author: HARRIS, Senior Judge (Assigned).

text:
    John Wesley BRETT, Appellant, v. MEDIA GENERAL OPERATIONS, INC., d/b/a WTVQ-TV; and William Stanley, Appellees.
    Nos. 2008-CA-000620-MR, 2008-CA-001619-MR.
    Court of Appeals of Kentucky.
    Jan. 29, 2010.
    Discretionary Review Denied by Supreme Court Dec. 8, 2010.

      James M. Morris (argued), Sharon K. Morris, Lexington, KY, for Appellant.
    Susan C. Sears (argued), Catherine S. Wright, Lexington, KY, for Appellees.

      Before LAMBERT and VANMETER, Judges; HARRIS, Senior Judge.

      . Senior Judge William R. Harris sitting as Special Judge by assignment of the Chief Justice pursuant to Section 110(5)(b) of the Kentucky Constitution and Kentucky Revised Statutes (KRS) 21.580.

   OPINION

HARRIS, Senior Judge (Assigned).

John Wesley Brett (Brett) appeals from a Fayette Circuit Court summary judgment entered on March 27, 2008, in favor of his former employer, Media General Operations, Inc., d/b/a WTVQ-TV (WTVQ), and William Stanley (Stanley), former general manager of WTVQ. Brett also appeals from orders entered on June 23 and July 16, 2008, awarding costs to WTVQ and Stanley. After a careful review of the record and briefs and consideration of counsels’ oral arguments, we affirm.

THE SUMMARY JUDGMENT ISSUES

We first consider whether the summary judgment was proper. In so doing, we review the trial court’s orders de novo, Smith v. Vest, 265 S.W.3d 246, 248 (Ky. App.2007), subject to these established principles:

Our black-letter law directs that “summary judgment is to be cautiously applied and should not be used as a substitute for trial.” Steelvest, Inc. v. Scansteel Serv. Ctr., Inc., 807 S.W.2d 476, 483 (Ky.1991). “Even though a trial court may believe the party opposing the motion may not succeed at trial, it should not render a summary judgment if there is any issue of material fact.” Id. at 480. “[Wjhere the conflict is between inferences to be drawn from undisputed facts, summary judgment may be granted when it is clear that the only reasonable inference is in favor of the moving party.” Harker v. Fed. Land Bank of Louisville, 679 S.W.2d 226, 229 (Ky.1984).

Designed to be narrow and exacting so as to preserve one’s right to trial by jury, summary judgment is nevertheless appropriate in cases where the nonmoving party relies on little more than “speculation and supposition” to support his claims. O’Bryan v. Cave, 202 S.W.3d 585, 588 (Ky. 2006). Thus, nonmoving parties are obligated to set forth “at least some affirmative evidence showing that there is a genuine issue of material fact for trial” to withstand a properly supported motion for summary judgment. Steelvest, 807 S.W.2d at 482. “The party opposing summary judgment cannot rely on their own claims or arguments without significant evidence in order to prevent a summary judgment.” Wymer v. JH Properties, Inc., 50 S.W.3d 195, 199 (Ky.2001).

In 2000, Brett was employed as a reporter for WLEX, a Lexington television station. While working for WLEX Brett supplemented his salary by working as a radio reporter for Metro Traffic. In November 2000, Brett left his position at WLEX to become a reporter/weekend news anchor at WTVQ. Brett executed an employment agreement with WTVQ on December 29, 2000. The employment agreement contained a prohibition against outside employment, but at Brett’s behest WTVQ agreed to allow him to continue his traffic reporting job for a term of five months,, which it subsequently extended by an additional month. Brett also signed documents evidencing his understanding of WTVQ’s personnel policy and procedure manual, its anti-harassment policy, and its internet access and use policy.

On April 16, 2002, one of Brett’s female co-workers reported that Brett inappropriately interjected sex into the workplace, touched her in an unwelcome manner, used degrading gender references, and made crude comments in her presence. The coworker indicated that she had reason to believe that other female employees had had similar experiences.

After meeting with two other managers, Stanley notified the company’s human resources department of the complaint and his intent to investigate. The next day, Stanley interviewed three additional female employees who related similar stories of harassment. Most of the allegations involved inappropriate comments, touching, and sexual innuendo. However, one co-worker alleged that Brett showed her an online picture of a woman performing oral sex on a man. She claimed that Brett told her that he was the man in the picture. The three women expressed fear of retaliation by Brett.

On April 26, 2002, Stanley informed Brett that WTVQ was exercising its right to terminate his employment and giving him 24 hours notice, pursuant to Sections VHI(b)(i) and (c) of his employment contract. WTVQ claims that Brett was informed that his termination was based upon the sexual harassment complaints of four co-workers, as well as corroborating emails and internet records.

Brett contended that he was terminated for other reasons. Brett defended his actions by claiming that he accessed the pornographic website during his work on an assignment about an internet pornography scam. However, later investigation revealed that the reporting assignment occurred after Brett showed a co-worker the pornographic picture.

Following his termination, Brett made minimal inquiries into another reporting position. When he inquired about a possible position at WLEX, the news director informed him that the station did not have any openings. Brett did not seek media related employment until four years later, when he applied for a news anchor position at WKYT. Brett did not receive any response from WKYT concerning his application.

On April 24, 2003, Brett filed suit against WTVQ and Stanley claiming breach of contract and the duty of good faith and fair dealing, defamation, fraud, misrepresentation, contractual interference, and intentional infliction of emotional distress (outrage). On March 27, 2008, the trial court, finding that no genuine issue of material fact existed, granted WTVQ and Stanley’s motion for summary judgment, thereby effectively dismissing all of Brett’s claims with prejudice. Brett filed a notice of appeal the same day. After WTVQ and Stanley filed a bill of costs and a motion for supplemental judgment, the trial court entered its June 23 and July 15, 2008, orders awarding them costs. Brett then filed his second notice of appeal. This consolidated appeal follows.

I. Evidentiary Errors

Brett’s first argument is that the summary judgment was erroneous because it was based upon improper evidence, including documents that were not authenticated, an incomplete deposition, and omitted evidence. We disagree with all of these assertions.

Brett argues that WTVQ and Stanley’s proof consisted of unauthenticated documents which were improperly considered by the trial court. Although Brett fails to specifically name any such documents, our review of the record indicates that the majority of the proof consisted of witness depositions that were properly certified and notarized. Because the deposition was a notarized, sworn statement, the depositions were properly admitted under the Kentucky Rules of Evidence (KRE) 902(8). Moreover, Kentucky Rules of Civil Procedure (CR) 56.03 expressly includes depositions among those matters which are proper for a trial court to consider in ruling on a summary judgment motion.

Further, our review indicates that Brett’s deposition was complete for the purposes of this action. Brett did not request a re-direct examination. Neither did he file an affidavit to explain, correct, or contradict the testimony which he gave under examination by opposing counsel, which CR 56.03 would have authorized. We find no error in the court’s consideration of Brett’s deposition.

Brett also claimed that WTVQ and Stanley destroyed evidence in order to withhold documents, including managerial working files, correspondence, and policy information. Rather than providing support for this allegation, Brett simply argues that WTVQ and Stanley were required by WTVQ’s document retention policy to retain such information for a certain period of time. Each company or organization is free to establish rules and policies to govern their dissemination and destruction of work product. Although WTVQ and Stanley may have violated office policies of document organization and destruction, Brett fails to demonstrate any laws or court orders that were violated by this act, or that the documents were lost or destroyed in anticipation of litigation. Therefore, Brett’s claim is without merit.

II. Breach of Contract and Implied Covenant of Good Faith and Fair Dealing

Second, Brett claims that WTVQ and Stanley breached the employment contract and acted in bad faith by terminating his employment without cause and without investigation. The termination provisions in Brett’s employment agreement are these:

Basic Terms, Article 5. WTVQ’s Termination Without Cause
WTVQ may terminate this [ajgreement at any time, at its discretion and without proof of breach by Brett, by delivering to Brett a written notice of WTVQ’s decision to terminate not less than 90 calendar days prior to the effective date of such termination. WTVQ may elect in its sole discretion to pay Brett the equivalent of 90 days compensation in lieu of the 90 days notice.
Talent Clauses, Section VIII:
(b) WTVQ shall have the right to terminate the [ajgreement upon twenty-four (24) hours notice to Brett if at any time (i) Brett fails to behave with due regard to social conventions and public morals and decency ...
(c) ... WTVQ may terminate the [ajgreement upon twenty-four (24) hours notice to Brett if Brett commits any of the following acts: ... using profane or vulgar language or actions while at work....

Reading the above-quoted provisions collectively, it can be seen that Brett’s employment was terminable at will under the “Basic Terms” provision, but in that case he would be entitled to 90 days severance pay or 90 days notice. Brett’s employment was also terminable for cause, without any severance pay and with only 24 hours notice, under the “Talent Clauses,” which can be fairly characterized as a morals clause. The termination letter makes it abundantly clear that Brett was terminated for cause under the “Talent Clauses” provision of the employment agreement.

