source: Caselaw Access Project

author: Justice SCOTT.

license: Public Domain

text:
    KENTUCKY FARM BUREAU MUTUAL INSURANCE COMPANY, Appellant, v. SHELTER MUTUAL INSURANCE COMPANY, Appellee.
    No. 2008-SC-000781-DG.
    Supreme Court of Kentucky.
    Nov. 18, 2010.
    Grover Carrington, Farrah Williams Ingram, White Peck Carrington, LLP, Mount Sterling, KY, Counsel for Appellant.
    James Wendell Taylor, Amanda Pope Thompson, Taylor, Thompson & Brannon, PLLC, Lexington, KY, Counsel for Appel-lee.
   Opinion of the Court by

Justice SCOTT.

I. Introduction

This is an appeal from an opinion of the Court of Appeals reversing the Montgomery Circuit Court, which had imposed primary liability for a motor vehicle accident on the vehicle’s and vehicle owner’s insurer, rather than on the insurer of the permissive driver. Neither policy was for a business or commercial coverage.

After paying the damages, the vehicle’s and vehicle owner’s insurer, Shelter Mutual Insurance Company (Shelter), filed a declaratory judgment action and subsequent motion for summary judgment against Kentucky Farm Bureau Mutual Insurance Company (Farm Bureau), the permissive driver’s insurer, seeking to recover a pro-rata allocation of the damages between it and Farm Bureau. Farm Bureau filed a cross-motion for summary judgment asserting Shelter’s primary liability as the primary insurer of the vehicle and thus, Farm Bureau, with its “excess insurance clause,” would be an excess carrier only.

The trial court granted Farm Bureau’s cross-motion for summary judgment, holding Shelter liable for the damages. It did not, however, detail its findings or reasoning in its summary judgment order. The Court of Appeals subsequently reversed, finding — as contended by Shelter — that each of the insurers’ policies contained “mutually repugnant” excess insurance clauses, and thus prorated the damages between the insurers.

Because we find that Shelter, the vehicle’s and vehicle owner’s insurer, was the primary insurer as mandated by the spirit and intent of the Kentucky Motor Vehicle Reparations Act (MVRA), KRS 304.39-010, et seq., we hold that the Court of Appeals erred when it reversed the Montgomery Circuit Court and prorated the damages. We, therefore, reverse the decision of the Court of Appeals and reinstate the decision of the trial court.

II. Background

This case stems from a two-car accident in which Farm Bureau insured Kevin Watkins (Kevin), the non-owner, but permissive driver, of the vehicle, while Shelter insured the vehicle through the owner’s policy, and, thus, the permissive driver. Although insured by Farm Bureau under his own separate policy on his vehicle, Kevin was driving his parents’ vehicle when he negligently collided with another vehicle, causing injuries. Shelter was the insurer for the parents’ vehicle, while Farm Bureau insured Kevin personally.

The issue then is which of the companies — Farm Bureau insuring the non-owner driver and Shelter insuring the vehicle, owner, and permissive driver — is liable and therefore obligated to pay the damages. The complication arises because each of the two policies arguably contains an “excess insurance clause” purporting only to provide coverage in excess of the other’s coverage. Thus, normally we would be called on to determine which policy, if any, is primary and which is excess, or if both are excess and mutually repugnant, how the damages should be pro-rated between them.

In acknowledging the importance of the questions presented, we are aware of Shelter’s assertion in its brief to the Court of Appeals that:

[T]he issues presented in this case arise every time the policy forms collide. Moreover, one or more of [the] policy forms at issue in this case are used by [other] insurers, multiplying exponentially the number of times when the competing forms collide. Thus, there is far more at stake than the amount in controversy.

In this same regard, we note Farm Bureau’s concern in its brief that “[t]he issues presented by this case arise each time the terms of separate policies are at odds. The policy language at issue is used by multiple companies which causes similar issues to arise on a frequent basis, making this case of far greater significance than it may appear.”

In this regard, Shelter’s excess clause for its insurance on the vehicle states: “[i]f there is other insurance which covers the insured’s liability with respect to a claim also covered by this policy, [liability] Coverages A and B of this policy will apply only as excess to such other insurance.”

Yet, Farm Bureau’s excess insurance clause (for Kevin’s insurance) states: “[a]ny insurance we provide for a vehicle you do not own shall be excess over any other collectable insurance or self-insurance whether primary, excess or contingent.” (Emphasis added).

Notwithstanding that Farm Bureau’s clause seems, at first blush, to be an “excess over excess” in that it recognizes that another competing policy may be an excess policy, but still asserts an excess position over such other excess coverage, see Globe Indem. Co., 415 S.W.2d at 582, the Court of Appeals determined that both clauses evince both insurers’ intention to provide only excess coverage. Hence, the Court of Appeals found the clauses mutually repugnant and remanded the matter to the trial court for proration of the damages between both insurers.

However, after due consideration, we reverse the Court of Appeals, and hold that the insurer of the vehicle in this case, Shelter, had the primary coverage and was thus liable for the damages to the extent of its coverage. In so doing, we decline, in this instance, to further embroil Kentucky courts in unduly complicated two-step insurance policy interpretations of continually emerging and changing insurance avoidance clauses and the consequent burden of apportionment because such considerations are inconsistent with the policies and intent of the MVRA.

III. Analysis

We are confronted here with a scenario wherein both automobile insurance policies claim to provide only excess coverage. Logically, under the circumstances, both cannot be excess insurers; rather, practically and semantically, one must be primary with the other secondary (responsible for the excess), or both must be deemed to be primary.

Indeed, there is actually no way by logic or word-sense to reconcile two such clauses, where each policy by itself can apply as a primary insurer, but where the clause in each policy nevertheless attempts to make its own liability secondary to that of any other policy issued by a similar primary insurer: For then the primary and (attempted) secondary liability of each policy chase the other through infinity, something like trying to answer the question: which came first, the chicken or the egg?

State Farm Mutual Insurance Co. v. Travelers Insurance Co., 184 So.2d 750, 753-54 (La.App.1966) (Tate, J., concurring); see also Pioneer State Mut. Ins. Co. v. TIG Ins. Co., 229 Mich.App. 406, 581 N.W.2d 802 (1998).

And here, any contrary result would be in contravention of the spirit and intent of Kentucky’s 1974 enactment of the MVRA. KRS 304.39-010, et seq. In this regard, the MVRA policy and purposes section, KRS 304.39-010, states in part:

The toll of about 20,000,000 motor vehicle accidents nationally and comparable experience in Kentucky upon the interests of victims, the public, policyholders and others require that improvements in the reparations provided for herein be adopted to effect the following purposes:
(2) To provide prompt payment to victims of motor vehicle accidents without regard to whose negligence caused the accident in order to eliminate the inequities which fault-determination has created;
(3) To encourage prompt medical treatment and rehabilitation of the motor vehicle accident victim by providing for prompt payment of needed medical care and rehabilitation;
(5) To reduce the need to resort to bargaining and litigation through a system which can pay victims of motor vehicle accidents without the delay, expense, aggravation, inconvenience, inequities and uncertainties of the liability system;
(6) To help guarantee the continued availability of motor vehicle insurance at reasonable prices by a more efficient, economical and equitable system of motor vehicle accident reparations;
(7) To create an insurance system which can more adequately be regulated; and
(8) To correct the inadequacies of the present reparation system, recognizing that it was devised and our present Constitution adopted prior to the development of the internal combustion motor vehicle.

Clearly, it would be a violation of the spirit and intent of the MVRA to allow each insurer to deny coverage based on a claimed contractual excess position, since without a primary insurer, there can be no excess. And while admittedly, Shelter paid the claim promptly in this instance, there are no guarantees that similar competing (and arguably) excess insurers will always do so in the future, further inhibiting the clear mandate of the MVRA. See Calvert Fire Ins. Co. v. Stafford, 437 S.W.2d 176, 177 (Ky.1969) (“Neither of the insurance companies would pay the loss.... ”). Thus, any contrary logic must cany with it the uncertainty and potential delays of the litigation necessary to establish — and re-establish — the priority and coverage from which reparations are to be made.

Generally, where the focus is on each insurer’s competing avoidance of liability clauses, courts take a bifurcated and sometimes complicated approach, with the court examining the policies, and if the court finds them mutually repugnant, it then apportions the loss in various ways between each insurer. See 7A Am.Jur.2d Automobile Insurance § 573 (2010) (listing decisions from multiple state and federal courts finding clauses mutually repugnant and holding each insurer liable for a share of the loss).

A. The Two-Step Framework

Under this approach, the court must first examine each policy. If, after examining the relevant clauses in each policy, “the two policies are indistinguishable in meaning and intent, [and] one cannot rationally choose between them [they are held] to be mutually repugnant and must be disregarded.” Travelers Indem. Co. v. Chappell, 246 So.2d 498, 504 (Miss.1971) (internal quotations omitted). Once found to be mutually repugnant, the trial court apportions liability between the insurers.

Once step one is resolved, and the court finds the competing clauses to be mutually repugnant, there are three primary options for pro-rata apportionment: policy limits, premiums paid, and the equal share method. Reliance Ins. Co. v. St. Paul Surplus Lines Ins. Co., 753 F.2d 1288, 1291 (4th Cir.1985). Under the policy limits approach, the court calculates the loss amount between each insurer in accordance with the maximum coverage limits of each insurance policy. Id. The second approach allocates the loss based on the amount of the premium paid by each insured to each insurer. Id. The third approach is a multi-step method, with the loss initially apportioned equally between two insurers until the lesser coverage is exhausted. Id. Thereafter, the remaining loss is absorbed by the insurance company with the larger policy, up to its policy limits. Id.

1. Problems with the Two-Step Framework

Numerous problems arise, however, with the application of the two step method. At the outset, as the parties somewhat acknowledge, it encourages insurance companies to continuously draft specific clauses seeking to evade primary liability; sometimes at odds with the premium charged on the insurance required of the insured under the MVRA. In addition, the apportionment methods can be replete with difficulty and complexity — and one might opine — unfairness.

a. The Mutually Repugnant Determination prompts Insurers to Engage in a “Drafting Battle”

The first step, determining whether the policies are “indistinguishable in meaning and intent,” is a highly subjective determination. Chappell, 246 So.2d at 504. Thus, unless the policies in question are virtually the same, two trial courts could potentially examine the same policies and come to opposite conclusions when determining whether they are mutually repugnant. Consequently, there is a substantial risk this initial step will produce varying results. And, with the nuances in wording, there is a plethora of precedent with different results. See Oregon Auto. Ins. Co. v. U.S. Fidelity & Guaranty, 195 F.2d 958, 959 (9th Cir.1952) (“These decisions point in all directions.”); see also W.R. Habeeb, Annotation, Apportionment of liability between automobile liability insurers where one of the policies has an “excess insurance” clause and the other a “proportionate” or “prorata” clause, 76 A.L.R.2d 502 (1961); C.C. Marvel, Annotation, Apportionment of liability between liability insurers each of whose policies provides that it shall be “excess” insurance, 69 A.L.R.2d 1122 (1960); C.C. Marvel, Annotation, Apportionment of liability between automobile liability insurers one or more of whose policies provide against any liability if there is other insurance, 46 A.L.R.2d 1163 (1956); see also Aetna Ins. Co. v. State Auto. Mut. Ins. Co., 368 F.Supp. 1278, 1282 (W.D.Ky.1973) (“[T]he Court realizes that this opinion represents only an educated guess as to what the Court of Appeals of Kentucky might say in a similar situation, but an educated guess is mandated under the circumstances brought about by this diversity action.”).

