Grundy v. Manchester Ins. & Indem. Co.
| Decision Date | 08 March 1968 |
| Citation | 425 S.W.2d 735 |
| Court | United States State Supreme Court — District of Kentucky |
| Parties | Anthony GRUNDY et al., Appellants, v. MANCHESTER INSURANCE & INDEMNITY COMPANY, Appellee. |
Lawrence S. Grauman, Joe G. Leibson, Louisville, for appellants.
James Levin, Ben Hanish, Hanish & Hanish, Louisville, for appellee.
Joseph E. Stopher, A. J. Deindoerfer, Boehl, Stopher, Graves & Deindoerfer, Louisville, amici curiae.
DAVID C. BRODIE, Special Commissioner.
Anthony Grundy, the plaintiff and appellant, recovered judgment against the insured, Carl E. Weaver, in the sum of $20,000 for injuries sustained. The defendant-appellee, Manchester Insurance & Indemnity Company, was the insurer under Weaver's policy with a $10,000 limit.
Grundy brought suit to recover the excess from Manchester alleging the Manchester was guilty of bad faith in negotiating with Grundy to settle his claim.
Grundy, by amendment, pleaded an assignment from Weaver to Weaver's rights against Manchester. The trial judge decided that Grundy had no claim in his own right against Manchester and further decided that Grundy, by assignment, had no claim against Manchester. The trial court dismissed the complaint.
The trial court cites Turk v. Illinois Central Railway Company, D.C., 193 F. 252, to the effect that a cause of action for tort is not assignable. While this rule is sound Kentucky law, it is not deemed applicable to the case at bar.
The argument is made that assignability of causes of action in Kentucky depends upon whether or not said causes of action are survivable under the Kentucky statute. The common law as to survival of actions has been modified in Kentucky to an extent by the terms of KRS 411.140. The proper interpretation of that statute is decisive of the question as to whether or not this cause of action is assignable. It is observed that the statute itself excludes from its terms causes of action founded on contract. This statute was construed by this court in Gross' Adm'r v. Ledford, 190 Ky. 526, 228 S.W. 24, 25, 14 A.L.R. 689, as follows:
'(N)or does it have any reference to actions for torts which are founded upon contracts and grow out of the contractual relations between the parties.'
It is our decision that the cause of action assigned in this case is founded upon the insurance contract and grew out of the contractual relationship between the insurance company and the insured.
The appellants' action herein is based on a contractual obligation founded on the insurance contract. There is an implied covenant in the insurance policy issued by Manchester of good faith and fair dealing. This implied covenant was a contractual duty to exercise good faith to protext the insured from the risk of having a judgment rendered against him greatly in excess of the limits of the...
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Texaco, Inc. v. Melton
...assignment or intention to assign existed. We have heretofore approved assignments of contractual rights. Grundy v. Manchester Insurance & Indemnity Co., Ky., 425 S.W.2d 735 (1968) and Terrell v. Western Casualty & Surety Co., Ky., 427 S.W.2d 825 (1968). Also see 6 C.J.S. Assignments § 31, ......
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...of KRS 411.140 is decisive of the question as to whether or not this cause of action is assignable." Grundy v. Manchester Ins. & Indem. Co., 425 S.W.2d 735, 736 (Ky.1968). Through interpretation of KRS 411.140,1 Kentucky's survival statute, and its predecessor, Section 10, Ky. Stat., rules ......
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