Brett maintains that he presented the trial court with sufficient evidence to conclude that his termination constituted a breach of contract. “If termination of a contract of employment, whether an executive or of a less responsible position, is justifiable, there is, of course, no legal liability of the employer for breach of contract.” Davies v. Mansbach, 338 S.W.2d 210, 212 (Ky.1960); Big Sandy Rural Elec. Coop. Corp. v. Gambill, 521 S.W.2d 240, 241 (Ky.1974). In the case at hand, Brett was terminated after four women complained that he had sexually harassed them on numerous occasions. The stories were corroborated by emails and company schedules. Nonetheless, Brett claims that WTVQ and Stanley should have conducted a more extensive investigation of the case and given him an opportunity to be heard.

Clearly employees may contract to receive a variety of employment rights, such as the right to a hearing prior to termination, additional notice, and certain investigative procedures. Absent specific contractual provisions concerning these rights, however, WTVQ and Stanley were under no obligation to provide Brett with additional investigation measures or an opportunity to be heard. We recognize that Brett argues a different version of the circumstances leading to his termination, but in light of the evidence against him, we conclude that Brett has failed to present evidence which demonstrates any genuine issue of material fact on his breach of contract claim. Dismissal of that claim was not error.

III. Fraud

Third, Brett argues that WTVQ and Stanley made fraudulent misrepresentations to induce him to enter into the employment contract. Specifically, Brett claims that WTVQ promised him that he would be able to keep his outside employment with Metro Traffic in order to lure him away from WLEX.

In order to prove his claim of fraud, Brett must establish the following elements: (a) a material misrepresentation; (b) which was false; (c) which was known to be false or made recklessly; (d) which was made with inducement to be acted upon; (e) which the plaintiff acted in reliance upon; and (f) which caused the plaintiff injury. United Parcel Serv. Co. v. Rickert, 996 S.W.2d 464, 468 (Ky.1999).

The record shows that Brett signed his employment agreement with WTVQ on December 29, 2000. However, he signed his outside employment agreement on December 26, 2000, three days prior to the employment contract. Although Brett was placed on notice of WTVQ’s policies concerning outside employment, the station allowed Brett to continue his position as a traffic reporter for 5 months. Then WTVQ gave Brett an extension of that grace period. In light of the ample notice given, Brett fails to demonstrate the existence of any genuine issues of material fact on the basic element of fraud, to wit, material misrepresentation. Summary judgment on Brett’s fraud claim was not error.

IV.Contractual Interference

Fourth, Brett claims that WTVQ’s misrepresentations and improper termination constituted contractual interference. However, Brett fails to articulate how these two allegations amount to contractual or tortious interference. One is liable for tortious interference with an existing contract when he wrongfully induces a third party not to perform a contract or enter into or continue a business relationship with another. Carmichael-Lynch-Nolan Advertising Agency, Inc. v. Bennett & Assocs., Inc., 561 S.W.2d 99, 102 (Ky.App.1977). Brett’s claims do not meet the definition of contractual or tortious interference. Therefore, we find no error in the trial court’s summary judgment.

V.Defamation

Fifth, Brett claims that sufficient evidence existed to show that WTVQ and Stanley defamed Brett because his termination was published on the internet and became locally known in the news industry. In order to show defamation, Brett must establish: (1) a defamatory statement; (b) about the plaintiff; (8) which is published; and (4) which causes injury to reputation. Columbia Sussex Corp., Inc. v. Hay, 627 S.W.2d 270, 273 (Ky.App.1981).

As the above elements suggest, rumors and innuendo are not enough to constitute defamation. Brett did not specifically describe the alleged defamatory statements, state where they were published, or indicate how WTVQ and Stanley are responsible for the information dissemination. Therefore, Brett has not shown the existence of any genuine issues of material fact which preclude summary judgment on his defamation claim.

VI.Intentional Infliction of Emotional Distress (Outrage)

Brett also alleges that WTVQ and Stanley intentionally inflicted emotional distress by accusing him of immoral acts designed to ruin his reputation, by making false representations concerning outside employment, and by failing to conduct any investigation concerning the harassment allegations. We disagree.

In order to prove a claim of intentional infliction of emotional distress, Brett must show that WTVQ and Stanley’s intentional or reckless conduct was so outrageous and intolerable that it caused severe emotional distress. Stringer v. Wal-Mart Stores, Inc., 151 S.W.3d 781, 788 (Ky.2004). Brett failed to produce evidence to show that his termination was outrageous or intolerable in the manner that Kentucky law requires to support an action for intentional infliction of emotional distress. Id. at 789-92. In addition, our review of the record shows that Stanley did conduct an investigation of the allegations against Brett, abbreviated and imperfect though it was.

THE AWARD OF COSTS TO WTVQ AND STANLEY

The final issue which we address is Brett’s appeal from the order which awarded costs to WTVQ and Stanley by granting their motion for supplemental judgment against Brett for those costs.

The trial court’s opinion and order which embodied the summary judgment in favor of WTVQ and Stanley was entered on March 27, 2008. It was silent on the subject of recovery of costs. After Brett filed his notice of appeal on the same day, March 27, WTVQ and Stanley filed their bill of costs thirteen days later on April 9, 2008. The trial court subsequently issued a supplemental judgment awarding costs. Brett objected and filed an Original Action with this Court seeking a writ of prohibition, arguing that the trial court had lost jurisdiction under CR 52.02. The Kentucky Supreme Court ultimately resolved this issue in a memorandum opinion, holding that the trial court, in fact, had jurisdiction under CR 54.04 to award costs. Brett v. Isaac, 2009 WL 2707092 (Ky.2009)(2008-SC-000712-MR).

While the parties at oral argument of this matter downplayed the significance of the Supreme Court’s opinion, Brett’s argument in this appeal concerning the assessment of costs is the same as he advanced in his Original Action: the trial court erred in making the award since it had lost jurisdiction. The Kentucky Supreme Court’s view, however, concerning the trial court’s jurisdiction to award costs under CR 54.04 is unmistakable:

Reading the rule provides the obvious— costs are assessed after judgment. Exceptions are to be served within five days and the court is to decide by way of a “supplemental judgment.” Clearly, this retained supplemental judgment jurisdiction has nothing to do with the lost jurisdiction to amend or supplement the final judgment. There is no Kentucky case directly on point, probably because the rule is self-explanatory.

Id., slip op. at 4-5.

In a footnote, the Court noted that no time limit was placed in the rule for filing a bill of costs, and implied that the bill of costs should be filed within a reasonable time. Id., slip op. at 5 n. 3. And as noted by the Court, in this instance, WTVQ and Stanley filed their bill of costs within a reasonable time. Id. The trial court’s supplemental judgment awarding costs is affirmed.

For the reasons stated above, we affirm the Fayette Circuit Court in all respects.

ALL CONCUR.

      . William Stanley was the general manager of WTVQ at all times pertinent to these appeals.

      . These portions of the employment agreement are quoted infra.

      . Every contract contains an implied covenant of good faith and fair dealing. Farmers Bank & Trust Co. of Georgetown, Kentucky v. Willmott Hardwoods, Inc., 171 S.W.3d 4, 11 (Ky.2005).

      . WTVQ required employees to sign a contract agreeing not to seek outside employment while employed at WTVQ.

      . This opinion became final on September 27, 2009.


source: Caselaw Access Project

author: CAPERTON, Judge:

license: Public Domain

text:
    Sarah Elizabeth HUMPHREY, Appellant, v. Edwin Jerome HUMPHREY, Appellee.
    No. 2009-CA-002241-ME.
    Court of Appeals of Kentucky.
    July 30, 2010.
    Case Ordered Published by Court of Appeals Oct. 15, 2010.

      Abigail C. Barnes, Smithland, KY, for appellant.
    L. Christopher Hunt, Paducah, KY, for appellee.
    Before CAPERTON, LAMBERT, and STUMBO, Judges.
   OPINION

CAPERTON, Judge:

The Appellant, Sarah Elizabeth Humphrey, appeals the November 12, 2009, findings of fact, conclusions of law, and judgment of the Marshall Family Court, awarding custody of the parties’ two minor children to their father, Appellee Edwin Jerome Humphrey. After a thorough review of the arguments of the parties, the record, and the applicable law, we affirm.

The parties were married on July 10, 1999, and were divorced by decree of the Livingston Circuit Court on November 6, 2002. The parties had two minor children, C.L.H. and C.W.H, both born on April 7, 2000. Upon divorce, the parties entered into a property and settlement agreement in which the parties agreed that they would share joint custody, with Sarah as the primary residential custodian. No child support was ordered at that time.

On January 4, 2008, Sarah filed a motion for review of visitation in the Livingston Circuit Court. Thereafter, on April 14, 2008, an order was entered setting a visitation schedule establishing that visitation would be conducted in accordance with the McCracken County Standard Visitation Schedule. Sarah remained the residential parent at that time. Thereafter, in May of 2008, Edwin was ordered to pay child support to Sarah in the amount of $550.00 per month.

