GARY MCCOY v. RWT, INC., d/b/a PAPA JOHN'S PIZZA; PAPA JOHN'S INTERNATIONAL, INC. and RWT, INC. v. GARY MCCOY
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RENDERED: July 8, 2005; 10:00 a.m.
NOT TO BE PUBLISHED
Commonwealth Of Kentucky
Court of Appeals
NO.
2003-CA-002177-MR
GARY MCCOY
APPELLANT
APPEAL FROM FLOYD CIRCUIT COURT
HONORABLE JOHN DAVID CAUDILL, JUDGE
ACTION NO. 01-CI-00161 AND 01-CI-00261
v.
RWT, INC., d/b/a PAPA JOHN’S PIZZA;
PAPA JOHN’S INTERNATIONAL, INC.
AND:
NO.
APPELLEES
2003-CA-002241-MR
RWT, INC.
CROSS-APPELLANT
CROSS-APPEAL FROM FLOYD CIRCUIT COURT
HONORABLE JOHN DAVID CAUDILL, JUDGE
ACTION NO. 01-CI-00161
v.
GARY MCCOY
CROSS-APPELLEE
OPINION
AFFIRMING IN PART,
REVERSING IN PART AND REMANDING
** ** ** ** **
BEFORE:
BARBER AND JOHNSON, JUDGES; HUDDLESTON, SENIOR JUDGE1.
HUDDLESTON, JUDGE:
On the evening of February 18, 2000, Gary
McCoy, the owner of Mountain Metal, a business in Prestonsburg,
Kentucky, called a local Papa John’s pizzeria.
He ordered two
pizzas, one to be delivered to his residence and the other to be
1
Senior Judge Joseph R. Huddleston sitting as Special Judge by assignment of
the Chief Justice pursuant to Section 110(5)(b) of the Kentucky Constitution
and KRS 21.580.
delivered to his housekeeper’s residence.
McCoy requested that
the delivery person stop at his business, where he would be
working late, to receive payment for the pizzas.
Around 6:30 p.m., Wendell Burke, one of the pizzeria’s
assistant managers, left to deliver McCoy’s order.
According to
Burke, after delivering the pizzas, he went to Mountain Metal to
obtain payment.
After McCoy paid Burke, he invited Burke to
stay so they could talk.
When Burke declined the invitation,
McCoy allegedly grew belligerent, brandished a rifle and ordered
Burke to sit down.
McCoy allegedly talked about “visions” and
suicidal thoughts that he was experiencing and demanded that
Burke watch a videotape recording of one of McCoy’s hunting
trips.
After watching the video, Burke slipped out while McCoy
was distracted.
Burke returned to the pizzeria at approximately 8:00
p.m.
When he arrived, he told his general manager and his co-
workers about McCoy’s behavior.
According to Burke, the manager
suggested that Burke contact the police; but Gretta Salisbury,
another of the pizzeria’s assistant managers, not Burke, called
the Prestonsburg Police Department.
Two officers were
dispatched to the pizzeria to investigate, and while there, took
statements from Burke and his co-workers.
The police obtained
an arrest warrant for McCoy in which he was charged with
unlawful imprisonment.
Later that night, McCoy was taken into
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custody.
However, on April 10, 2000, the criminal charge lodged
against McCoy was dismissed without prejudice after McCoy
stipulated to probable cause for his arrest.
On February 16, 2001, McCoy filed suit in Floyd
Circuit Court against Papa John’s International (Papa John’s)
and Burke in which he sought damages for wrongful arrest,
malicious prosecution and defamation.
Later, McCoy learned that
RWT, Inc., a local corporation, rather than Papa John’s owned
and operated the Prestonsburg pizzeria and employed Burke.
On
March 29, 2001, McCoy filed a separate complaint against RWT in
which he sought damages for wrongful arrest, malicious
prosecution, defamation and the intentional infliction of
emotional distress (IIED).
Subsequently, the circuit court
consolidated McCoy’s two lawsuits.
In due course, Papa John’s and RWT moved for summary
judgment.
In their motions, the corporations argued that Burke
had acted outside the scope of his employment.
They also
contended that McCoy’s claim for wrongful arrest lacked merit
since he had been arrested pursuant to a valid warrant, and they
insisted that McCoy’s claim for malicious prosecution should be
dismissed since McCoy could not possibly prove one element of
that tort.
After conducting a hearing, the circuit court signed
an interlocutory order which was entered on July 29, 2002, in
which it concluded that Burke was an employee of RWT and that he
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had acted within the scope of his employment; thus, it denied
RWT’s motion for summary judgment.
On the other hand, the court
granted partial summary judgment in the defendant-corporations’
favor, dismissing McCoy’s wrongful arrest claim.
