KENTUCKY FARM BUREAU MUTUAL INSURANCE COMPANY V. BELINDA K. RYAN, ET AL
Annotate this Case
Download PDF
RENDERED : NOVEMBER 23, 2005
TO BE PUBLISHED
,*ixyrrmp ~aurf of ~fi
2003-SC-0944-DG
KENTUCKY FARM BUREAU MUTUAL
INSURANCE COMPANY
V.
APPELLANT
ON REVIEW FROM COURT OF APPEALS
2002-CA-0637-MR
SHELBY CIRCUIT COURT NO . 2000-CI-0269
BELINDA K . RYAN, KEVIN J . KRUER, AND
MARY JO LESAK, CO-EXECUTORS OF THE
ESTATES OF LAWRENCE J . KRUER AND
MILDRED L . KRUER
APPELLEES
OPINION OF THE COURT BY JUSTICE JOHNSTONE
REVERSING
This case stems from an automobile accident that occurred on May 21, 1993, on
Interstate 64 near Shelbyville, Kentucky. Charles Ashby, traveling in the westbound
lane, was attempting to pass a truck when a motorcyclist veered in front of him . Ashby
lost control of his vehicle and crossed the median, colliding with an eastbound vehicle
driven by Lawrence Kruer . Kruer and his wife, Mildred, were killed instantly . The
motorcyclist continued westbound on I-64 and was never identified .
Appellees, the estates of Lawrence and Mildred Kruer, settled with Ashby's
insurer for liability policy limits and thereafter instituted the instant action against
Appellant, Kentucky Farm Bureau Mutual Insurance Company (hereinafter "KFB") for
underinsured motorist (UlM) coverage provided under the Kruers' policy. In its answer,
KFB maintained that the accident was caused in whole, or in .part, by the actions of the
motorcyclist, and that KFB was entitled to apportion fault to the unknown individual .
Subsequently, the trial court permitted KFB to file a third party complaint against this
"unknown motorcyclist," who was constructively served via warning order attorney . In
response to KFB's third party complaint, Appellees amended their complaint to claim
uninsured motorist (UM) coverage from KFB based on the alleged actions of the
motorcyclist. KFB, in turn, argued that the motorcyclist was not an uninsured motor
vehicle because the "hit and run" policy provision required physical contact between the
motorcycle and the Kruers' vehicle, which was never alleged .
The matter proceeded to a jury trial on November 26, 2001 . At the close of the
evidence, the trial court dismissed the UM claim against KFB, finding that there was no
evidence of any physical contact between the Kruers' vehicle and the motorcyclist.
Further, over Appellees' objection, the jury was instructed to apportion fault between
Ashby and the motorcyclist . The jury returned a unanimous verdict apportioning fifty
percent of the fault to Ashby and fifty percent to the motorcyclist, and awarding gross
damages of $350,668 to Lawrence Kruer and $107,322 to Mildred Kruer. After
reducing for apportionment and the amounts paid by Ashby's liability carrier, the trial
court entered a judgment of $78,334 to Lawrence Kruers' estate . Because the award to
Mildred's estate was less than the payment by Ashby's carrier, the trial court entered a
judgment dismissing Mildred's UIM claim against KFB.
Appellees appealed the issue of apportionment, as well as the validity of KFB's
"physical contact" requirement for UM coverage . The Court of Appeals reversed the
trial court's ruling on apportionment, holding that KRS 411 .182 does not permit
apportionment of fault against a nominal party who is not subject to personal liability .
As a result, the court did not reach the issue concerning the dismissal of the UM claim
under the "physical contact" language of KFB's policy.' This Court thereafter granted
KFB's motion for discretionary review . For the reasons discussed herein, we now
reverse the decision of the Court of Appeals and reinstate the judgment of the Shelby
Circuit Court.
