DONNA J. PETREY v. DIVISION OF UNEMPLOYMENT INSURANCE AND NORTHERN KY MH/MR BOARD
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RENDERED:
DECEMBER 17, 2004; 2:00 p.m.
NOT TO BE PUBLISHED
Commonwealth Of Kentucky
Court of Appeals
NO. 2003-CA-001697-MR
DONNA J. PETREY
v.
APPELLANT
APPEAL FROM FRANKLIN CIRCUIT COURT
HONORABLE ROGER L. CRITTENDEN, JUDGE
ACTION NO. 02-CI-01667
DIVISION OF UNEMPLOYMENT
INSURANCE AND
NORTHERN KY MH/MR BOARD
APPELLEES
OPINION
AFFIRMING
** ** ** ** **
BEFORE:
BUCKINGHAM, DYCHE, AND TACKETT, JUDGES.
BUCKINGHAM, JUDGE:
Donna Petrey appeals an order of the
Franklin Circuit Court granting a motion of the Division of
Unemployment Insurance to dismiss her complaint.
The circuit
court dismissed the complaint because Petrey did not name the
Kentucky Unemployment Insurance Commission as a party, thereby
failing to comply with KRS1 341.450(1).
1
Kentucky Revised Statutes.
Because strict
compliance with the terms of the statute is required for the
circuit court to exercise jurisdiction, we affirm.
Petrey provided care for the mentally handicapped in
her home under an agreement with the Northern Kentucky Mental
Health/Mental Retardation Board (Board).
After her contract
with the Board was terminated on June 27, 2002, Petrey filed a
claim for unemployment compensation benefits.
Her claim was
denied by the Kentucky Division of Unemployment Insurance, and
thereafter by the Kentucky Unemployment Insurance Commission
(Commission), on the ground that she had not been an employee of
the Board but had been an independent contractor.
Petrey appealed the Commission’s decision to the
Franklin Circuit Court (2002-CI-01667), which dismissed the
appeal in an order entered on July 22, 2003.
It did so on the
ground that it lacked jurisdiction to hear the case because
Petrey had failed to name the Commission as a defendant.
Petrey
then appealed the dismissal of her case to this court (2003-CA001697).
Meanwhile, however, Petrey had resubmitted an appeal
of the same Commission decision to the Franklin Circuit Court
(2003-CI-00602).
She attempted to join her appeal with an
appeal by Patricia Howard, a woman who was similarly challenging
a ruling that she had not been an employee of the Board but had
been an independent contractor.
-2-
The circuit court dismissed the Petrey/Howard appeal
in an order entered on July 22, 2003, the same day as the order
dismissing the earlier suit.
dismissal (2003-CA-001698).
Petrey appealed this second
This court dismissed that appeal
earlier this year.
Petrey submitted a brief in the present appeal (2003CA-1697) that lists both her and Howard as appellants, even
though Howard was not a party in the first action that is the
subject of this appeal and was not designated in the notice of
appeal as required under CR2 73.03(1).
In her brief, Petrey argues that the circuit court
acted in an arbitrary and capricious manner in upholding the
agency finding that she and Howard were independent contractors
rather than employees.
She also argues that the circuit court
erred in holding that she could not join with Howard in
appealing the agency decision.
These arguments are not relevant
to the present appeal.
The circuit court order from which Petrey appeals
dismissed her case (2002-CI-1667) on the sole ground that it
lacked jurisdiction over the appeal due to her failure to name
the Commission as a party.
merits of the appeal.
The circuit court did not reach the
The joinder issue was pertinent only in
circuit court action 2003-CI-00602, which, as we have noted, was
2
Kentucky Rules of Civil Procedure.
-3-
dismissed by the circuit court and thereafter was dismissed on
appeal by this court.
The only issue that may be considered
here is whether the circuit court properly dismissed the first
action (2003-CI-1667) for failure to name the Commission as a
party.
KRS 341.450(1) states in pertinent part:
Except as provided in KRS 341.460, within
twenty (20) days after the date of the
decision of the commission, any party
aggrieved thereby may, after exhausting his
remedies before the commission, secure
judicial review thereof by filing a
complaint against the commission in the
Circuit Court of the county in which the
claimant was last employed by a subject
employer whose reserve account or
reimbursing employer account is affected by
such claims. (Emphasis added.)
In the complaint she filed in the circuit court,
Petrey named as defendants/appellees the Division of
Unemployment Insurance and the Northern Kentucky Mental
Health/Mental Retardation Board.
She characterizes her failure
to name the Commission as a party as a “clerical misprision.”
She urges us to apply a standard of substantial compliance with
the statute, arguing that because she named the “full Commission
of the Division of Unemployment Insurance” in the first sentence
of the body of her complaint, the Commission received adequate
notice of suit, particularly since it is located at the same
address as the Division of Unemployment Insurance.
-4-
She argues
that the primary purpose of the statute is to ensure that all
parties receive adequate notice.
Thus, she asserts that because
the requirement was fulfilled in her case, the action was
improperly dismissed.
She also claims that it is unjust to hold
her to a standard of strict compliance with the statute when the
Office of the General Counsel also committed various procedural
errors, such as allegedly failing to mail a copy of the
complaint to the employer (the Board).
But Kentucky case law is very clear that strict
compliance with the terms of the statute is necessary to sustain
an appeal of an administrative decision.
There is no appeal to the courts from an
action of an administrative agency as a
matter of right. When grace to appeal is
granted by statute, a strict compliance with
its terms is required. Where the conditions
for the exercise of power by a court are not
met, the judicial power is not lawfully
invoked. That is to say, that the court
lacks jurisdiction or has no right to decide
the controversy.
Board of Adjustments of City of Richmond v. Flood, Ky., 581
S.W.2d 1, 2 (1978)(citations omitted).
“[S]tatutes which require the joinder of certain
parties on appeal effectively transform those parties into
indispensable ones.”
Kentucky Unemployment Ins. Com'n v.
Providian Agency Group, Inc., Ky. App., 981 S.W.2d 138,
140 (1998)(citing CR 19.01).
-5-
In a case factually similar to Petrey’s, where the
appellant failed to name the employer as a party but argued that
he had substantially complied with the statute by mentioning the
employer in the recitation of facts and mailing a copy of the
complaint to the employer’s attorney, the Kentucky Supreme Court
stated, “Even if we agreed with the claim, we find no authority
before the court to authorize the doctrine of substantial
compliance in a case where the appeal process is statutorily
created and implemented.”
Kentucky Unemployment Ins. Com'n v.
Carter, Ky., 689 S.W.2d 360, 361 (1985).
Therefore, naming the
Commission as a party is one of the conditions precedent to the
exercise of jurisdiction by the circuit court.
Id. at 362.
As to Petrey’s claims that the Office of General
Counsel also committed various procedural errors, these do not
negate the fact that Petrey failed to comply with` the terms of
the statute.
Petrey’s argument that we should apply a
“substantial compliance” standard is contrary to precedent.
Regarding her argument that we reverse or partially vacate the
holding in Flood, we note that as an intermediate appellate
court, this court is bound by established precedents of the
Kentucky Supreme Court. SCR 1.030(8)(a). The Court of Appeals
cannot overrule the established precedents set by our supreme
court or its predecessor court. Smith v. Vilvarajah, Ky. App.,
57 S.W.3d 839, 841 (2000).
-6-
We affirm the order of the Franklin Circuit Court.
ALL CONCUR.
BRIEF FOR APPELLANT:
BRIEF FOR APPELLEE:
Edwin F. Kagin
Union, Kentucky
B. Amy O’Nan
Frankfort, Kentucky
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