08.08.2013 Views

Civil Case Compilation June 22 2012 - May 3 2013.pdf - Office of ...

Civil Case Compilation June 22 2012 - May 3 2013.pdf - Office of ...

Civil Case Compilation June 22 2012 - May 3 2013.pdf - Office of ...

SHOW MORE
SHOW LESS

Transform your PDFs into Flipbooks and boost your revenue!

Leverage SEO-optimized Flipbooks, powerful backlinks, and multimedia content to professionally showcase your products and significantly increase your reach.

RECENT DECISIONS AND HOT ISSUES –<br />

APPELLATE CASES UPDATE<br />

CIVIL CASES<br />

CASES: JUNE <strong>22</strong>, <strong>2012</strong> – MAY 3, 2013<br />

______________________________________________________________________________<br />

ADEQUACY OF COUNSEL<br />

Coulter v. Anadarko Petroleum Corp.<br />

296 Kan. 336, 292 P.3d 289 (Jan. 11, 2013) (Johnson, J.)<br />

<strong>Case</strong> No. 103,310<br />

Royalty owners entitled to receive a share <strong>of</strong> the production <strong>of</strong> natural gas in the Hugoton gas field brought<br />

a class action against Anadarko Petroleum Corporation, claiming that the company and its affiliates had<br />

underpaid the royalties required by the plaintiffs' respective oil and gas leases. The case was tried to the<br />

bench in 2002, reargued in 2006, and settled in <strong>June</strong> 2009 with an amended class that had expanded from<br />

4,500 to 6,000 members. One member objected to the amended class certification and to the class action<br />

settlement agreement, claiming the agreement essentially gave away class members' potential nongathering<br />

claims without adequate identification or investigation.<br />

The Supreme Court held that the district court did not abuse its discretion in finding that class counsel<br />

adequately represented the class members, and affirmed the certification <strong>of</strong> the amended class. Prior to the<br />

2010 amendment, K.S.A. 60-<strong>22</strong>3 contained no specific guidance on how a district court should assess the<br />

adequacy <strong>of</strong> class counsel. The amended statute was not binding authority in this case, but the Court used it<br />

as a framework for analyzing the argument that class counsel was inadequate. The Court also held that the<br />

district court did not abuse its discretion in finding that the settlement agreement was fair, reasonable, and<br />

adequate. The Court explained that Kansas appellate courts had not adopted a specific test or list <strong>of</strong> factors<br />

for evaluating class action settlements, and because the amended version <strong>of</strong> K.S.A. 60-<strong>22</strong>3 mirroring Fed.<br />

R. Civ. P. 23 did not control, the Court did not determine whether federal factors will become mandatory<br />

inquiry in class action settlements in Kansas district courts.<br />

ADMINISTRATIVE LAW AND PROCEDURE<br />

Ryser v. State Board <strong>of</strong> Healing Arts<br />

295 Kan. 452, 284 P.3d 337 (Sept. 7, <strong>2012</strong>) (Moritz, J.)<br />

<strong>Case</strong> No. 103,579<br />

During the course <strong>of</strong> its disciplinary investigation <strong>of</strong> a medical provider (Ryser) licensed to practice in both<br />

Kansas and Missouri, the Kansas Board <strong>of</strong> Healing Arts (Board) caused a subpoena to issue for documents<br />

related to Ryser's treatment <strong>of</strong> a Missouri patient that had filed medical malpractice lawsuit against Ryser.<br />

Ryser petitioned to revoke subpoena under K.S.A. 65-2839a(b)(3)(B). Supreme Court held that Kansas<br />

Judicial Review Act (KJRA) does not apply to such petitions. Court further concluded Ryser was not<br />

1


ADOPTION<br />

required to exhaust administrative remedies before filing her petition because K.S.A. 65-2839a(b)(1)<br />

permits, but does not require a person to seek relief from the Board before applying to the district court for<br />

review <strong>of</strong> a subpoena. Court ruled that Board has jurisdiction to investigate Ryser's practice <strong>of</strong> medicine in<br />

Missouri under its general authority to take disciplinary action against "any licensee practicing under [the<br />

Act]" under K.S.A. 2011 Supp. 65-2838(a). Moreover, Ryser's practice <strong>of</strong> medicine in Missouri could<br />

provide "grounds for disciplinary action" under K.S.A. 65-2839a(b)(1), (3)(B) as well as an investigation<br />

for any possible violations under K.S.A. 2011 Supp. 65-2836.<br />

In the Matter <strong>of</strong> the Adoption <strong>of</strong> I.M.<br />

48 Kan. App. 2d 343, 288 P.3d 864 (<strong>2012</strong>) (Nov. 9, <strong>2012</strong>) (Arnold-Burger, J.)<br />

<strong>Case</strong> No. 107,456<br />

Former stepfather wanted to adopt former stepdaughter. Biological mother consented to the adoption so<br />

long as she did have to relinquish her parental rights. The district court dismissed the case for failure to<br />

state a claim because the relief former stepfather requested is not possible in Kansas. The Court <strong>of</strong> Appeals<br />

affirmed the district court, holding that Kansas law does not allow adoptions by former stepparents without<br />

a relinquishment <strong>of</strong> parental rights by the biological parents.<br />

AD VALOREM TAXATION<br />

In the Matter <strong>of</strong> the Application <strong>of</strong> TransCanada Keystone Pipeline, L.P. for<br />

Exemption from Ad Valorem Taxation<br />

__ Kan. App. 2d __, __ P.3d __, 2013 WL 1786019 (Apr. 26, 2013) (Bruns, J.)<br />

<strong>Case</strong> No. 108,116<br />

TransCanada Keystone Pipeline, L.P. (Keystone) filed an application for a property tax valuation<br />

exemption for the Cushing Extension—the 210-mile portion <strong>of</strong> its crude oil pipeline passing through<br />

Kansas. The Director <strong>of</strong> Property Valuation (Director) recommended denying the exemption, and Keystone<br />

and the Director both filed motions for summary judgment with the Court <strong>of</strong> Tax Appeals (COTA) on<br />

stipulated facts. The COTA granted Keystone’s motion for summary judgment, and the Director appealed.<br />

For an oil pipeline to qualify for an exemption under K.S.A. 2010 Supp. 79-<strong>22</strong>7, it must be a “qualifying<br />

pipeline.” A “qualifying pipeline” is defined by K.S.A. 2010 Supp. 79-32,<strong>22</strong>3(d) as “a pipeline which is<br />

located in this state, is used primarily for transportation <strong>of</strong> crude oil or natural gas liquids and has a length<br />

<strong>of</strong> more than 190 miles in this state and to which refineries or natural gas liquid processing facilities in this<br />

state have access.” The parties stipulated that Kansas refineries have access to the pipeline in Cushing,<br />

Oklahoma. The Director argued, however, that K.S.A. 2010 Supp. 79-32,<strong>22</strong>3(d) required a direct access<br />

point in Kansas. Nevertheless, the plain and unambiguous language <strong>of</strong> the statute does not make an in-thisstate<br />

requirement for access. And the legislature clearly knew how to make an in-this-state requirement<br />

because it did so for the pipeline, a 190-mile length, and refineries or natural gas liquid processing<br />

facilities. Furthermore, the plain meaning <strong>of</strong> “access” is a “means <strong>of</strong> approaching . . . or making use <strong>of</strong>.” As<br />

such, the access requirement can be achieved without a direct connection. Therefore, the plain and<br />

unambiguous language <strong>of</strong> the statute did not require that Kansas refineries have direct access to the<br />

Cushing Extension in Kansas. If the plain language <strong>of</strong> the statute did not express the legislature’s intent<br />

then the legislature, rather than the judiciary, is the proper branch to address the matter.<br />

2


In the Matter <strong>of</strong> the Equalization Appeal <strong>of</strong> Wedge Log-Tech, L.L.C./Pioneer Wireline<br />

Services for the Year 2008 in Ellis County, Kansas, and In the Matter <strong>of</strong> the<br />

Application <strong>of</strong> Wedge Log-Tech, L.L.C./Pioneer Wireline Services for Exemption from<br />

Ad Valorem Taxation in Ellis County, Kansas<br />

___ Kan. App. 2d ___, ___ P.3d ___, 2013 WL 1497338 (Apr. 12, 2013)<br />

(Malone, C.J.)<br />

<strong>Case</strong> No. 108,119<br />

Ellis County appealed an order <strong>of</strong> the Court <strong>of</strong> Tax Appeals that granted Wedge Log-Tech, L.L.C./Pioneer<br />

Wireline Services' (the taxpayer) application for exemption from ad valorem taxation. Historically, Ellis<br />

County had classified, valued, assessed, and taxed the taxpayer's wireline equipment as commercial and<br />

industrial machinery and equipment under subclass 5 <strong>of</strong> class 2 <strong>of</strong> § 1(a) <strong>of</strong> Article 11 <strong>of</strong> the Kansas<br />

Constitution. After the legislature passed a tax exemption for certain commercial and industrial machinery<br />

and equipment, the taxpayer applied for the exemption for the wireline equipment. Ellis County denied the<br />

application and informed the taxpayer that it had reclassified the wireline equipment under subclass 2 <strong>of</strong> the<br />

constitutional provision, which relates to mineral leasehold interests. The taxpayer appealed to COTA,<br />

which found that the taxpayer's wireline equipment is properly categorized as commercial and industrial<br />

machinery and equipment; COTA granted the exemption. Ellis County appealed to the Court <strong>of</strong> Appeals<br />

and argued that the wireline equipment should be classified under subclass 2 because wireline equipment is<br />

intrinsically related to the oil and gas industry. The Court <strong>of</strong> Appeals disagreed, finding that Ellis County's<br />

argument that equipment "intrinsically related" to the oil and gas industry should be categorized with<br />

mineral leasehold interests for tax purposes was not supported by any legal authority. Further, the court<br />

noted that the position Ellis County advocated was contrary to the Division <strong>of</strong> Property Valuation <strong>of</strong> the<br />