A solution to this problem is to draft a policy so specific in nature that it is more distinguishable in meaning and intent than others. And where successful, the insurer avoids primary liability. Thus, as a reactionary measure, each company may continuously draft and redraft provisions, seeking to avoid the mutually repugnant analysis while placing primary liability on the other company. This then leads to repetitive litigation between the old and newly emerging clauses. “Reconciling the various other-insurance clauses in automobile-liability policies has forced some courts to referee the ‘battle of the draftsmen’ waged by insurance companies.” Brown v. Travelers Ins. Co., 610 A.2d 127, 130 (R.I.1992).

b. Pro Rata Apportionment Problematic

The second step, appropriating the loss between the companies, presents its own set of problems with varying precedent. The inherent problems in each of the three available methods led one court to conclude, “unfortunately, no method of apportioning liability is entirely satisfactory.” Continental Cas. Co. v. Aetna Cas. and Sur. Co., 823 F.2d 708, 711 (2nd Cir.1987).

The first apportionment method, pro-ration based on the maximum policy limits, has been criticized as inequitable. Reliance Ins. Co., 753 F.2d at 1291. The criticism stems from the buyer’s proportionally lower additional cost to purchase insurance in excess of the minimum amount. For example, where an insured’s policy limit is three times the minimum coverage level, thus tripling the insurance company’s exposure in an apportionment situation, the insured has not paid triple the minimum premium amount. See Cosmopolitan Mutual Insurance Company v. Continental Casualty Co., 28 N.J. 554, 147 A.2d 529, 584 (1959) (stating that “[i]t is commonly known that the cost of liability insurance does not increase proportionately with the policy limits.”).

Furthermore, even if the loss amount is within the smaller policy limits, the larger insurance company nevertheless covers a greater segment of the loss since the calculus is based on the maximum policy limits. See Carriers Ins. Co. v. American Policyholders’ Ins. Co., 404 A.2d 216 (Me.1979) (criticizing this method as apportioning a greater amount of the loss on the larger insurer regardless of the amount).

The second apportionment method, prorating based on the premiums paid, has limited practical application. At first blush, this method may seem equitable as the amount each insured pays for a premium generally correlates to the amount of the coverage provided by the insurance company. However, this method is difficult to fairly apply when the two policies in question provide different coverage. Reliance Ins. Co., 753 F.2d at 1291. Many factors, aside from those used in the liability calculation, account for the premiums an insurance company charges a specific policyholder (e.g., payment history and various discounts). Id.

Finally, the third apportionment method, the equal share method, provides a •windfall for the smaller insurer in less than policy limits damages, while in high damages situations, allocates a disproportionate share of the loss to the larger insurer., Under this apportionment method, each insurer contributes matching dollar for dollar payments up to the limits of the lower policy, with the larger insurer solely responsible for any remaining portion of the loss, up to its policy limits. If, however, the damages are insufficient to exhaust the smaller policy, the two insurers both split the loss evenly.

Having analyzed the existing options for apportionment, we agree somewhat with the Second Circuit’s conclusion that each of these methods of apportioning liability between insurers is somewhat unsatisfactory. Continental Cas. Co., 823 F.2d at 712. Furthermore, the apportionment methods can provide a windfall for the lower limit policies and unnecessarily burden the trial courts with the task of determining which factors (determining apportionment) are relevant to the analysis required.

In addition, such an analysis promotes insurance clause writing competition that rewards insurers that, through the “drafting game,” successfully draft policies that avoid primary liability in these situations. And by obscuring the initial identity of the primary insurer, it promotes inefficiency in the prompt payment and treatment of vehicle accident victims, contrary to the demands of the MVRA. KRS 304.39-010(2)-(5).

Moreover, such a rule is inconsistent with our “simpler is better and less litigious” view of the spirit and intent of the MVRA as stressed in Mitchell v. Allstate Ins. Co., 244 S.W.3d 59, 63 (Ky.2008) (“[w]e believe that the ... rule will further the goals of KRS 304.39-010 by speeding up the process of compensating victims because determining the [issue] will no longer be as complex, or litigation prone, as it was under the [old] rule.”).

B. The Vehicle Owner’s Insurance is Primary

As we have detailed above, problems proliferate at each apportionment step and with every method. Moreover, when faced with two conflicting excess clauses, many courts recognize the absurdity of finding that neither policy is primary. Thus, courts create the legal fiction that both insurers are de facto primary and must share the loss. And some even do it in the hopes it will stop the “drafting wars.” See Brown, 610 A.2d at 130 (“[W]e do believe that ruling in full for either Metropolitan or Travelers would lend more ammunition to the battle of the drafters. We do not wish to encourage the complication of insurance legerdemain at the expense of the policy holders’ money or the courts’ time.”).

While we recognize that the apportionment methods are an attempt at fairness and at times they must be adhered to, we can avoid the entire framework under these circumstances by refusing to perpetuate the legal fiction that both insurers are primary when the contest is between the insurer of the vehicle and the insurer of the non-owner, permissive driver. It is simply as we said in Motorists Mut. Ins. Co. v. Glass; “the insurer of the motor vehicle involved in the accident, [Shelter,] was the ‘primary’ insurer for this accident, whereas Farm Bureau was the ‘excess’ insurer.” 996 S.W.2d 437, 442 (Ky.1997). “This accords with the general rule which places primary liability on the insurer of the owner of the automobile involved rather than on the insurer of the operator, where we are dealing with the standard automobile liability policy.” U.S. Fidelity & Guaranty Co. v. Safeco Ins. Co. of America, 522 S.W.2d 809, 821 (Mo.1975); see also William J. Schermer and Irvin E. Schermer, Automobile Liability Insurance § 7.1 (4th ed. 2004) (“The driver of a nonowned vehicle is ordinarily afforded primary coverage under the omnibus provision of the owner’s policy and excess coverage under the drive other cars provisions of his own policy.”).

We recognize that the Court of Appeals, under differing factual circumstances in-' volving commercial applications or policies, expressed a different view in Royal-Globe Ins. Companies v. Safeco Ins. Co. of America, 560 S.W.2d 22, 24 (Ky.App.1977), where it stated:

Compulsory insurance laws are intended to protect the public at large who might otherwise suffer from being injured by uninsured motor vehicles. Compulsory insurance laws are not intended to protect other insurance companies. When the controversy is between two insurers, the liability for a loss should be determined by the terms and provisions of the respective policies without regard to the rights injured third parties might assert under a compulsory insurance law.

See also Omni Ins. Co. v. Kentucky Farm Bureau Mut. Ins. Co., 999 S.W.2d 724, 726 (Ky.App.1999); State Farm Mut. Auto. Ins. Co. v. Register, 583 S.W.2d 705, 706-07 (Ky.App.1979); but see Motorists Mut. Ins. Co. v. Grange Mut. Cas. Co., 149 S.W.3d 437, 441 (Ky.App.2004) (“Unlike the escape clause at issue in Royal-Globe, the provision in Motorist Mutual’s policy limiting coverage to “bodily injury” clearly does not provide coverage for property damage as required by KRS 190.033.”). However, we are compelled to our contrary position by our view of the legislative intent and spirit of the MVRA. Thus, to the extent inconsistent herewith, Omni Ins. Co. v. Kentucky Farm Bureau Mut. Ins. Co., 999 S.W.2d 724, State Farm Mut. Auto. Ins. Co. v. Register, 583 S.W.2d 705, and Royal-Globe Ins. Companies v. Safeco Ins. Co. of America, 560 S.W.2d 22, are overruled.

Admittedly, parties may contract for such coverage as they wish. And the terms of such policies “must control unless [they] contraven[e] public policy or a statute.” York v. Kentucky Farm Bureau Mut. Ins. Co., 156 S.W.3d 291, 294 (Ky.2005) (quoting Meyers v. Kentucky Medical Insurance Co., 982 S.W.2d 203, 209 (Ky.App.1997)). Yet, to be valid in respect of the MVRA, such contract, or clause thereof, must comply with its statutory scheme, including its intent and purposes. See Bishop v. Allstate Ins. Co., 623 S.W.2d 865, 866 (Ky.1981) (“Neither the drafters of the Uniform Act nor the writers of Kentucky’s MVRA included sections permitting exclusions to the minimum required tort liability coverage.”).

This is consistent with our pronouncement that “the MVRA is social legislation that must be liberally construed to accomplish [its] objectives.” Mitchell, 244 S.W.3d at 63 (quoting Nat’l Ins. Ass’n v. Peach, 926 S.W.2d 859, 861 (Ky.App.1996)). And we have also noted that the intent and purpose of the MVRA are to be broadly applied to accomplish its public policy purpose and thus “supercede general principles of insurance law as broadly applied.” Id.

We glean from the legislative intent underlying the MVRA that the General Assembly intended, that in instances where both the vehicle owner and non-owner driver are separately insured, the vehicle owner’s insurance shall be primary.

Since its inception in 1974, the MVRA has required every owner to procure insurance covering liability arising out of ownership of a motor vehicle. KRS 304.39-080. The basic underlying premise is that in the event of an accident, the liable insurer will be readily identifiable and will promptly pay, up to its policy limits, for the injuries suffered. The MVRA does not gamble that a permissive driver may have insurance. See KRS 304.39-080(5) (“The owner of a motor vehicle who fails to maintain security on a motor vehicle in accordance with this subsection shall have his or her motor vehicle registration revoked in accordance with KRS 186A.040 and shall be subject to the penalties in KRS 304.99-060. An owner who permits another person to operate a motor vehicle without security on the motor vehicle as required by this subtitle shall be subject to the penalties in KRS 304.99-060.”); see also KRS 304.39-080(1) (“The vehicle for which the security is so provided is the ‘secured vehicle.’ ”).

Moreover, we have previously stated that, “[b]y enacting the MVRA, the legislature intended to create a comprehensive compulsory insurance system that requires owners to provide vehicle security covering basic reparation benefits and that imposes legal liability on vehicle owners for damages or injuries arising out of ownership of or use of the vehicle.” McGrew v. Stone, 998 S.W.2d 5 (Ky.1999) (emphasis added). And in McGrew, given the strong mandates of the MVRA, we recognized a vehicle owner’s liability for injuries resulting from the permissive use of her uninsured, vehicle, a “new tort of no insurance” as described by Justice Cooper in his dissent. Id. at 7.

Finally, we find exceedingly inequitable the assertion that an insurance company can, under mandates of the MVRA, collect premiums from its insured while hiding behind an excess clause that purports to subvert its primary liability for that of another. See Roth, 269 So.2d at 6 (finding that the insurance company receiving the premium payment cannot escape primary liability).

