CAB-VERTISING OF LOUISVILLE, INC. V. LOUISVILLE/JEFFERSON COUNTY OFFICE FOR ECONOMIC DEVELOPMENT
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RENDERED: November 25, 1998; 2:00 p.m.
NOT TO BE PUBLISHED
C ommonwealth O f K entucky
C ourt O f A ppeals
NO.
1996-CA-001926-MR
CAB-VERTISING OF LOUISVILLE, INC.
APPELLANT
APPEAL FROM JEFFERSON CIRCUIT COURT
HONORABLE KEN G. COREY, JUDGE
ACTION NO. 95-CI-2305
V.
LOUISVILLE/JEFFERSON COUNTY OFFICE
FOR ECONOMIC DEVELOPMENT
APPELLEE
OPINION AND ORDER
DISMISSING
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BEFORE:
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GUDGEL, Chief Judge; ABRAMSON1 and COMBS, Judges.
COMBS, JUDGE:
The appellant, Cab-Vertising of Louisville, Inc.,
appeals from the judgment of the Jefferson Circuit Court which
granted summary judgment in favor of the appellee,
Louisville/Jefferson County Office For Economic Development
(OED).
For failure of the appellant to name all indispensable
parties, we order this appeal dismissed.
1
Judge Abramson concurred in this opinion and order prior to
leaving the Court on November 22, 1998.
In March, 1991, Cab-Vertising received a $30,000
business loan through the Minority Business Development Loan
Program (the loan program) which provides minority businesses
with short-term financing.
Created by an agreement between and
among the OED, Jefferson County, and a consortium of area banks,
the loan program is administered by OED.
After Cab-Vertising signed a promissory note and a
guaranty agreement, OED made the first disbursement of the loan
to Cab-Vertising; the remaining balance of the loan was to be
disbursed directly to the manufacturer developing the prototypes
for Cab-Vertising in two installments to be paid as specified
stages of the project were completed. However, between June and
October 1991, Cab-Vertising failed to make its monthly payments;
as a result, OED refused to release the remaining balance of the
loan.
Ultimately, the Executive Committee of the loan program
declared Cab-Vertising’s loan to be in default, and OED filed a
collection action against Cab-Vertising and the seven guarantors
of the loan.
The case was eventually settled and, on April 26,
1998, it was dismissed by order of the Jefferson Circuit Court
for lack of prosecution.
On April 26, 1995, Cab-Vertising filed a complaint
against the OED, the City of Louisville, and Jefferson County
seeking damages for breach of contract, malicious institution of
legal proceedings, negligence, and outrageous conduct.
Its
complaint was based upon the alleged actions of the defendants
regarding the business loan that Cab-Vertising had received in
March 1991.
On March 15, 1996, the court granted summary
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judgment in favor of the defendants as to Cab-Vertising’s claims
of negligence, malicious institution of legal proceedings, and
outrageous conduct; only Cab-Vertising’s claim for breach of
contract remained. Shortly thereafter, on June 7, 1996, the court
again granted summary judgment in favor of the defendants, this
time dismissing Cab-Vertising’s remaining claim for breach of
contract.
On July 6, 1996, Cab-Vertising filed a notice of
appeal from the Jefferson Circuit Court’s order of June 7, 1996.
The notice, however, named only OED as an appellee, omitting the
City of Louisville and Jefferson County as parties to the appeal.
This omission raises the procedural issue of whether CabVertising failed to name all of the indispensable parties to this
appeal.
The notice of appeal transfers jurisdiction of a case
from the circuit court to the appellate court.
Clark Equipment
Company, Inc. v. Bowman, Ky. App., 762 S.W.2d 417(1988).
It
places only the named parties within the jurisdiction of this
Court.
(1990).
City of Devondale v. Stallings, Ky., 795 S.W.2d 954
Failure to name all necessary parties to an appeal is a
fatal flaw.
R.L.W. v. Cabinet For Human Resources, Ky. App., 756
S.W.2d 148 (1988).
Where absence of a party prevents this Court
from granting complete relief among those already named as
parties, we are precluded entirely from entertaining the merits
of an appeal.
Braden v. Republic-Vanguard Life Insurance
Company, Ky., 657 S.W.2d 241 (1983), construing CR 73.03.
The OED was created pursuant to a Cooperative Compact
executed by the City of Louisville (the City) and Jefferson
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County (the County).
The City and the County agreed to create “a
joint City/County Department for the purpose of promoting
economic development . . . . to be known as the Louisville and
Jefferson County Office for Economic Development.”
Compact, Section XVIII (A).
Cooperative
In accordance with the compact, OED
was to be financed by annual appropriations from both the City
and the County based upon a proposed budget prepared by the Mayor
and the County Judge-Executive.
The director of OED was to be
appointed jointly by the Mayor of the City and the County JudgeExecutive, and OED employees were to be classified and
compensated at the same rate as employees for the City.
All
power of OED (including its finances and personnel) is derived
from the County and the City.
Indeed, the OED even lacks the
authority to pay its own expenses as the compact designated the
City as the OED’s fiscal agent responsible for paying its
expenses.
‘Accurately, suits by or against a municipal
corporation should be in its corporate name
and not by or against the individuals
composing it, or the council, or its
officers, or its corporate authorities.’
Buckner v. Clay, Ky., 206 S.W.2d 827, 829 (1947), quoting
McQuillin, Municipal Corporations, Volume 6, paragraph 2657.
OED functions only as an agent for the City and County
and is not an independent legal entity capable of suing or being
sued on its own.
Any judgment returned against the OED would be
paid by the City and the County -- both of which prepare and fund
the OED's budget.
Any suit brought against OED would, therefore,
have to name the city and the county as parties.
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As Cab-Vertising has failed to name all of the
necessary parties to this appeal, we are precluded from
addressing the merits of this appeal.
Therefore, we hereby ORDER
the appeal dismissed.
ABRAMSON, JUDGE, CONCURS.
GUDGEL, CHIEF JUDGE, CONCURS IN RESULT.
Date: November 25, 1998
/s/ Sara Combs
JUDGE, KENTUCKY COURT OF APPEALS
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BRIEF FOR APPELLANT:
BRIEF FOR APPELLEE:
Wendell L. Jones
Louisville, KY
Edwin J. Lowry, Jr.
Louisville, KY
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