Kansas Department <strong>of</strong> Revenue's historical position on wireline equipment, which was to classify it for tax<br />

purposes as commercial and industrial machinery and equipment. Finally, the court pointed out a statutory<br />

provision expressly prohibiting reclassification <strong>of</strong> subclass 5 property for the purpose <strong>of</strong> avoiding the tax<br />

exemption in question. Accordingly, the Court <strong>of</strong> Appeals affirmed COTA's order.<br />

ALTERNATIVE MEANS<br />

Tom Bates and Michelle Entriken, as Parents and Next Friends <strong>of</strong> Hayley Bates, a<br />

Minor, v. Dodge City Healthcare Group, L.P., d/b/a Western Plains Regional Hospital<br />

296 Kan. 271, 291 P.3d 1042 (Jan. 11, 2013) (Nuss, C.J.) (Biles, J.,<br />

concurring in part and dissenting in part)<br />

<strong>Case</strong> No. 100,215<br />

In the early morning <strong>of</strong> December 20, 1996, Michelle Entriken, who was 34 to 35 weeks pregnant, went to<br />

Western Plains Regional Hospital to the obstetrical department; she was in pain and believed she was in<br />

labor. After being admitted, Entriken met with Linda Unruh, a labor and delivery nurse who started a fetal<br />

heart monitor. Unruh also called Entriken's obstetrician to inform him that she was at the hospital.<br />

Prolonged decelerations to the fetal heart rate began shortly thereafter. Unruh called Entriken's obstetrician<br />

again, who lived 5 to 10 minutes away, and later testified that she asked him to come to the hospital. When<br />

he had not arrived 10 minutes later, Unruh paged him to come immediately. The obstetrician arrived 20<br />

minutes later and ordered an immediate C-section. Entriken and Tom Bates' daughter was delivered shortly<br />

thereafter, but has resulting severe health problems. Bates and Entriken sued the hospital, alleging<br />

negligence liability under a respondeat superior theory, but the jury returned a verdict for the hospital. After<br />

the Court <strong>of</strong> Appeals affirmed, the Supreme Court granted review on one issue: whether a jury instruction<br />

incorrectly directed the jury to apply a community nursing standard <strong>of</strong> care to the parents' claim that the<br />

nurse's failure to call up the chain <strong>of</strong> command for assistance fell below the required standard <strong>of</strong> care. The<br />

parents argued that the nurse's failure to appropriately and quickly initiate the chain <strong>of</strong> command to deal<br />

with the fetal distress was governed by a national standard, but the Supreme Court disagreed, finding that it<br />

was appropriate for the district court to give an instruction that retained the language regarding a<br />

3


community-based standard <strong>of</strong> care due to differences in procedure at hospitals across the country,<br />

especially due to the different resources available at those hospitals. Under the facts <strong>of</strong> this case, the jury<br />

instruction was an accurate and fair statement <strong>of</strong> Kansas law.<br />

Biles, J., dissented, claiming that the question <strong>of</strong> which standard <strong>of</strong> care is applicable is a question <strong>of</strong> fact<br />

and that the jury should have been presented with both a national- and community-based standard <strong>of</strong> care<br />

and been instructed to determine which one was appropriate and then apply that standard <strong>of</strong> care.<br />

Wright v. State<br />

___ Kan. App. 2d ___, 294 P.3d 1201 (Feb. 15, 2013) (Malone, C.J.)<br />

Petition for Review filed Mar. 15, 2013<br />

<strong>Case</strong> No. 106,780<br />

After our Supreme Court affirmed her conviction <strong>of</strong> rape, Mary Ann Wright filed a K.S.A. 60-1507 motion<br />

raising claims that (1) her trial counsel was unconstitutionally ineffective for requesting a general verdict<br />

form when she was charged with alternative means <strong>of</strong> committing rape and (2) her appellate counsel for her<br />

direct appeal was unconstitutionally ineffective for failing to argue that sexual intercourse with a person<br />

who does not consent and who is overcome by force or fear constitutes alternative means <strong>of</strong> committing<br />

rape. The district court conducted an evidentiary hearing and denied relief. On appeal, the Kansas Court <strong>of</strong><br />

Appeals affirmed, finding that the trial counsel's request for a general verdict form was a strategic choice<br />

and that the district court correctly found that the request did not fall below an objective standard <strong>of</strong><br />

reasonable representation; therefore, the choice did not constitute ineffective assistance <strong>of</strong> counsel. The<br />

Kansas Court <strong>of</strong> Appeals further held that the district court correctly found that, in light <strong>of</strong> the<br />

circumstances existing at the time <strong>of</strong> Wright's direct appeal, the treatment <strong>of</strong> force and fear as a single<br />

means <strong>of</strong> committing rape did not fall below an objective standard <strong>of</strong> reasonable representation; therefore,<br />

it did not constitute ineffective assistance <strong>of</strong> counsel. Moreover, the court held that Wright had also failed<br />

to show she was prejudiced because, as a matter <strong>of</strong> law, force and fear is a single, unified means <strong>of</strong><br />

committing rape.<br />

ANNEXATION<br />

Pishny v. Board <strong>of</strong> Johnson County Comm'rs,<br />

47 Kan. App. 2d 547, 277 P.3d 1170 (July 27, <strong>2012</strong>) (Hill, J.)<br />

Petition for Review filed <strong>June</strong> 1, <strong>2012</strong><br />

<strong>Case</strong> No. 105,595<br />

The Board <strong>of</strong> Commissioners for Johnson County (the Board) did not lose jurisdiction to render the<br />

annexation decision. As an issue <strong>of</strong> first impression, for the purposes <strong>of</strong> the annexation statute, "adjourn<br />

sine die" in K.S.A. 12-521(d) means when the board will no longer take evidence on the annexation matter.<br />

As applied to the facts <strong>of</strong> this case, the Board made a conditional adjournment on October 30, 2007, and<br />

left the record open. Also, the seven-day time limit in K.S.A. 12-521(d) is a procedural requirement that is<br />

directory in nature rather than mandatory. The fact that the Board required the City <strong>of</strong> Overland Park (the<br />

City) to later reach an agreement with Aubry Township is not ultra vires, and those opposing the<br />

annexation abandoned this issue.<br />

The district court's finding <strong>of</strong> the Board's substantial compliance is affirmed. The annexation statutes<br />

clearly provide for annexation <strong>of</strong> a lesser amount <strong>of</strong> area than was proposed for annexation. There is no<br />

statutory requirement for the Board to have amended the information in order to consider or partially grant<br />

the annexation. Refinements made to the service extension plan <strong>of</strong>fered by the City did not make it the<br />

wrong plan as those opposing the annexation contend. The argument presented by those opposing the<br />

annexation—that the district court applied the wrong legal standard—was rejected.<br />

4


The court found no procedural due process errors. Those opposing the annexation were provided adequate<br />

notice and opportunity to be heard. There is no legal authority that requires a public hearing every time an<br />

annexation record is supplemented with additional information. The annexation statutes contemplate only a<br />

single public hearing. In addition, there was no showing that the rights <strong>of</strong> those opposing the annexation<br />

were violated as a result <strong>of</strong> ex parte communications.<br />

ARBITRATION<br />

Neighbors Construction Co., Inc. v. Woodland Park at Soldier Creek, LLC, et al<br />

48 Kan. App. 2d 33, 284 P.3d 1057 (Aug. 3, <strong>2012</strong>) (Green, J.)<br />

<strong>Case</strong> No. 106,536<br />

Woodland Park at Soldier Creek, LLC (Woodland Park), appealed from the trial court's decision that: (1)<br />

denied Woodland Park's application to vacate, or modify and correct arbitration; and (2) confirmed an<br />

arbitration award in favor <strong>of</strong> Neighbors Construction Co., Inc. (Neighbors Construction), in the amount <strong>of</strong><br />

$1,277,701.31. On appeal, Woodland Park challenged several aspects <strong>of</strong> the arbitration proceeding. The<br />

Court <strong>of</strong> Appeals held the following: (1) Architect's decision regarding payment dispute between Neighbors<br />

Construction and Woodland Park was not final and therefore not entitled to deference by the arbitrator or<br />

trial court; (2) the arbitrator did not exceed his powers under K.S.A. 5-412(a)(3); the arbitrator's award was<br />

not in manifest disregard <strong>of</strong> the law; (4) the arbitration award was not based on irrational interpretation <strong>of</strong><br />

the contract; and (5) the consequential damages waiver clause in the parties contract did not preclude award<br />

<strong>of</strong> attorney's fees or interest.<br />

Unified Government <strong>of</strong> Wyandotte County/Kansas City v. IBEW Local 53<br />

48 Kan. App. 2d 128, 286 P.3d 570 (Aug. 24, <strong>2012</strong>) (Pierron, J.)<br />

<strong>Case</strong> No. 106,845<br />

This appeal arises out <strong>of</strong> the arbitration undertaken by the parties regarding the discharge <strong>of</strong> an employee <strong>of</strong><br />

the Unified Government's Water Pollution Control Division after that employee, Herron, got into a fight<br />

with a coworker. Herron was protected by the provisions <strong>of</strong> the Memorandum <strong>of</strong> Agreement (MOA)<br />

previously negotiated between the International Brotherhood <strong>of</strong> Electrical Workers, Local 53 (IBEW) and<br />

