Watkins v. Department of Highways of Com. of Ky.

• Decision Date: 04 May 1956
• Citation: 290 S.W.2d 28
• Parties: J. S. WATKINS and G. R. Watkins, Partners, d/b/a J. Stephen Watkins, Consulting Engineers, Appellants, v. DEPARTMENT OF HIGHWAYS OF THE COMMONWEALTH OF KENTUCKY et al., Appellees.
• Court: United States State Supreme Court — District of Kentucky

Page 28

290 S.W.2d 28

J. S. WATKINS and G. R. Watkins, Partners, d/b/a J. Stephen

Watkins, Consulting Engineers, Appellants, v. DEPARTMENT OF HIGHWAYS OF THE COMMONWEALTH OF KENTUCKY et

al., Appellees.

Court of Appeals of Kentucky.

May 4, 1956.

William A. Young, Frankfort, for appellants.

Jo M. Ferguson, Atty. Gen., Wm. M. Deep, Asst. Atty. Gen., for appellees.

CLAY, Commissioner.

The question presented is whether or not the Franklin Circuit Court has jurisdiction to make effective an arbitration agreement between appellants Watkins and appellee, Department of Highways, under the provisions of KRS 417.011. The underlying issue is whether or not the Department of Highways would be subject to suit with respect to the controversy between the parties.

In February, 1954, appellants entered into a contract with the Department to perform engineering services in the construction of the Elizabethtown-Louisville Toll Road. Subsequently a controversy arose with respect to additional compensation claimed by appellants under the contract. In October, 1955, appellants and the Department entered into a written agreement submitting to arbitration under KRS 417.011 all of the matters at issue. This agreement was filed in the Franklin Circuit Court, arbitrators were appointed, and the Franklin Circuit Court submitted the controversy to the arbitrators as provided by the statute.

After hearings had been held by the arbitrators, the Commissioner of Highways cancelled the arbitration agreement. Upon motion filed in the Franklin Circuit Court an order was entered setting aside the previous order submitting to arbitration on the ground that the court was without jurisdiction.

KRS 417.011 provides in part as follows:

'Any controversy which is or might be the subject of an action may, at the request of those interested therein, be submitted to the decision of one or more arbitrators, or to two and their umpire, by the order of any court having jurisdiction of the subject.' (Our emphasis.)

It is thus evident if appellants could have brought suit against the Department to enforce these claims (the nature of the suit being immaterial), the Franklin Circuit Court would have jurisdiction to carry out the arbitration agreement. It is the contention of the Department that since the legislature has not authorized a suit against the Department and since it is an arm of the Commonwealth, the state's constitutional immunity from suit may be invoked. Kentucky Constitution, Section 231.

It is generally recognized that immunity from suit is a high attribute and prerogative of the sovereign. 81 C.J.S., States, § 214; Kentucky State Park Commission v. Wilder, 256 Ky. 313, 76 S.W.2d 4. The Commonwealth cannot be made a party defendant and is not suable in her own courts without legislative authorization. Divine v. Harvie, 7 T.B.Mon. 439; Board of Councilmen of City of Frankfort v. State Highway Commission, 236 Ky. 253, 32 S.W.2d 1008.

At the outset, it should be noted that the Commonwealth, as such, is not a party to this proceeding. It is contended that since the Department of Highways is simply an arm or agency of the Commonwealth the principle of immunity still applies. While this may generally be true, it has been recognized that a certain class of action may be brought against an agency of the state government even though not expressly authorized by the legislature. If the suit is to compel the performance of a ministerial duty by a state agency, it is not a suit against the state within the scope of sovereign immunity. 81 C.J.S., States, § 216(3). In this latter category is an action to compel a state agency to perform a contract legally entered into. Kentucky State Park Commission v. Wilder, 256 Ky. 313, 76 S.W.2d 4.

We are of the opinion that the cases of Reliance Mfg. Co. v. Board of Prison Com'rs, 161 Ky. 135, 170 S.W. 941, and Board of Councilmen of City of Frankfort v. State Highway Commission, 236 Ky. 253, 32 S.W.2d 1008, are controlling on the question presented. The first case cited was a suit to compel the Board of Prison Commissioners to renew a contract in accordance with the terms of an original agreement between the parties. The claim of immunity from suit was rejected on the ground that the plaintiff had the right to compel a state agency to do what the legislature had authorized and the agency had agreed to do. It was suggested in the opinion, though not specifically decided, that to deny the plaintiff the right to compel performance of a valid contract by the state agency would deprive the plaintiff of its rights without due process of law, similar to the taking of property without due process.

In the second case above cited, suit was brought against the State Highway Commission to compel it to pay one-half of the construction costs of certain streets in the City of Frankfort, which the Highway Commission had agreed to do by contract with the Board of Councilmen of the City. In the opinion we recognized the immunity of the Commonwealth from suit and we further recognized that without...