The Court of Appeals essentially decided two issues in this case . First, it
concluded that although KFB's liability for UIM coverage is contractual in nature, the
measure of that contractual liability sounds in tort law, thus implicating Kentucky's
apportionment statute, KRS 411 .182. Second, it determined that KRS 411 .182 does
not permit apportionment against an unknown tortfeasor who, while nominally a party to
the action, is neither before the court nor subject to personal liability . The court opined
that the statute, while not expressly defining the term "party," limits allocation of fault to
those who actively assert claims, offensively or defensively, as parties in the litigation or
who have settled by release or agreement, thus excluding constructively served parties
.such as the unknown motorcyclist in this case.
We do not agree with the Court of Appeals' restrictive interpretation of the
procedural nature of KRS 411 .182, and, in particular, what constitutes a party subject to
allocation of fault. However, we need not reach the substance of the issue because we
conclude that the statute expressly does not apply to contractual claims, including those
for UIM and UM coverage .
KRS 411 .182, entitled Allocation of fault in tort actions, provides, in pertinent
part :
1Appellees acknowledge that this Court's recent decision in Burton v. Kentucky Farm
Bureau , 116 S .W .3d 475 (Ky. 2003) resolves this issue in favor of KFB, and have thus
declined to address it herein .
(1) In all tort actions, including products liability actions,
involving fault of more than one party to the action, including
third-party defendants and persons who have been released
under subsection (4) of this section . . . ."
(Emphasis added) . By its plain language, KRS 411 .182 limits itself to tort actions . An
unambiguous statute is to be applied without resort to any outside aids. Delta Air Lines,
Inc. v . Commonwealth, Revenue Cabinet , 689 S .W .2d 14 (Ky. 1985) . See also
Gateway Construction Co . v. Wallbaum , 356 S.W .2d 247 (Ky. 1962) . This Court has
repeatedly held that statutes must be given a literal interpretation unless they are
ambiguous and if the words are not ambiguous, no statutory construction is required .
See McCracken County Fiscal Court v. Graves, 885 S .W .2d 307 (Ky. 1994) ;
Commonwealth v. Shivley, 814 S .W.2d 572 (Ky. 1991) .
Despite the unambiguous language of KRS 411 .182, the Court of Appeals
nonetheless determined that it applies to contractual cases that "sound in tort," such as
UM and UIM claims . Further, Appellees point out that KRS 411 .182 is a selective
adoption of the provisions of the Uniform Comparative Fault Act (UCFA) of 1977,
formulated by the Commission on Uniform State Laws. UCFA § 2(a) specifically states
that the Act governs "all actions involving the fault of more than one party to the action
. . . . " (Emphasis added) . Contrary to Appellees' assertion, however, our legislature did
not adopt § 2(a) verbatim, but rather embraced the more restrictive language "in all tort
actions . . . involving fault of more than one party to the action . . . ." Thus, we are of
the opinion that the legislature was quite clear in its intent to exclude contract actions,
including those for UM and UIM coverage, from the scope of KRS 411 .182 . And while
we certainly agree that UM and UIM actions involve aspects of tort law, in that the
allocation of fault is a necessary prerequisite to coverage, our case law firmly
establishes that the contractual nature of the claims is procedurally controlling.
"[A] 'suit to recover UIM coverage is a direct action' against the UIM carrier and
'the [UIM] carrier alone is the real party in interest . . . ."' Philadelphia Indemnity
Insurance Co . v. Morris , 990 S .W .2d 621, 625 (Ky. 1999) (quoting Coots v. Allstate
Insurance Co . , 853 S .W .2d 895, 903 (Ky. 1993)) . While a UIM insurer's liability to its
insured is fault-based to the extent the claimant has any comparative fault, there is no
requirement that any other tortfeasor be named and/or served as a party in the action.
In fact, Kentucky courts have refused to enforce insurance policy provisions requiring
an insured to obtain a judgment or even sue the uninsured/underinsured motorist in
order to determine liability under the contract . Puckett v. Liberty Mutual Insurance Co . ,
477 S .W.2d 811 (Ky. 1971) . As this Court has stated with regard to UM coverage, it is
first party contractual insurance that "must be honored even if the tort-feasor cannot be
identified ." Gordon v. Kentucky Farm Bureau Insurance Co ., 914 S .W .2d 331, 332 (Ky.