UG. Under this contract, the issue <strong>of</strong> whether UG had "just cause" to terminate Herron's employment was<br />

submitted to arbitration. The arbitrator elicited testimony at a hearing as well as legal arguments in the form<br />

<strong>of</strong> briefs and rendered a decision in favor <strong>of</strong> Herron and IBEW. The arbitrator ordered UG to reduce<br />

Herron's discharge to a suspension. At UG's request, the district court reviewed the contract between the<br />

parties, the decision <strong>of</strong> the arbitrator, and the legal arguments <strong>of</strong> the parties, and then issued a memorandum<br />

decision affirming the arbitrator's decision. The Court <strong>of</strong> Appeals stated that the arbitrator used the<br />

appropriate seven-part test to decide whether he should reduce Herron's discipline. The court also stated<br />

that the arbitrator's use <strong>of</strong> the test's appropriateness/reasonableness prong was far from unreasonable.<br />

Before exercising his discretion to reduce Herron's discipline, the arbitrator made factual findings regarding<br />

Herron's work record (good employee for almost 10 years and was promoted to foreman) and other<br />

mitigating circumstances (Herron was provoked and was genuinely remorseful about assaulting Rangel).<br />

These findings suggest the arbitrator believed UG would not be harmed by Herron's continued employment<br />

and that Herron would benefit from a chance to redeem himself. The court set forth the disclaimer that the<br />

award does not mean every UG employee who assaults another employee will be reinstated—not every<br />

arbitrator will exercise his or her discretion to reduce discipline, not every employee will have a sparkling<br />

work record, and not every situation will have compelling mitigating circumstances. The court also<br />

clarified that because <strong>of</strong> the rule against reweighing evidence, it could not consider UG's claim that Herron<br />

was not truly sorry about hurting Rangel.<br />

This appeal arises out <strong>of</strong> the arbitration undertaken by the parties regarding the discharge <strong>of</strong> an employee <strong>of</strong><br />

the Unified Government's Water Pollution Control Division after that employee, Herron, got into a fight<br />

with a coworker. Herron was protected by the provisions <strong>of</strong> the Memorandum <strong>of</strong> Agreement (MOA)<br />

5


previously negotiated between the International Brotherhood <strong>of</strong> Electrical Workers, Local 53 (IBEW) and<br />

UG. Under this contract, the issue <strong>of</strong> whether UG had "just cause" to terminate Herron's employment was<br />

submitted to arbitration. The arbitrator elicited testimony at a hearing as well as legal arguments in the form<br />

<strong>of</strong> briefs and rendered a decision in favor <strong>of</strong> Herron and IBEW. The arbitrator ordered UG to reduce<br />

Herron's discharge to a suspension. At UG's request, the district court reviewed the contract between the<br />

parties, the decision <strong>of</strong> the arbitrator, and the legal arguments <strong>of</strong> the parties, and then issued a memorandum<br />

decision affirming the arbitrator's decision. The Court <strong>of</strong> Appeals stated that the arbitrator used the<br />

appropriate seven-part test to decide whether he should reduce Herron's discipline. The court also stated<br />

that the arbitrator's use <strong>of</strong> the test's appropriateness/reasonableness prong was far from unreasonable.<br />

Before exercising his discretion to reduce Herron's discipline, the arbitrator made factual findings regarding<br />

Herron's work record (good employee for almost 10 years and was promoted to foreman) and other<br />

mitigating circumstances (Herron was provoked and was genuinely remorseful about assaulting Rangel).<br />

These findings suggest the arbitrator believed UG would not be harmed by Herron's continued employment<br />

and that Herron would benefit from a chance to redeem himself. The court set forth the disclaimer that the<br />

award does not mean every UG employee who assaults another employee will be reinstated—not every<br />

arbitrator will exercise his or her discretion to reduce discipline, not every employee will have a sparkling<br />

work record, and not every situation will have compelling mitigating circumstances. The court also<br />

clarified that because <strong>of</strong> the rule against reweighing evidence, it could not consider UG's claim that Herron<br />

was not truly sorry about hurting Rangel.<br />

ATTORNEY FEES<br />

Snider v. American Family Mut. Ins. Co. (Snider II)<br />

___ Kan. ___, ___ P.3d ___, 2013 WL 1694786 (Apr. 19, 2013) (Luckert, J.)<br />

(Moritz and Johnson, JJ. dissenting)<br />

<strong>Case</strong> No. 103,340<br />

Eugene Wayne Snider, d/b/a West Heating & Cooling, did not file a motion for appellate attorney fees in a<br />

successful appeal to the Court <strong>of</strong> Appeals (Snider I). In the district court proceeding on remand, Snider<br />

requested and received attorney fees related to both the district court and the appellate proceedings under<br />

K.S.A. 40-908 (prevailing party attorney fee statute). The Court <strong>of</strong> Appeals reversed the appellate attorney<br />

fee order (Snider II), determining Snider had waived his right to appellate attorney fees by not filing a<br />

motion for attorney fees with the Court <strong>of</strong> Appeals in Snider I. Snider filed a petition for review.<br />

The Kansas Supreme Court previously held in Evans v. Provident Life & Accident Ins. Co., 249 Kan. 248,<br />

265, 815 P.2d 550 (1991), that a party's request for civil appellate attorney fees must be determined by the<br />

appellate court hearing the appeal. Supreme Court Rule 7.07(b) provides a procedure for making such a<br />

request and specifies the time period after the appellate oral argument in which the request must be made.<br />

In this case, our Supreme Court held that the Court <strong>of</strong> Appeals correctly applied Rule 7.07(b), Evans, and<br />

K.S.A. 40-908 in denying appellate attorney fees for Snider I; the Court <strong>of</strong> Appeals did not abuse its<br />

discretion in determining the amount <strong>of</strong> reasonable appellate attorney fees for Snider II; and Snider was not<br />

entitled to appellate attorney fees for the current proceeding because he did not prevail. The court rejected<br />

Snider's argument that Evans should be overruled or deemed inapplicable in cases where a fee applicant did<br />

not prevail in the district court.<br />

The dissent would have followed the Evans dissent to hold that Snider's failure to file a motion for attorney<br />

fees in Snider I did not bar his claim for appellate attorney fees on remand because Rule 7.07(b) only<br />

applies where appellate attorney fees are sought in discretionary situations, not where they are specifically<br />

provided for by statute.<br />

6


BAILMENT<br />

Schoenholz v. Hinzman<br />

295 Kan. 786, 289 P.3d 1155 (Oct. 12, <strong>2012</strong>) (Rosen, J.)<br />

<strong>Case</strong> No. 101,063<br />

Schoenholz entered into an oral agreement with his sister, Hinzman, for the bailment <strong>of</strong> farm animals and<br />

farm equipment on her land. Four years after their cooperative effort to breed horses broke down, Hinzman<br />

sold her farm and the horses. Schoenholz subsequently retrieved most <strong>of</strong> his equipment from the farm and<br />

sued Hinzman for conversion and breach <strong>of</strong> the bailment contract. Hinzman counterclaimed for the<br />

expenses <strong>of</strong> maintaining the equipment and caring for the horses. The Supreme Court held the following:<br />

(1) Schoenholz' breach <strong>of</strong> contract and conversion claims accrued when Hinzman sold Schoenholz' horses;<br />

(2) Schoenholz didn't abandoned his property because he intended to retrieve it whenever he could find a<br />

place to store the equipment and board the horses; (3) Hinzman's gratuitous bailment <strong>of</strong> Schoenholz' tractor<br />

didn't make her liable for alleged deterioration <strong>of</strong> tractor while tractor sat outside on her farm, because the<br />

damage to the tractor occurred only as a result <strong>of</strong> her inaction; (4) Setting <strong>of</strong> 30-day limit on Schoenholz'<br />

right to recover bale fork and link that Hinzman had removed from her farm in the mistaken belief that it<br />

belonged to her was within inherent equitable powers <strong>of</strong> district court to prevent abuse <strong>of</strong> judicial process;<br />

and (5) Hinzman's award <strong>of</strong> attorney fees as a sanction because <strong>of</strong> Schoenholz' refusal to provide his tax<br />

returns to her as required by the district court's order to compel discovery was required under K.S.A. 2008<br />

Supp. 60–237(b)(2).<br />

BANKRUPTCY<br />

Sanford R. Fyler v. Brundage-Bone Concrete Pumping, Inc.,<br />

___ Kan. App. 2d ___, 297 P.3d. 1180, 2013 WL 646303 (Feb. <strong>22</strong>, 2013) (Hill,<br />

J.)<br />

<strong>Case</strong> No. 107,763<br />

Brundage-Bone Concrete Pumping, Inc., filed for bankruptcy protection under Chapter 11 <strong>of</strong> the United<br />

States Bankruptcy Code. The bankruptcy court entered an order lifting the automatic stay to allow Sanford<br />

R. Fyler to file a claim <strong>of</strong> negligence against Brundage-Bone in Sedgwick County District Court. The<br />

district court subsequently ordered Brundage-Bone to expedite a direct cash payment to Fyler. Brundage-<br />