The divorce action was subsequently transferred to the Marshall Circuit Court, where Sarah had moved with both boys. Below, Sarah testified that she moved to Marshall County for the schools, but acknowledged that she has no connection to Marshall County other than her boyfriend, Danny, who also resides there. At the time the action below was filed, both boys attended Marshall County Schools.

Edwin and his current wife, Patrice, relocated to Colorado for a job opportunity in approximately 2007, but later relocated to Marion, Illinois, approximately one year ago. Edwin testified that he did so in order to see his sons more regularly. On July 2, 2009, Edwin filed a motion to modify custody. In that motion, Edwin requested that the parties continue to share joint custody of the children and that he be named primary residential custodian. Edwin argued that said modification was necessary to serve the best interests of the children. A hearing was held below on November 4, 2009.

Upon commencement of the hearing in this matter, the parties differed as to the appropriate standard to be applied by the court. Sarah asserted that the court should apply the standard set forth in Kentucky Revised Statutes (KRS) 403.340 for modification of custody decrees, while Edwin’s counsel argued that the best interest of the child standard should apply. The trial court, citing its reliance on Pennington v. Marcum, 266 S.W.3d 759 (Ky.2008), chose to apply the best interest of the child standard. In its order, the court indicated that even though Edwin had filed a motion to modify custody, it was treating the case as an action for modification of timesharing.

Testimony was heard from the parties; Wendy Lay, a guidance counselor at the children’s school; Kelly Cox, a social worker with the Cabinet for Health and Family Services; an education director at Sylvan Learning Center where the children had attended a brief course; and various relatives and character witnesses for each party. The children were also interviewed by the court in chambers.

Following the hearing, the court issued its findings of fact, conclusions of law, and judgment on November 12, 2009. As noted, the court found that although Edwin styled his motion as one to modify custody, he was actually seeking a modification of the parties’ current timesharing arrangement, as both parties would still have custody. The modification would name Edwin as the primary residential custodian instead of Sarah. In its order, the trial court stated that it found insufficient evidence to support the claim that Sarah’s boyfriend abused the children. It nevertheless found that on the basis of the wishes of the parents and the children, it would be in the best interest of the children to make Edwin the primary residential parent. The court also set forth the respective support and financial obligations of the parties. It is from that order that Sarah now appeals to this Court.

As her first basis of appeal, Sarah argues that the trial court abused its discretion in applying the standard set forth in Pennington. Sarah asserts that Pennington should only apply when triggered by either an objection to, or request for, relocation. She argues that in the matter sub judice, Edwin was seeking a modification of custody and not timesharing, and points out that his arguments for becoming primary residential custodian centered not on reasons of relocation but around objections to the atmosphere of Sarah’s home and the parenting styles she implemented. Accordingly, Sarah asserts that the court should have applied KRS 403.340 instead of KRS 403.320(3). Sarah argues that under the standards set forth in KRS 403.340, the court did not have a sufficient basis for changing the primary residential custodian from her to Edwin.

In response, Edwin argues that the trial court correctly applied Pennington. He argues that although he styled his motion as a motion to modify custody, in reality, he sought a modification of timesharing. Edwin therefore asserts that pursuant to Pennington> the best interest standard of KRS 403.320(3) was correctly applied. Edwin asserts that Pennington was not intended to apply solely to situations involving relocation, and that relocation was merely part of the specific set of facts that gave rise to that appeal. Edwin therefore argues that the holding of Pennington applies to every modification of timesharing, whether sought in response to relocation or for other practical reasons.

Alternatively Edwin asserts that, even if the court did misapply Pennington, that error was harmless because he sought modification more than two years after the initial custody determination and, therefore, the threshold to be met for modification was not as stringent as it would otherwise have been had the motion been made earlier. Edwin also asserts that regardless of whether the court used the best interests of the child standard, or the factors set forth in KRS 403.340, the evidence to support its findings was sufficient.

In addressing the issues raised by the parties, we note that our standard of review is set forth in Kentucky Rules of Civil Procedure (CR) 52.01, and that findings of fact shall not be set aside unless clearly erroneous. Due regard shall be given to the opportunity of the trial court to judge the credibility of the witnesses. See Murphy v. Murphy, 272 S.W.3d 864 (Ky.App.2008). Thus, the question before this Court is not whether we would have decided it differently, but whether the findings of the family court are clearly erroneous, whether it applied the correct law, or whether it abused its discretion. See B.C. v. B.T., 182 S.W.3d 213, 219-20 (Ky.App.2005). See also Eviston v. Eviston, 507 S.W.2d 153 (Ky.1974). We review the arguments of the parties with this in mind.

Stated simply, we believe that Pennington speaks clearly to the primary issue raised by the parties herein. In Pennington, our Kentucky Supreme Court held that a motion seeking to change the primary residential parent was in reality a motion to modify visitation/timesharing and not a motion to modify custody. Pennington v. Marcum, 266 S.W.3d 759 (Ky.2008). We cannot agree with Sarah that the holding in Pennington was intended to be limited only to cases involving relocation and, in fact, this Court has already found otherwise on several occasions.

While a relocation was the particular context in which Pennington was decided, we believe that the intent of our Supreme Court was to establish a distinction between a modification of custody (either from joint custody to sole or split custody, or vice-versa), and a modification of timesharing. A modification of time-sharing maintains the basic custodial framework agreed upon by the parties but changes the amount of time that each parent spends with the child within that framework. In the matter sub judice, Sarah and Edwin retain joint custody. Edwin did not seek sole custody of the children, but instead sought to change the primary custodian from Sarah to himself. Pennington is clear that this is not a modification of custody, but of timesharing, and we decline to find otherwise herein.

Having found that Edwin’s motion was, in reality, a motion to modify timesharing, Pennington is the controlling case. Pennington is clear that motions to modify visitation/timesharing are brought, under KRS 403.320(3), which permits modification when it “would serve the best interests of the child.” The court below, in making this determination, heard evidence from numerous sources. It clearly considered the interactions between each of the adults involved and the children, the disciplinary styles of the parents, and the children’s wishes.

While Sarah attacks the findings of the trial court that the children wished to live with their father, we note that there was conflicting evidence on this issue. As we have noted, it is within the discretion of the trial court to judge the credibility of the witnesses, and to make a determination after reviewing the evidence as a whole. In the matter sub judice, the court not only heard the testimony of the witnesses on this issue, but also conducted its own interview with the children themselves. We believe that these interviews, in conjunction with the evidence presented during the course of the trial, formed a sufficient basis for the trial court to make the determination that it did. We simply cannot conclude that the court abused its discretion, or that its findings of fact were clearly erroneous.

Wherefore, for the foregoing reasons, we hereby affirm the November 12, 2009, findings of fact, conclusions of law, and judgment of the Marshall Circuit Court.

ALL CONCUR.

      . In particular, Edwin cited concerns that the children were being abused by Sarah’s boyfriend, Danny, that the boys desired to live primarily with their father, and that he takes their education more seriously than Sarah.

      . There is dispute between the parties as to the true wishes of the children. Edwin asserts that the children want to live with him, while Sarah asserts that Edwin coached the children to make this request. The court below found that the boys were well-behaved, articulate, and intelligent, and adamantly stated that they wanted to live with their father. The court found no indication that they had been coached.

      .We decline to discuss this aspect of the order herein as it is not pertinent to the issues before us on appeal.

      . In making this argument, Edwin relies upon the statement of the Kentucky Supreme Court in Pennington that “after two years from the date of the custody decree, the standard reverts to review of the best interests of the child, either under KRS 403.270 or KRS 403.340(3).” Pennington at 767. Edwin uses this as a basis to argue that although the statute requires the court to consider the enumerated factors, it did not have to find that serious endangerment to the children existed prior to modifying custody.

      . See Gaskins v. Gaskins, 2009 WL 3321408 (Ky.App.2009)(Unpublished); Gardner v.

        Gardner, 2009 WL 1811730 (Ky.App.2009)(Unpublished); and also Warren v. Warren, 2010 WL 135174 (Ky.App.2010)(Unpublished).

      . Witness Cox testified as to her belief that the children had been coached by their father, but Witness Lay testified that it was her belief that they had not been coached.


author: DIXON, Judge:

text:
    Brandon WARE, Appellant, v. COMMONWEALTH of Kentucky, Appellee.
    No. 2009-CA-001730-MR.
    Court of Appeals of Kentucky.
    Oct. 22, 2010.

      Brandon Neil Jewell, Assistant Public Advocate, Frankfort, KY, for Appellant.
    Jack Conway, Attorney General of Kentucky, David W. Barr, Assistant Attorney General, Frankfort, KY, for Appellee.
    Before CLAYTON, DIXON and WINE, Judges.
   OPINION

DIXON, Judge:

Appellant, Brandon Ware, appeals from an order of the Campbell Circuit Court revoking his probation and ordering his five-year sentence for first-degree trafficking to run consecutive to a one-year Ohio sentence. For the reason set forth herein, we reverse and remand.