The
defendants’ motions to dismiss McCoy’s remaining claims were
held in abeyance pending the completion of discovery.
After the completion of pre-trial discovery, Papa
John’s moved to alter, amend or vacate the trial court’s July
29th order, in effect renewing its motion for summary judgment,
while RWT simply re-noticed its original motion for summary
judgment.
On September 30, 2002, after holding another hearing,
summary judgment in favor of both RWT and Papa John’s was
granted.
The court said that McCoy’s claims for damages for
defamation and malicious prosecution against RWT had accrued on
February 18, 2000.
Since McCoy did not file suit against RWT
until March 29, 2001, these claims were barred by the one-year
statute of limitation found in Kentucky Revised Statutes (KRS)
413.140.
As to McCoy’s claim for the intentional infliction of
emotional distress, the court pointed out that this tort exists
strictly to redress extreme emotional distress when other
traditional torts do not apply.
Citing Banks v. Fritsch,2 the
court observed that where a defendant has engaged in acts which
constitute one or more of the traditional common law torts that
2
39 S.W.3d 474 (Ky.App. 2001).
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allow for recovery for emotional distress, an action for the
intentional infliction of emotional distress will not lie.
Since McCoy had asserted claims for malicious prosecution and
defamation, both of which authorize recovery for emotional
distress, the court concluded that McCoy could not assert a
claim based on the tort of IIED.
The court said that it was undisputed that Burke was
employed by RWT, not Papa John’s.
Since no employer-employee
relationship existed between Papa John’s and Burke, the court
concluded that Papa John’s could only be held vicariously liable
for Burke’s actions if he was Papa John’s ostensible agent.
The
court determined that McCoy did not rely upon any representation
made by Papa John’s that had any relation to any of Burke’s
allegedly intentional acts.
And, Burke’s intentional acts, the
court said, did not advance the cause of Papa John’s.
Consequently, Papa John’s was not vicariously liable for Burke’s
actions.
Believing summary judgment in favor of the defendant
corporations was inappropriate, McCoy appeals to this Court,
while RWT challenges in a protective cross-appeal the July 29,
2002, order finding that at relevant times Burke was acting
within the scope of his employment with the pizzeria.
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OSTENSIBLE AGENCY
On appeal, McCoy insists that the circuit court
misinterpreted the law of ostensible agency.
Because Papa
John’s allowed its name to be listed in the telephone directory
and allowed its name to be placed on RWT’s pizzeria, on Burke’s
car and on Burke’s uniform, McCoy argues, Papa John’s induced
him to believe that Burke was Papa John’s agent.
Citing
Paintsville Hospital v. Rose,3 McCoy insists that an ostensible
agency situation must be interpreted in light of what the
relying party [McCoy] knew or should have known, not what the
purported agent [Burke] knew or should have known.
There is no
genuine issue of material fact, insists McCoy, that Burke was
anything but Papa John’s ostensible agent.
Furthermore, since
Burke is Papa John’s ostensible agent, then Papa John’s is
liable under the doctrine of respondeat superior for Burke’s
tortious acts.
McCoy also insists that Burke acted within the
scope of his employment since his acts occurred substantially
within the authorized time and space of his employment.
It is well-settled in this Commonwealth that when
considering a motion for summary judgment, the circuit court
must view the record in a light most favorable to the party
opposing the motion, and the court must resolve all doubts in
3
683 S.W.2d 255 (Ky. 1985).
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favor of the party opposing the motion.4
The court should not
grant summary judgment if any issue of material fact exists.5
We, on the other hand, must determine whether the circuit court
correctly found that no genuine issue of material fact exists
and that, as a matter of law, the moving party was entitled to
judgment in its favor.6
Since findings of fact are not in issue,
we review the circuit court’s decision de novo.7
The Supreme Court of Kentucky has defined “ostensible
agency” as follows:
One who represents that another is his
servant or his agent and thereby causes a
third person justifiably to rely upon the
care or skill of such apparent agent is
subject to liability to the third person for
harm caused by the lack of care or skill of
the one appearing to be a servant or other
agent as if he were such.8
To put it another way, for a plaintiff to establish an
ostensible agency relationship, he must show that “(1) the
defendant made representations leading the plaintiff to
reasonably believe that the wrongdoer was operating as an agent
under the defendant’s authority, and (2) the plaintiff was
4
Steelvest, Inc. v. Scansteel Service Center, Inc., 807 S.W.2d 476, 480 (Ky.
1991).
5
Id.
6
Scifres v. Kraft, 916 S.W.2d 779, 781 (Ky.App. 1996).
7
Id.
8
Roethke v. Sanger, 68 S.W.3d 352 (Ky. 2001), quoting Restatement (Second)
of the Law of Agency, § 267 (A.L.I. 1958).