Bone appealed, challenging the district court's jurisdiction. The Kansas Court <strong>of</strong> Appeals reversed, holding<br />

that the district court did not have jurisdiction to order cash payments under the mandatory alternative<br />

dispute resolution order <strong>of</strong> the bankruptcy court, which required all liquidated tort claims to become a<br />

general unsecured claim against the bankruptcy estate.<br />

CAUSE OF ACTION<br />

Jeanes v. Bank <strong>of</strong> America, et al.<br />

___ Kan. ___, 295 P.3d 1045 (Mar. 8, 2013) (Per curiam)<br />

<strong>Case</strong> No. 97,855<br />

In 1991, Maxine Anton, assisted by attorney Sharon Kunard, created an inter vivos revocable trust with the<br />

intention that, upon her death, the majority <strong>of</strong> the assets would pass to her niece, Janet Jeanes. When Anton<br />

died in late 2003, the grass value <strong>of</strong> her estate was approximately $39 million; in January 2004, her estate<br />

paid estate and inheritance taxes <strong>of</strong> over $21 million. Jeanes sued Kunard, among others, alleging<br />

negligence and breaches <strong>of</strong> fiduciary duty and contract. The district court granted summary judgment for<br />

all parties, and Jeanes appealed the grant <strong>of</strong> summary judgment to Kunard and the trust's manager to the<br />

Court <strong>of</strong> Appeals. The Court <strong>of</strong> Appeals reversed part <strong>of</strong> the summary judgment for the trust manager, but<br />

affirmed it for Kunard, finding that because the injury from the alleged negligence and breaches did not<br />

7


arise until after Anton's death, the cause for legal malpractice did not accrue in Anton's lifetime and did not<br />

survive her death. Jeanes appealed to the Supreme Court, who held that a cause <strong>of</strong> action sounding in tort<br />

does not accrue until the act giving rise to the cause <strong>of</strong> action first causes substantial injury or the fact <strong>of</strong><br />

injury becomes reasonably ascertainable to the injured party. Here, the injury did not occur until January<br />

2004, when the inheritance and estate taxes were paid. Therefore, the Kansas Supreme Court affirmed the<br />

Court <strong>of</strong> Appeals and the district court, finding that because Jeanes' cause <strong>of</strong> action did not accrue during<br />

Anton's lifetime, it cannot survive her death.<br />

CHILD IN NEED OF CARE<br />

In the Interest <strong>of</strong> A.E.S.<br />

___ Kan. App. 2d ___, 298 P.3d 386, 2013 WL 1364746 (Apr. 5, 2013) (Hebert,<br />

J.)<br />

<strong>Case</strong> No. 108,108<br />

After a probable cause hearing, the district court granted temporary custody <strong>of</strong> A.E.S., a minor child, to<br />

Social and Rehabilitation Services. A.E.S.' father, M.S., appealed from this temporary order. Because there<br />

is no provision to stay child in need <strong>of</strong> care (CINC) proceedings pending such an appeal, the district court<br />

subsequently found A.E.S. a CINC and ordered that she remain in SRS custody. Finally, the district court<br />

entered a journal entry <strong>of</strong> disposition, in which M.S. agreed that A.E.S.' custody shall remain with SRS.<br />

The later orders superceded the temporary order and eliminated any justiciable controversy regarding the<br />

custody determination in the temporary order and M.S.' agreement to the journal entry effectively conceded<br />

the issue M.S. wanted to raise on appeal; therefore, the Court <strong>of</strong> Appeals determined that M.S.' appeal was<br />

moot. Because the appeal was capable <strong>of</strong> repetition and raised concerns <strong>of</strong> public importance, however, the<br />

court retained the appeal to address M.S.' and the guardian ad litem's arguments that K.S.A. 2011 Supp. 38-<br />

<strong>22</strong>43(f)(3) is unconstitutionally vague and overbroad. The statute provides that a "court may enter an order<br />

<strong>of</strong> temporary custody after determining there is probable cause to believe that the . . . health or welfare <strong>of</strong><br />

the child may be endangered without further care." The Court <strong>of</strong> Appeals held that the statutory provision<br />

was neither unconstitutionally vague nor unconstitutionally overbroad.<br />

CHILD SUPPORT<br />

In re Marriage <strong>of</strong> Brown<br />

295 Kan. 966, 291 P.3d 55 (Oct. 26, <strong>2012</strong>) (Luckert, J.)<br />

<strong>Case</strong> No. 103,758<br />

After his divorce from Kristin, Jared fell behind in his child support payments, and eventually his wages<br />

were garnished. Jared owed $15,524 in unpaid child support and Kristin requested a judgment against Jared<br />

for the child support arrearage and for other monies she claimed Jared owed her, including $15,000 Kristin<br />

had provided to erase spousal maintenance and child support obligations that Jared owed to his previous<br />

spouse. The district judge ruled that Kristin could keep all <strong>of</strong> the money from the proceeds from the sale <strong>of</strong><br />

the couples' house and all arrearage would be covered by that and the court "called it good." The Court <strong>of</strong><br />

Appeals affirmed the district court's orders.<br />

Court stated if a motion for modification has not been filed, any court-ordered modification operates<br />

prospectively only, and the district court is not authorized to vacate or discharge past-due child support.<br />

Court held that although several motions to modify were filed while the divorce was pending, the district<br />

court did not make findings that were tied to a motion to modify. Consequently, contrary to the Court <strong>of</strong><br />

Appeals' holding in this case, the district court could enter only a prospective order regarding child support<br />

and was not authorized to vacate the temporary child support order that had resulted in an arrearage <strong>of</strong><br />

$15,524. Court found it was unable to state with any certainty which one <strong>of</strong> the two alternatives<br />

(modification or vacation) was intended by the district court. Court remanded so the district judge could<br />

clarify his intent and make further findings.<br />

8


CIVIL PROCEDURE<br />

Prime Lending II, LLC v. Trolley's Real Estate Holdings, LLC, et. al<br />

___ Kan App. 2d. ___, ___ P.3d ___, 2013 WL 17860<strong>22</strong> (Apr. 26, 2013) (Green,<br />

J.)<br />

<strong>Case</strong> No. 108,412<br />

Bank filed action to foreclose its mortgage on certain real property owned by Holding Company. Later,<br />

Bank moved for summary judgment, asking to foreclose on the property. The district court granted Bank's<br />

summary judgment and ordered a sheriff's sale <strong>of</strong> the property. Bank, based on its bid <strong>of</strong> $2,200,000, was<br />

the high bidder for the property. The district court then issued an order confirming the sheriff's sale. The<br />

district court later issued an order certifying its previous August 24, 2011, memorandum decision <strong>of</strong><br />

summary judgment as a final judgment under K.S.A. <strong>2012</strong> Supp. 60-254(b) and denying Holding<br />

Company's motion for leave to amend its answer. The Court <strong>of</strong> appeals determined that the district court<br />

abused its discretion when it retroactively certified its August 24, 2011, memorandum decision <strong>of</strong> summary<br />

judgment as a final judgment under K.S.A. <strong>2012</strong> Supp. 60-254(b). Because the district court failed to make<br />

a proper determination as required by K.S.A. <strong>2012</strong> Supp. 60-254(b), it dismissed the appeal as<br />

interlocutory.<br />

U.S. Bank National Association, as Trustee <strong>of</strong> the Security National Mortgage Loan<br />

Trust 2006-2 v. Steven R. McConnell, et al.<br />

___ Kan App. 2d. ___, ___ P.3d ___ (<strong>May</strong> 3, 2013) (McAnany, J.)<br />

<strong>Case</strong> No. 107,300<br />

Bank filed an action to foreclose its mortgage on a home. The McConnells raise a number <strong>of</strong><br />

issues regarding the propriety <strong>of</strong> U.S. Bank's foreclosure action and <strong>of</strong> the district court's entry <strong>of</strong> summary<br />

judgment. The Court <strong>of</strong> Appeals affirmed the district court's order granting summary judgment to U.S.<br />

Bank, holding: (1) the fact that the Bank held the promissory note was sufficient to give it standing to<br />

pursue this action because the promissory note follows the mortgage and the mortgage follows the note; (2)<br />

the McConnells have failed to present any evidence which would create a genuine issue <strong>of</strong> material fact<br />

regarding their KCPA claims which would bar summary judgment; (3) every factual dispute between the<br />

parties does not constitute a bar to summary judgment if the factual dispute is not material to the ultimate<br />

outcome <strong>of</strong> the case; (4) a severance <strong>of</strong> the mortgage and the promissory note it secures may be cured by<br />

the holder <strong>of</strong> the note becoming the holder <strong>of</strong> the mortgage before any judgment <strong>of</strong> foreclosure; and (5) a<br />

spouse who does not sign a promissory note but who signs the mortgage securing the other spouse's<br />

promissory note voluntarily consents to the alienation <strong>of</strong> his or her homestead rights under K.S.A. 60-2301.<br />

CLASS ACTION<br />

City <strong>of</strong> Neodesha v. BP Corporation North America Inc, et al.<br />

295 Kan. 298, 287 P.3d 214 (Aug. 31, <strong>2012</strong>) (Biles, J.)<br />

<strong>Case</strong> No. 101,183<br />

All persons and entities owning real property in and around the City <strong>of</strong> Neodesha, Kansas, brought a class<br />

action against BP Corporation <strong>of</strong> North American and other owners <strong>of</strong> a former oil refinery, alleging<br />

groundwater and subsurface soil contamination caused by the now dismantled facility. A jury found in the<br />

defendants' favor after a 17-week trial. But in posttrial proceedings, the district court decided it had made a<br />

mistake in submitting the strict liability claim to the jury, and it granted the plaintiff class judgment as a<br />

matter <strong>of</strong> law on its strict liability claim, setting the stage for a new trial over damages. BP filed an<br />

interlocutory appeal. The Kansas Supreme Court held that the district court should not have granted the<br />

class judgment as a matter <strong>of</strong> law. The jury was instructed to determine whether BP engaged in an<br />

abnormally dangerous activity and the trial court erred by overturning the jury's finding. The abnormally<br />