In September 2006, Appellant pled guilty in the Campbell Circuit Court to one count of first-degree trafficking and was sentenced to five years’ imprisonment. However, on March 28, 2007, the trial court granted Appellant’s motion for shock probation and his sentence was probated for a period of five years. Thereafter, in August 2008, Appellant was convicted in Hamilton County, Ohio, of two felony counts of trafficking cocaine. It is undisputed that the Kentucky Department of Corrections was notified of the pending Ohio charges in February 2008, as well as of Appellant’s conviction of such in September 2008.

Some ten months later, on July 2, 2009, Corrections filed an affidavit in the Campbell Circuit Court seeking revocation of Appellant’s probation. Following a hearing, the trial court revoked probation and ruled that Brewer v. Commonwealth, 922 S.W.2d 380 (Ky.1996) and KRS 533.060(2) mandated that Appellant’s five-year sentence run consecutively to his Ohio sentence. This appeal ensued.

On appeal, Appellant argues that the trial court erred in applying KRS 533.060(2) to run his sentences consecutively. Rather, Appellant contends that under KRS 533.040(3) and KRS 532.155, his Kentucky sentence should have run concurrently with the Ohio sentence. We must agree.

As previously noted, the trial court herein relied upon the decision in Brewer v. Commonwealth, which discussed the interplay between KRS 533.040(3) and KRS 533.060(2). The relevant provisions are as follows:

KRS 533.040(3) provides:

A sentence of probation or conditional discharge shall run concurrently with any federal or state jail, prison, or parole term for another offense to which the defendant is or becomes subject during the period, unless the sentence of probation or conditional discharge is revoked. The revocation shall take place prior to parole under or expiration of the sentence of imprisonment or within ninety (90) days after the grounds for revocation come to the attention of the Department of Corrections, whichever occurs first.

Further, KRS 533.060(2) provides:

When a person has been convicted of a felony and is committed to a correctional facility maintained by the bureau of corrections and released on parole or has been released by the court on probation, shock probation, or conditional discharge, and is convicted or enters a plea of guilty to a felony committed while on parole, probation, shock probation, or conditional discharge, such person shall not be eligible for probation, shock probation, or conditional discharge and the period of confinement for that felony shall not run concurrently with any other sentence.

In Brewer, the defendant pled guilty in the Warren Circuit Court of two counts of felony theft and was sentenced in April 1992, to one year’s imprisonment, probated for a period of five years. However, in May 1993, Brewer pled guilty in the Barren Circuit Court to another felony. The Warren Circuit Court thereafter revoked Brewer’s probation and ordered his Warren County sentence to run consecutively to the Barren County sentence. On appeal, Brewer argued that his sentences should have run concurrently because his probation was not revoked within the 90-day time limitation of KRS 533.040(3).

In rejecting Brewer’s arguments, the Supreme Court held that the latter-enacted KRS 533.060(2) controlled:

The statute clearly and unambiguously requires that the appellant’s second sentence, the Barren County sentence, not run concurrently with his first sentence, the Warren County sentence....
While the specific conflict between KRS 533.060(2) and KRS 533.040(3) has not been addressed previously, prior cases, such as Devore v. Commonwealth, Ky., 662 S.W.2d 829 (1984) and Riley v. Parke, Ky., 740 S.W.2d 934 (1987), have noted the General Assembly’s clear intention in enacting KRS 533.060(2) to provide stiff penalties in the form of consecutive sentences to those who, after having been awarded parole or probation, violate that trust by the commission of subsequent felonies.

Brewer, 922 S.W.2d at 381-82.

In ruling that Brewer controlled the case herein, the trial court noted in its revocation order,

Defendant received a new felony conviction in Hamilton County, Ohio, on August 5, 2008, while he was serving his sentence of five (5) years probation that this Court imposed when granting the Defendant shock probation.... The Department of Corrections did not meet the 90-day time limit of K.R.S. § 533.040(3) after receiving notice of the Defendant’s new conviction in September 2008. However, under Brewer, K.R.S. § 533.060(2) controls over K.R.S. § 533.040(3) and the Court may not run a sentence imposed after probation revocation concurrently with a sentence for the new felony conviction the defendant received while on shock probation.

Unfortunately, the trial court’s reliance on Brewer is misplaced. Interestingly, and likely contributing to the courts’ confusion in the instant case, is the fact that the Kentucky Supreme Court’s holding in Brewer cannot be reconciled with the facts therein. In Brewer, the Court specifically stated that KRS 533.060(2) clearly and unambiguously required that the appellant’s second sentence, the Barren County sentence, not run concurrently with his first sentence, the Warren County sentence. 922 S.W.2d at 381. Yet, the appeal in Brewer was from the Warren Circuit Court’s order running its reinstated sentence consecutively to the Barren Circuit Court’s sentence. In other words, Brewer’s first sentence was reinstated and ran consecutively to the second sentence.

Brewer has been a source of confusion. For example, in Peyton v. Commonwealth, 253 S.W.3d 504, 510 (Ky.2008), cert. denied, — U.S. -, 129 S.Ct. 604, 172 L.Ed.2d 463 (2008), the Supreme Court quoted from Brewer, observing that it held that “KRS 533.060(2) unambiguously required that Appellant’s second sentence could not run concurrently with the reinstated sentence that he was on parole for.” Id. at 510. Unfortunately, as previously discussed, it is obvious from the facts that it was the first reinstated sentence and not the second sentence that was at issue in Brewer. This is clearly not what is contemplated by KRS 533.060(2).

In Peyton, the Supreme Court noted, [Wje now hold that the logic espoused by Justice Leibson in his dissent [in Devore v. Commonwealth, 662 S.W.2d 829 (Ky.1984)] provides an inherently more practical understanding of [KRS 533.060]. “A reasonable interpretation of the phrase ‘with any other sentence,’ (KRS 533.060(2)) is that ‘any other sentence’ means only the unserved portion of the sentence for the felony for which probation or parole should be revoked.” Devore, 662 S.W.2d at 831 (Leibson, J., dissenting). This viewpoint interprets the language, “shall not run concurrently with any other sentence,” in KRS 533.060(2) as meaning any other sentence previously imposed. (Emphasis added).
Thus, it becomes quite clear in the context of KRS 533.060(2), that the language, “the period of confinement for that felony shall not run concurrently with any other sentence,” should be construed as meaning that subsequent felony offense(s) committed while on probation or parole may not be run concurrently with the sentence for which the individual is on probation or parole.

Peyton, 253 S.W.3d at 511. Based upon Peyton, we must conclude that KRS 533.060(2) governs the actions of the court with jurisdiction over the second subsequent offense, not the original court that granted conditional discharge, probation or parole. Nevertheless, we acknowledge that the facts behind Brewer stand in opposition to this conclusion. As such, we would urge our Supreme Court to revisit Brewer and clarify the proper application of the statute.

Returning to the case at hand, we agree with Appellant that the facts herein are more analogous to those presented in Gavel v. Commonwealth, 674 S.W.2d 953 (Ky.1984). Therein, the defendant was convicted of a felony in the federal court while on probation in the state court. The trial court, upon learning of the federal court sentence, revoked the defendant’s probation and ordered that his three-year state sentence was required to run consecutively to the federal sentence pursuant to KRS 533.060(2). A panel of this Court affirmed the trial court on appeal. However, on discretionary review, our Supreme Court held:

[T]he trial court may run the state sentence concurrently or consecutively with the federal sentence because KRS 538.060(2) is not applicable to the facts in the present case. The conviction referred to in that section is the subsequent one, not the first. That section provides that when a person while on probation is “convicted or enters a plea of guilty to a felony, ... the period of confinement for that felony shall not run concurrently with any other sentence.” In the present case “that ” felony would be the federal conviction, which the state court has no control over. (Emphasis in original).

Gavel, 674 S.W.2d at 954. Accordingly, the Court ruled that KRS 538.040(3) and KRS 532.115 controlled. Id.

Similarly, for purposes of revoking Appellant’s probation, we also conclude that KRS 533.040(3) and KRS 532.115 respectively, are controlling. Certainly, this case is distinguishable from Gavel in that Appellant’s subsequent felony was not a federal conviction. Nonetheless, we discern no true distinction, as this state had no more jurisdiction over the Ohio conviction than it would have had over a federal conviction.

Because we have determined that KRS 533.040(3) rather than KRS 533.060(2) applies to the instant case, the trial court’s authority to run Appellant’s sentences concurrently or consecutively was conditioned, as it was in Gavel, upon a determination of whether the revocation occurred “within ninety (90) days after the grounds for revocation [came] to the attention of the Department of Corrections.... ” KRS 533.040(3). However, here the trial court made a specific finding that the Commonwealth did not comply with the 90-day time requirement. In fact, the affidavit seeking revocation of Appellant’s probation was not filed in the trial court until nearly ten months after the Department of Corrections first learned of Appellant’s Ohio convictions. Further, an officer with the Kentucky Division of Probation and Parole testified at the revocation hearing that Appellant’s Ohio sentence was scheduled to expire on July 20, 2009, nearly one month prior to the revocation hearing.