Thus, under the mandates of the MVRA, our trial courts, under similar circumstances, will no longer be mired in the quagmire of which policy is primary. Moreover, the expedient resolution of this issue will streamline the process as each insurer’s role is clearly defined, thus facilitating a simple determination of which policy is primarily liable under these circumstances and hopefully without further drafting wars.

IV. Conclusion

For the above reasons, we reverse the Court of Appeals’ opinion and reinstate the summary judgment order of the Montgomery Circuit Court.

All sitting. MINTON, C.J.; ABRAMSON, CUNNINGHAM, SCHRODER, and VENTERS, JJ., concur. NOBLE, J., concurs in result only.

      . “In substance, [an excess clause] provide[s] that in the case of a loss .... the policy would be excess insurance over any other valid and collectible insurance.” Government Emp. Ins. Co. v. Globe Indem. Co., 415 S.W.2d 581, 581 (Ky.1967). (internal citations omitted). Compare this with a standard escape clause, which "in most instances ... negat[es] any liability if ‘other valid and collectible insur-anee’ is available to the driver.” Id. at 582. On the other hand, a pro-rata clause "provides that if more than one policy applies, the insurer is responsible only for that percent of the total sum payable that the limit of liability of the coverage bears to the total limits of liability under that coverage for all the policies.” Robert D. Monfort, Kentucky Motor Vehicle Insurance Law § 10.2 (2d ed.1996).

      . The Court of Appeals found that each insurance policy had a liability limit of: $25,000 per person, $50,000 per accident for bodily injury, and $25,000 per accident for property damages. However, it is undisputed that that the injured parties’ personal and property damages were less than either of these minimum policy limits, as the total amount of damages was $2,000.00 for personal injury, $2,289 for medical expenses, and $954.26 for property damage.

      . In so holding, we are mindful of Shelter’s argument that Farm Bureau did not raise this issue in the trial court and therefore, we have no authority to address it. Regional Jail Authority v. Tackett, 770 S.W.2d 225 (Ky.1989). It should be noted, however, that in Tackett, the Court of Appeals reversed the trial court via an issue that was never addressed by it. Here, the result of our opinion is to affirm the trial court. See Emberton v. GMRI, Inc., 299 S.W.3d 565, 575-76 (Ky.2009) (”[A]n appellate court may affirm a lower court’s decision on other grounds as long as the lower court reached the correct result.”); see also Fischer v. Fischer, 197 S.W.3d 98, 102-03 (Ky.2006) ("Appellee’s failure to raise the issue ... does not prevent Appellant from presenting it here as he had no duty to present it to the Court of Appeals since he defended the trial court decision and it had to be affirmed if it was sustainable on any basis.”). Of even greater concern is that such a requirement could force this Court to affirm and publish an opinion that we know is erroneous for other reasons. GMRI, 299 S.W.3d at 576. Moreover, "we, as an appellate court, may affirm the trial court for any reason sustainable by the record.” Kentucky Farm Bureau Mut. Ins. Co. v. Gray, 814 S.W.2d 928, 930 (Ky.App.1991). At any rate, in this case, the issue was presented squarely to the Court of Appeals, but implicitly rejected.

      . Our aversion to perpetuating a policy clause drafting battle under circumstances involving the MVRA seeks to avoid specificity arguments such as the one propounded here. Farm Bureau argues in the alternative that its non-standard excess clause's specific language and intent prevails over Shelter's general excess clause, i.e., an “excess over excess" or "super excess" clause. Farm Bureau construes our precedent, see GEICO, 415 S.W.2d at 582 (holding that a non-standard escape clause prevails over a general excess clause), as being the logical precursor to its proposed rule that specific excess clauses trump general excess clauses.

      . "In other words, the cost of insuring the first million dollars of risk may be substantially greater than the cost of insuring the second million dollars.... [0]nce the unit cost of a million dollars of insurance coverage has been established, the insurance companies use a factor of 1.25 in pricing $2 million of insurance; a factor of 1.4 in pricing $3 million; a factor of 1.45 in pricing $4 million; and a factor of 1.5 in pricing $5 million.” Continental Cas. Co., 823 F.2d at 711-712.

      . This method has also been criticized "because [the] cost [of the higher limit policy] does not increase in direct proportion to the amount of coverage,” thus "apportioning liability equally [does not] accurately allocate] liability according to the cost of the burden each insurer contracts to carry.” Continental Cas. Co., 823 F.2d at 712.

      .Equal Shares Apportionment Examples: Small Insurer ($100,000 policy limit) and Large Insurer ($300,000 policy limit). Hypothetical 1: $150,000 in damages. Small Insurer and Large Insurer both contribute $75,000; Small Insurer saves $25,000. Hypothetical 2: $250,000 in damages. Small Insurer and Large Insurer both contribute $100,000, which exhausts Small Insurer’s policy, thereby forcing Large Insurer to contribute an additional $50,000 to satisfy the damages amount.

      . We do note that KRS 304.39-080(5) was amended in 2007 to include the "or operator” language. However, this inclusion does not detract from our conclusion that the legislature, through the MVRA, intended to place the primary onus on the owner to secure the insurance on the vehicle, thus the vehicle would be insured whether the particular driver had separate insurance or not as the "or operator” language was only added in response to our decision in Estes, which refused to recognize criminal penalties for an operator of an motor vehicle uninsured by the owner, a fact we acknowledged in Blakely. Estes v. Commonwealth, 952 S.W.2d 701 (Ky.1997); Commonwealth v. Blakely, 223 S.W.3d 107 (Ky.2007). Thus, as we held in Blakely, the "or operator” language of KRS 304.39-080(5) does not undercut the underlying MVRA's policy that every vehicle operated be covered by insurance by its owner. Cf. Blakely, 223 S.W.3d at 109.


author: WINE, Judge:

text:
    Danielle JOHNSON, Individually and as Parent and Next Friend of Alaya Dakota Johnson, a Minor, and Larry Wells as Administrator of the Estate of Larry Demond Johnson, Deceased, Appellants v. UNITED PARCEL SERVICE, INC., Appellee.
    No. 2009-CA-000404-MR.
    Court of Appeals of Kentucky.
    Feb. 19, 2010.
    Discretionary Review by Supreme Court Denied Dec. 10, 2010.
    Case Ordered Published by Supreme Court Dec. 10, 2010.

      Brian D. Cook and Alexander Wilson (argued), Louisville, KY, for appellant.
    Tony C. Coleman and William F. Becker (argued), Louisville, KY, for appellee.
    Before MOORE, NICKELL, and WINE, Judges.
   OPINION

WINE, Judge:

Larry Wells, Administrator of the Estate of Larry Demond Johnson, and Danielle Johnson, individually and as parent and next friend of Alaya Dakota Johnson (hereinafter “the Estate”), appeal from a dismissal under Kentucky Rules of Civil Procedure (“CR”) 12.02 for failure to state a claim for which relief can be granted. On appeal, the Estate contends that United Parcel Service, Inc. owed a duty to warn future employers of its prior employee’s violent work history when contacted by those future employers for reference checks. We disagree.

History

Larry Demond Johnson was employed by Kroger Limited Partnership I at a Kroger Distribution Center. In June of 2005, Kroger hired Raymal Rivers. Rivers and Johnson worked together at the Distribution Center. On May 27, 2006, Rivers and Johnson, accompanied by several other employees, left the Distribution Center during their lunch break to eat at a nearby McDonalds. During the lunch, an argument broke out between Johnson and Rivers. At some point, Rivers left the parking lot of the McDonalds to retrieve a firearm from his vehicle, after which point he returned, shot, and fatally wounded Johnson.

Before working for Kroger, Rivers had been employed by UPS from June 2000 until 2004. While employed by UPS, Rivers displayed aggressive behavior on numerous occasions. On February 27, 2004, Rivers threatened a co-worker, James Beasley, who then reported the incident to management. Rivers also engaged in other aggressive behavior, such as making threats to co-workers in the parking lot and waiting in the parking lot for employees to leave. He also reportedly followed female co-workers to their cars. The coworkers reported these incidents to members of management and security at UPS. On March 10, 2004, UPS held a disciplinary hearing regarding these allegations against Rivers. Rivers was reassigned to a new work area and ordered to attend anger management classes. He was later terminated from UPS.

Some time after being fired by UPS, Rivers applied for employment with Kroger. On his application for employment, he listed UPS as a previous employer. Kroger called UPS to obtain verification and for a reference check. The Estate alleges that UPS verified only the dates of employment and the title of the position Rivers held.

Kroger thereafter hired Rivers to work at the Distribution Center where Johnson worked. After Johnson was killed, his Estate brought the present action in Jefferson Circuit Court, claiming, among other things, that UPS was negligent in its referral and failure to warn Kroger and that UPS was negligent in its performance of the duty it undertook and in its misrepresentation of Rivers. UPS filed a motion to dismiss under CR 12.02 for failure to state a claim for which relief can be granted. On February 4, 2009, the trial court granted UPS’s motion to dismiss on the grounds that UPS owed Kroger no duty. The Estate now appeals.

Analysis

In ruling on a motion to dismiss under CR 12.02, “a court should not dismiss for failure to state a claim unless the pleading party appears not to be entitled to relief under any state of facts which could be proved in support of his claim.” Weller v. McCauley, 383 S.W.2d 356, 357 (Ky.1964). As the trial court considered matters outside the pleadings, we shall review the dismissal as if it were a summary judgment. Waddle v. Galen of Kentucky, Inc., 131 S.W.3d 361, 364 (Ky.App.2004). Since summary judgments involve no fact-finding, we review de novo. Blevins v. Moran, 12 S.W.3d 698 (Ky.App.2000).

The trial court began its analysis by citing that any action for negligence requires duty, breach, (causation), and injury. The trial court further stated that no additional analysis is required if it is found that no legal duty exists. We agree that duty must first be established in a negligence action. James v. Wilson, 95 S.W.3d 875 (Ky.App.2002). Identifying a duty is a question of law for the court. Id. at 889.

It has been well-settled in Kentucky jurisprudence that there exists no duty to act in the protection of others or to alert others that a crime may be committed by another. James v. Wilson, supra. However, the Estate points out that a trend has developed concerning employee reference checks, whereby employers refuse to give references for fear of defamation suits by former employees. The Estate argues that the “universal duty of care” that every person owes a duty to every other person to exercise reasonable care should apply here. The Estate further argues that a “special relationship” existed here, as contemplated by the Restatement (Second) of Torts § 315, which established a duty to warn foreseeable third parties. Finally, the Estate also argues that when an ex-employer undertakes to provide a reference check, that he undertakes a duty to render services under the Restatement (Second) of Torts § 323 and can be held liable when those services are negligently performed.