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thereby induced to rely upon the ostensible agency relationship
to his detriment.”9
Therefore, McCoy had to show that Papa John’s made
representations that RWT and its employees, including Burke,
were its agents.
Such representations could have been made
directly to McCoy or to the community at large through
advertisements.10
The record shows that Papa John’s had placed
its name prominently on RWT’s pizzeria or allowed it to be
placed there, on the pizza boxes in which pizza was delivered,
on Burke’s uniform and on his car.
As a result, the record
contains sufficient evidence to raise a genuine issue of
material fact as to whether Papa John’s made representations
that RWT and, consequently, its employees, including Burke, were
its agents.
The circuit court held that McCoy had failed to show
that he relied on any representations made by Papa John’s which
related to any of the specific actions taken by Burke.
However,
we agree with McCoy that the court misinterpreted the law as it
relates to justifiable reliance.
McCoy needed only to show that
that he justifiably relied on the representation that an agency
relationship existed.
Viewed in a light most favorable to
McCoy, the fact that he called a number listed in the telephone
9
10
Shaffer v. Maier, 627 N.E.2d 986, 988 (Oh. 1993).
Gizzi v. Texaco, Inc., 437 F.2d 308, 309 (3rd Cir. 1970).
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directory assigned to Papa John’s pizzeria is sufficient
evidence to raise a genuine issue of material fact as to
justifiable reliance.
Since the record contained enough
evidence to raise a genuine issue of material fact as to the
existence of an agency relationship, the circuit court erred in
granting summary judgment in Papa John’s favor.
STATUTE OF LIMITATIONS
McCoy argues that his claims against RWT could not
have been barred by the one-year statute of limitations because
of the doctrine of respondeat superior.
According to McCoy,
since RWT is vicariously liable for Burke’s actions and RWT had
notice of the action against Burke, the statute of limitations
did not bar McCoy’s otherwise late-filed complaint against RWT.
KRS 413.140 expressly sets forth a one-year statute of
limitations for both malicious prosecution and defamation.
We
have neither been cited to nor found statute or case law that
supports McCoy’s argument.
In his reply brief, McCoy addresses this issue again.
He argues that his malicious prosecution claim was not barred
since it accrued on April 10, 2000, at the earliest.
Since he
filed his complaint against RWT on March 29, 2001, McCoy reasons
that this claim was asserted within the one-year statute of
limitations.
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The tort of malicious prosecution consists of five
elements:
(1) the institution of a criminal proceeding against
a criminal defendant by a complaining witness; (2) the
termination of the criminal proceeding in the favor of the
defendant; (3) malice on the part of complaining witness in
instituting the criminal proceeding; (4) lack of probable cause
for the criminal proceeding; and (5) consequent damage to the
criminal defendant resulting from the institution of the
criminal proceedings.11
So a cause of action for malicious
prosecution does not accrue until the criminal proceedings have
been terminated in favor of the defendant.12
The record establishes that the criminal charge
against McCoy was dismissed without prejudice on April 10, 2000.
Thus, McCoy had one year from that date in which to file a claim
for malicious prosecution.
Since McCoy filed his complaint
against RWT on March 29, 2001, his claim for malicious
prosecution was timely.
The circuit court erred when it found
otherwise.
McCoy insists that his defamation claim accrued when
the local newspaper ran a short article about his arrest on
February 23, 2000, not when Burke spoke to his co-workers and
the police on February 18, 2000.
McCoy insists that since his
11
Raine v. Drasin, 621 S.W.2d 895, 899 (Ky. 1981).
12
Sneed v. Rybicki, 146 F.3d 478, 481 (7th Cir. 1998).
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cause of action for defamation accrued on February 23, 2000, his
defamation claim, which was filed on March 29, 2001, was not
barred by the one-year statute of limitations.
McCoy is incorrect that his defamation claim accrued
when the local paper published an article about his arrest.
The
tort of defamation consists of four elements: (1) defamatory
language, (2) about the plaintiff, (3) which is published and
(4) causes injury to the plaintiff’s reputation.13
In general, a
cause of action for defamation accrues when the defamatory
language is published.14
Publication occurs when “the words
[are] either negligently or intentionally communicated as to be
heard by an understanding third party[.]”15
Burke first
communicated the allegedly defamatory words on February 18,
2000, when he spoke to his co-workers.
claim accrued on February 18, 2000.
Thus, McCoy’s defamation
Since McCoy filed his
defamation claim against RWT on March 29, 2001, he filed it well
after the one-year statute of limitations had expired.
In
addition, even if the cause of action did not accrue until
February 23, 2000, McCoy’s complaint was filed too late.
INTENTIONAL INFLICTION OF EMOTIONAL DISTRESS
13
Columbia Sussex Corporation, Inc. v. Hay, 627 S.W.2d 270, 273 (Ky.App.