9


dangerous activities tests under the Restatement <strong>of</strong> Laws were the appropriate standards to apply to the<br />

plaintiff class' claims, and the jury decided the question. The court reversed the district court's entry <strong>of</strong><br />

judgment for the class on its strict liability claim, and remanded this matter to the district court with<br />

directions that the jury's verdict be reinstated and final judgment entered for the defendants. Based on its<br />

decision, the court did not address BP's claims that its activities or lack there<strong>of</strong> did not constitute an<br />

abnormally dangerous activity as a matter <strong>of</strong> law or that the class failed to establish causation. The court<br />

also did not address BP's argument that the district court erred by conditionally granting a new trial as a<br />

matter <strong>of</strong> law because it lacked the authority to enter a conditional new trial order.<br />

See also, Coulter v. Anadarko Petroleum Corp., 296 Kan. 336, 292 P.3d 289 (Jan. 11,<br />

2013) (Johnson, J.) (Adequacy <strong>of</strong> Counsel)<br />

CONSTRUCTIVE FRAUD<br />

Hemphill v. Shore<br />

295 Kan. 1111, 289 P.3d 1173 (Dec. 7, <strong>2012</strong>) (Beier, J.)<br />

<strong>Case</strong> No. 102,938<br />

Hemphill appeals the district court's statute <strong>of</strong> limitations dismissal <strong>of</strong> his lawsuit against his uncle, Shore,<br />

as trustee <strong>of</strong> the Shore Family Trust. The Court <strong>of</strong> Appeals affirmed the district court's decision leading<br />

Hemphill to file a petition for review. Our Supreme Court held that Hemphill's constructive fraud cause <strong>of</strong><br />

action was not time barred while his other three causes <strong>of</strong> actions were barred by the statute <strong>of</strong> limitations.<br />

To establish Hemphill's constructive fraud cause <strong>of</strong> action, our Supreme Court held that the controlling<br />

trust instrument established a confidential relationship between Hemphill as beneficiary and Shore as<br />

trustee, and it limited Shore's discretion to pay out income and distribute proceeds from the sale <strong>of</strong> principal<br />

to provide only for Shore's health, education, support, or maintenance. The Court further held that the 10year<br />

statue <strong>of</strong> repose in K.S.A. 60-513(b) did not apply to actions for fraud. The Court affirmed in part and<br />

reversed in part the decision <strong>of</strong> the Court <strong>of</strong> Appeals and remanded the case to the district court.<br />

CONSUMER PROTECTION ACT<br />

Stechschulte v. Jennings<br />

__ Kan. __, __ P.3d __ (Apr. 12, 2013) (Beier, J.) (Donald R. Noland, District<br />

Judge, assigned vice Justice Moritz)<br />

<strong>Case</strong> No. 100,648<br />

Plaintiffs, the purchasers <strong>of</strong> a home, brought suit against the seller for fraud, negligent misrepresentation,<br />

and breach <strong>of</strong> contract, and against seller's real estate agent and agency for negligent misrepresentation and<br />

violations <strong>of</strong> the Kansas Consumer Practices Act (KCPA) due to water leakage in the home. Defendants<br />

moved for summary judgment, primarily arguing that Plaintiffs had waived their right to rely on any<br />

representations made by Defendants. They pointed to Paragraph 5 <strong>of</strong> the Buyer Acknowledgement, signed<br />

by the Plaintiffs, which stated: "I specifically represent that there are no important representations<br />

concerning the condition or value <strong>of</strong> the property made by SELLER or BROKER on which I am relying<br />

except as may be fully set forth in writing and signed by them." The district court granted summary<br />

judgment in favor <strong>of</strong> Defendants on this basis. On direct appeal, the Court <strong>of</strong> Appeals reversed the district<br />

court's grant <strong>of</strong> summary judgment in favor <strong>of</strong> the seller and affirmed its grant <strong>of</strong> summary judgment in<br />

favor <strong>of</strong> seller's real estate agent and agency. On petition for review, the Supreme Court affirmed the<br />

judgment <strong>of</strong> the Court <strong>of</strong> Appeals reversing the district court's grant <strong>of</strong> summary judgment in favor <strong>of</strong> the<br />

seller. Relying on Osterhaus v. Toth, 291 Kan. 759, 249 P.3d 888 (2011), the Supreme Court found that<br />

Paragraph 5 <strong>of</strong> the Buyer Acknowledgment was merely an integrator protecting the seller and his broker<br />

from the buyer's later argument that the seller made oral representations upon which the buyer relied.<br />

10


However, Paragraph 5 did not protect the seller from the buyer's lawsuit based on representations and<br />

failure to disclose information in the written disclosure form or relieve the seller <strong>of</strong> the obligation to make<br />

accurate and complete disclosures. Since Plaintiffs had produced evidence, not barred under Paragraph 5,<br />

which supported their fraud, negligent misrepresentation, and breach <strong>of</strong> contract claims against the seller,<br />

the case was remanded to the district court for further proceedings on those claims. The Supreme Court<br />

then reversed the judgment <strong>of</strong> the Court <strong>of</strong> Appeals affirming the district court's grant <strong>of</strong> summary<br />

judgment in favor <strong>of</strong> the seller's real estate agent and agency. It found that the Brokerage Relationships in<br />

Real Estate Transactions Act (BRRETA), K.S.A. 58-30,101 et seq., does not eliminate the common-law<br />

cause <strong>of</strong> action against a real estate agent or broker for negligent misrepresentation; it merely requires<br />

evidence <strong>of</strong> the agent's or broker's actual knowledge <strong>of</strong> an otherwise undisclosed adverse material fact<br />

about the subject property. The Supreme Court also noted that a consumer cannot waive or forego rights<br />

under the KCPA. Since Plaintiffs had produced evidence which supported their negligent misrepresentation<br />

and KCPA claims against seller's real estate agent and agency, the case was remanded to the district court<br />

for further proceedings on those claims.<br />

CONTRACTS<br />

CoreFirst Bank & Trust v. JHawker Capital, LLC<br />

47 Kan. App. 2d 755, 282 P.3d 618 (<strong>June</strong> 15, <strong>2012</strong>) (Marquardt, J.)<br />

<strong>Case</strong> No. 106,201<br />

CoreFirst Bank & Trust filed a mortgage foreclosure action against JHawker Capital, LLC on a subdivision<br />

development. Linda and James David Alexander were named as defendants in the foreclosure action<br />

because <strong>of</strong> their recorded interests in the real estate. While the foreclosure action was pending, the<br />

Alexanders and Outwest Investments, LLC—a real estate business in which David is the managing<br />

member—filed a third-party petition against Junction City Abstract & Title Co., Inc. (JCAT) alleging that<br />

JCAT failed to adequately protect their retained interests. Specially, the plaintiffs alleged JCAT was liable<br />

for failing to include a restrictive covenant on the warranty deeds as reflected in the contracts between<br />

Outwest (and other sellers) and the buyers, JHawker and Southboro, LLC. The plaintiffs claimed that their<br />

contracts provided that when each <strong>of</strong> the lots in the development was fully developed and was sold, the<br />

buyers would either (1) ensure that the Alexanders were the exclusive listing agents with a 5.5%<br />

commission or (2) pay Outwest a commission or fee <strong>of</strong> $2,500 regardless <strong>of</strong> whether the buyers still owned<br />

the lots. The district court granted summary judgment to JCAT and held that the retained interests were<br />

void transfer fee covenants under K.S.A. 2011 Supp. 58-3821 and K.S.A. 2011 Supp. 58-38<strong>22</strong>, and JCAT<br />

could not be liable for failing to adequately protect an unenforceable interest. The district court also denied<br />

the plaintiffs' claims for damages for future lost pr<strong>of</strong>its, finding them too speculative and remote. On<br />

appeal, the Alexanders and Outwest argued that the district court erred in concluding that their<br />

contractually retained interests did not fit within either <strong>of</strong> the statutory exceptions to the barring <strong>of</strong> transfer<br />

fees found in K.S.A. 2011 Supp. 58-3821(a)(2)(A) and (B). Issues involving the interpretation and legal<br />

effect <strong>of</strong> a written contract, as well as statutory interpretation, involve questions <strong>of</strong> law subject to unlimited<br />

review. The Court <strong>of</strong> Appeals refused to go outside the four corners <strong>of</strong> the contracts because the parties did<br />

not point to any ambiguity in the contracts and the contracts stated that prior agreements have "no further<br />

force or effect." Parol evidence is inadmissible to contradict, alter, or vary terms <strong>of</strong> a written instrument<br />

unless ambiguity exists on vital points such that parol evidence is necessary to ascertain parties' intent in<br />

executing the instrument. Furthermore, when a contract clearly states that it represents the parties' entire<br />

agreement and all other agreements previously entered into by the parties are superseded by this contract<br />

and <strong>of</strong> no further force or effect, parol evidence on the issue is not admissible. The Court <strong>of</strong> Appeals<br />

concluded that (1) the district court did not err in holding that the statutory exceptions allowing transfer<br />

fees for additional consideration or real estate commissions were inapplicable and (2) the district court<br />

properly denied the plaintiffs' claim for damages for future lost pr<strong>of</strong>its. Lost pr<strong>of</strong>its resulting from a breach<br />

<strong>of</strong> contract may only be recovered as damages when such pr<strong>of</strong>its are proved with reasonable certainty and<br />

when they may reasonably be considered to have been within the contemplation <strong>of</strong> the parties. While<br />