It is apparent from the Commentary to KRS 533.040(3), that it was enacted to prevent precisely what occurred in this case; i.e., authorities waiting until the expiration of a defendant’s subsequent sentence to initiate revocation proceedings on the first offense.

Subsection (3) is designed to eliminate a problem that could exist with probation or conditional discharge sentences which are followed by a subsequent conviction for a separate offense. When this situation arises, authorities could wait until the defendant has served his prison sentence for the subsequent offense and then seek revocation of his prior sentence of probation or conditional discharge and reinstate his prior sentence of imprisonment. It is the purpose of this subsection, which is borrowed from the proposed Michigan Revised Criminal Code, § 1330, and the proposed Federal Criminal Code, § 3104, to prohibit such a practice unless the authorities act to revoke the prior sentence of probation or conditional discharge before the defendant has completed his imprisonment under the subsequent sentence. This provision would seem to be especially important in the event of a release of the defendant from prison on parole. Such a release contemplates a rehabilitation of the defendant or at least a chance to live a non-deviant existence. It also contemplates supervision of the defendant by the Department of Corrections. With such a release, a clean slate for the offender should serve a useful rehabilitative function. Subsection (3), like the preceding ones, is new to Kentucky law.

Commentary to KRS 533.040. As such, we believe our decision herein comports with the intent of KRS 533.040(3). Because it is undisputed that the revocation herein did not occur “prior to parole under or expiration of the sentence of imprisonment or within ninety (90) days after the grounds for revocation come to the attention of the Department of Corrections,” the trial court was prohibited from ordering Appellant’s sentences to run consecutively.

For the reasons set forth herein, the order of the Campbell Circuit Court is reversed and this matter is remanded with directions that the circuit court order Appellant’s five-year state sentence to run concurrently with the Ohio sentence of imprisonment.

ALL CONCUR.

      . It was undisputed in Brewer that the Warren County Commonwealth Attorney became aware of the Barren County proceedings in January 1993, yet did not file a motion for revocation until May 1993.

      . KRS 532.115 provides: "The court in sentencing a person convicted of a felony, shall be authorized to run the sentence concurrent with any federal sentence received by that defendant for a federal crime and any sentence received by that defendant in another state for a felony offense. The time spent in federal custody and the time spent in custody in another state under the concurrent sentencing shall count as time spent in state custody; but the federal custody and custody in another state shall not include time spent on probation or parole or constraint incidental to release on bail. If the court does not specify that its sentence is to run concurrent with a specific federal sentence or sentence of another state, the sentence shall not run concurrent with any federal sentence or sentence of another state.”


author: KELLER, Judge:

text:
    Bobby Gene BROWN, Appellant, v. COMMONWEALTH of Kentucky, Appellee.
    No. 2009-CA-001272-MR.
    Court of Appeals of Kentucky.
    Oct. 22, 2010.

      Ryan VanTrease, Louisville, KY, for appellant.
    Jack Conway, Attorney General of Kentucky, Todd D. Ferguson, Assistant Attorney General, Frankfort, KY, for appellee.
    Before COMBS, KELLER, AND LAMBERT, JUDGES.
   OPINION

KELLER, Judge:

In April 2006, Bobby Gene Brown (Brown) pled guilty to several counts of theft by deception and to being a persistent felony offender in the first degree. In August 2006, the trial court sentenced Brown to a total of eleven years’ imprisonment on those charges. In January 2009, the Commonwealth filed a motion asking the court to amend its sentence and to order Brown to pay restitution to his victims. Over Brown’s objection, the trial court granted the Commonwealth’s motion. It is from this order that Brown now appeals. For the reasons set forth below, we reverse and vacate.

FACTS

On June 20, 2005, August 8, 2005, and March 21, 2006, Jefferson County grand juries indicted Brown on nineteen counts of theft by deception of more than $300.00, one count of theft by deception of less than $300.00, and one count of being a persistent felony offender in the first degree (PFO I). The thefts occurred when Brown billed various customers a total of $58,692.00 for construction work that he did not perform.

On April 20, 2006, Brown entered a plea of guilty. In exchange for that plea, the Commonwealth offered a sentence of eleven years’ imprisonment or probation that, if violated, would result in a sentence of thirty-five years’ imprisonment. The agreement also provided that Brown would make restitution and, to the extent he did so, any probationary sentence would be reduced. Brown testified that he understood the agreement, entered into it freely, and that he wanted to make restitution. Brown then asked the court to delay imposing a sentence until August 2006 so that he could earn money to start making restitution.

On April 24, 2006, the court entered three judgments on guilty plea, one for each of Brown’s indictments. We note that the judgments on guilty plea that are associated with case numbers 06-CR-000946 and 05-CR-002478 are essentially the same. The judgment on guilty plea in case number 05-CR-001911 is worded somewhat differently. However, in all three judgments, the court noted the terms of the plea agreement, including the amount of restitution owed. Pursuant to Brown’s request, the court set the sentencing hearing for August 10, 2006.

At the sentencing hearing, Brown stated that he had just obtained employment and had not been able to pay any restitution. He reiterated his intent to do so and asked the court to probate his sentence. The court noted Brown’s prior convictions and that Brown had previously violated probation/parole, and it sentenced him to eleven years’ imprisonment. ' The court’s judgment of conviction and sentence did not contain any reference to restitution.

In 2009, Brown was paroled. Brown’s parole officer noted that the judgment of conviction and sentence did not contain any restitution order. He contacted the Commonwealth’s Attorney’s office and asked it to move the court for an amended judgment of conviction and sentence so that restitution could be made a condition of Brown’s parole.

The Commonwealth filed the requested motion. After a hearing and over Brown’s objection, the court amended the judgment of conviction and sentence. In doing so, the court noted that it had some concern that it had lost jurisdiction because the Commonwealth had not sought a restitution order within ninety days of sentencing. Nonetheless, the court, relying on Kentucky Rule of Criminal Procedure (RCr) 10.10, amended the judgment of conviction and sentence and added the following language: “Defendant is ordered to make restitution to any victims identified either in the AOC 491.1 forms, victim impact statements, or restitution applications filed of record herein.” Because the court believed the Parole Board had the authority to determine the exact amounts owed and the appropriate payees, the court did not specify what amount Brown owed or to whom. Therefore, the court “transferred” the Commonwealth’s motion “to the Parole Board for determination of the details of how much restitution is to be paid, to whom, and on what schedule, pursuant to KRS 439.563(2).”

It is from this order that Brown appeals.

STANDARD OF REVIEW

Whether the trial court acted outside its jurisdiction in amending the judgment of conviction and sentence is a question of law, which we review de novo. Carroll v. Meredith, 59 S.W.3d 484, 489 (Ky.App.2001).

ANALYSIS

Brown argues that, because the judgment of conviction and sentence had been final for three years, the trial court did not have jurisdiction to amend it. The Commonwealth argues that, under RCr 10.10, the trial court had jurisdiction.

RCr 10.10 provides that:

Clerical mistakes in judgments, orders or other parts of the record and errors therein arising from oversight or omission may be corrected by the court at any time on its own initiative or on the motion of any party and after such notice, if any, as the court orders.

As noted by the parties, whether RCr 10.10 applies depends on whether the trial court’s failure to mention restitution in its initial judgment of conviction and sentence was a clerical mistake that arose from oversight or omission.

Both parties cite Cardwell v. Commonwealth, 12 S.W.3d 672 (Ky.2000), as supportive of their positions. Cardwell pled guilty to two charges of operating a motor vehicle under a revoked or suspended license and received a total sentence of five years’ imprisonment on the two convictions. He then stood trial for murder, was found guilty of manslaughter and assault, and received a total sentence of ten years. In open court, with Cardwell present, the trial court ordered the five-year and the ten-year sentences to run consecutively for a total of fifteen years’ imprisonment. However, when the trial court reduced its sentence to writing, it did not specify that the two sentences should run consecutively. Approximately eight months later, the trial court entered an amended judgment stating that the sentences were to run consecutively.

A divided Supreme Court of Kentucky held that the trial court legitimately corrected a clerical error. In doing so, the majority stated that there is a distinction between clerical errors, which are correctable under RCr 10.10, and judicial errors, which are not.

[T]he distinction turns on whether the error “was the deliberate result of judicial reasoning and determination, regardless of whether it was made by the clerk, by counsel, or by the judge.” Buchanan v. West Kentucky Coal Company, Ky., 218 Ky. 259, 291 S.W. 32, 35 (1927). “A clerical error involves an error or mistake made by a clerk or other judicial or ministerial officer in writing or keeping records.... ” 46 Am.Jur.2d, Judgments § 167.

Id. at 674.