Essentially, the Estate argues that this Court should make new law through a precedent holding that all ex-employers have a duty to warn future employers of the potentially violent nature of its former employees where the former employee has exhibited a history of violence and the future employer calls for a reference check. However, this Court will not recognize such a duty where no such duty has existed before in the Commonwealth. While we are sympathetic with the position advanced by the Estate, it is more appropriately the role of the Kentucky Supreme Court or our Legislature to change existing law if either body deems such a change proper.

I. Universal Duty of Care

To begin, Kentucky does not recognize a boundless and general “universal duty of care.” This common misperception hails from Grayson Fraternal Order of Eagles, Aerie No. 3738, Inc. v. Claywell, 736 S.W.2d 328 (Ky.1987) (superseded by statute), where the Kentucky Supreme Court pronounced the oft-quoted rule that “every person owes a duty to every other person to exercise ordinary care in his activities to prevent foreseeable injury.” Id. at 332. However, despite misinterpretations to the contrary, Kentucky has never recognized a general “universal duty of care,” that would allow for new causes of action to arise that did not previously exist. See Morgan v. Scott, 291 S.W.3d 622 (Ky.2009) (stating that Grayson v. Claywell, supra “did not speak of creating new causes of action”). Indeed, our Supreme Court has recently noted that:

[■Grayson v. Claywell ] is often invoked “by parties advocating a theory of liability or a cause of action where none previously existed and legal authority is otherwise lacking. Despite its use of the catch phrase ‘universal duty of care,’ the Grayson case itself demonstrates that the duty referred to is not without limits.”

Id. at 631, quoting James v. Wilson, supra.

As we stated in 2007, “despite its value as a ‘catch phrase’ ... the ‘universal duty of care,’ has no meaning in Kentucky jurisprudence beyond the most general expression of negligence theory.” Jenkins v. Best, 250 S.W.3d 680, 691 (Ky.App.2007).

II. Duty to Warn and “Special Relationship”

Further our courts have held that there is no duty to warn others that a crime may be committed by another. James v. Wilson, 95 S.W.3d at 889. See also, Fryman v. Harrison, 896 S.W.2d 908 (Ky.1995). Although other jurisdictions have established precedent which establishes a duty to warn in the employee reference context, Kentucky has never adopted such a rule. See, e.g., Davis v. Board of County Commissioners of Doña Ana Co., 127 N.M. 785, 987 P.2d 1172, 1175 (1999); Gutzan v. Altair Airlines, Inc., 766 F.2d 135 (3d Cir.1985).

Further, we are not persuaded by the Estate that there is a special relationship between employer and ex-employee or future employers which would create a duty to warn as contemplated by the Restatement (Second) of Torts § 315. The Restatement (Second) of Torts § 315 states as follows:

There is no duty to control the conduct of a third person as to prevent him from causing physical harm to another unless
(a) a special relation exists between the actor and the third person which imposes a duty upon the actor to control the third person’s conduct, or
(b) a special relation exists between the actor and the other which gives to the other a right to protection.

Id. The Kentucky Supreme Court has stated that in order to establish an affirmative legal duty to warn, there must be a special relationship with the victim. Fryman v. Harrison, 896 S.W.2d 908, 910 (Ky.1995). The Kentucky Supreme Court has also stated that the requirement of a “special relationship” applies to ordinary tort cases. Id. Cases in which our courts have recognized “special relationships” include psychiatrist and patient relationships where patients have expressed homicidal or violent intentions toward certain individual(s) to their psychiatrist or medical provider. See, Evans v. Morehead Clinic, 749 S.W.2d 696 (Ky.App.1988). See also, Devasier v. James, 278 S.W.3d 625 (Ky.2009). We have also recognized the employer-employee relationship as a special relationship. Grand Aerie Fraternal Order of Eagles v. Carneyhan, 169 S.W.3d 840, 851 (Ky.2005).

While we have recognized the employer-employee relationship as one such “special relationship,” our courts have not recognized this as a special relationship once the term of employment has ended. Further we have found no other jurisdictions which recognize the existence of a “special relationship” in the employment context once the employer-employee relationship has ended. As such, we decline to find such a relationship here.

Moreover, we note that the Sixth Circuit has recently acknowledged that Kentucky law does not support the proposition that there is a “special relationship” between employer and employee which would impose upon the employer a “duty to warn” an employee of foreseeable risk of harm by a third party. Mackey v. U.S., 247 Fed.Appx. 641 (6th Cir.2007).

III. Negligent Performance of Undertaking to Render Services

Next, we are not persuaded by the Estate’s argument that UPS undertook a duty by providing a reference check to Kroger. The Estate argues that this Court should rely upon the Restatement (Second) of Torts § 323 to find that UPS negligently performed the duty it allegedly undertook when provided the dates of employment and/or provided a reference to Kroger. However, we do not find that UPS undertook to render any “services” (as the term is contemplated by the Restatement (Second) of Torts) to Kroger, and can find no support in this jurisdiction or others for such a proposition.

IV. Negligent Misrepresentation

Finally, the Estate asks this Court to recognize negligent misrepresentation as a cause of action in the employee reference context. We acknowledge that several other jurisdictions have recognized a cause under Sections 310 and 311 of the Restatement (Second) of Torts for negligent and/or intentional misrepresentation. See e.g., Passmore v. Multi-Management Services, Inc., supra, and Davis v.'Board of County. Com’rs of Doña Ana County, supra. However, there is no support for this cause of action in the employee reference context in existing Kentucky case law. As aforestated, we decline to expand our existing law on negligent misrepresentation to encompass references given by former employers where there has been not previously been a cause of action in this context.

Conclusion

In sum, we are aware of no Kentucky law which would impose a duty to warn upon an ex-employer under the theories espoused by the Estate on appeal. Unless or until a duty is recognized in this context by the Kentucky Supreme Court or by our Legislature, no cause will lie for such claims in the Commonwealth.

Thus, we hereby affirm the Jefferson Circuit Court.

ALL CONCUR.

      . The Estate states that they are unaware of whether a neutral or positive reference was given because they were not given the opportunity to conduct discovery.

      . Kroger and Rivers were also named in the complaint and the claims pertaining to them remain active in the Jefferson Circuit Court.

      . Indeed, we have only found cases which establish a "special relationship” between employer and employee while the employee is still employed by the employer. Cases in other jurisdictions finding liability once the employer-employee relationship has terminated rely not upon a "special relationship” theory, but instead upon the Restatement (Second) of Torts § 310 or § 311, which provide that an employer may not intentionally or negligently provide false information about an ex-employee. See, e.g., Passmore v. Multi-Management Services, Inc., 810 N.E.2d 1022 (Ind.2004); Davis v. Board of County Com’rs of Doña Ana County, supra.


author: MOORE, Judge.

text:
    David GAINES d/b/a David Gaines Roofing and Supplies, Appellant, v. KENTUCKY OCCUPATIONAL SAFETY AND HEALTH REVIEW COMMISSION and Kentucky Department of Labor (now Kentucky Labor Cabinet), Appellees.
    No. 2009-CA-001794-MR.
    Court of Appeals of Kentucky.
    April 16, 2010.
    Discretionary Review Denied by Supreme Court Dec. 8, 2010.

      John H. Gray, Frankfort, KY, for appellant.
    James R. Grider, Jr. Frankfort, KY, for appellee, Kentucky Labor Cabinet.
    Frederick G. Huggins, Frankfort, KY, for appellee, Kentucky Occupational Safety and Health Review Commission.
    Before CAPERTON and MOORE, Judges; BUCKINGHAM, Senior Judge.

      . Senior Judge David C. Buckingham sitting as Special Judge by assignment of the Chief Justice pursuant to Section 110(5)(b) of the Kentucky Constitution and Kentucky Revised Statute (KRS) 21.580.

   OPINION

MOORE, Judge.

David Gaines, d/b/a David Gaines Roofing and Supplies, appeals an opinion and order of the Franklin Circuit Court dismissing as untimely his declaratory action and appeal from the Kentucky Occupational Safety and Health Review Commission. After a careful review of the record, we agree that Gaines’ appeal was untimely. As such, we affirm.

FACTUAL AND PROCEDURAL HISTORY

On August 3, 2004, the Department of Labor issued two citations to Gaines, who properly filed a notice of contest on August 19, 2004, pursuant to Kentucky Revised Statute (KRS) 338.141(1). On September 3, 2004, the Department of Labor filed a complaint with the Occupational Safety and Health Review Commission. Gaines failed to answer. Gaines also failed to respond to a September 23, 2004 show cause order, which the Commission issued because Gaines failed to file an answer.

The Commission’s regulations, contained in 803 Kentucky Administrative Regulations (KAR) 50:010 et seq., require that a responding party file an answer within fifteen days and state that failing to file an answer within that time may, in the discretion of the Commission, constitute a waiver of right to further participation in the proceedings and grounds for the Commission to dismiss or dispose of the case without a hearing. See 803 KAR 50:010 §§ 3(1) and 23. Accordingly, the Commission dismissed Gaines’ contest in a final order of October 5, 2004, without a hearing.

On October 26, 2004, Gaines moved the Commission to reconsider its October 5, 2004 final order and reopen his case. On November 9, 2004, the Commission granted Gaines’ motion and sent him a letter on November 12, 2004, stating that he should file an answer by November 19, 2004. Gaines filed an answer on November 18, 2004. Then, in a December 7, 2004 order, the Commission stated that it had no jurisdiction to rescind its October 5, 2004 order when it purported to do so through its order of November 9, 2004. Accordingly, it withdrew its November 9, 2004 order and reinstated its October 5, 2004 order.

Two years later, Gaines filed two additional motions to reopen and/or for reconsideration with the Commission — one on December 4, 2006, and the other on January 10, 2007. The Commission denied these motions on January 4, 2007, and February 6, 2007, respectively.

On March 8, 2007, Gaines filed an action with the Franklin Circuit Court styled as an appeal of each of the Commission’s orders refusing to reconsider the December 7, 2004 order; as referenced above, the December 7, 2004 order reinstated the earlier October 5, 2004 final order of dismissal. Gaines also asked for a declaration of his right to a hearing before the Commission with respect to the September 3, 2004 complaint that was filed against him by the Department of Labor.

On September 2, 2009, the court held that Gaines failed to timely appeal the December 7, 2004 order by January 6, 2005 (ie., within the thirty-day period mandated by KRS 338.091(1)), and accordingly dismissed Gaines’ action. This appeal followed.

ANALYSIS

The Commission’s order dismissing Gaines’ right to contest the Cabinet’s complaint was final when it was entered on October 5, 2004, because it put an end to the action. Hubbard v. Hubbard, 303 Ky. 411, 412, 197 S.W.2d 923, 924 (1946). It states on its face that it is final. Furthermore, it specifically informed Gaines of his right to appeal it within thirty days before the Franklin Circuit Court, pursuant to KRS 338.091. No party contends that this order was in any way defective or void when it was entered.

The Commission correctly notes that KRS 338.091(1) provides the exclusive means for contesting its final decisions: “[a]ny party adversely affected or aggrieved by a final order of the review commission may appeal within thirty (30) days to the Franklin Circuit Court on the record for a review of such order.” When Gaines appealed this decision to the Franklin Circuit Court two years after it was rendered, rather than thirty days, Gaines failed to timely appeal the Commission’s decision per KRS 338.091(1), and failed to properly exhaust his administrative remedies. Thus, his case was properly dismissed.

