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Progressive Max Ins. Co. v. Jamison

Court of Appeals of Kentucky

July 19, 2013

PROGRESSIVE MAX INSURANCE COMPANY, APPELLANT
v.
DAVID JAMISON AND LORI HUMBLE, APPELLEES; DAVID JAMISON, CROSS-APPELLANT
v.
PROGRESSIVE MAX INSURANCE COMPANY AND LORI HUMBLE, CROSS-APPELLEES

Page 453

APPEAL FROM WAYNE CIRCUIT COURT. HONORABLE VERNON MINIARD, JR, JUDGE. ACTION NO. 03-CI-00284. CROSS-APPEAL FROM WAYNE CIRCUIT COURT. HONORABLE VERNON MINIARD, JR, JUDGE. ACTION NO. 03-CI-00284.

BRIEFS FOR APPELLANT/CROSS-APPELLEE, PROGRESSIVE MAX INSURANCE COMPANY: Thomas L. Travis, E. Megan Howard, Lexington, Kentucky.

BRIEF FOR APPELLEE/CROSS-APPELLEE, LORI HUMBLE: John T. Pruitt, Jr., Somerset, Kentucky.

BRIEF FOR APPELLEE/CROSS-APPELLANT, DAVID JAMISON: Ralph D. Gibson, Somerset, Kentucky.

BEFORE: ACREE, CHIEF JUDGE; MOORE AND THOMPSON, JUDGES.

OPINION

Page 454

ACREE, CHIEF JUDGE:

Appellant/Cross-Appellee Progressive Max Insurance Company and Appellee/Cross-Appellant David Jamison appeal and cross-appeal, respectively, from the Wayne Circuit Court's January 10, 2011 Verdict and Judgment. For the reasons that follow, we reverse appeal number 2011-CA-001127-MR, affirm cross-appeal number 2011-CA-001187-MR, and remand for additional proceedings consistent with this opinion.

I. Facts and Procedure

Jamison and Appellee/Cross-Appellee Lori Humble were involved in an automobile collision on August 17, 2001, in Wayne County, Kentucky. Jamison was injured. Humble's vehicle was insured by State Farm Mutual Automobile Insurance Company and her policy limit was $25,000.00. Jamison's vehicle was insured by Progressive Max Insurance Company. His policy included underinsured motorist (UIM) coverage. Shortly after the accident, Progressive paid Jamison $10,000.00 in basic reparation benefits (BRB).

Jamison sued Humble alleging negligence and seeking to recover monetary damages for his injuries. Jamison then amended his complaint to assert a claim against Progressive for UIM benefits.

Prior to trial, Humble's liability insurance carrier, State Farm, settled Jamison's negligence claim against Humble for $15,000.00; Jamison communicated this to Progressive. Progressive elected to preserve its subrogation rights against Humble and, in keeping with the procedures set forth in Coots v. Allstate Insurance Company, 853 S.W.2d 895 (Ky. 1993), now codified in Kentucky Revised Statutes (KRS) 304.39-320, substituted its own funds and paid Jamison the $15,000.00 settlement amount negotiated by State Farm on Humble's behalf. Progressive then filed a subrogation cross-claim against Humble.

After the settlement, the circuit court conducted a jury trial to resolve Jamison's claim for benefits under the UIM provision of his insurance contract with Progressive. Resolution of this claim required " proof the offending motorist [Humble] is a tortfeasor and proof of the amount of damages[.]" Coots, 853 S.W.2d at 899 (accident liability and damages are " essential facts that must be proved before the insured can recover judgment" on a contractual UIM claim). The jury found Humble liable, apportioning 100% of the fault to her and determining Jamison's damages to be $37,709.21. The circuit court adopted the jury's verdict and entered an order holding Progressive liable to Jamison for the entire $37,709.21 awarded. However, the circuit court's judgment made no mention of Progressive's cross-claim.

Progressive moved the circuit court pursuant to Kentucky Rules of Civil Procedure (CR) 59.05 to alter, amend, or vacate the judgment to account for several " set-offs"

Page 455

from the jury's award: (1) a $10,000.00 reduction for BRB paid, as required by KRS 304.39-060(2)(a); and (2) a $25,000.00 reduction representing Humble's liability insurance policy limits, as required by KRS 304.39-320. These amounts are irrefutably supported by the record. After deducting the set-offs, Progressive argued, Jamison was entitled to recover $2,709.21[1] and asked the circuit court to amend its judgment accordingly. Progressive also requested that the circuit court address and enter a $17,709.21 judgment for Progressive against Humble on its subrogation cross-claim.[2] The circuit court summarily denied Progressive's motion. The parties agree that the denial of Progressive's CR 59.05 motion was, effectively, a denial of Progressive's cross-claim against Humble.[3] Progressive promptly appealed and Jamison cross-appealed.

II. Progressive's Direct Appeal

Progressive raises the same issues it raised in the CR 59.05 motion. This Court must construe the applicable statutory provisions to ascertain whether the circuit court erred when it concluded Progressive was not entitled to two statutory offsets, and when it denied Progressive's subrogation cross-claim. " Statutory construction is a matter of law[.]" Maynes v. Commonwealth, 361 S.W.3d 922, 924 (Ky. 2012). Our review of these issues is de novo. Bob Hook Chevrolet Isuzu, Inc. v. Com. Transp. Cabinet, 983 S.W.2d 488, 490, 45 13 Ky. L. Summary 28 (Ky. 1998).

In construing and applying a statute, " our duty is to ascertain and give effect to the intent" of the legislature. Stewart v. ELCO Admin. Services, Inc., 313 S.W.3d 117, 121 (Ky. App. 2010) (quoting Beckham v. Bd. of Educ. of Jefferson County, 873 S.W.2d 575, 577 (Ky. 1994)). To discern legislative intent and purpose, we look to the statute's plain language. Cabinet for Families and Children v. Cummings, 163 S.W.3d 425, 430 (Ky. 2005) (" Our main objective is to construe the statute in accordance with its plain language and in order to effectuate the legislative intent." ). Relevant rules of statutory construction require us not to be guided by a single word or sentence of a statute; instead, we " should look to the letter and spirit of the statute, viewing it as a whole." Lewis v. Jackson Energy Co-op. Corp., 189 S.W.3d 87, 93 (Ky. 2005) (citation omitted). With these standards as our guide, we turn to Progressive's claims of error.

A. Statutory Set-offs or Credits Against Jury's Verdict

Progressive first asserts the circuit court erred when it entered a verdict against Progressive for $37,709.21. As it did before the circuit court, Progressive argues it is entitled to two statutory set-offs: (1) a $10,000.00 reduction for basic reparation benefits paid, as required by KRS 304.39-060(2)(a); and (2) a $25,000.00 reduction representing Humble's liability insurance policy limits, as required by

Page 456

KRS 304.39-320. Applying the set-offs, Progressive claims, reduces the jury's damages award from $37,709.21 to $2,709.21. Naturally, Jamison argues Progressive is not entitled to either ...


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