.  Not to mention years of practice honing their craft in and out of courtrooms.

The pro se non-lawyer litigant is in a legal minefield of deadlines, traps, and other rules which can sink his case, even with some judges who have even bent over backwards to balance the playing field.

However, in Sullivan, things went awry when a trial judge holds a pro se litigant liable for costs of a mediator attending a mediation that the pro se litigant had not even agreed to!

Here are the facts per the COA opinion:

At the pretrial conference in the matter, the trial court recommended that the parties  mediate. To that end, Anderson attempted to arrange a mediation; Sullivan agreed that he would mediate only under certain conditions, including that the mediator be Tom Knopf. Anderson's attorney thereafter wrote Sullivan, indicating that Knopf was not available to mediate until after the parties'  cheduled trial date but that he had scheduled mediation with another mediator on January 5. As Sullivan neither attended the mediation nor informed Anderson that he objected to mediation or would not attend, Anderson moved the court to award her the costs she incurred as a result of the canceled mediation, as well as the mediator's costs.

Here is an extract from the COA opinion authored by Judge Vanmeter and with Chief Judge Combs and Judge Dixon in agreement:

We [COA] agree with Sullivan and the trial court that Sullivan was not obligated to attend the mediation since it was not ordered by the court. However, Anderson [other party] did not have any reason to know that the parties had not agreed on mediation since Sullivan did not inform her that he did not agree to the arranged mediator and mediation date.

The fallacy in Judge Vanmeter's reasoning is that in the absence of an acceptance or some proof of the existence of an agreement, then what was it that Anderson based her reason that the parties HAD AGREED to mediation?   

An unanswered or ignored letter announcing mediation does and an ex parte selection of your mediation do not an agreement make;  nor is there an acceptance upon deviation of the terms of an offer. 

Sullivan had agreed to mediation with Tom Knopf;  another mediator by any other name is not Tom Knopf (in will not smell as sweet to Sullivan).  Thus no agreement, no meeting of the minds, and no acceptance of the terms of the mediation.

Interestingly enough, another panel of our Court of Appeals took a stricter interpretation of the fine art of communication in Malone v. KFBM within the context of a "Coots" notice under KRS 304.39-320 regarding a claimant's intent to accept an offer of the tortfeasor's liability limits requiring the notice to the underinsured motorist carrier indicate acceptance or intent to accept the liability limits offer.  Failure to so indicate meant failure to comply with the staturory procedures which resulted in the claimant losing his UIM claim. [The Malone case is mentioned by way of example, and not by way of agreement with its reasoning.]

Although I can appreciate the travails of defense counsel and acknowledge the use of the inherent power of the court to impose sanctions for bad faith mediation, this is not a case worthy of sanctions.  The risk of a "no show" in the face of a "no agreement" was borne by the wrong litigant.

In looking at this decision, I am reminded of the three blind men examining an elephant and reaching three different conclusions based upon their respective examinations of the trunk, tail, and ears.  Based upon your position, you can see in it whatever you want.  However, does any counsel honestly suspect that this incident without a "fer sure" confirmation among all counsel involved would have occurred in an attorney-represented case?

I suspect more is involved in this case, but the facts reported by the COA are the facts which supported their decision to affirm the trial court.

Thanks to Vickie Pynchon in Beverly Hills of the "Settle it Now" Negotiation Law Blog who picked up my earlier bad faith mediation post and ran with it - "Sanctions for 'Bad Faith' Failure to Attend Mediation".  And another interesting post entitled "State and Federal Mediation Protections in 'Bad Faith'".

COA affirms trial court's award of mediation fees for party failing to attend (NPO COA Decision)

The number of mediations is increasing while the number of trials is dropping through the floor.  Oftentimes mediation is ordered by the trial judge, and either local rules or the court order contains requirements for attendance and arranging for mediation. 

In court-ordered mediation, many lawyers agree that the court may order attendance at mediation, and the rub comes regarding the payment for mediation when one side feels it's a waste of time.  Nonetheless mediation is usually held, and the mediator paid.

The next rub for some is if mediation is ordered, and the court cannot compel you agree to a settlement at mediation, then what happens if one side believes the other side has not entered mediation in good faith?

Or the insurance adjuster or the insured fail to personally appear at the mediation?

Although these may be interesting questions, they are not yet answered by any published or nonpublished decision in Kentucky that I have discovered or uncovered yet. [And if there is, then please by all means post it as a comment!]