The Commonwealth argues that Brown agreed to make restitution as part of his plea agreement, that restitution was incorporated into the court’s judgment on that plea, and that Brown admitted during several court appearances that he was obligated to and was going to make restitution. Therefore, the court’s omission of restitution in its sentence was simply a clerical error “arising from error or omission.” On the other hand, Brown argues that the same evidence shows that the judge was keenly aware that restitution was a factor in the plea agreement but that she made a judicial determination to exclude it from her sentence.

Although the language in Cardwell is instructive, it is distinguishable from the case herein. In Cardwell, the judge specifically stated at the sentencing hearing that the sentences were to run consecutively. Although the judge herein and the parties discussed restitution, the judge did not specifically state at the sentencing hearing that she was making restitution part of the sentence. Therefore, unlike in Cardwell, there is no specific statement by the judge that contradicts the written sentence.

In addition to Cardwell, Brown cites to Viers v. Commonwealth, 52 S.W.3d 527 (Ky.2001). In Viers, the trial court stated in court that it was giving Viers credit for time served. The court then set forth that credit in its written order. Sometime later, the court discovered that it had granted the credit in error and that no credit was due. The court then issued an amended sentence, deleting the credit. Vi-ers appealed and the Supreme Court revisited the distinction between clerical and judicial errors.

[T]he question of whether an error is “judicial” or “clerical” turns on whether the amended judgment embodies the trial court’s oral judgment as expressed in the record. See Presidential Estates Apartment Associates v. Barrett, 129 Wash.2d 320, 917 P.2d 100, 103 (1996). If it does, then the error is clerical in that the amended judgment either corrects language that is inconsistent with the oral judgment, or supplies language that was inadvertently omitted from the oral judgment. See id. at 104. But if it does not, then the error must be judicial.

Id. at 529.

As with Cardwell, Viers is distinguishable. The oral and written sentences in Viers were consistent, although they were premised on faulty information. Here, the court had sufficient and correct information, but it did not specifically make restitution a part of Brown’s sentence either orally or in writing.

We are persuaded that Rollins v. Commonwealth, 294 S.W.3d 463 (Ky.App.2009), most closely resembles the case herein and is controlling. Rollins pled guilty to a number of counts of arson and received a sentence of ten years’ imprisonment. “The final judgments provided that Rollins would pay restitution with ‘the amount of full restitution to be determined.’ ” Id. at 464. Rollins “served out” his sentence and the Commonwealth filed a motion seeking an order of restitution. The court granted the Commonwealth’s motion over Rollins’s objection and ordered Rollins to pay $183,317.50 in restitution.

On appeal, this Court pointed out several errors by the trial court. First, we held that an order of restitution must set the amount of restitution to be paid, which the trial court’s original sentencing order failed to do. Id. at 465. Second, we noted that a post-sentence petition for restitution must be filed within 90 days of sentencing. Because the Commonwealth waited more than seven years to seek an order of restitution, its motion was time barred. Third, we noted that “the mention of restitution in the plea agreement, at best, indicate[s] that a restitution claim would be forthcoming from the Commonwealth.” Id. at 466. In order to protect that claim, the Commonwealth is required to file a petition within 90 days of sentencing. Fourth, we noted that “[a] court loses jurisdiction ten days after the entry of final judgment, and such jurisdiction can only be renewed or extended by statute or rule.” Id. The only statute that extends that period is KRS 431.200, which requires the filing of a petition within 90 days. The only rule that extends that time is RCr 10.10, which provides for the correction of clerical errors. This Court held that the trial court’s mistaken belief that the original restitution order was sufficient was not a clerical error but a mistake involving a matter of substance. Id. at 466-67. We characterized that error as judicial error and not subject to correction under RCr 10.10. Therefore, we held that the trial court lacked the ability to correct its faulty restitution award. Id. at 467.

As in Rollins, Brown agreed to pay restitution as part of his plea agreement and the court acknowledged that agreement. Furthermore, it appears that Brown and the Commonwealth contemplated and agreed that restitution would be part of the sentence. However, the judge did not incorporate that agreement into the sentence. The failure to incorporate that agreement into the sentence, like the court’s failure to specify the amount of restitution in Rollins, is substantive and not simply a clerical error. Thus, the court’s failure to include restitution in the original sentence was not properly the subject of an RCr 10.10 motion/petition. Furthermore, the Commonwealth failed to file a petition asking the court to set restitution within the required ninety days. Therefore, the Commonwealth’s petition was not properly before the court and the court’s amended order and judgment must be reversed and vacated.

Finally, even if the amended sentence were permissible under RCr 10.10, it would not be a valid restitution order because it does not-specify the amount to be paid as required by KRS 532.033(3). Rollins, 294 S.W.3d at 465.

CONCLUSION

For the foregoing reasons, we reverse and vacate the trial court’s “Order Addressing Restitution and Correcting 8/22/06 Judgment of Conviction and Sentence.”

ALL CONCUR.


author: THOMPSON, Judge:

text:
    Wendy W. BURTON, Appellant, v. KENTUCKY FARM BUREAU MUTUAL INSURANCE COMPANY, Appellee.
    No. 2009-CA-001056-MR.
    Court of Appeals of Kentucky.
    Nov. 5, 2010.

      Otis Doan, Jr., Harlan, KY, for appellant.
    Robert M. Melvin, Harlan, KY, for ap-pellee.
    Before TAYLOR, Chief Judge; MOORE and THOMPSON, Judges.
   OPINION

THOMPSON, Judge:

Wendy W. Burton appeals from a summary judgment entered in the Harlan Circuit Court declaring that she was not entitled to underinsured motorists benefits under a policy of insurance issued by Kentucky Farm Bureau Mutual Insurance Company. The issue presented is whether a clause excluding UIM coverage of a vehicle owned by the insured or a family member is enforceable. We affirm.

Ms. Burton was injured when she was a passenger in a vehicle operated by her husband when it was involved in an accident. The 2001 Mountaineer that was registered to the Burtons was insured by Kentucky Farm Bureau. After her husband was determined to be at fault in causing the accident, a settlement for Ms. Burton’s bodily injury claims was reached for the policy limits of $25,000 under the Mountaineer policy. Ms. Burton then asserted a claim for underinsured motorist coverage under a separate Kentucky Farm Bureau policy on a 1976 Ford Bronco registered to her husband and available for her use.

After the claim was denied by Kentucky Farm Bureau, Ms. Burton filed an action in the Harlan Circuit Court. Following discovery, Kentucky Farm Bureau moved for summary judgment on the basis that under the terms of the policies issued, Ms. Burton could not recover UIM benefits. The circuit court agreed and granted Kentucky Farm Bureau summary judgment.

Our review of a summary judgment is de novo. Blevins v. Moran, 12 S.W.3d 698, 699 (Ky.App.2000). Although summary judgment must be granted with caution, it is warranted when there is no material issue of fact in dispute and the moving party is entitled to judgment as a matter of law. Steelvest Inc. v. Scansteel Service Center, Inc., 807 S.W.2d 476, 482-83 (Ky.1991).

Ms. Burton misstates that the issue in this case is whether or not she can “stack” the coverage under the'two separate policies and cites Kentucky cases discussing the “stacking” of insurance policies. See e.g. James v. James, 25 S.W.3d 110 (Ky.2000); Allstate Ins. Co. v. Dicke, 862 S.W.2d 327 (Ky.1993). However, the issue presented does not concern “stacking” of the two insurance policies: It is whether Ms. Burton can recover UIM benefits under the terms of the policies.

The policies state that underinsured motor vehicle “does not include any vehicle or equipment ... owned by or furnished or available for the regular use of you or any family member.” There is no dispute that the vehicle in which Ms. Burton was a passenger is owned by her and her husband and that the 1976 Bronco is a vehicle also registered to her husband and is available for Ms. Burton’s use. Thus, the terms of the policies exclude underinsured motorists coverage under the facts. We have repeatedly upheld virtually identical provisions under similar facts and do so again in this case.

Although numerous Kentucky cases could be cited in support of our conclusion, we need rely on only one: Murphy v. Kentucky Farm Bureau Mutual Insurance Company, 116 S.W.3d 500 (Ky.App.2003). Construing the precise policy language as in the present policies, this Court held that underinsured motorists coverage was unavailable based on statutory law and the policy itself.

In Murphy, Austin Goodpaster was fatally injured in a single-car accident while riding as a passenger in a vehicle operated by his brother and owned and insured by his mother. Austin was a minor who resided in the household with his mother and step-father who owned vehicles insured through separate policies with Kentucky Farm Bureau, which both contained UIM coverage. The estate filed an action to collect UIM benefits.

This Court affirmed the trial court’s grant of summary judgment in favor of Kentucky Farm Bureau on the basis that the regular-use exclusion in the policies barred the estate from collecting UIM benefits. In doing so, it was emphasized that the “justification for the regular-use exclusion is not the possibility of collusion but, rather, the fact that the insured or another family member has control over how much liability is purchased.” Id. at 503. We echo the conclusions reached by this Court and our Supreme Court when reviewing exclusions from UIM coverage as now presented.