11


absolute certainty in proving loss <strong>of</strong> future pr<strong>of</strong>its is not required, a damage award for lost pr<strong>of</strong>its cannot be<br />

based upon purely speculative or problematic evidence. There must be some reasonable standard to<br />

determine damages. When, as in this case, claimed damages for future lost pr<strong>of</strong>its depend upon future<br />

developments that are contingent, conjectural, and improbable, they are speculative and not reasonably<br />

ascertainable.<br />

Kincaid v. Dess<br />

___ Kan. App. 2d ___, 298 P.3d 358, 2013 WL 856463 (Mar. 8, 2013) (Green, J.)<br />

Petition for Review filed Apr. 8, 2013<br />

<strong>Case</strong> No. 107,970<br />

The Kincaids appeal from a summary judgment granted in favor <strong>of</strong> the Desses involving the Kincaids'<br />

breach <strong>of</strong> contract, fraud, negligent misrepresentation, civil conspiracy, and rescission claims. Here, the<br />

Kincaids purchased a house from Sirva Relocation LLC (Sirva). The bases <strong>of</strong> the Kincaids' claims involve<br />

the alleged failure <strong>of</strong> the Desses to disclose the true condition <strong>of</strong> their home before they sold it to Sirva. The<br />

Desses moved for summary judgment, which the trial court granted. On appeal, the Kincaids contend that<br />

the trial court erred in granting summary judgment on their breach <strong>of</strong> contract, fraud, and negligent<br />

misrepresentation claims. The Court <strong>of</strong> Appeals agreed and reversed and remanded for trial on the<br />

Kincaids' breach <strong>of</strong> contract, fraud, and negligent misrepresentation claims; however, the Court <strong>of</strong> Appeals<br />

affirmed the trial court's grant <strong>of</strong> summary judgment in favor <strong>of</strong> the Desses on the Kincaids' civil<br />

conspiracy and rescission claims. On the breach <strong>of</strong> contract claim, the court held that privity was<br />

established because the Kincaids were intended third-party beneficiaries and because the disclosure<br />

statements were incorporated by reference into the contract between Sirva and the Kincaids. On the fraud<br />

and negligent misrepresentation claim, the Desses maintained that the Kincaids could not establish<br />

reasonable reliance. In relying on Osterhaus v. Toth, 291 Kan. 759, 249 P.3d 888 (2011), the Court held<br />

that a buyer does not need to provide a separate writing to show reasonable reliance which is an essential<br />

element <strong>of</strong> fraud and negligent misrepresentation and that a buyer does not waive their right to rely upon<br />

the sellers representations by signing a sales agreement.<br />

State ex rel. Hecht v. City <strong>of</strong> Topeka<br />

___ Kan. ___, 293 P.3d 713 (Feb. 1, 2013) (Per curiam) (Daniel A. Duncan,<br />

District Judge, assigned vice Justice Mortiz)<br />

<strong>Case</strong> No. 102,731<br />

The council <strong>of</strong> the City <strong>of</strong> Topeka passed a resolution authorizing the City to enter into a contract to<br />

purchase a helicopter from Schreib-Air. The contract was in the form <strong>of</strong> a lease-purchase agreement, by<br />

which the City agreed to a pay a down payment that Schreib-Air would keep as liquidated damages if the<br />

City failed to fulfill its obligations. After the contract was signed, the mayor vetoed the resolution, which<br />

the council failed to override. The city manager nonetheless authorized a third-party financing company to<br />

send the down payment to Schreib-Air. The State then filed suit seeking a declaratory judgment that the<br />

contract between the City and Schreib-Air was void because it violated the cash-basis law, K.S.A. 10-1101<br />

et seq. The district court granted summary judgment in favor <strong>of</strong> the City and ordered Schreib-Air to return<br />

the down payment. On appeal, Schreib-Air argued that the contract was valid when it was entered into and<br />

that any violations <strong>of</strong> the cash-basis law were attributable solely to the City's third-party financing contract.<br />

The Supreme Court first noted that the cash-basis law prohibits municipalities from creating indebtedness<br />

in excess <strong>of</strong> funds actually on hand in the treasury <strong>of</strong> the municipality. K.S.A. 10-1112. Contracts entered<br />

into in violation <strong>of</strong> the cash-basis law are void. K.S.A. 10-1119. As an exception to this general rule, leasepurchase<br />

agreements may be valid if approved by a majority vote <strong>of</strong> all members <strong>of</strong> the governing body <strong>of</strong><br />

the municipality. K.S.A. 10-1116b; K.S.A. 10-1116c(a). Since there was no evidence that the City had the<br />

entire purchase price <strong>of</strong> the helicopter on hand in the treasury, and the undisputed facts clearly showed that<br />

the contract was not approved by a majority vote <strong>of</strong> the City's governing body at the time it was entered<br />

into, the contract was ultra-vires, void, and unenforceable because it violated the cash-basis law. Thus, the<br />

decision <strong>of</strong> the district court was affirmed.<br />

12


USD No. 446 v. Sandoval<br />

295 Kan. 278, 286 P.3d542 (Aug. 31, <strong>2012</strong>) (Rosen, J.) (Luckert, J., concurring<br />

and dissenting) (Nuss, C.J., dissenting)<br />

<strong>Case</strong> 101,145<br />

The Kansas Supreme Court stated that the parties to a contract may mutually rescind their contractual<br />

obligations. The court held that assuming a contract existed, an essential term <strong>of</strong> the contract required<br />

Sandoval, the teacher, to leave the classroom by March 28 in order to qualify for KPERS disability<br />

benefits. Nevertheless, the District provided no substitute teacher beginning on March 28 and did not<br />

inform Sandoval that she was not to come to the school and teach her classes as <strong>of</strong> that date. Instead, she<br />

finished her teaching duties for the year and the District paid her salary for that term. The board sent her a<br />

letter informing her that it would not renew her contract, and on April 14, 2008, the board adopted a<br />

resolution <strong>of</strong> nonrenewal. The actions by both the board and Sandoval were clearly inconsistent with the<br />

existence <strong>of</strong> a contract to terminate her employment as <strong>of</strong> March 28 and each acquiesced in the conduct <strong>of</strong><br />

the other. The parties abandoned any intent to be bound by the agreement. The Kansas Supreme Court<br />

concluded as a matter <strong>of</strong> law that no enforceable contract existed between the parties. Justice Luckert<br />

agreed that the district court's and Court <strong>of</strong> Appeals' decisions should be reversed, but dissented that the<br />

case is appropriately resolved on summary judgment because <strong>of</strong> the conflicting intent <strong>of</strong> the parties. Chief<br />

Justice Nuss dissented and would affirm the lower decisions that the uncontroverted facts establish the<br />

parties entered into a binding oral contract on March 10, 2008.<br />

Waste Connections <strong>of</strong> Kansas, Inc. v. Ritchie Corporation<br />

___ Kan. ___, 298 P.3d 250 (Mar. <strong>22</strong>, 2013) (Beier, J.)<br />

<strong>Case</strong> No. 101,812<br />

This dispute arose out <strong>of</strong> Waste Connections <strong>of</strong> Kansas, Inc.'s right <strong>of</strong> first refusal to buy a waste transfer<br />

station that it operated but Ritchie Corporation owned. Ritchie entered into negotiations to sell the waste<br />

transfer station and adjoining landfill to Cornejo & Sons. Cornejo agreed to pay $4,950,000 total, <strong>of</strong> which<br />

$2 million was for the rights and obligations to the transfer station. Ritchie and Cornejo agreed that if<br />

Waste Connections exercised its right <strong>of</strong> first refusal to the transfer station, the purchase price for the<br />

remaining assets would be $3.5 million. When Ritchie informed Waste Connections <strong>of</strong> the <strong>of</strong>fer, as<br />

required, Waste Connections replied that it wanted to exercise its option to purchase Ritchie's interest in the<br />

transfer station, but that it would do so at the price <strong>of</strong> $1.45 million—the $4.95 million total minus the $3.5<br />

million that Cornejo would pay for everything but the transfer station—not the $2 million that Ritchie<br />

requested. Ultimately, Waste Connections paid Ritchie $2 million but reserved its rights to pursue<br />

repayment <strong>of</strong> the disputed $550,000, for which it sued. The parties agreed that the issue for resolution was<br />

identification <strong>of</strong> the correct transfer station price and filed cross-motions for summary judgment. The<br />

district court entered judgment for Ritchie and awarded costs, expenses, and attorney fees, finding that the<br />

right <strong>of</strong> first refusal, as written in the escrow agreement, required Waste Connections to step into the shoes<br />

<strong>of</strong> a third-party purchaser and purchase Ritchie's transfer station interest for the same price <strong>of</strong>fered or<br />

agreed to by a bona fide third-party purchaser. The court also found that the price for the transfer station<br />

was $2 million. Waste Connections appealed, and a panel <strong>of</strong> the Court <strong>of</strong> Appeals reversed the district court<br />

and granted judgment to Waste Connections. Ritchie petitioned for review and our Supreme Court decided<br />

that neither party was entitled to summary judgment in its favor; the court remanded to the district court for<br />

trial on the merits <strong>of</strong> Waste Connections' breach <strong>of</strong> contract claim, including allegations <strong>of</strong> Ritchie's bad<br />

faith, because genuine issues <strong>of</strong> material fact existed. Further, our Supreme Court found that Waste<br />

Connections did not waive its claim that it should only pay $1.45 million when it informed Ritchie that it<br />

exercised its right <strong>of</strong> first refusal.<br />

See also, Unified Government <strong>of</strong> Wyandotte County/Kansas City v. IBEW Local 53, 48<br />