Gaines contends that he has not failed to exhaust his administrative remedies because a defect in the Commission’s December 7, 2004 order, which purported to reinstate its October 5, 2004 order, indefinitely extended the Commission’s jurisdiction over his case. Alternatively, Gaines argues that his motion for reconsideration stayed the finality of the Commission’s October 5, 2004 order. Gaines also contends that he was denied due process when the Commission denied him a hearing in relation to the Department of Labor’s complaint. We disagree. Each of these arguments is addressed, in turn, below.

To begin, whether the December 7, 2004 order is defective is a moot point. After the Commission issues an effective final order, the agency retains no jurisdiction to withdraw previous orders and issue new ones. See Secretary, Labor Cabinet v. Boston Gear, Inc., a Div. of IMO, Industries, Inc., 25 S.W.3d 130, 134 (Ky.2000). “[A]n administrative agency does not have any inherent or implied power to reopen or reconsider a final decision and ... such power does not exist where it is not specifically conferred upon the agency by the express terms of the statute creating the agency.” Kentucky Bd. of Medical Licensure v. Ryan, 151 S.W.3d 778, 780 (Ky.2004) (citing Phelps v. Sallee, 529 S.W.2d 361, 365 (Ky.1975)). Thus, regardless of how many orders the Commission decided to render after October 5, 2004, or how defective those orders may have been, none of those orders could have repealed its earlier final order of October 5, 2004, or changed the fact that Games’ sole remedy for challenging that final order was to appeal it to the Franklin Circuit Court by November 4, 2004. See KRS 338.091(1). Nor, for that matter, could the Commission’s actions subsequent to rendering the October 5, 2004 final order, or its purported consent to allow Gaines to file an answer, have somehow reinvested it with the jurisdiction allowing it to do so.

For similar reasons, Gaines’ motion for reconsideration, which he filed with the Commission after it had rendered its final order, could not have stayed the thirty-day period allowed under KRS 338.091(1) for an appeal before the Franklin Circuit Court. Gaines argues that the Kentucky Civil Rules of Procedure allow for motions for reconsideration and that 803 KAR 50:010 § 49 indicates that the Commission retains jurisdiction over matters following a final order, and it thus had the authority to indefinitely stay the proceedings in this matter. This argument, however, misinterprets two points of law.

First, the Civil Rules do not apply in administrative proceedings unless a statute so provides; they only apply after an appeal from an administrative proceeding has been perfected to the circuit court. Pollitt v. Kentucky Unemployment Ins. Com’n, 635 S.W.2d 485, 487 (Ky.App.1982); see also Board of Adjustments of City of Richmond v. Flood, 581 S.W.2d 1, 2 (Ky.1978); see also CR 1. Here, given the procedural history of this case, nothing in KRS Chapter 338 specifically confers upon the Commission the power to reconsider or reopen a final order that it has issued. Thus, it has no such authority.

Second, while 803 KAR 50:010 § 49(1) provides that that “[a]ny party aggrieved by a final order of the commission may, while the matter is within the jurisdiction of the commission, file a motion for a stay,” this regulation speaks only to the powers of an agency “to enforce its validly entered orders, and its standing authority to retain enforcement jurisdiction of the same.” Brighty v. Brighty, 883 S.W.2d 494, 496 (Ky.1994); see also, Natural Re sources and Environmental Protection Cabinet v. Whitley Development Corp., 940 S.W.2d 904, 908 (Ky.App.1997) (describing the “enforcement jurisdiction” of the Natural Resources and Environmental Protection Cabinet to “continue until such time as the required reclamation is completed”).

Indeed, KRS 838.991(6) specifically authorizes the Commission, at its discretion, to “suspend the time period allotted for correction of a violation during the review of an appeal from the violation in question,” and KRS 338.091(2) enables the Commission to enforce its orders while they are being appealed to the Franklin Circuit Court in the absence of an order staying their enforcement. These rules, however, cannot be interpreted to confer any authority upon the Commission to modify its final orders or extend the period of time for taking an appeal of its final orders because, as noted above, no statute grants the Commission that authority.

Finally, we disagree with Gaines’ proposition that the Commission’s behavior in these proceedings, or its denial of a hearing on the matter of the Department of Labor’s complaint, could have violated his due process rights. The Commission was authorized to dismiss Gaines’ case in a final order without a hearing when Gaines failed to timely file an answer. And where an order is not void, KRS 338.091(1) clearly states the only procedure available for relief from the final order of the Commission is to file an action in circuit court.

CONCLUSION

For these reasons, the order and opinion of the Franklin Circuit Court is AFFIRMED.

ALL CONCUR.

      . An appellate court may affirm a lower court’s decision on other grounds as long as the lower court reached the correct result. See e.g. McCloud v. Commonwealth, 286 S.W.3d 780, 786 n. 19 (Ky.2009) (”[I]t is well-settled that an appellate court may affirm a lower court for any reason supported by the record.”) (citing Kentucky Farm Bureau Mut. Ins. Co. v. Gray, 814 S.W.2d 928, 930 (Ky.App.1991)). We agree with the ultimate conclusion of the circuit court, but must point out that we disagree with several portions of the circuit court’s opinion. For example, much of its analysis relies upon the assumption that Gaines’ appellate rights expired thirty days following the Commission’s December 7, 2004 order. As analyzed in our opinion infra, the Commission had no jurisdiction to render that order at all, and Gaines’ appellate rights had actually expired one month prior to that order.
      Furthermore, the circuit court held that it was arbitrary for the Commission to have dismissed Gaines’ contest as a penalty for untimely filing an answer, without first granting him a hearing. In support, the Circuit Court relied upon KRS 13B.010(6), which defines a final order as "the whole or part of the final disposition of an administrative hearing. ...” This holding, however, ignores two points of law. First, administrative hearings before the Commission are exempt from the purview of KRS 13B. See KRS 13B.020(3)(d)(4)(a). Second, as analyzed in this opinion, the Commission was authorized to dismiss Gaines' contest, without a hearing, as a penalty for Gaines' failure to timely file an answer.

      . Curiously, the Commission cites to Carnahan v. Yocom, 526 S.W.2d 301, 303 (Ky.1975), for the proposition that the Civil Rules authorized it to grant default judgment against Gaines when Gaines failed to timely file an answer in the administrative proceedings. However, unless otherwise provided by statute, the Civil Rules do not apply in the context of administrative proceedings until after an appeal of those proceedings has been perfected to the circuit court. Carnahan does not support a contrary proposition because that case addresses a default judgment resulting from failure to file an answer after an administrative action had been perfected to a circuit court. The Commission's authorizing legislation and regulations provided it the discretionary authority to dismiss Gaines’ contest, rather than the Civil Rules.


author: LAMBERT, Judge:

text:
    Timothy J. SHEMWELL, Appellant, v. COMMONWEALTH of Kentucky, Appellee.
    No. 2008-CA-001742-MR.
    Court of Appeals of Kentucky.
    Nov. 12, 2010.

      Karen Shuff Maurer, Assistant Public Advocate, Frankfort, KY, for appellant.
    Jack Conway, Attorney General, Jeffrey A. Cross, Assistant Attorney General, Frankfort, KY, for appellee.
    Before: TAYLOR, Chief Judge; LAMBERT, Judge; HENRY, Senior Judge.

      . Senior Judge Michael L. Henry 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

LAMBERT, Judge:

Timothy Shemwell appeals from an order of the Ohio Circuit Court directing that his real property be forfeited due to its use in the commission of a violation of KRS Chapter 218A. After careful review, we affirm.

In an opinion rendered August 27, 2009, the Kentucky Supreme Court affirmed Shemwell’s convictions arising from his manufacture of methamphetamine on his real property. Shemwell v. Commonwealth, 294 S.W.3d 430 (Ky.2009). A summary of the facts set forth in the opinion states:

On February 25, 2004, the Ohio County Sheriffs Department responded to a domestic dispute call at Appellant’s residence. Upon arriving there, Deputy Danny Kessinger found Appellant, Appellant’s ex-wife Betty Shemwell, Appellant’s friend Reva Roeder, and Roeder’s son. Deputy Kessinger also found evidence of a suspected methamphetamine lab. After getting permission from Appellant, a thorough search of the property ensued. In Appellant’s garage, lithium batteries, batteries with lithium strips removed, and two small canisters containing hemostats and suspected marijuana seeds were found. Inside a shed, the police discovered a five-gallon bucket containing lithium strips and a pink powder which later tests revealed to contain ephedrine or pseudoephed-rine. Directly outside the shed, starter fluid cans with holes in the bottom were found. On a tractor, a wooden spoon with methamphetamine residue was located. Also scattered around Appellant’s property were a blender, scales, plastic baggie corners, a two-quart container containing ammonia, a two-quart container containing a two-layered substance consisting of liquid on the top and a sludge of pseudoephedrine on the bottom, two cans of fuel in a trash can, two containers of salt, drain cleaner, tubing, and a propane tank containing ammonia. Inside Appellant’s house, police discovered nine empty Sudafed packets inside a coat pocket and inside Reva Roeder’s purse, a wet coffee filter with methamphetamine residue.

Id. at 432.

Shemwell was convicted of manufacturing methamphetamine under KRS 218A.1432(l)(a), possession of anhydrous ammonia in an unapproved container with the intent to manufacture methamphetamine (KRS 250.489), possession of methamphetamine precursor (KRS 218A.1437), possession of marijuana, less than eight ounces, and possession of drug paraphernalia.

While Shemwell’s direct appeal of his convictions was pending, the Commonwealth sought the forfeiture of his real property. On February 14, 2008, the prosecutor and Shemwell’s counsel appeared before the trial judge to argue the Commonwealth’s forfeiture motion. During this hearing, the Commonwealth argued in favor of forfeiture, and Shemwell argued that the trial judge should refrain from ordering the forfeiture of Shemwell’s real property until after the appeal of his criminal convictions was final. The trial court granted the Commonwealth’s motion and ordered the Commonwealth to prepare the order of forfeiture.

By order entered February 19, 2008, the trial judge directed Shemwell’s real property to be forfeited. The real property at issue consists of two tracts, the first containing approximately five acres and the second 1.91 acres. On February 26, 2008, Shemwell filed a motion to reconsider the forfeiture order and to hold the matter in abeyance until he had “exhausted all appeals in the criminal case related to his property.” After a hearing on March 27, 2008, the trial court denied Shemwell’s motion to reconsider in an order dated April 1, 2008.

In April 2009, this Court granted Shem-well’s motion for a belated appeal and allowed him to appeal the trial judge’s forfeiture order. This appeal now follows.

On appeal, Shemwell concedes that forfeiture is appropriate in this case but argues that forfeiture is only appropriate for the areas where manufacturing methamphetamine occurred. Shemwell asks this Court to reverse the Ohio Circuit Court’s order of forfeiture and enter a new order permitting only forfeiture of his garage and shed.