There is nothing ambiguous about this exclusion. A vehicle owned by or furnished or available for the regular use of the named insured or a family member is not an “underinsured vehicle.” The obvious reason for the exclusion is that the named insured can avoid the fact of underinsurance by simply purchasing additional liability insurance coverage for his vehicle.

Id. at 502(citing Motorists Mutual Insurance Co. v. Glass, 996 S.W.2d 437, 449-50 (Ky.1997)).

Regular-use exclusions from UIM coverage have been repeatedly upheld as not being against public policy and, because the Kentucky Farm Bureau exclusion is unambiguous, the doctrine of reasonable expectations does not apply.

[T]he reasonable expectation doctrine ... resolves an insurance-policy ambiguity in favor of the insured’s reasonable expectation^] ... The reasonable expectation doctrine “is based on the premise that policy language will be construed as laymen would understand it” and applies only to policies with ambiguous terms— e.g., when a policy is susceptible to two (2) or more reasonable interpretations. Under the reasonable expectations doctrine, when such an ambiguity exists, the ambiguous terms should be interpreted “in favor of the insured’s reasonable expectations.” ... Only actual ambiguities, not fanciful ones, will trigger application of the doctrine.

True v. Raines, 99 S.W.3d 439, 443 (Ky.2003) (citations and footnotes omitted).

Ms. Burton points out the factual distinctions between Murphy and the present case. Specifically, she emphasizes that in Murphy, the estate sought to recover UIM benefits under the underinsured policies of two household members who were not involved in the accident while she had a “reasonable expectation of coverage under her two (2) policies, for the two (2) vehicles which paid two (2) separate premiums.” Ms. Burton’s attempt to escape the unambiguous exclusion in the policies issued by Kentucky Farm Bureau and the law as stated in Murphy is unpersuasive. Regardless of the factual distinctions, it remains that the vehicle in which Ms. Burton was a passenger was not an underinsured vehicle.

Accordingly, the summary judgment is affirmed.

ALL CONCUR.


author: ROBERT G. DOWD, JR., Judge.

text:
    Harold HANSEN, Respondent, v. W.K. HALLIBURTON and Halliburton Financial Services, Inc., Appellants.
    No. ED 93688.
    Missouri Court of Appeals, Eastern District, Division Four.
    Oct. 5, 2010.

      Charles F. Durfour, Jr., St. Louis, MO, for Appellant.
    Angela M. Redden-Jansen, St. Louis, MO, for Respondent.
   ROBERT G. DOWD, JR., Judge.

W.K. Halliburton (“Halliburton”) and Halliburton Financial Services, Inc. (collectively “HFS”) appeal from the judgment in favor of Harold E. Hansen (“Hansen”) in the amount of $408,271.58. HFS alleges: (1) the trial court erred in concluding HFS failed to meet its burden of proof on its counterclaim; (2) the trial court erred in concluding that, exclusive of tax consequences, Hansen suffered $304,609.58 in damages as a consequence of Defendants’ disbursement of $804,609.58 from Hansen’s IRA accounts without his authorization or consent; (3) the trial court’s judgment that the unauthorized disbursements from Hansen’s IRA accounts made by HFS between April of 2002 and 2006 resulted in $103,662.00 of negative tax consequences for Hansen was not supported by competent and substantial evidence; and (4) the trial court erred in awarding Hansen $408,271.58 as a consequence of HFS’s unauthorized disbursement of $304,609.58 from Hansen’s IRA accounts. We reverse and remand.

In 1985, after the death of his wife, Hansen, a retired aerospace engineer, retained HFS for assistance with financial matters, including paying bills, filing taxes, and managing investments. The parties did not execute a written contract; however, in January of 1988 Hansen conferred a general power of attorney on HFS so they could file tax returns, sell real estate, pay bills, and otherwise conduct business on Hansen’s behalf. Also, beginning in 1989, Hansen transferred his self-directed IRA accounts to HFS for them to manage.

HFS managed Hansen’s affairs for many years. During this time, Hansen bought and subsequently sold a partnership interest in a partnership called B & H Partnership, which was created by Halliburton to construct an office building, the Edison Building, in the Chesterfield valley. Hansen also engaged in other investment opportunities and financial dealings, which included purchasing real estate and taking out loans. Hansen had taken out a loan with Mega Bank to pay for expenses associated with his partnership interest in B & H Partnership, but had subsequently become dissatisfied with Mega Bank. Hanson then went to HFS to seek assistance with ending his obligations to Mega Bank.

In 1989, HFS arranged to have Hansen take a loan from another client, Elizabeth Polczynski (“Polczynski”), for $107,248.41. This loan was secured by deeds of trust for three properties: 1163 Ashford Drive, St. Louis, Missouri 63137 (“the Ashford Property”), 1215 Bakewell Drive, St. Louis, Missouri 63137 (“the Bakewell Property ”), and 2424 Farnham Court, Florissant, Missouri 63033 (“the Farnham Property”). Around the same time, Hansen signed a promissory note signifying that he took a loan from HFS for $101,589.21, which was secured by the same properties. Hansen used the proceeds from his loans with Polczynski and HFS to pay off his loan with Mega Bank. Thus, the loans from Polczynski and HFS allowed Hansen to pay off his debt to Mega Bank, which was related to his partnership interest in B & H Partnership, but he remained indebted to Polczynski and HFS.

In April of 2002, the parties separated, and the power of attorney that Hansen had conferred upon HFS was formally terminated by mutual agreement. Hansen resumed control of his financial matters, but the record shows that from April of 2002 on, HFS continued to exercise control over Hansen’s IRA accounts and to make distributions from those accounts to pay off over $200,000 in loans to Polczynski and HFS.

Hansen subsequently filed a petition against HFS and Polczynski. Hansen’s petition included eight counts. The first six counts were against HFS and included: Count I to quiet title regarding three properties: the Ashford Property, the Bakewell Property, and the Farnham Property; Count II for an accounting; Count III for breach of trust and negligence; Count IV for fraud; Count V to set aside the transfer of partnership; and Count VI for co-mingling and conversion of funds. The remaining two counts were asserted against Polczynski and included: Count VII for money had and money received and Count VIII for conspiracy to commit fraud.

HFS filed an answer in which it asserted numerous affirmative defenses. HFS also asserted a counterclaim, arguing Hansen was indebted to HFS on an unpaid promissory note, which was secured by the three properties and Hansen had defaulted on the note.

Thereafter a bench trial was held and both parties adduced evidence. Subsequently, the trial court entered its judgment. The trial court ruled against Hansen on Counts I, V, VI. Further, the trial court found the claim in Count II was moot. However, the trial court ruled in favor of Hansen on counts III and IV. The trial court noted it was clear that after Hansen revoked his power of attorney to HFS, HFS continued to make distributions from Hansen’s IRA accounts when it had no authority, express or implied, to continue to do business or satisfy financial obligations on Hansen’s behalf. Thus, the trial court held any and all distributions dating from April 2002 and made from Hansen’s IRA account by HFS were done without authority and fraudulently, and Hansen’s testimony regarding his authority was found to be credible. Further, the trial court found Halliburton’s testimony regarding his authority was not credible, especially in light of the lack of any supporting evidence.

As to damages, the trial court found Hansen had incurred $103,662.00 in negative tax consequences from the unauthorized disbursement of proceeds from Hansen’s IRA accounts. Further, the trial court found HFS had disbursed proceeds from Hansen’s IRA accounts without authorization in the amount of $304,609.58.

In finding HFS failed to meet its burden on its counterclaim on an allegedly outstanding promissory note, the trial court noted it was unable to determine the validity of the parties’ various notes and deeds of trust. More generally, the trial court noted it “was unable to determine exactly what transpired between the parties with regard to their real estate dealings, loan transactions, and limited partnership.”

Thus, the trial court entered judgment in favor of Hansen and against HFS on Counts III for breach of trust and negligence and Count IV for fraud in the amount of $408,271.58. This appeal follows.

Our Court reviews a bench-tried case under the standard set forth in Murphy v. Carron, 536 S.W.2d 30, 32 (Mo. banc 1976). Jewish Center for Aged v. BSPM Trustees, Inc., 295 S.W.3d 513, 518 (Mo.App. E.D.2009). We will affirm the judgment of the trial court unless it is not supported by substantial evidence, unless it is against the weight of the evidence, or unless it erroneously declares or applies the law. Id. As the trier of fact, it is the trial court’s function and duty to assess the weight and value of the testimony of each witness. Id. We defer to the trial court’s superior opportunity to assess the credibility of the witnesses. Id. We view the evidence and all reasonable inferences drawn therefrom in the light most favorable to the trial court’s judgment and disregard all contrary evidence. Id.

In its first point, HFS argues the trial court erred in concluding HFS had failed to meet its burden of proof on its counterclaim because HFS made a prima facie case for recovery on its counterclaim and Hansen failed to rebut its prima facie case with clear, cogent, and convincing evidence. We agree.