Kan. App. 2d 128, 286 P.3d 570 (Aug. 24, <strong>2012</strong>) (Pierron, J.) (Arbitration)<br />

13


COPARENTING AGREEMENT<br />

DAMAGES<br />

Frazier v. Goudschaal<br />

___ Kan. ___, 295 P.3d 542 (2013) (Feb. <strong>22</strong>, 2013) (Johnson, J.)<br />

<strong>Case</strong> No. 103,487<br />

Goudschaal and Frazier were committed to a long-time, same-sex relationship, during which they jointly<br />

decided to have 2 children via artificial insemination. In conjunction with the birth <strong>of</strong> each child, the couple<br />

executed a coparenting agreement that, among other provisions, addressed the contingency <strong>of</strong> a separation.<br />

A few months after the couple separated, Goudschaal notified Frazier that she was taking the children to<br />

Texas, prompting Frazier to file this action seeking to enforce the coparenting agreement. The district<br />

court's final order divided all <strong>of</strong> the women's property, awarded the couple joint legal custody <strong>of</strong> the two<br />

children, designated Goudschaal as the residential custodian, established unsupervised parenting time for<br />

Frazier, and ordered Frazier to pay child support. Goudschaal appealed.<br />

The Kansas Supreme Court held that the district court had jurisdiction to divide the parties' property; to<br />

determine the existence or nonexistence <strong>of</strong> a mother and child relationship between Frazier and the two<br />

children; to determine the validity and effect <strong>of</strong> the coparenting agreement; and to enter such orders with<br />

respect to child custody, parenting time, and child support that are in the best interests <strong>of</strong> the children. The<br />

court also held that the coparenting agreement between the biological mother and her same-sex partner<br />

contained no element <strong>of</strong> immorality or illegality and did not violate public policy, but rather the contract<br />

was for the advantage and welfare <strong>of</strong> the children, rendering it enforceable by the district court to the extent<br />

it is in the best interests <strong>of</strong> the children.<br />

Evenson v. Lilley<br />

295 Kan. 43, 282 P.3d 610 (Aug. 17, <strong>2012</strong>) (Rosen, J.)<br />

<strong>Case</strong> No. 102,100<br />

The Evensons owned 160 acres <strong>of</strong> rural property in Greenwood County. Lilley, the lessee <strong>of</strong> an adjacent<br />

lot, lost control <strong>of</strong> a fire when he was conducting a controlled burn <strong>of</strong> his land. The fire spread onto the<br />

Evensons' lot and burned down numerous trees and some dilapidated outbuildings. Evenson sued for<br />

negligence, requesting damages in excess <strong>of</strong> $75,000 for the lost value <strong>of</strong> the trees. The district court,<br />

however, awarded only $7,687, which was the difference in value <strong>of</strong> the land before and after the fire along<br />

with the cost to clean up the debris. The Court <strong>of</strong> Appeals affirmed. The Kansas Supreme Court affirmed as<br />

well, but for reasons different from the Court <strong>of</strong> Appeals. Generally, the measure <strong>of</strong> damages for the<br />

destruction <strong>of</strong> productive trees is the difference in value <strong>of</strong> the land before and after the injury. But this rule<br />

is flexible, and the proper measure <strong>of</strong> damages depends on the owner's use <strong>of</strong> the trees. For example, if<br />

trees lost were going to be sold as lumber, then the measure <strong>of</strong> damages might be lost pr<strong>of</strong>its from the sale<br />

<strong>of</strong> the trees. In this case, Evenson put on very little evidence that the trees on his land had any special value<br />

apart from the land itself. So although the "temporary" or "permanent" dichotomy that the Court <strong>of</strong> Appeals<br />

relied on to affirm the district court's decision was not the correct legal standard to apply to the trees, the<br />

ultimate decision affirming the district court was correct. Accordingly, the Supreme Court affirmed the<br />

decision.<br />

14


DEBTOR-CREDITOR<br />

First National Bank <strong>of</strong> Omaha v. Centennial Park LLC, et al<br />

___ Kan. App. 2d ___, ___ P.3d ___, 2013 WL 1173914 (Mar. <strong>22</strong>, 2013) (Green,<br />

J.)<br />

<strong>Case</strong> No. 108,315<br />

Bank entered into commercial loan agreement for nearly $10 million with debtors for commercial real<br />

estate development. Debtors defaulted on the loan. District court granted summary judgment in bank's<br />

favor for principal amount plus interest. Debtor raised four arguments to the Court <strong>of</strong> Appeals: (1) that<br />

equitable principles should have prevented bank from accelerating their loan debt obligation although bank<br />

could accelerate loan under the terms <strong>of</strong> the promissory note; (2) that the district court erred when it found<br />

that debtors had not substantially performed under the terms <strong>of</strong> the loan documents and therefore had<br />

committed a material breach <strong>of</strong> the contract; (3) that bank waived its right to accelerate the loan debt by<br />

depositing debtors' check in its account; and (4) that bank breached implied covenant <strong>of</strong> good faith and fair<br />

dealing when it sent debtors a billing statement requiring a principal payment <strong>of</strong> $1,350,000. The Court <strong>of</strong><br />

appeals held the following: (1) equitable principle that debtors relied on—mistake—didn't apply because<br />

no mistake was made; (2) district correctly held that debtors had not substantially performed under the<br />

terms <strong>of</strong> the note and the loan documents, and, therefore, had materially breached the contract; (3), bank<br />

didn't waive its right to accelerate loan debt by accepting debtors' late payment because parties' note<br />

contained multiple anti-waiver provisions; and (4) bank didn't breach implied covenant <strong>of</strong> good faith and<br />

fair dealing when it sent debtors a billing statement requiring a principal payment <strong>of</strong> $1,350,000. Although<br />

district court determined that debtors didn't owe a principal payment <strong>of</strong> $1,350,000 on April 10, 2010,<br />

district court found that debtors owed an unpaid balance <strong>of</strong> $176,880.57 on that date.<br />

DEFAULT JUDGMENT<br />

Church <strong>of</strong> God in Christ, Inc. v. Board <strong>of</strong> Trustees <strong>of</strong> Emmanuel Church <strong>of</strong> God in<br />

Christ<br />

47 Kan. App. 2d 674, 280 P.3d 795 (<strong>June</strong> 8, <strong>2012</strong>) (Bruns, J.)<br />

<strong>Case</strong> No. 104,859<br />

The Church <strong>of</strong> God in Christ, Inc. (COGIC) is a hierarchical denominational church organized by<br />

jurisdictions separately headed by a bishop. The Emmanuel Church <strong>of</strong> God in Christ, Wichita, Kansas, is a<br />

member <strong>of</strong> the COGIC that belongs to the Kansas Southwest Jurisdiction. The Emmanuel Church<br />

purchased real property (Mascot property), which it used to hold worship services and to conduct church<br />

business. After the Emmanuel Church's pastor died, Bishop Joseph C. Gilkey, Sr. temporarily assumed the<br />

pastorate under the terms <strong>of</strong> the COGIC's constitution. Although members <strong>of</strong> the Emmanuel Church<br />

subsequently requested the appointment <strong>of</strong> a specific pastor, Bishop Gilkey appointed someone else. This<br />

caused an immediate dispute and eventually the Emmanuel Church announced its decision to unilaterally<br />

transfer to the Kansas Central Jurisdiction; church members changed the locks to the Mascot property and<br />

attempted to deny Gilkey access to the church building. The COGIC filed a lawsuit seeking an injunction<br />

and further relief. After more than 3 years <strong>of</strong> litigation, the parties entered into a settlement agreement;<br />

shortly thereafter, however, the parties' dispute resumed and the COGIC subsequently filed the present<br />

lawsuit. After the district court entered a temporary injunction, the COGIC filed its first amended petition.<br />

About 3 months later, the COGIC filed a motion for default judgment because the defendants had failed to<br />

file an answer. After a hearing, the district court entered a default judgment and awarded the COGIC<br />

injunctive relief and monetary damages. On appeal, the defendants challenged the district court's order on<br />

several grounds, including contending that the district court improperly entered a default judgment. The<br />

Court <strong>of</strong> Appeals concluded that the district court did not abuse its discretion because it was undisputed that<br />

the defendants did not file an answer nor did they seek leave to file an answer out <strong>of</strong> time, the defendants<br />

did not adequately explain why they failed to file an answer, the failure to answer was not an isolated<br />

15


incident (defendants failed to comply with the rules <strong>of</strong> civil procedure on other occasions), and the<br />

defendants delayed the progression <strong>of</strong> the litigation. The Court <strong>of</strong> Appeals also recognized that the<br />

defendants did not file a motion to set aside the default judgment, and as such, the defendants did not<br />

preserve this issue for appeal. The Court <strong>of</strong> Appeals noted, however, that prior to the adoption <strong>of</strong> the code<br />

<strong>of</strong> civil procedure, the Kansas Supreme Court held that a default judgment could be set aside if it was<br />

clearly erroneous even if no motion to set aside was filed. Although the Court <strong>of</strong> Appeals questioned<br />

whether this rule was still applicable, it found that the default judgment was not clearly erroneous. The<br />

defendants also challenged the district court's order, contending, in part, that the civil courts lacked subject<br />

matter jurisdiction because the issues involved arise out <strong>of</strong> the appointment <strong>of</strong> a pastor. The Court <strong>of</strong><br />

Appeals explained that the jurisdiction <strong>of</strong> civil courts to address matters involving church affairs is limited.<br />

