*1 GORDON, Appellant, Robin
v. FARM
KENTUCKY BUREAU COMPANY,
INSURANCE
Appellee.
No. 94-SC-900-DG.
Supreme Kentucky. Court of 19, 1995.
Oct.
Rehearing Feb. Denied Alexander, Horn,
Jim M. Alexander & Lexington, Appellant. for Feamster, Colson, Guy Elizabeth S. Fowl- er, Bell, Lexington, Appellee. Measle & FUQUA, Justice. 18, 1992, appellant
On December Robin against appellee Kentucky Gordon filed suit Company Farm Bureau Insurance to collect arising uninsured motorist benefits out of an County, accident which occurred Bourbon 26, 1990, Kentucky, July on in which the appellant, age seventeen at who was time, bodily injured motorcycle was when a passenger, which was on which he was a being by one uninsured Michael Gil- driven vin, Appellant vehicle. slid into another father, apparently living in the home of his Gordon, and his father had effect Charles policy at that time a of insurance from the provided appellee which uninsured motorist $100,000 coverage in the amount of for all family household. resident members his policy one-year limita- This also contained bringing tion an action on an uninsured on requirement of claim as well as the usual prompt to the carrier. notice *2 332 be carrier must uninsured-motorist was filed on December
This action by period provided the granted appellee’s two-year mo- the 1992. The trial court within Wilhoit, summary judgment grounds. concurring on two in result Judge tion for MVRA. by First, Elkins, it that the action was barred present ruled the issue: in foresaw period provided the twd-year limitation the on to see how an action based am unable Act, 304.39- Reparations KRS Motor Vehicle two-year “fall within the a contract can 230(6). ground, con- a the court As second 304.39-230(6),”which by KRS limit allowed two-year delay in nearly cluded “that actions. deals with tort having accident is a sufficient notice of the (Wilhoit, J., concurring). Id. at 425 has been that Farm Bureau demonstration by late notice.” The Court prejudiced case, Appeals, present In the Court of by vote on the Appeals affirmed a two-to-one Elkins, specifically referring to the dicta un- issue and found it statute of limitations two-year in the MVRA statute held that necessary to address the notice issue. Judge agrees with apply. This Court does dissent, that in which he notes Huddleston’s this Court primary issue before 304.39-230(6) purport to limit does not KRS for applies to a claim is what time limitation contracts, by very terms actions on but of the motorist benefits view uninsured liability not abol- for tort limits “an action Appeals in Kentucky Court of decision of the finds This Court ished KRS 304.39-060.” Kentucky Farm Bureau Mutual Elkins v. adopt general rule which illogical it a Company, Ky.App., 844 S.W.2d Insurance require plaintiff to sue his own insur- a (1992). not the discovering whether or er before bar, Appeals In the case at motorist. in fact an uninsured tort-feasor is any motorist claim must held that uninsured pro- two-year period brought within the be rationale of the result nor the Neither 304.39-230(6). Elkins, In vided KRS application of the MVRA requires Elkins validity provision of a with- question was the an action on a first- of limitations to statute policy purporting motorist the uninsured necessarily nor is it party insurance one-year period of limitations. to establish a is not controlling alleged tort-feasor that the Appeals voided the contract The Court of party a to the action. reasoning that: provision, recognized inception, From its we spe- Although does not [KRS 304.39-230] coverage party motorist] [uninsured first car- cifically suing one’s insurance refer to that it is a contrac- coverage, which means bene- or underinsured rier for uninsured directly insured obligation to the tual years fits, allow two it mates no sense to if the tort- must honored even be more) (or unin- against a suit an to file identified_ car- [T]he feasor cannot be yet tort-feasor and or underinsured sured obtaining a may sued without first rier be liability if the escape insurer to permit the motorist, judgment against the uninsured year. one involving it is not filed within suit being a uninsured motorist or without the unreasonably only an would not be Such suit, potential liabili- albeit the party to the time, completely it would frus- short but must be ty damages he caused of the no-fault insurance scheme. trate the against the insurer in the suit established argu- [appellee’s] find no merit We obli- the insurer’s in order to measure coverage uninsured motorist ment policy.... under the gation to the insured two-year limit al- not fall within the does regard to coverage exists without UM 304.39-230(6).... KRS lowed tort-feasor obligation of the whether the simply requires an insurer 304.20-020 judgment.... can be reduced part coverage uninsured motorist offer Co., Ky., 853 S.W.2d Ins. v. Allstate Coots Otherwise, provisions of the contract. (1993) (citations omitted; emphasis 895, 898 39 control. in Subtitle original). Id. at 424. of the contractual In the absence proposition language comes the From this Elkins, ruling in to the provision, invalid due against one’s holds that an action that Elkins LEIBSON, Justice, concurring in we must look to the statute of limitations results provided in general only. contract law. KRS 413.090(2) provides fifteen-year only. Respectfully, I in results concur general limitations for actions on a written Appeals on the I would affirm the Court fifteen-year period contract. This therefore *3 issue as to whether the statutes of limitations However, applies present in the ease. this A applies in to this case. KRS 304.39-230 should not be construed to inhibit the insur- interpretation of KRS 304.39-230 reasonable companies from contracting ance with their (6), implies “[a]n that subsection which states period insureds for a shorter of time to file a liability by action for tort not abolished KRS period contractual claim. Such of time must year shall have a two 304.39-060” Elkins, required be “reasonable” as under limitations, liability covers contract when the required years
which at least two to file a underlying basis for the contract claim is the two-year period contractual claim. This liability tort anof uninsured or underinsured period provided not a result of the similar motorist. by the MVRA.1 agree Appeals’ I with the Court of state- regards
The second issue
actual no ment:
which,
company
pre
tice to the insurance
as
though
“Even
we have before us an action
mentioned,
viously
summarily
by
decided
contract,
brought
in
we would have no
the trial
in appellee’s
court
favor and not
personal
action whatsoever absent the
in-
upon by
ruled
Appeals.