HFS contends a $101,589.21 promissory note dated June 27, 1989 and payable to HFS was introduced into evidence and that Hansen admitted to signing this note. Further, HFS alleged it showed through witness and documentary evidence there remained a balance of $65.495.80 on the note as of December 27, 2007. Hansen testified that he had signed the note, and had used the funds represented by the note to pay off the balance of another loan to Mega Bank.

In a suit on a note, the holder makes a prima facie ease by producing the note admittedly signed by the maker and showing the balance due. Sverdrup Corp. v. Politis, 888 S.W.2d 753, 755 (Mo.App. E.D.1994). The burden is then upon the party against whom the note would be enforced to establish a defense by clear, cogent, and convincing evidence. Id. If the person against whom the note would be enforced fails to establish any defense, the holder is entitled to recovery. Magna Bank of Madison County v. W.P. Foods, Inc., 926 S.W.2d 157, 161 (Mo.App. E.D.1996).

In this case, HFS produced a note admittedly signed by Hansen and showing the balance due. HFS presented the testimony of Geraldine Kirchoff that there remained a balance of $69,425.55 on the HFS note as of June of 2009. Hansen presented evidence that in exchange for the loan from HFS, he executed deeds of trust in favor of HFS on three properties he owned: the Ashford Property, the Bake-well Property, and the Farnham Property. Hansen testified that the debts to Polczyn-ski and HFS secured by these deeds of trust should have been paid off with the sale of Hansen’s partnership interest in B & H Partnership in 1993. Hansen also asserted that unauthorized disbursements from his IRA accounts went to pay these same debts to Polczynski and HFS. The argument asserting Hansen’s debts were extinguished with the sale of Hansen’s partnership interest in B & H Partnership in 1993 has no support in the record. However, there is evidence that Hansen’s debts were paid through disbursements from his IRA accounts.

As the trial court stated, it was unable to determine exactly what transpired between the parties with regard to their loan transactions, real estate dealings, and limited partnership. However, HFS made a prima facie case that it was owed money on the promissory note, and Hansen failed to produce substantial evidence that the note in favor of HFS was paid off either through the sale of his interest in B & H Partnership or through the unauthorized disbursements from his IRA accounts.

Therefore, we find the trial court erred in concluding HFS had failed to meet its burden of proof on its counterclaim. We remand to the trial court to determine the amount owed by Hansen to HFS including any costs and for entry of judgment in favor of HFS on its counterclaim for that amount and for any other relief deemed appropriate. Point granted.

In its second point, HFS argues the trial court erred in concluding that, exclusive of tax consequences, Hansen suffered $304,609.58 in damages as a consequence of Defendants’ disbursement of $304,609.58 in proceeds from Hansen’s IRA accounts without his authorization or consent. We agree.

HFS contends the record establishes the $304,609.58 in proceeds from Hansen’s IRA accounts was disbursed to make payments totaling $304,609.58 on the unpaid balances of promissory notes to Polczynski and HFS. Further, HFS asserts Hansen has retained the $304,609.58 benefit he received from the paying down of the two promissory notes. In essence, HFS argues because Hansen’s funds were used without authorization to pay his own debts, the proper measure of damages is the total amount of unauthorized transactions minus the total amount of unauthorized payments from which Hansen received and retained a benefit. HFS asserts, under this measure of damages, Hansen was entitled to only $481.61, and that the trial court’s award amounts to a double recovery.

In Missouri, a victim of fraud has a choice, he can either rescind the transaction, tender return of any benefits he obtained by the transaction, and seek judicial aid to recover the benefits he conveyed, or he can adhere to the transaction, retaining whatever benefits inured to him, and seek to recover in damages the difference in value between what he actually received and what he would have received had there been no fraud. Rosenblum v. Jacks or Better of America West Inc., 745 S.W.2d 754, 764 (Mo.App. E.D.1988). In other words, a victim of fraud can undo the transaction or he can obtain the benefit of the bargain, but he cannot do both. Id.

In this case, the trial court determined any and all distributions dating from April 2002 and made from Hansen’s IRA account by HFS were done without authority and fraudulently, and Hansen’s testimony regarding his authority was found to be credible. Further, the trial court found Halliburton’s testimony regarding his authority was not credible, especially in light of the lack of any supporting evidence. Hansen testified he never gave HFS authority to make any disbursements after he revoked his power of attorney. Further, Hansen testified he did not realize these payments were being made. The trial court found Hansen to be credible regarding his lack of authorization.

However, HFS’s argument is that even if it did not have authority to make the disbursements, the trial court’s judgment has, in effect, given Hansen a double recovery. HFS asserts it made the disbursements, but the money went to pay down notes on which Hansen was indebted to Polczynski and HFS. Thus, Hansen recovers the disbursements, but he does not re-incur the indebtedness. For his part, Hansen contended in his testimony at trial that his indebtedness to Polczynski and HFS had been paid off when he sold his interest in the B & H Partnership in 1993, well before the unauthorized disbursements began. As mentioned earlier, there is no evidence in the record to support this assertion. However, there is evidence to show Hansen’s debt was paid through unauthorized disbursement from his IRA accounts. As noted above, the trial court found it was unable to determine exactly what transpired between the parties with regard to their loan transactions, real estate dealings, and limited partnership.

However, the trial court’s judgment resulted in him receiving the benefit of having his debts at least partially paid off in addition to being repaid for the unauthorized disbursements that paid down those debts. Thus, Hansen improperly received a double recovery.

Therefore, we find the trial court erred in concluding that, exclusive of tax consequences, Hansen suffered $804,609.58 in damages as a consequence of Defendants’ disbursement of $804,609.58 in proceeds from Hansen’s IRA accounts without his authorization or consent. We remand to the trial court for a determination of the actual amount, if any, of Hansen’s damages after deducting the benefits which inured to Hansen from the unauthorized disbursements. Point granted.

In its third point, HFS argues the trial court’s judgment that the unauthorized disbursements from Hansen’s IRA accounts made by HFS between April of 2002 and 2006 resulted in $103,662.00 of negative tax consequences for Hansen was not supported by competent and substantial evidence. We agree.

HFS contends the calculations on which the trial court relied were insufficient because Hansen’s expert witness, John Mo-roney (“Moroney”), admitted his calculations failed to take into account a variety of relevant factors. Further, Moroney’s calculations included $11,272.00 in damages for tax years 2000 and 2001, which pre-dated the alleged unauthorized IRA disbursements. Moreover, HFS claims Hansen’s damage estimate of $76,432.00 for tax year 2006 was demonstrably inaccurate and excessive in that it failed to credit Hansen for the $43,983.12 federal withholding tax payment HFS made on Hansen’s behalf in July of 2006. Lastly, HFS claims Hansen did not show the negative tax consequences he suffered were incurred as a direct and proximate cause of HFS’s actions.

Generally, damages need not be established "with absolute certainty, but reasonable certainty is required as to both existence and amount, and the evidence must not leave the matter to speculation. V.J.M. Associates, Inc. v. Gilmore, 44 S.W.3d 440, 441 (Mo.App. E.D.2001).

In this case, Hansen’s evidence only showed the “possible tax effects to certain transactions that could have been made.” Further, when creating Exhibit 68, a summary of the tax effects Hansen incurred from 2000 through 2006, Moroney testified there were a lot of factors that went into the calculation of whether or not qualified mortgage interest was deductible and his estimation of the tax consequences failed to account for all of those factors. As a result, we find the evidence of negative tax consequences is too speculative and there is not competent support for the trial court’s judgment on that count.

Therefore, the trial court’s judgment that the unauthorized disbursements from Hansen’s IRA accounts made by HFS between April of 2002 and 2006 resulted in $103,662.00 of negative tax consequences for Hansen was not supported by competent and substantial evidence. Point granted.

In its fourth point, HFS argues the trial court erred in awarding Hansen $408,271.58 as a consequence of HFS’s unauthorized disbursement of $304,609.58 in proceeds from Hansen’s IRA accounts.

This point was asserted in the alternative to HFS’ second and third points. Because we have found in favor of HFS on those points, this point is rendered moot.

The judgment of the trial court is reversed and remanded. We remand to the trial court to determine the amount owed by Hansen to HFS including any costs and for entry of judgment in favor of HFS on its counterclaim for that amount and for any other relief deemed appropriate. Further, we remand to the trial court for a determination of the actual amount, if any, of Hansen’s damages from the unauthorized disbursements using the proper calculation for damages set out in this opinion. Lastly, we reverse the trial court’s judgment that the unauthorized disbursements from Hansen’s IRA accounts made by HFS between April of 2002 and 2006 resulted in $108,662.00 of negative tax consequences for Hansen.

KURT S. ODENWALD, P.J. and NANNETTE A. BAKER, J., concur.

      . Hansen did not file a brief for this appeal.

      . In the transcript this property is referred to as the "Bankwell” property.

      . Polczynski was never served with the petition. The trial court eventually dismissed the claims against Polczynski for lack of jurisdiction and dismissed Polczynski without prejudice.

      . We note that during these years, Hansen’s tax were prepared by his own accountant, not by HFS.