Milby v. Wright

• Decision Date: 04 September 1997
• Docket Number: No. 96-SC-117-DG,96-SC-117-DG
• Citation: 952 S.W.2d 202
• Parties: Terry MILBY, Appellant, v. Mark WRIGHT, Individually and as Agent of H.D.B. Cable Communications, Inc.; H.D.B. Cable Communications, Inc.; and David Elam, Appellees.
• Court: United States State Supreme Court — District of Kentucky

Page 202

952 S.W.2d 202

Terry MILBY, Appellant, v. Mark WRIGHT, Individually and as Agent of H.D.B. Cable Communications, Inc.; H.D.B. Cable Communications, Inc.; and David Elam, Appellees.

No. 96-SC-117-DG.

Supreme Court of Kentucky.

Sept. 4, 1997.

Joseph C. Souza, Anne Milton McMillin, Louisville, for appellant.

Pamela Adams Chesnut, J. Warren Keller, Boyd F. Taylor, Mary-Ann Smyth, William C. Stambaugh, Taylor, Keller & Dunaway, London, for appellees.

OPINION

STUMBO, Justice.

This appeal questions the Court of Appeals' decision that held a personal injury suit was time barred by the two-year statute of limitations contained in KRS 304.39-230(6), and that neither KRS 304.39-040(2) nor KRS 413.270 provided additional time in which to file. We affirm.

Appellant, Terry Milby ("Milby"), was injured in a single-car accident on March 16 1989. The car in question was owned either by Milby's employer, H.D.B. Cable Communications, Inc. ("H.D.B."), or by David Elam and/or Harold LeMaster (co-owners of H.D.B.). It was driven by his co-worker, Mark Wright. Wright apparently suffered a seizure as the two travelled to lunch. Milby received both basic reparation benefits (BRB) from the car's insurer, State Farm, and benefits from his employer's workers' compensation carrier for a period of temporary total disability. He received his last BRB payment for a medical expense on March 5, 1990.

Milby filed a workers' compensation claim, with H.D.B. as the named defendant. The Administrative Law Judge eventually dismissed the claim, holding that because Milby was not performing a service for his employer at the time of the injury, the claim fell within the "coming and going rule" and was, thus, noncompensable. See, Baskin v. Community Towel Serv., Ky., 466 S.W.2d 456 (1971). That decision was affirmed at all levels on appeal, with this Court's opinion having been issued on March 24, 1994.

This personal injury claim was filed by Milby on March 16, 1992, against H.D.B., Mark Wright, David Elam, and Harold LeMaster. On April 8, 1992, Milby requested payment of a medical bill from Elam's insurer, State Farm. This was more than two years after the last BRB payment and the bill was for medical services rendered on August 12, 1991, some eight months earlier. State Farm refused to honor the bill on two grounds: because it believed that the statute of limitations had expired, and because the bill and accompanying medical report appeared to be associated with a work-related injury suffered during Milby's work for his then-current employer and not for the injuries received in the automobile accident.

Upon motion by the defendants below, the Pulaski Circuit Court dismissed the suit, holding that:

KRS 304.39-230(6) requires that a civil action for injuries sustained in a motor vehicle collision be commenced within two years of the injury or the last basic reparation payment, whichever occurred later. Basic reparation benefits were paid to the Plaintiff through March 5, 1990. The complaint ... was filed more than two years after that date. It is therefore barred.

On the alternate argument that the saving statute, KRS 413.270, applied, the trial court held that the determination of whether the "coming and going rule" applied to bar Milby's workers' compensation claim was an issue of substantive law, not of jurisdiction. Therefore, the savings statute did not apply. In so ruling, the trial court also noted that the basis of and parties to the civil action were different than those asserted in the workers' compensation claim.

Milby's appeal raised both issues at the Court of Appeals, arguing additionally that State Farm wrongfully denied payment of the bill submitted in April of 1992, an issue raised at the trial court level but not resolved. Milby contended that because the bill was for treatment received within two years of the last BRB payment and should be assumed to be reasonable, the submission tolled the statute of limitations. The Court of Appeals agreed with the reasoning of the trial court on the two issues presented to it and rejected Milby's other argument. Citing the plain language of the statutes, the court held:

Although KRS 304.30-040(2) [sic] states that basic reparations obligors shall pay basic reparations benefits for loss from injury arising out of the use of a motor vehicle, appellant ignores the fact that it is subject to the terms and conditions stated in the subtitle. One such condition is found in KRS 304.39-230(1), which clearly states in pertinent part that "[i]f basic or added reparation benefits have been paid for loss arising otherwise than from death, an action for further benefits ... may be commenced not later than two (2) years after the last payment of benefits." (Alteration in original).

The court deemed the more than two years that had passed since the last BRB payment fatal to the claim for additional BRB payment, as well as to the suit. The Court of Appeals affirmed in all respects. We granted discretionary review.

Milby repeats the three arguments raised before the lower courts. Addressing the last argument first, Appellant contends that an insurance carrier may not refuse to pay a medical expense in order to protect its statute of limitations defense. Citing KRS 304.39-040(2), wherein it states that the obligation to pay BRB "exists without regard to immunity from liability or suit which might otherwise be applicable," Appellant contends the limitations language of KRS 304.39-230 does not apply to the right to BRB set forth in KRS 304.39-030(1) ("[E]very person ... has a right to basic reparation benefits"). Apparently, Appellant believes the Court of Appeals erred in equating a request for payment submitted to an insurance carrier to "an action for further benefits" which must be filed within two years of the last payment of benefits. The argument is that because the carrier is obliged to pay without regard to immunity from liability or suit, the insurer cannot, by virtue of refusal to pay, provide the insured with a statute of limitations defense.

We agree with the Court of Appeals that the claim for payment is subject to the limitation set forth in KRS 304.39-230(1). To hold otherwise would allow the potential plaintiff to hold the alleged tortfeasor hostage by the leisured submission of medical claims, thereby forestalling the running of the statute of limitations. One of the purposes of the Motor Vehicle Reparations Act (MVRA) was to simplify and speed up the process by which medical bills and other losses resulting from vehicular accidents are reimbursed, without resorting to litigation, thereby providing certainty at a time of need for those involved. Crenshaw v. Weinberg, Ky., 805 S.W.2d 129, 132 (1991); KRS 304.39-010(5). Analogous to the rights bestowed upon the injured person is the right of the other party to, eventually and within a time period that can be easily determined, be free of the possibility of becoming the target of litigation. It is that right that the time limitations of the MVRA are designed to provide.

We are aware of and take note of the holding of Crenshaw, wherein we stated that: "the plain meaning of the statute is that a person ... has two years after the last payment of benefits in which to file an action for tort liability without regard to whether such benefits were first claimed or first paid within two years of the date of injury." Id. at 133. In the case at bar, benefits were both claimed and paid within two years of the injury. There was, however, a gap of...