1995). This distinction is further illustrated by the fact that the fifteen-year statute of
limitations governs the bringing of these contractual actions rather than the tort statute
of limitations set out in the Motor Vehicle Reparations Act, KRS 304.39-230(6). Id .
Appellees' action against KFB was based in contract, seeking UIM coverage for
damages that exceeded the payments by Ashby's liability carrier . This is not a tort case
against Ashby because Appellees have previously released him in exchange for his
insurer's payment of policy limits. To the extent that Appellees could prove damages
caused by Ashby which exceeded the policy limits paid by his insurer, they would be
entitled to recover such additional damages under the UIM contract with KFB . But any
payment by KFB would necessarily be made in performance of its contractual obligation
to the Kruers, and neither would nor could be characterized as payment of legal
damages pursuant to tort liability . Morris, supra . See also State Farm Mutual
Insurance Co . v. Fireman's Fund American Insurance Co., 550 S .W .2d 554, 557 (Ky.
1977). ("[P]ayment made in performance of a contractual obligation is not a payment of
'damages."')
In United States Fidelity and Guaranty Co . v. Preston , 26 S .W.3d 145 (Ky.
2000), a Kentucky resident was killed in an automobile accident in Georgia involving an
uninsured motorist . The estate brought suit against the uninsured motorist and a
Georgia jury found the Kentucky decedent to be sixty percent at fault. Under Georgia's
modified comparative fault scheme, the estate was barred from recovery and the trial
court entered a defense verdict . Nonetheless, the estate was subsequently permitted
to bring an action in Kentucky against the decedent's insurer for UM coverage and to
prove damages, ultimately recovering the forty percent of those damages attributable to
the Georgia tortfeasor under the UM portion of the decedent's insurance contract . A
majority of this Court distinguished the Georgia tort action from the Kentucky contract
action, holding that the Georgia judgment in favor of the uninsured motorist would not
be offended by the estate's recovery of benefits under the unrelated UM insurance
contract . USF&G's liability was based upon its independent contract with the decedent
which could be enforced regardless of the presence of the tortfeasor in the lawsuit. Id.
at 149. See also Nationwide Mutual Insurance Co. v. Hatfield , 122 S .W .3d 36 (Ky.
2003).
As a condition precedent to establishing any contractual liability on behalf of
KFB, Appellees had the burden of proving damages caused by Ashby that exceeded
payments they had already received from Ashby's liability carrier . Within that context,
we agree with the Court of Appeals that the UIM claim sounded in tort .
Notwithstanding, KFB's liability was purely contractual . And because the action was
based in contract, it simply did not fall within the purview of KRS 411 .182 .
In focusing on KRS 411 .182, the Court of Appeals ignored the basic concepts of
Kentucky's comparative fault approach . In Hilen v. Hays , 673 S .W .2d 713 (Ky. 1984),
this Court first judicially adopted pure comparative fault in place of contributory
negligence, stating that "allocating liability proportionate to fault remains 'irresistible to
reason and all intelligent notions of fairness ."' Id . at 718 . We explained :
Comparative negligence is not "no-fault," but the direct
opposite . It calls for liability for any particular injury in direct
proportion to fault. It eliminates a windfall for either claimant or
defendant as presently exists in our all-or-nothing situation
where sometimes claims are barred by contributory negligence
and sometimes claims are paid in full regardless of contributory
negligence . . . .
Id . (Citations omitted) .
Shortly after Hilen , we addressed the issue of comparative fault among multiple
tortfeasors in Prudential Life Insurance Co . v. Moody, 696 S.W.2d 503 (Ky. 1985),
wherein Justice Vance noted in his concurring opinion :
[W]e held [in Hilen that a plaintiff who is only partially at fault
cannot fairly be required to bear the entire loss . It would seem
to follow, therefore, that a defendant who is only partially at fault
in causing an injury should not be required to bear the entire
loss but should, likewise, be chargeable only to the extent of his
fault.