However, one question has been the subject of a nonpublished Court of Appeals decision, styled Sullivan v. Anderson, 2006-CA-000586.pdf, in which the defenant's attorney apparently believed the parties had agreed to mediation but the pro se litigant did not attend the mediation.  The insurance defense lawyer then arranged for the date, time, location, and mediator and notifed the pro se litigant who did nothing. 

Judge Vanmeter in affirming a Jefferson Circuit Court decision by Judge Stephen Mershon held that although a party was not obligated to attend the "agreed" upon mediation, he was obligated to notify the other side he would not attend so as not to waste the mediator's time.

What is interesting in this decision is the opening given to the lower court's inherent authority.

We agree with Sullivan and the trial court that Sullivan was not obligated to attend the mediation since it was not ordered by the court. However, Anderson did not have any reason to know that the parties had not agreed on mediation since Sullivan did not inform her that he did not agree to the arranged mediator and mediation date. A Kentucky court “may invoke its inherent power to impose attorney's fees and related expenses on a party as a sanction for bad faith conduct, regardless of the existence of statutory authority or remedial rules.” Lake Village Water Ass'n, Inc. v. Sorrell, 815 S.W.2d 418, 421 (Ky.App. 1991) (citing Chambers v. Nasco, 501 U.S. 32, 111 S.Ct. 2123, 115 L.Ed.2d 27 (1991)).

Could this inherent authority be used in the other direction when

• the insurance defense lawyer shows up at mediation without the adjuster or the insured and relying upon the adjuster's attendance by telephone? 
• the adjuster in attendance does not have settlement authority extending to the policy limits? 
• the adjuster has to leave early? 
• the adjuster with higher authority is not available by phone, or there are delays in contacting the adjuster by telephone?

Of Trials, Bad Faith, and Bifurcation - American Commerce v. Hall

The Kentucky Court of Appeals ruled recently in a non-published decision that it was NOT palapable error when the trial judge did NOT bifurcate the claim for statutory bad faith (unfair claims settlement practices act) from the underlying UIM/underinsured motorist claim.   

The case was American Commerce Ins. Co. v. Hall, 2005-CA-002183, COA, Apr. 6, 2007.  Senior Judge Buckingham wrote this decision for a unanimous panel of Stumbo and Lambert.

The significance of this decision is that all too often, trial judges have a knee-jerk reaction to an insurance company's bifurcation motion.  Well, bifurcation makes sense when you have a claim against the defendant driver tied in with a bad faith claim against either a third party or first party insurance company in the form of bad faith or Unfair Claims Settlement Practices Act.   It sounds fair to the defendant that the liability claim should be held in abeyance and should not unfairly affect the claim of liability and damages against him or her.  Furthermore, the resolution of the underlying tort claim might even foreclose and preclude the bad faith claim.

However, some contend that bifurcation is problably not appropriate when there is no defendant driver in the suit and all the claims are against the insurer!  Remember the Sixth Circuit decision that required all the claims be filed against the insurer or risk issue preclusion?  See, eg., Bad Faith: First-party Bad Faith Decision from Sixth Circuit on Kentucky Case Applies Issue Preclusion.

Keep in mind this decision only says it is NOT palpable error for the judge NOT to bifurcate the UIM contractual claim from the UCSPA claim.  Thus, judges have discretion and are not complelled by Witmer v. Jones and other cases to split the case for trial.

Here is the odd set of facts found in American Commerce v. Hall.

How and when does this happen.  Well, it happened here.  In the facts of this case,  the plaintiff's settled with the liability carrier (with presumable compliance under the Coots v. Allstate procedure), then sued the underinsured motorist carrier (American Family) for UIM or first party insurance benefits AND for violations of the Unfair Claims Settlement Practices Act.  Oddly enough, American Family did not answer, and liability was entered.  The matter was later tried on damages on both the UIM and the UCSPA claims and American Family still was not in attendance and the verdict exceeded the policy limits. 

Here.  The claims against the defendant resolved, and the only claims left were those for UIM and unfair claims.  When American Family learned of the verdict, it jumped in and tried to set it aside with one of the reasons being it was palpable error not to have bifurcated the contractual UIM claim from the tort of statutory bad faith.

American Family lost, and even though this set of facts is odd, the result is that bifurcating the contractual UIM claim from the UCSPA claim is not automatic and not palpable error to include thus giving judges some leeway in consolidating their dockets and putting pressure on the insurance companies not to deny, delay, and defend and maybe, just maybe, attempt to resolve these claims without the bifurcation card and its cocomitant expense of two, yes two, trials.

The Kentucky Court of Appeals ruled recently in a non-published decision that it was NOT palapable error when the trial judge did NOT bifurcate the claim for statutory bad faith (unfair claims settlement practices act) from the underlying UIM/underinsured motorist claim.   