The Commonwealth argues that Shem-well did not present this argument to the trial court in his motion to reconsider, and therefore it is not preserved for appeal. We agree. At the trial court level, Shem-well argued that the Commonwealth’s forfeiture motion should be held in abeyance until his criminal appeals were exhausted. Now, Shemwell argues to this Court that forfeiture should be limited to the exact location where the violation of KRS Chapter 218A occurred. Because this argument was never presented to the trial court, the issue was not preserved, and we cannot review it for error. See Kennedy v. Commonwealth, 544 S.W.2d 219, 222 (Ky.1977) (“The appellants will not be permitted to feed one can of worms to the trial judge and another to the appellate court.”).

Shemwell has not asked this court to review his case under Kentucky Rules of Criminal Procedure (RCr) 10.26 for palpable error. Even had he done so, we do not find his arguments to be meritorious. In its decision, the Kentucky Supreme Court noted evidence of Shemwell’s manufacturing operation was found in his garage, his shed, “[djirectly outside the shed,” “[o]n a tractor,” “scattered around [his] property[,]” and “[i]nside [his] house[.]” Shemwell, 294 S.W.3d at 432. Despite evidence being found in so many places on Shem-well’s property, he argues that only his shed and garage should be subject to forfeiture. Shemwell offers no legal support for this argument whatsoever. Thus, we find Shemwell’s argument to be without merit, even were we to review it at this juncture.

Accordingly, we affirm the April 1, 2008, order of the Ohio Circuit Court denying Shemwell’s motion to reconsider.

ALL CONCUR.


author: ROY L. RICHTER, Chief Judge.

text:
    Lauren CHEATHEM, Claimant/Appellant, v. ATLANTIC EXPRESS OF MISSOURI, INC., and Division of Employment Security, Respondents.
    No. ED 95639.
    Missouri Court of Appeals, Eastern District, Division One.
    Dec. 7, 2010.
    Lauren Cheathem, St. Louis, MO, for Appellant.
    Michael Pritchett, Jefferson City, MO, Atlantic Express of Missouri, St. Louis, MO, for Respondent.
   ROY L. RICHTER, Chief Judge.

Lauren Cheathem (“Claimant”) has filed a notice of appeal from the Labor and Industrial Relations Commission’s (“Commission”) decision regarding her application for unemployment benefits. We dismiss the appeal.

A deputy of the Division of Employment Security (“Division”) concluded that Claimant was disqualified from receiving unemployment benefits because she was discharged from her employment for misconduct connected with work. This determination was affirmed by the Appeals Tribunal of the Division. Claimant then filed an application for review with the Commission. On February 25, 2010, the Commission issued its decision affirming the Appeals Tribunal’s decision. Claimant has now filed a notice of appeal to this Court. The Division has filed a motion to dismiss Claimant’s appeal, asserting it is untimely. Claimant has not filed a response to the motion.

A party aggrieved by an unemployment decision must file a notice of appeal to this Court from the Commission’s decision within twenty days of the decision becoming final. Section 288.210, RSMo 2000. The Commission’s decision becomes final ten days after it is mailed to the parties. Section 288.200.2, RSMo 2000.

Here, the Commission mailed its decision to Claimant on February 25, 2010. Therefore, the notice of appeal to this Court was due on or before Monday, March 29, 2010. Sections 288.200.2, 288.210; 288.240, RSMo 2000. The secretary of the Commission certified that Claimant filed her notice of appeal on October 12, 2010, which is untimely. The unemployment statutes do not provide for the late filing of the notice of appeal and do not recognize any exceptions for filing out of time. McCuin Phillips v. Clean-Tech, 34 S.W.3d 854, 855 (Mo.App. E.D.2000). Because unemployment benefits are solely a creature of statutory provision, this Court cannot create an exception where none exists. See, Martinez v. Lear-Ed, Inc., 155 S.W.3d 809, 810 (Mo.App. E.D.2005).

The Division’s motion to dismiss is granted. The appeal is dismissed.

KURT S. ODENWALD, J. and GARY M. GAERTNER, JR., J., concur.


author: PER CURIAM.

text:
    Craig SMALL, Employee/Claimant, v. DIVISION OF EMPLOYMENT SECURITY, Respondent.
    No. ED 94741.
    Missouri Court of Appeals, Eastern District, Division Five.
    Dec. 7, 2010.
    Craig Lamont Small, St. Louis, MO, pro se.
    Shelly A. Kintzel, Jefferson City, MO, for Respondent.
    Before GARY M. GAERTNER, JR., P.J., MARY K. HOFF, J., and PATRICIA L. COHEN, J.
   ORDER

PER CURIAM.

Craig Small (Claimant) appeals from the order of the Labor and Industrial Relations Commission (Commission) affirming the Appeals Tribunal’s dismissal of his claim for unemployment benefits. Claimant contends that the Commission erred in affirming the dismissal on the grounds that he failed to establish good cause for failing to appear at his telephone hearing with the Appeals Tribunal.

We have reviewed the briefs of the parties and the record on appeal and find that the Commission did not abuse its discretion in finding that Claimant lacked good cause for failing to appear at his telephone hearing with the Appeals Tribunal. An extended opinion reciting the detailed facts and restating the principles of law applicable to this case would have no precedential value. We have, however, provided a memorandum for the use of the parties only setting forth the reasons for our decision.

We affirm the judgment pursuant to Rule 84.16(b).


text:
    STATE of Missouri, Respondent, v. Charles FEGER, Defendant/Appellant.
    No. ED 94184.
    Missouri Court of Appeals, Eastern District, Division Five.
    Dec. 7, 2010.
    Kim Freter, Clayton, MO, for Appellant.
    Chris Koster, Attorney General, Jamie Pamela Rasmussen, Assistant Attorney General, Jefferson City, MO, for Respondent.
    Before GARY M. GAERTNER, JR., P.J., MARY K. HOFF, J. and PATRICIA L. COHEN, J.
   ORDER

PER CURIAM.

Charles Feger (Defendant) appeals from the trial court’s judgment and sentence imposed after a jury trial in which the jury found Defendant guilty of one count of first-degree robbery, in violation of Section 569.020, and one count of armed criminal action, in violation of Section 571.015. The trial court found beyond a reasonable doubt that Defendant was a prior and persistent offender and sentenced Defendant to concurrent terms of twenty-five years’ imprisonment for the robbery conviction and twenty-five years’ imprisonment for the armed criminal action conviction.

We have reviewed the briefs of the parties, the legal file, and the record on appeal and find the claims of error to be without merit. No error of law appears. An extended opinion reciting the detailed facts and restating the principles of law applicable to this case would serve no jurisprudential purpose. We affirm the judgment pursuant to Rule 30.25(b).

      . All statutory citations are to RSMo 2000, unless otherwise indicated.


text:
    Toby S. DUNLAP, Appellant, v. DIRECTOR OF REVENUE, State of Missouri, Respondent.
    No. ED 94586.
    Missouri Court of Appeals, Eastern District, Division Four.
    Dec. 7, 2010.
    Mark T. Bishop, Hillsboro, MO, for Appellant.
    Jonathan H. Hale, Jefferson City, MO, for Respondent.
    Before KURT S. ODENWALD, P.J. and ROBERT G. DOWD, JR. and NANNETTE A. BAKER, JJ.
   ORDER

PER CURIAM.

Toby S. Dunlap (“Dunlap”) appeals the judgment of the trial court sustaining the Director of Revenue’s revocation of Dunlap’s driving privilege pursuant to Section 577.041, RSMo Cum.Supp.2009, after he refused to submit to a breath test. Dunlap contends the trial court erred in sustaining the revocation because the judgment was not supported by substantial evidence and was against the weight of the evidence.

We have reviewed the briefs of the parties and the record on appeal and find the claims of error to be without merit. An opinion reciting the detailed facts and restating principles of law would have no precedential value. The parties have been furnished with a memorandum for their information only, setting forth the reasons for this order. The judgment is affirmed in accordance with Rule 84.16(b).


text:
    JOHN BEAL, INC., Respondent, v. Carmen HILL, Defendant, and Jon E. Fuhrer, Co., et al., Appellants.
    No. ED 94660.
    Missouri Court of Appeals, Eastern District, Division Two.
    Dec. 7, 2010.

      Randall Gusdorf, Saint Louis, MO, for Respondent.
    David M. Hocking, Esq., Saint Louis, MO, for Defendants/Appellants.
    Before GLENN A. NORTON, P.J., KATHIANNE KNAUP CRANE, J. and GEORGE W. DRAPER III, J.
   ORDER

PER CURIAM.

Jon E. Führer, Co., Alternative Funding, LLC, Danyielle Burks, and Sean Bu-channon appeal the trial court’s judgment in favor of John Beal, Inc. (“Beal”) on his petition to enforce a mechanic’s liens. We find that the trial court did not err in its judgment in favor of Beal.

An extended opinion would have no precedential value. We have, however, provided the parties a memorandum setting forth the reasons for our decision. The judgment of the trial court is affirmed under Rule 84.16(b).


author: KURT S. ODENWALD, Presiding Judge.

text:
    Kyle BOND, Appellant, v. STATE of Missouri, Respondent.
    No. ED 94715.
    Missouri Court of Appeals, Eastern District, Division Four.
    Dec. 7, 2010.
    H. Marvin Gilmore, Sikeston, MO, for Appellant.
    Chris Koster, Attorney General, Mary H. Moore, Assistant Attorney General, Jefferson City, MO, for Respondent.
   KURT S. ODENWALD, Presiding Judge.

Introduction

Kyle Bond (Bond) filed a Rule 24.035 motion for post-conviction relief, claiming that he was denied due process because he was not informed by the motion court that he would not be allowed to withdraw his guilty plea if the court rejected his plea agreement made with the prosecutor. We vacate the judgment and remand the cause with directions to dismiss the motion because Bond failed to timely file his pro se motion as required by Rule 29.15(b).

Factual and Procedural Background

Bond was charged by the State of Missouri (State) in the Circuit Court of Cape Girardeau County with second-degree assault, leaving the scene of an accident, endangering the welfare of a child, and resisting arrest in case number 04CG9-CR02138-01 (Case I). He also was charged with possession of a controlled substance in case number 04G9-CR02167-01 (Case II). Bond appeared in court on February 7, 2005, to enter his guilty pleas in Case I and Case II. He entered a written plea of guilty in both cases. In exchange for his plea in Case I, the State dismissed all charges except second-degree assault in Case I. The State agreed to Bond receiving probation.

Bond appeared for sentencing on July 18, 2005. The court suspended imposition of sentence and placed Bond on five years of supervised probation on both Case I and Case II. Bond understood that if he did not successfully complete probation, he would be sent to prison, to be determined by the court.

On September 4, 2007, Bond appeared in court again to enter a guilty plea to the class C felony of stealing in case number 07CG9-CR00498-01 (Case III). He also admitted violating his probation in both Case I and Case II.