Id . at 505 . See also Dix & Associates Pipeline Contractors, Inc. v. Key, 799 S .W .2d 24,
27 (Ky. 1990) . ("Whereas it is fundamentally unfair for a plaintiff who is only 5 percent
at fault to be absolutely barred from recovery from a defendant who is 95 percent at
fault, it is equally and fundamentally unfair to require one joint tort-feasor who is only 5
percent at fault to bear the entire loss when another tort-feasor has caused 95 percent
of the loss.")
In 1988, Kentucky codified certain procedural aspects of our comparative fault
system with the passage of KRS 411 .182, thus representing the legislature's intent to
eliminate, once and for all, joint and several liability and to protect plaintiffs and
defendants alike from being penalized for the fault of another. KFB aptly points out that
the adoption of comparative fault and its codification in KRS 411 .182 were designed to
prevent the result reached by the Court of Appeals herein, i .e. , a plaintiff being able to
allocate fault against a tortfeasor far in excess of that tortfeasor's actual liability .
KRS 411 .182 did not supplant our body of Kentucky law of comparative fault .
Rather, it "is simply a codification of this common law evolution of the procedure for
determining the respective liabilities of joint tortfeasors," whether joined in the original
complaint or by third-party complaint . Degener v . Hall Contracting Corp. , 27 S .W .3d
775, 779 (Ky. 2000) . See also Dix, supra . Emphasizing the underlying foundation of
the equitable policies of comparative fault, we recently reiterated that "[t]he core
principle of comparative negligence is that '[o]ne is liable for an amount equal to his
degree of fault, no more and no less ."' Regenstreif v. Phelps, 142 S .W.3d 1, 6 (Ky.
2004) (quoting Stratton v. Parker, 793 S .W .2d 817, 820 (Ky. 1990) .
At oral argument, Appellees' counsel argued that had the jury placed one
hundred percent of the fault with the unknown motorcyclist, then KFB would not have
been obligated to pay any UI M coverage . However, since the jury found that Ashby
was fifty percent at fault, then one hundred percent of the fault should be allocated to
him, and KFB should be required to pay all damages in excess of that paid by Ashby's
liability carrier . In response to a question from the bench, counsel stated that such a
result should occur even if the jury had found Ashby only five percent at fault and the
motorcyclist ninety-five percent at fault . Essentially, Appellees' position is that if the
known tortfeasor is found at all at fault, then the entire burden must be allocated to him.
We find such a result illogical, unfair, and contrary to the purpose of comparative fault
principles.
KFB's contractual liability to Appellees is defined and determined by the extent to
which Ashby was found to be an underinsured motorist.
Part of the equation in fixing
that liability involves establishing Appellees' damages, which necessarily requires a
determination of Ashby's percentage of liability or fault . In other words, Appellees are
only entitled to recover such damages from KFB that they would have been entitled to
recover from Ashby but for the fact he had insufficient liability coverage . Thus,
fundamental fairness requires that KFB be permitted to introduce evidence pertaining to
the alleged fault of a third-party tortfeasor. 2 By reversing the trial court's decision to
permit apportionment against the unknown motorcyclist, the Court of Appeals
essentially resurrected the concept of joint and several liability .
Kentucky CR 4.15 permits an action against an unknown defendant.
Furthermore, upon compliance with the service of process procedures set forth in CR
4.05, 4 .06, 4 .07, the action may proceed accordingly . See Schwindel v. Meade County ,
113 S .W .3d 159 (Ky. 2003). KFB complied with the procedural requirements to bring
the unknown motorcyclist into the lawsuit as a third-party defendant. While not
2 Of course, as this Court has established, apportionment would not be appropriate
against a third-party immune from liability as a matter of law, Lexington-Fayette Urban
County Government v. Smolcic , 142 S .W.3d 128 (2004), or a party who has been
dismissed on the merits of the claim .