The case was American Commerce Ins. Co. v. Hall, 2005-CA-002183, COA, Apr. 6, 2007.  Senior Judge Buckingham wrote this decision for a unanimous panel of Stumbo and Lambert.

The significance of this decision is that all too often, trial judges have a knee-jerk reaction to an insurance company's bifurcation motion.  Well, bifurcation makes sense when you have a claim against the defendant driver tied in with a bad faith claim against either a third party or first party insurance company in the form of bad faith or Unfair Claims Settlement Practices Act.   It sounds fair to the defendant that the liability claim should be held in abeyance and should not unfairly affect the claim of liability and damages against him or her.  Furthermore, the resolution of the underlying tort claim might even foreclose and preclude the bad faith claim.

However, some contend that bifurcation is problably not appropriate when there is no defendant driver in the suit and all the claims are against the insurer!  Remember the Sixth Circuit decision that required all the claims be filed against the insurer or risk issue preclusion?  See, eg., Bad Faith: First-party Bad Faith Decision from Sixth Circuit on Kentucky Case Applies Issue Preclusion.

Keep in mind this decision only says it is NOT palpable error for the judge NOT to bifurcate the UIM contractual claim from the UCSPA claim.  Thus, judges have discretion and are not complelled by Witmer v. Jones and other cases to split the case for trial.

Here is the odd set of facts found in American Commerce v. Hall.

How and when does this happen.  Well, it happened here.  In the facts of this case,  the plaintiff's settled with the liability carrier (with presumable compliance under the Coots v. Allstate procedure), then sued the underinsured motorist carrier (American Family) for UIM or first party insurance benefits AND for violations of the Unfair Claims Settlement Practices Act.  Oddly enough, American Family did not answer, and liability was entered.  The matter was later tried on damages on both the UIM and the UCSPA claims and American Family still was not in attendance and the verdict exceeded the policy limits. 

Here.  The claims against the defendant resolved, and the only claims left were those for UIM and unfair claims.  When American Family learned of the verdict, it jumped in and tried to set it aside with one of the reasons being it was palpable error not to have bifurcated the contractual UIM claim from the tort of statutory bad faith.

American Family lost, and even though this set of facts is odd, the result is that bifurcating the contractual UIM claim from the UCSPA claim is not automatic and not palpable error to include thus giving judges some leeway in consolidating their dockets and putting pressure on the insurance companies not to deny, delay, and defend and maybe, just maybe, attempt to resolve these claims without the bifurcation card and its cocomitant expense of two, yes two, trials.

6th Cir: Sixth Circuit Holds Administrative Costs Chargeable Only to Parties and Not their Counsel Under Rule 54(d)(1)

Sixth Circuit Holds Administrative Costs Chargeable Only to Parties and Not their Counsel Under Rule 54(d)(1) from the Federal Civil Practice Bulletin Blog.

Web Tip: Wanted - Dead or Alive? Using the "death index" to find out

Should a party, client, or someone you need to contact in a case as a witness, heir, etc. pass away, you have some online resources available rather than a google (tm) search by name.

However, there are two useful and free web sites to get started - the "death" index from Kentucky and Social Security. 

• Kentucky Death Index from kygenweb.com
• Social Security Death Index  from Roots Web (note the actual index is not directly available through SSA but other online services have obtained the data and make it available)
• Obituaries from Legacy.com (useful for names of people who have died and their family members)

Courts: E-Discovery: A Special Publication of the ABA Section of Litigation is available for purchase ($19.95)

Thanks to Diana Skaggs for this link which I appropriated en toto since it was so short and to the point (rather than a link to a link to a line) and thus giving credit where it is due to account for the theivery.  As you can see, the various on-line journals overlap in their practices so a little cross-reading helps.

E-Discovery: A Special Publication of the ABA Section of Litigation is available for purchase ($19.95) here.

Sixth Cir: Are Expert Witness Fees Recoverable in the Sixth Circuit?

John Day from Day on Torts has posted a remark on a Sixth Circuit decision and expert fees, as follows.  Click on title for entire post:

Are Expert Witness Fees Recoverable in the Sixth Circuit?

The Sixth Circuit Court of Appeals has ruled on whether expert witness fees may be taxed as costs in federal court.FRCP 54(d) permits a successful party to recover costs in federal court and 28 U.S.C. 1920 permits the recovery of "fees and disbursements for printing and witnesses."  The amount recoverable for witnesses is spelled out in § 1821 and includes . . . . .