The sentencing hearing for all three cases was held on November 19, 2007. There, the prosecuting attorney confirmed that pursuant to the plea agreement, the State recommended a three-year sentence to serve concurrent to all other sentences on the new charge. Additionally, Bond’s trial counsel asked the court to consider the State’s recommendation, but also consider, in the alternative, “even a longer sentence and run it not necessarily concurrently, but consider the 120-day program which would permit [Bond] to serve a term of probation after 120 days.”

The trial court asked Bond if he would like to say anything on his own behalf. Bond responded, “I’m the sole support of my wife and my daughter, and if there’s any way that I can come home quicker than, you know, the three years, I’d sure appreciate it.”

The trial court then rejected Bond’s plea agreement, stating:

Mr. Bond, as the latest episode indicates to me, you’re not a candidate for probation, not now or ever. It also illustrates the danger of taking an SIS on the case because that leaves the door wide open for me to do whatever I think is appropriate. So I’m going to revoke both of your probations, and in [Case I], I’m going to sentence you to five years in the Missouri Department of Corrections. On [Case II] I’m going to sentence you to five years in the Missouri Department of Corrections. On the new matter, [Case III], I’ll follow the recommendation and sentence you to three years in the Missouri Department of Corrections. These are to be served consecutively and not concurrently. That is a total of 13 years, and order the execution of all those sentences.

Bond was sentenced under Section 559.115 to 120 days of shock incarceration and was sent to the Missouri Department of Corrections. On February 7, 2008, the trial court entered an order in all three cases requiring Bond to be released from the Department of Corrections after serving 120 days. Bond was released from shock incarceration on March 19, 2008, and placed on five years of supervised probation.

On March 16, 2009, Bond again appeared in the trial court for a probation violation for absconding on all three cases. The sentences in all three cases were executed.

Bond filed a pro se Motion to Vacate, Set Aside or Correct the Judgment or Sentence of the trial court under Rule 24.035 for post-conviction relief on April 10, 2009. His amended motion was filed on October 16, 2009.

On March 29, 2010, the motion court denied Bond relief without an evidentiary hearing. Bond filed his notice of appeal to this Court on April 21, 2010. This appeal follows.

Discussion

Post-conviction motions filed pursuant to Rule 24.035 are governed by the rules of civil procedure “insofar as applicable.” Rule 24.035(a); Cook v. State, 156 S.W.3d 418 (Mo.App. E.D.2005). A person seeking relief pursuant to Rule 24.035 shall file a motion to vacate, set aside or correct judgment or sentence “within 180 days of the date the person is delivered to the custody of the department of corrections,” if no appeal of that person’s judgment was taken. Rule 24.035(b).

Failure to file a motion within the time provided by this Rule 24.035 shall constitute a complete waiver of any right to proceed under this Rule 24.035 and a complete waiver of any claim that could be raised in a motion filed pursuant to this Rule 24.035.

Rule 24.035(b).

The Missouri Supreme Court has held that “[a]ny claim not raised in a timely Rule 24.035 motion is a complete waiver of that claim.” State v. Shafer, 969 S.W.2d 719, 738 (Mo. banc 1998). Moreover, “the time limits of [Rule 24.035] are constitutionally firm and are mandatory.” Id. at 741. The time limits “serve the legitimate end of avoiding delay in the processing of prisoners claims and prevent the litigation of stale claims.” Day v. State, 770 S.W.2d 692, 695 (Mo. banc 1989).

Here, Bond was sentenced on November 19, 2007. After serving 120 days of shock time in the Missouri Department of Corrections under Section 559.115, Bond was released on March 19, 2008. Although the record does not specify the date he first was delivered to the department of corrections, our calculations conclude that he was delivered on November 20, 2007.

Bond violated his probation and was ordered to return to prison on March 16, 2009. The date of Bond’s return to prison, however, is not the date used to calculate the time requirements for filing under Rule 24.035. For example, in Bollinger v. State, 144 S.W.3d 335 (Mo.App. E.D.2004), the movant was delivered to the Department of Corrections on February 8, 2002, to serve 120 days of shock time, and his August 5, 2002 motion for post-conviction relief under Rule 24.035 was dismissed as untimely under the rule’s time limit of 90 days. Furthermore, in Crabtree v. State, 91 S.W.3d 736 (Mo.App. W.D.2002), the appellate court dismissed the movant’s appeal under Rule 24.035 as untimely because the movant filed his pro se motion on April 25, 2000, more than nine months after he was first delivered to the department of corrections on June 17,1999. The court did not calculate timeliness based on the movant’s probation revocation and second delivery to the department of corrections on March 24, 2000.

Rule 24.035 clearly requires a movant file his motion for post-conviction relief “within 180 days of the date the person is delivered to the custody of the department of corrections.” Missouri courts have consistently held that the time for filing runs from the initial delivery of a person to the department of corrections. Accordingly, Bond was required to file his motion to vacate, set aside or correct judgment within 180 days of November 20, 2007, i.e., no later than May 19, 2008. Bond did not file his pro se motion under Rule 24.035 until nearly a year later, on April 10, 2009. Therefore, Bond’s motion was untimely. Bond waived his right to postconviction relief under the rule. Shafer, 969 S.W.2d at 738. The motion court did not err in denying Bond’s Rule 24.035 motion for post-conviction relief without an evidentia-ry hearing.

Conclusion

The judgment is vacated and the cause is remanded with instructions to dismiss Bond’s Rule 24.035 motion.

ROBERT G. DOWD, JR., and NANNETTE A. BAKER, JJ., Concur.


text:
    Kerwin D. SCOTT, Appellant, v. STATE of Missouri, Respondent.
    No. ED 94381.
    Missouri Court of Appeals, Eastern District, Division Four.
    Dec. 7, 2010.
    Maleaner R. Harvey, St. Louis, MO, for Appellant.
    Chris Koster, Attorney General, Jayne T. Woods, Asst. Attorney General, Jefferson City, MO, for Respondent.
    Before KURT S. ODENWALD, P.J. and ROBERT G. DOWD, JR. and NANNETTE A. BAKER, JJ.
   ORDER

PER CURIAM.

Kerwin Scott (“Movant”) appeals from the denial of his Rule 24.035 motion for posteonviction relief without an evidentiary hearing. Movant contends the motion court clearly erred in denying his motion because the plea court accepted Movant’s guilty pleas to the class B felony of driving while intoxicated as a chronic offender, the class A misdemeanor of leaving the scene of an accident, and the class A misdemean- or of operating a motor vehicle while his license was revoked in. violation of Mov-ant’s right to be free from double jeopardy.

We have reviewed the briefs of the parties and the record on appeal and find the claims of error to be without merit. The motion court’s findings of fact and conclusions of law are not clearly erroneous. Rule 24.035(k). An opinion reciting the detailed facts and restating principles of law would have no precedential value. However, the parties have been furnished with a memorandum for their information only, setting forth the reasons for this order. The judgment is affirmed in accordance with Rule 84.16(b).


text:
    Jonathan RAYMOND, Claimant/Appellant, v. DIVISION OF EMPLOYMENT SECURITY, Respondent.
    No. ED 95549.
    Missouri Court of Appeals, Eastern District, Division One.
    Dec. 7, 2010.
    Jonathan Raymond, St. Louis, MO, pro se.
    Michael Pritchett, Jefferson City, MO, for Respondent.
   ROY L. RICHTER, Chief Judge.

Jonathan Raymond (“Claimant”) has filed a notice of appeal from the Labor and Industrial Relations Commission’s (“Commission”) decision regarding his application for unemployment benefits. We dismiss the appeal.

A deputy of the Division of Employment Security (“Division”) concluded that Claimant was disqualified from receiving unemployment benefits because he left work voluntarily without good cause attributable to his work or employer. Claimant sought review with the Appeals Tribunal, which affirmed the deputy’s determination. Claimant then filed an application for review with the Commission. On August 23, 2010, the Commission issued its decision affirming the Appeals Tribunal’s decision. Claimant filed a notice of appeal to this Court. The Division has filed a motion to dismiss Claimant’s appeal, asserting it is untimely. Claimant has not filed a response to the motion.

The unemployment statutes require a claimant to file a notice of appeal to this Court from the Commission’s decision within twenty days of the decision becoming final. Section 288.210, RSMo 2000. The Commission’s decision becomes final ten days after it is mailed to the parties. Section 288.200.2, RSMo 2000.

Here, the Commission mailed its decision to Claimant on August 23, 2010. Therefore, the notice of appeal to this Court was due on or before September 22, 2010. Sections 288.200.2, 288.210. The secretary of the Commission certified that Claimant filed her notice of appeal on September 24, 2010, which is untimely. The unemployment statutes do not provide for the late filing of the notice of appeal and do not recognize any exceptions for filing out of time. McCuin Phillips v. Clean-Tech, 34 S.W.3d 854, 855 (Mo.App. E.D.2000). Because unemployment benefits are solely a creature of statutory provision, this Court cannot create an exception where none exists. See, Martinez v. Lea-Ed, Inc., 155 S.W.3d 809, 810 (Mo.App. E.D.2005).

The Division’s motion to dismiss is granted. The appeal is dismissed.

KURT S. ODENWALD, J. and GARY M. GAERTNER, JR., J., concur.

      . This certification appears to be based on the postmark on the envelope in which the notice of appeal was enclosed. The record also contains a faxed copy of a letter indicating Claimant-wishes to appeal. However, this has a facsimile date stamp of September 23, 2010, which is also untimely.


text:
    Timothy SCHERDER, Petitioner-Respondent, v. Trisha SONNTAG, Respondent-Appellant.
    No. ED 93005.
    Missouri Court of Appeals, Eastern District, Northern Division.
    Dec. 7, 2010.
    Dan J. Pingelton, Columbia, MO, for appellant.
    Joseph A. Brannon, New London, MO, for respondent.
    Before ROY RICHTER, C.J., CLIFFORD H. AHRENS, J., and GLENN A. NORTON, J.
   ORDER

PER CURIAM.

Trisha Sonntag (Mother) appeals the circuit court’s judgment modifying, in favor of Timothy Scherder (Father), an original order concerning the custody and support of their daughter, M.A. (Child).

We have reviewed the briefs of the parties and the record on appeal and find no error of law. No jurisprudential purpose would be served by a written opinion. However, the parties have been furnished with a memorandum opinion for their information only, setting forth the facts and reasons for this order.

The judgment of the trial court is affirmed in accordance with Rule 84.16(b).


author: PER CURIAM:

text:
    STATE of Missouri, Respondent, v. Lyle M. SCHOOLFIELD, Appellant.
    No. WD 71107.
    Missouri Court of Appeals, Western District.
    Dec. 14, 2010.
    Craig A. Johnston, Columbia, MO, for appellant.
    Shaun J. Mackelprang and Mary H. Moore, Jefferson City, MO, for respondent.