the Court of
The
act,
juries arising out of a tortious
so we do
any
record
if
proof upon
reveals little
real
illogical
apply
not find it
KRS 304.39-
Appellee
this issue.
filed a short and incon
230(6)
un-
to an uninsured motorist claim
adjuster.
clusive
made
affidavit
its claims
der
circumstances.”
these
Appellant filed an inconclusive affidavit of
Nevertheless, I
of
would reverse
Court
appellant’s father. These two affidavits were
Appeals
language
because the
of KRS
proof
all
concerning
the record
this
304.39-230(1)
(2)
applies
and
also
to this
notice issue. There was sufficient conflict
that,
case. This means
if on remand the
present
between the
ques
two affidavits to
presented
evidence
shows that no-fault bene-
tion of fact sufficient under Steelvest v. Scan
paid,
fits were
limitations would be extended
steel, Ky.,
(1991),
separate opinion. bar, Appellee “In the case at had actual REYNOLDS, J., by separate early dissents at as the notice of the claim least opinion STEPHENS, C.J., joins. 1991,” spring in which have been ade- Perhaps Assembly may the General consider uninsured motorist contractual claims. legislation creating a statute of limitations for liability or underinsured deny actual of an uninsured quate. The insurer does not but relies on the demand for written motorist: notice The insurer concedes: notice. Appeals’ agree state- with Court Casualty “In v. Bituminous Jones ment: (1991), Corp., Ky., this 821 S.W.2d though us an ac- “Even we have before imposed upon the burden of insurers tion we would showing ‘reasonably probable that that it is person- no action whatsoever absent carrier suffered substantial the insurance ” act, injuries arising al out of a tortious prejudice delay from the in notice.’ illogical apply it so we do not find why, this standard I see no reason Under 304.39-230(6) mo- to an uninsured notwithstanding policy language, the insurer circumstances.” torist claim under these wait for *4 permitted should be to sit back and insurer, notice. No doubt the formal written majority’s of the no- characterization The insured, potential knew of its more than the faulty. accident occurred tice issue is The investigate, liability, of the need to at the and 26, of July Indicative of a failure 1990. point notice. it receives actual timeliness, appellee the promptness or this More evidence is needed before 14, July Ap- furnished written notice law, ñnd, of as did the should as a matter pellant’s allegation best that the insurance court, trial “a sufficient demonstration that spring of company had actual notice the by the prejudiced Farm Bureau has been “by from a the alleged to have arisen 1991 late notice.” motorcycle acci- way, my got hurt in a son illusionary. Proof thereof is but dent.” Justice, REYNOLDS, dissenting. not, in all of notice need While the manner Respectfully, majority one, from cases, I dissent the exacting it should be basi- be an opinion. cally informational. two-year statute of limitations set correctly majority cite Appellee and the 6 of KRS 304.39-230 forth Subsection Inc., Ky., Casualty, v. Bituminous Jones apply only to those tort actions within should (1991), proposition that for the S.W.2d 798 Repara- purview the of the Motor Vehicles proving carries the burden of the insurer succinctly that Act. It is reasoned tions majority, to how- prejudice. In contrast an action although appears there this ease ever, Kentucky I Farm Bureau has believe have no action we would Kentucky sufficiently carried this burden. injuries personal aris-
whatsoever absent Bureau, affidavit, that has shown Farm clearly ing out of a tortious act and it is (even they prompt if had notice was not 304.39-230(6) to an logical apply KRS 1991) they spring of and were actual notice under these circum- uninsured motorist claim inability in their to locate prejudiced such otherwise, is no tort if there stances. Said motorcycle, if to determine the driver of the pay liability, responsibility to there is no uninsured, from to determine indeed he was provided by the contract. judgment tort of the precise circumstances the driver the concurring opinion, on Justice Leibsoris accident, adequately investigate the issue, quoted directly as follows: this memory impairment. claim due to witnesses’ Appeals on the I affirm the Court of would satisfy insurer’s burden If does not such of limita- to whether the statutes issue as hard say an insurer would be proof, dare applies this case. tions in 304.230 KRS prove prejudice. pressed to ever interpretation A of KRS reasonable delay “Prejudice will be found where (6), implies subsection 304.39-230 ability to ‘materially’ impairs an insurer’s liability for tort states action “[a]n liability liability or the to an insured test 304.39-060” shall not abolished Bay party.” limitations, to a third West of an insured year cov- a two Agencies, Specialty v. AIG underlying Exploration Co. liability ers contract when 1990). (6th Cir., Inc., 1036-37 915 F.2d claim is the tort basis for the contract above, I For the reasons stated opinion Appeals.
affirm the Court
STEPHENS, C.J., joins this dissent. HOKE, Appellant,
William
v. CULLINAN, Appellee.
R. Keith
No. 95-SC-042-DG.
Supreme Kentucky. Court of 22,
Nov. 1995.
Rehearing Denied Feb.