- 9-
currently known, the motorcyclist can nonetheless be apportioned fault for the purposes
of determining Ashby's percentage of fault and KFB's resulting contractual liability .
Finally, we find the Court of Appeals' "empty chair" concerns to be without merit.
In this case, there was more than sufficient evidence presented from several witnesses
as to the motorcyclist's culpability in causing the accident . Despite Appellees'
protestations to the contrary, this is not a situation where an insurance company has
created a "phantom" party for the purpose of shifting liability . Nor does apportionment
of fault to a tortfeasor who is not an "active" party to the action impose any liability upon
him or warrant a judgment against him ; it merely determines the percentage of total
damages for which he was responsible . Flood v. Carlisle Construction Co ., Inc. , 758
S.W .2d 430 (Ky. 1988) .
The thrust of the comparative negligence doctrine is to accomplish (1) the
apportionment of fault between or among negligent parties whose negligence
proximately causes any part of a loss or injury, and (2) the apportionment of the total
damages resulting from such loss or injury in proportion to the fault of each party. To
reach those purposes of the doctrine, we have great faith in the ability of our juries to
determine whether an unknown tortfeasor was a legitimate cause of an injury or merely
a fraudulent apparition to shift fault. Furthermore, apportionment of fault may not even
be considered by the jury unless and until the trial court makes a threshold assessment
that reasonable jurors could, in fact, determine that an individual was a fault. Owens
Corning Fiberglass Corp. v. Parrish , 58 S .W .3d 467, 471 (Ky. 2001) .
Here, KFB properly joined the motorcyclist as a party to the action and presented
sufficient evidence to justify an apportionment instruction . We conclude that the trial
court properly instructed the jury to consider the liability of the motorcyclist in
- 1 0-
apportioning fault, and the jury concluded that he was fifty percent responsible for the
accident .3 As such, KFB's liability to Appellees under the UIM contract was limited to
fifty percent of the excess damages over and above Ashby's policy limits .
For the foregoing reasons, the decision of the Court of Appeals is reversed and
the judgment of the Shelby Circuit Court is reinstated .
Cooper, Graves, Roach, and Wintersheimer, JJ ., concur. Scott, J ., dissents by
separate opinion, with Lambert, C .J ., joining that dissent .
3Although the trial court erred in relying on KRS 411 .182 for apportionment, it reached
the correct result and can still be affirmed . Haddad v. Louisville Gas & Electric Co ., 449
S.W.2d 916 (Ky. 1970) .
COUNSEL FOR APPELLANT :
Michael E . Krauser
Eric S . Moser
Krauser & Brown
325 W . Main St ., Suite 2100
Louisville, KY 40202
COUNSEL FOR APPELLEES :
Jeffrey L . Freeman
9311 Preston Highway
Louisville, KY 40229
Tyler S. Thompson
Martin H . Kinney, Jr.
Dolt, Thompson, Shepherd & Kinney, PSC
310 Starks Building
455 South Fourth Avenue
Louisville, KY 40202
COUNSEL FOR AMICUS CURIAE,
KENTUCKY DEFENSE COUNSEL :
Robert L . Steinmetz
W. Douglas Kemper
Frost Brown Todd, LLC
400 W . Market Street, 32nd Floor
Louisville, KY 40202
COUNSEL FOR AMICUS CURIAE,
PROPERTY CASUALTY INSURERS
ASSOCIATION OF AMERICA :
A. Campbell Ewen
William P. Carrell II
Ewen, Kinney & Rosing
1090 Starks Building
455 South Fourth Street
Louisville, KY 40202-2511
RENDERED : NOVEMBER 23, 2005
TO BE PUBLISHED
~supremle
(~113urf
of ~rnfurhV
2003-SC-0944-DG
KENTUCKY FARM BUREAU
MUTUAL INSURANCE COMPANY
APPELLANT
ON REVIEW FROM COURT OF APPEALS
2002-CA-0637-MR
CIRCUIT COURT NO. 2000-CI-0269
SHELBY
BELINDA K. RYAN, KEVIN J . KRUER
AND MARY JO LESAK, CO-EXECUTORS
OF THE ESTATES OF LAWRENCE J .