1981).
14
Lashlee v. Sumner, 570 F.2d 107, 109 (6th Cir. 1977).
15
Columbia Sussex Corporation, Inc. v. Hay, supra, note 13, at 274.
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In his reply brief, for the first time, McCoy argues
that the circuit court erred in dismissing his claim for damages
based on the intentional infliction of emotional distress.
McCoy acknowledges that the tort is a “gap-filler” intended to
provide a remedy when other torts are not adequate.
Although
McCoy admits that he has not shown that Burke intentionally
acted solely to cause McCoy emotional distress, he insists that
his claim is still appropriate because when a person acts with
reckless disregard and causes extreme emotional disturbance,
then a claim for outrage will lie.
As we said in Banks v. Fritsch,16 the tort of
intentional infliction of emotional distress, also known as the
tort of outrage, was
intended as a “gap-filler”, providing
redress for extreme emotional distress where
traditional common law actions do not.
Where an actor’s conduct amounts to the
commission of one of the traditional torts .
. . for which recovery for emotional
distress is allowed, and the conduct was not
intended only to cause extreme emotional
distress in the victim, the tort of outrage
will not lie. Recovery for emotional
distress in those instances must be had
under the appropriate traditional common law
action.17
In his two complaints, McCoy sought damages for both
defamation and malicious prosecution.
16
39 S.W.3d 474 (Ky.App. 2001).
17
Id. at 481.
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These traditional torts
allow for the recovery of damages due to emotional distress.
Thus, a claim for intentional infliction of emotional distress
is inappropriate in the present case.
In addition, McCoy offers
no evidence that Burke acted with the sole intent to cause McCoy
emotional distress.
The court correctly dismissed McCoy’s
claim.
SCOPE OF EMPLOYMENT
In a protective cross-appeal, RWT challenges the
circuit court’s determination that at relevant times Burke was
acting within the scope of his employment.
RWT cites Roethke v.
Sanger18 and argues that the test to determine ostensible agency
is also the one used to determine whether an employee has acted
within the scope of his employment.
RWT insists that Burke
intentionally lied to the police regarding McCoy and
intentionally and falsely prosecuted him as well.
RWT insists
Burke’s intentional actions were outside the scope of his
employment since they did not inure to RWT’s benefit.
Regarding “scope of employment”, the Supreme Court has
said that
the critical analysis is whether the
employee or agent was acting within the
scope of his employment at the time of his
tortious act. Wood v. Southeastern
Greyhound Lines[19] provides that for it to be
within the scope of its employment, the
18
supra, note 8.
19
302 Ky. 110, 194 S.W.2d 81 (1946).
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conduct must be of the same general nature
as that authorized or incidental to the
conduct authorized. A principal is not
liable under the doctrine of respondeat
superior unless the intentional wrongs of
the agent were calculated to advance the
cause of the principal or were appropriate
to the normal scope of the operator's
employment.20
RWT bases its argument on the assumption that Burke’s
actions were both intentional and tortious.
So its argument can
only succeed if it is determined as a matter of fact that Burke
intentionally lied when he reported that McCoy had unlawfully
imprisoned him.
Neither we nor the circuit court at this stage
can make such a determination since this factual dispute lies at
the very heart of this case; only a jury can resolve factual
disputes.
Since it can often be difficult to determine whether
an employee’s actions fall within the apparent scope of his
employment, courts generally hold that the issue of scope of
employment is a question of fact to be decided by a jury.21
In
the present case, the record contains sufficient evidence to
raise a genuine issue of material fact as to whether Burke acted
within the scope of his employment; therefore, this issue should
be decided by a jury.
CONCLUSION
20
Osborne v. Payne, 31 S.W.3d 911, 915 (Ky. 2000). (Citation omitted.)
21
Willis v. Maysville & B.S.R. Co., 122 Ky. 658, 92 S.W. 604, 605 (Ky.
1906).
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That portion of the summary judgment dismissing
McCoy’s claims for damages based on intentional infliction of
emotional distress against Papa John’s and RWT is affirmed.
That portion of the summary judgment dismissing McCoy’s claim
against RWT for damages for defamation is affirmed.
That
portion of the summary judgment dismissing McCoy’s claim for
damages for defamation and for malicious prosecution against
Papa John’s and his claim for malicious prosecution against RWT
is reversed, and this case is remanded for further proceedings
consistent with this opinion.
ALL CONCUR.
BRIEF FOR APPELLANT/CROSSAPPELLEE:
BRIEF FOR APPELLEES AND FOR
CROSS-APPELLANT RWT, INC.
C. Thomas Hectus
Hectus & Strause PLLC
Louisville, Kentucky
Erich E. Blackburn
Pam May and Associates, P.S.C.
Pikeville, Kentucky
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