      Before: JOSEPH M. ELLIS, P.J., and ALOK AHUJA and KAREN KING MITCHELL, JJ.
   ORDER

PER CURIAM:

Lyle M. Schoolfield was convicted in the Circuit Court of Ray County of one count of sale of a controlled substance, two counts of possession of a controlled substance with the intent to distribute, two counts of possession of a controlled substance, and one count of possession of drug paraphernalia with the intent to deliver or sell. On appeal, Schoolfield challenges the sufficiency of the evidence on each count. We affirm. Because a published opinion would have no precedential value, a memorandum setting forth the reasons for this order has been provided to the parties. Rule 30.25(b).


author: GARY M. GAERTNER, JR., Judge.

text:
    COURT OF 5 GARDENS CONDOMINIUM ASSOCIATION, Plaintiff/Respondent, v. 10330 OLD OLIVE, LLC, Defendant/Appellant.
    No. ED 94576.
    Missouri Court of Appeals, Eastern District, Division Five.
    Dec. 14, 2010.

      Patricia Ann Wilcox, Weiss & Associates, P.C., St. Louis, MO, for appellant.
    Randall E. Gusdorf, Michael A. Kasper-ek, Gusdorf Law Firm, LLC, St. Louis, MO, for respondent.
   GARY M. GAERTNER, JR., Judge.

Introduction

Defendant, 10330 Old Olive, LLC, appeals from the judgment denying its motion to set aside a default judgment. We affirm in part, reverse in part and remand.

Background

On December 30, 2008, plaintiff, Court of 5 Gardens Condominium Association, filed a two-count petition for breach of contract and suit on account. Plaintiff alleged that defendant, as a successor in interest, breached an easement agreement (agreement) that provided that defendant would pay thirty-one percent of “Common Operating Costs” as defined in the agreement. Plaintiff further alleged that defendant’s breach caused it to suffer damages “in the principal amount of $23,536.56 (31% of $83,206.89 as of October 29, 2007), plus additional charges that have and continue to accrue, together with interest per contract or statute.” Plaintiff sought payment of $23,536.56, additional charges to the date of judgment, interest, attorney fees and costs. The agreement was one of the documents attached to the petition. The agreement contains provisions regarding interest, attorney fees and costs if certain obligations under the agreement are not satisfied.

The summons to be served on defendant’s registered agent was returned non-est. Thereafter, an alias summons was issued for service upon the Secretary of State of Missouri, as agent for defendant. The Secretary of State forwarded the summons by certified mail to defendant. The Secretary of State’s affidavit provides that the certified mailing was returned because “forward time expired” but the returned envelope does provide a new address. On May 28, 2009, defendant failed to appear for a scheduled hearing and plaintiff requested a default judgment. The court does not appear to have ruled on plaintiffs request but subsequently certified the case for a principal balance in excess of $25,000.

On August 24, 2009, the court conducted a status hearing. Defendant did not appear. On that day the court entered a default judgment in favor of plaintiff and awarded $35,977.54 for principal, $5,331.82 for interest, and $6,196.40 for attorney fees for a total of $47,505.76 plus court costs. Defendant contends that it did not receive notice of the status hearing until September 2009.

On October 12, 2009, defendant filed a motion to set aside the default judgment. The motion was not verified and no affidavits were attached. On November 12, 2009, the trial court had a hearing on the motion. The trial court subsequently denied the motion. Defendant thereafter filed a “VERIFIED MOTION TO RECONSIDER ORDER/JUDGMENT OF THE COURT.” In this motion, defendant raised for the first time the issue that there was not an evidentiary hearing for proof of damages or written evidence of plaintiffs damages for the default judgment’s award. The court denied the motion. Defendant raises two points on appeal.

Discussion

A trial court’s ruling on a motion to set aside a default judgment is reviewed for abuse of discretion. Brungard v. Risky’s Inc., 240 S.W.3d 685, 687-88 (Mo. banc 2007). A trial court has broader discretion when sustaining a motion to set aside a default judgment then when overruling such a motion. Id. at 687.

In its first point, defendant argues that the trial court abused its discretion in denying its motion to set aside the default judgment under Rule 74.05(d). Defendant contends that it established grounds of good cause and meritorious defenses against plaintiffs action. In response, plaintiff argues that the trial court did not abuse its discretion in denying defendant’s motion to set aside because defendant failed to file a verified pleading, provide affidavits in support or provide sworn testimony at a hearing.

Rule 74.05(d) provides that “[u]pon motion stating facts constituting a meritorious defense and for good cause shown, an interlocutory order of default or a default judgment may be set aside.” A motion to set aside a judgment cannot prove itself. First Community Bank v. Hubbell Power Systems, Inc., 298 S.W.3d 534, 540 (Mo.App. S.D.2009); Hinton v. Proctor & Schwartz, Inc., 99 S.W.3d 454, 458 (Mo.App. E.D.2003); Reed v. Reed, 48 S.W.3d 634, 642 (Mo.App. W.D.2001). The motion must be verified or supported by affidavits or sworn testimony produced at the hearing on the motion. Id. In the present case, defendant failed to satisfy this requirement. The record does not reflect that defendant’s motion to set aside the default judgment was verified or supported by affidavits or sworn testimony at the hearing on the motion. “Where the motion to set aside a judgment is unverified and unsupported by affidavits or sworn testimony, the circuit court has no basis for granting the motion.” Reed, 48 S.W.3d at 642. Accordingly, the trial court did not abuse its discretion in denying defendant’s motion to set aside the default judgment.

Defendant did file a verified motion to reconsider the denial of its motion to set aside. Defendant’s motion for reconsideration may be treated as a motion for new trial under Rule 78.01 if, as in this case, it was timely filed. Hinton, 99 S.W.3d at 459-60. Rule 78.01 states in part, “On a motion for a new trial in an action tried without a jury, the court may open the judgment if one has been entered, take additional testimony, amend findings of fact or make new findings, and direct the entry of a new judgment.” In Hinton, this court stated that “Rule 74.05(d) provides for the setting aside of a default judgment by the trial court when the party requesting such relief meets certain requirements in the motion requesting such relief, not in a motion for reconsideration after a judgment denying the motion requesting such relief.” Id. Even assuming that the trial court for purposes of Rule 74.05(d) could consider defendant’s verified motion to reconsider under Rule 78.01, it would have had discretion not to do so. See In re Coe, 903 S.W.2d 916, 918 n. 1 (Mo. banc 1995). Defendant’s first point is denied.

In its second point, defendant argues that the trial court erred in its award of damages to plaintiff. Defendant contends that when, as in this case, a plaintiff sues for an unliquidated sum and takes a default judgment, there must be proof of the damages.

Defendant failed to challenge the damages award in its motion to set aside. Defendant first raised the issue in its motion to reconsider. The issue is not properly preserved and review is for plain error. Rule 84.13(c). “Plain errors affecting substantial rights may be considered on appeal, in the discretion of the court, though not raised or preserved, when the court finds that manifest injustice or miscarriage of justice has resulted therefrom.” Id. Plain error is rarely applied in civil cases. In re S.R.J., Jr., 250 S.W.3d 402, 405-06 n. 2 (Mo.App. E.D.2008).

In a case where the plaintiff has taken a default judgment and sued for an unliquidated sum in the underlying action there must be some proof of damages to validly support an assessment of damages. Duvall v. Maxey, 249 S.W.3d 216, 222 (Mo.App. W.D.2008); Beckmann v. Miceli Homes, Inc., 45 S.W.3d 533, 540 (Mo.App. E.D.2001). Because a judgment is by default does not excuse the legal requirement that “probative evidence” sustain a damage award for the adjudication of an unliquidated claim for damages. Beckmann, 45 S.W.3d at 541; Smith v. Sayles, 637 S.W.2d 714, 718 (Mo.App.1982). Although a defaulting defendant loses the right to contest the determination of liability, the defendant is entitled to have the court hear evidence regarding damages and to base its determination on the evidence adduced. Duvall, 249 S.W.3d at 222-23. When the damages are unliqui-dated, a default is not an “ ‘admission of the amount of damages claimed, which then becomes a matter of proof.’ ” Beckmann, 45 S.W.3d at 541.

In the present case, the record does not reflect that the trial court conducted a hearing on the issue of damages. Plaintiff did allege in its petition that it suffered damages “in the principal amount of $23,536.56 (31% of $83,206.89 as of October 29, 2007), plus additional charges that have and continue to accrue.... ” But the allegations in the petition do not constitute “probative evidence” for plaintiff to prove damages. See Haynes v. Bohon, 878 S.W.2d 902, 905 (Mo.App. E.D.1994).

Also part of the record is a document titled “Court of Five Gardens Expenses October 2007 through April 2009” (Document). The Document lists dates, services provided, the apparent name of the provider of the service and amounts. On appeal, plaintiff states that the Document “was attached as an exhibit to [plaintiffs] .petition” and “was evidence for the court to base its decision.” Plaintiffs petition refers to three exhibits but not to the Document. Further, plaintiffs petition was filed on December 30, 2008 but the Document lists charges from November 2007 to April 14, 2009. The minute entries do not provide that the Document was added as an attachment after the petition’s original filing in December 2008 or that an amended petition was filed. Moreover, it is unclear when or if the Document was before the trial court. Ostensibly, the Document could have been presented to the court when it entered the default judgment. But the Document is not file stamped and not referred to in the minute entries. We also note that defendant argues that certain charges listed in the Document are not payable under the agreement.

The Western District in Duvall and Smith, considered the damage awards arising from default judgments. 249 S.W.3d at 221-24; Smith, 637 S.W.2d at 716-19. In Duvall, the court held because of the lack of evidence regarding damages the trial court plainly erred in its determination of the damages award. 249 S.W.3d at 224. Similarly in Smith, the court held that to allow an “award for actual damages to stand on [] sparse proof would be a manifest injustice.” 637 S.W.2d at 718.

In this case, there was no presentation of any probative evidence regarding damages: no witnesses presented at a hearing, no affidavit, nothing verified, or any document that possessed any indicia of reliability. There is not a modicum of probative evidence to support the award of damages. Our review of the entire record in this particular case shows a manifest injustice would occur to permit the award of damages to stand. The case is remanded for a hearing on the issue of damages.

Conclusion

The judgment denying defendant’s motion to set aside is affirmed in part, reversed in part and remanded for further proceedings consistent with this opinion.

MARY K. HOFF, J., and LAWRENCE E. MOONEY, J., concur.

      . Section 347.033.3 RSMo 2000.

      . The record on appeal consists of only the legal file. A transcript of any hearing, if prepared, is not part of the record on appeal.

      . The trial court did not state in its judgment a reason for denying defendant’s motion. Rule 74.05 does not require the trial court to state a reason for denying a motion to set aside a default judgment. Sears v. Dent Wizard Int’l Corp., 13 S.W.3d 661, 665 (Mo.App. E.D.2000).

      . Amending Rule 74.05(d) to provide that a motion to set aside an order or judgment of default should be verified, could possibly rectify any confusion in the future such as may have occurred here.

      . Plaintiff also asserts that "evidence for the court to base its decision” consists of the prayer of the petition and descriptions in the petition regarding defendant’s obligations and types of charges to be assessed. The petition though was not verified.

      . The default judgment with the damages award was prepared by plaintiff and signed by the court.