KRUER AND MILDRED L. KRUER
APPELLEES
DISSENTING OPINION BY JUSTICE SCOTT
Respectfully, I dissent.
The majority opinion concedes that apportionment would not be appropriate
against a third-party immune from liability as a matter of law, citing Lexington- Fayette
Urban County Government v . Smolcic , 142 S .W.3d 128 (Ky. 2004) . Yet, they would
allow apportionment to an unknown tortfeasor who is neither before the court, nor
subject to personal liability, such as the unknown motorcyclist in this case.
In Smolcic and Jefferson County Commonwealth Attorney's Office v. Kaplan , 65
S .W.3d 916 (Ky. 2001), this Court held that fault could not be apportioned to persons or
entities that enjoyed absolute or sovereign immunity because they failed to qualify as
substantive "parties to the action" and therefore were not within the scope of KRS
411 .182, Kentucky's apportionment statute . Following this same line of reasoning, a
non-party, non-settling entity, not before the court, and not subject to personal liability,
should not be considered for apportionment purposes because such a person is not a
"party to the action" as required by KRS 411 .182. There is simply no consistent logic
between Smolcic and the majority's opinion in this case .
Of course, the majority doesn't even think KRS 411 .182 applies in this case.
They conclude the statute only applies in tort actions and feel this case is purely
contractual . They cite Philadelphia Indemnity Insurance Co . v. Morris , 990 S.W.2d 621,
625 (Ky. 1999) 1 , for the well-settled principle that "a `suit to recover UIM coverage is a
direct action' against the UIM carrier and `the [UIM] carrier alone is the real party in
interest. . ."' However, it does not follow from that premise that KRS 411 .182 is
irrelevant to adjudication of KFB's contractual obligations . Under the terms of the
contract, KFB's liability is measured by the uninsured driver's fault as determined under
tort law. See Hoffman v. Yellow Cab Co . of Louisville, 57 S.W .3d 257, 259 (Ky. 2001) .
However, if the procedural requirements of KRS 411 .182 are not applicable to contract
claims, then neither can the comparative negligence principles of Hilen v. Hays, 673
S .W .2d 713 (Ky. 1984) be used to obtain the same result ( Hilen only applies to ordinary
negligence cases - not contract issues) . How then can the majority claim any right to
apportionment in a contract case?
I believe KRS 411 .182 does apply in this case, and this Court has repeatedly
recognized that apportionment is strictly limited to those who fall within the scope of the
statute. Kaplan , supra; Owens Corning Fiberglass Corporation v. Parrish , 58 S.W.3d
467 (Ky. 2001) . As such, it is important to look to the terms of the statute in order to
determine to whom it applies . KRS 411 .182 does not expressly define the term "party."
But upon review of the statute, it becomes clear that "party" means anyone who actively
1 (quoting Coots v. Allstate Insurance Company , 853 S.W.2d 895, 903 (Ky. 1993)) .
2
assert claims, offensively or defensively, as parties before the court or who have settled
by release or agreement .
In this case, the Kruers' estate sued KFB for UIM coverage provided under their
policy. KFB then filed a third party complaint against the unknown motorcyclist, who
was constructively served via warning order attorney . The Kruers countered with a
claim against KFB on its UM coverage, but were denied their claim on grounds there
was no contact by the motorcyclist with the Kruers' vehicle. See Burton v. Farm
Bureau Ins. Co . , 116 S.W.3d 475, 478 (Ky. 2003)("the purpose of the physical contact
rule is to protect [ ] the insurer from fraudulent claims"). Yet, here, the majority refuses
to apply its own Burton "no contact" logic in the apportionment of fault to an "unknown
defendant", who was only constructively served by a warning order attorney, and thus,
was unavailable as a real party in the case .
Civil Rule 4 .05 allows "individuals whose name or place of residence is unknown"
to be constructively served via warning order. However, CR 4.05 should be read in
conjunction with KRS 454.165, which provides that a court cannot achieve in personam
jurisdiction over persons who are the subject of constructive service of process.
Proceedings are divided into three classes, viz. : (1) in personam, (2) in rem, and
(3) quasi in rem.
A judgment in a proceeding in rem is an adjudication upon the
status of some particular thing by a tribunal having jurisdiction
of the subject matter ; it differs from a judgment in a proceeding
in personam, in that the latter is an adjudication of the rights of
the parties to the action, and does not directly affect the status
of a thing or res. A personal judgment is a pronouncement
binding only on the parties to the action and their privies ; a
judgment in rem, by a court of competent jurisdiction, is a
pronouncement upon the status of the subject matter, and is
binding upon the world . Judgments in rem and quasi in rem
may be pronounced in an action in which the defendant has
been notified by constructive process ; whereas, a personal
3
judgment may be pronounced only by personal service upon
the defendant within the territorial jurisdiction of the court, or by
his voluntary appearance to the action .
Gayle v. Gayle, 192 S .W .2d 821, 822 (Ky. 1946)(internal citations omitted) .
As the Kruers' action against KFB for UIM benefits is an in personam action, the
unknown motorist cannot be constructively served and become a "party to the action."
In effect, the majority opinion lowers the standard of service necessary for
apportionment . Instead of requiring personal jurisdiction, the majority would now allow
apportionment to any unknown, nominal party, constructively served. They argue
"fundamental fairness" requires that KFB be permitted to introduce evidence pertaining
to the alleged fault of a third-party tortfeasor (who never touched anybody), even
though the deceased plaintiffs are not to be accorded the same "fundamental fairness"
on their UM coverage from KFB per Burton.
Even so, we are not dealing with a true "third-party" in this case . A constructively
served "unknown" defendant is not considered to be before the court in an in personam
action such as this. c.f. . Nolph v . Scott, 725 S .W .2d 860, 861-862 (Ky. 1987)
(Appointment of a warning order attorney is a procedural device permitting an action to
proceed in certain circumstances, unknown to the defendant."). Even Justice Liebson
in his dissent in Nolph acknowledged : "This lawsuit is an action in personam and not in
rem, and constructive service does not, per se, make Mr. Nolph a party defendant."
Nolph at 862 (emphasis added) . Therefore, the unknown motorcyclist is not a 'thirdparty" or any "party to the action." Fundamental fairness requires that apportionment
not be allowed to such a non-party on the basis of constructive service of process
alone .
He does not defend himself - and in many cases in the future, he will only be a
"ghost" - created by the intellect of the otherwise liable party - defending himself
against subrogation from the UIM carrier, both having the same interest-reducing the
damages awarded . In this case the parties were killed, and thus, they cannot dispute
the tortfeasor's proof as to who did what . Yet, for some unfathomable reason - we now
have a "no personal jurisdiction" apportionment and a "no contact" rule for KFB - but
not for their policyholders who paid their premiums on the earnest expectation they
were buying coverage.
For the above stated reasons, I believe the unknown motorcyclist cannot be
deemed a "party to the action" for purposes of apportionment. And because fault
should not be apportioned against the "unknown motorcyclist", the issue of dismissal of
the UM claim need not be addressed, other than to add, this Court has repeatedly
upheld policy provisions requiring direct, physical contact with an uninsured vehicle as a
prerequisite to UM coverage . That being said, the policyholders ought to have the
benefit of the same rule. That would meet the need for consistency and avoid this
absurd result .
Lambert, C .J ., joins this dissent.
Some case metadata and case summaries were written with the help of AI, which can produce inaccuracies. You should read the full case before relying on it for legal research purposes.
This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.