Neither state nor federal courts may undertake the resolution <strong>of</strong> quintessentially religious controversies,<br />

whose resolution the First Amendment commits exclusively to the highest ecclesiastical tribunals <strong>of</strong> the<br />

church. Accordingly, civil courts do not have subject matter jurisdiction over issues relating to the selection<br />

<strong>of</strong> a pastor or minister because the Establishment Clause prohibits the government from such ecclesiastical<br />

decisions. However, when church-related controversies involve civil or property rights, civil courts have<br />

jurisdiction to assure regularity <strong>of</strong> business practices and the right <strong>of</strong> private use and ownership <strong>of</strong> property.<br />

Finding that this case involved a property dispute rather than a dispute over the authority to appoint or call<br />

a pastor, the Court <strong>of</strong> Appeals held that the district court had subject matter jurisdiction, and the Court <strong>of</strong><br />

Appeals had subject matter jurisdiction to consider this appeal. Next, the defendants challenged the district<br />

court's order contending, in part, that the district court should have dismissed the case based on res judicata<br />

and collateral estoppel. Because the defendants failed to come forward with any authority suggesting that<br />

these affirmative defenses were not waived by their failure to file an answer or other responsive pleading,<br />

the Court <strong>of</strong> Appeals concluded that the affirmative defenses <strong>of</strong> res judicata and collateral estoppel were<br />

waived as a matter <strong>of</strong> law. Finally, on appeal, the defendants challenged the district court's order<br />

contending that the default judgment should be reversed because the corporation that holds the title to the<br />

Mascot property was not named as a party. The Court <strong>of</strong> Appeals concluded that the district court could<br />

properly trace or pursue the trust property and award the COGIC control <strong>of</strong> the corporation and the building<br />

without making the corporation a party. The Court <strong>of</strong> Appeals explained that although a local church is<br />

permitted to incorporate under the COGIC rules, incorporation does not change the trust relationship that<br />

exists between the local church and the COGIC. Accordingly, when the defendants decided to create a<br />

corporation and deed the Mascot property to it, they were still required to hold ownership <strong>of</strong> the property in<br />

trust for the national church. Thus, the COGIC continued to be entitled to possession <strong>of</strong> the property<br />

regardless <strong>of</strong> the corporate status <strong>of</strong> the local church. Moreover, the trustee defendants transferred the<br />

property multiple times and formed the corporation in an attempt to avoid their trust obligation to the<br />

COGIC. As such, the district court, as a court <strong>of</strong> equity, was entitled to make such a decree as justice<br />

demands, which includes the imposition <strong>of</strong> a constructive trust and/or application <strong>of</strong> the "trust pursuit rule."<br />

Turner v. Steele<br />

47 Kan. App. 2d 976, 282 P.3d 632 (July 20, <strong>2012</strong>) (Marquardt, J.)<br />

Petition for Review filed Aug. 20, <strong>2012</strong><br />

<strong>Case</strong> No. 105,552<br />

The court stated that a sheriff's deed is sufficient evidence <strong>of</strong> the legality <strong>of</strong> the sheriff's sale and vests title<br />

to the property in the purchaser under K.S.A. 60-2416. A party challenging the validity <strong>of</strong> a sheriff's deed<br />

has the burden <strong>of</strong> proving its invalidity. Thus, the court found that the district court's conclusion that its<br />

order confirming the sheriff's sale did not establish title missed the mark—the confirmation clearly affected<br />

the Landowners' title in a significant manner. Title owners <strong>of</strong> real property have standing to request a delay<br />

<strong>of</strong> the sheriff's sale or a subsequent confirmation <strong>of</strong> the sale because such actions could result in a cloud on<br />

their title or otherwise negatively affect their title to the real property. The court held that the lack <strong>of</strong> the<br />

Landowners' formal intervention did not deprive them <strong>of</strong> standing to seek the relief they were requesting.<br />

The Landowners were not challenging the judgment; they were simply seeking a stay <strong>of</strong> execution <strong>of</strong> the<br />

judgment against their real property until a decision was made whether the judgment was valid against the<br />

real property. The court stated that the Landowners established legitimate grounds to stay the sheriff's sale<br />

16


and the confirmation <strong>of</strong> the sale pending resolution <strong>of</strong> the quiet title action. The court held that the district<br />

court abused its discretion and erred in refusing to stay the sheriff's sale and refusing to rule on the<br />

subsequent requests to stay the confirmation and to extend the redemption period.<br />

DRIVER'S LICENSE REVOCATION<br />

Pratt v. Kansas Department <strong>of</strong> Revenue<br />

___ Kan. App. 2d ___, 296 P.3d 1128 (Feb. 8, 2013) (Arnold-Burger, J.)<br />

<strong>Case</strong> No. 108,204<br />

After arresting Pratt for DUI based on her failure <strong>of</strong> a BAC test, the <strong>of</strong>ficer personally served her with a<br />

DC-27 form, which served, in part, as the notice to Pratt <strong>of</strong> the resulting suspension <strong>of</strong> her driving<br />

privileges required by K.S.A. 2010 Supp. 8-1002(c). The <strong>of</strong>ficer failed, however, to check a box under<br />

paragraph 8 <strong>of</strong> the DC-27 form to certify that personal service, as opposed to service by mail. In her<br />

petition for review <strong>of</strong> the resulting suspension <strong>of</strong> her driving privileges by the Kansas Department <strong>of</strong><br />

Revenue (KDR), Pratt argued the <strong>of</strong>ficer's failure to check the box deprived the KDR <strong>of</strong> jurisdiction. The<br />

district court disagreed and affirmed the suspension <strong>of</strong> Pratt's driving privileges. On review, the Court <strong>of</strong><br />

Appeals held that an <strong>of</strong>ficer's failure to certify the manner <strong>of</strong> service <strong>of</strong> the DC-27 form does not, standing<br />

alone, deprive the KDR <strong>of</strong> jurisdiction to suspend or restrict driving privileges because such certification is<br />

not statutorily required. The Court <strong>of</strong> Appeals also held that when an <strong>of</strong>ficer strictly complies with the<br />

requirements <strong>of</strong> K.S.A. 8-1002, the doctrine <strong>of</strong> substantial compliance is irrelevant. And finally, the Court<br />

<strong>of</strong> Appeals held the record refuted Pratt's arguments that she was prejudiced by the <strong>of</strong>ficer's failure to check<br />

the box.<br />

Shrader v. Kansas Department <strong>of</strong> Revenue<br />

296 Kan. 3, 290 P.3d 549 (Dec. 14, <strong>2012</strong>) (Nuss, C.J.)<br />

<strong>Case</strong> No. 103,176<br />

<strong>Office</strong>rs saw Shrader’s vehicle make a left turn without signaling and they also knew Shrader was driving<br />

on a suspended license. <strong>Office</strong>rs stopped Shrader as he pulled into his driveway. Shrader got out <strong>of</strong> his<br />

vehicle and walked toward his house. <strong>Office</strong>rs detected a moderate smell <strong>of</strong> alcohol on his breath. Shrader<br />

produced an expired license and expired pro<strong>of</strong> <strong>of</strong> insurance. When backup arrived, <strong>of</strong>ficers asked Shrader<br />

to perform field sobriety tests. <strong>Office</strong>rs told him he was not under arrest, but that driving while suspended<br />

in an arrestable <strong>of</strong>fense. Shrader declined field sobriety testing and a PBT. <strong>Office</strong>rs arrested Shrader and at<br />

the station Shrader refused a breath test. KDOR revoked Shrader's driver's license. The district court<br />

affirmed Shrader's suspension. The Court <strong>of</strong> Appeals reversed.<br />

Court affirmed the Court <strong>of</strong> Appeals and held that the plain language <strong>of</strong> K.S.A. 8-1001(b) requires an arrest<br />

for an alcohol-related driving <strong>of</strong>fense rather than simply requiring an arrest for any <strong>of</strong>fense involving<br />

operation <strong>of</strong> a motor vehicle. Court held that under the facts <strong>of</strong> this case, the <strong>of</strong>fense for which defendant<br />

was arrested does not authorize the arresting <strong>of</strong>ficer under K.S.A. 8-1001(b) to request an evidentiary<br />

breath test. Consequently, the defendant's refusal to take the test cannot be the basis for suspending his<br />

driving privileges under K.S.A. 8-1014(a), and they must be reinstated.<br />

DRIVER'S LICENSE SUSPENSION<br />

Byrd v. Kansas Dept. <strong>of</strong> Revenue<br />

295 Kan. 900, 287 P.3d 232 (Oct. 26, <strong>2012</strong>) (Luckert, J.)<br />

<strong>Case</strong> No. 101,189<br />

The Supreme Court held that by enacting K.S.A. 2011 Supp. 8-1002(c), which requires a law enforcement<br />

<strong>of</strong>ficer to serve a notice <strong>of</strong> driver's license suspension by mailing the notice to the driver, the Kansas<br />

Legislature intended to give the <strong>of</strong>ficer the responsibility <strong>of</strong> ensuring that the notice was mailed. The<br />

legislature did not intend that the <strong>of</strong>ficer must physically perform the acts <strong>of</strong> addressing, stamping, and<br />

17


DRUG TAX<br />

placing the envelope containing the notice in a receptacle for mail pickup. The Court conducted a statutory<br />

interpretation analysis to reach its conclusion, finding that the word "mailing" was ambiguous and<br />

following the canon <strong>of</strong> construction requiring it to construe a statute in a reasonable manner. In this case, an<br />

Atchison County Sheriff's <strong>of</strong>ficer ensured mailing by following the sheriff's standard operating procedure<br />

for mailing the notice.<br />

Sloop v. Kansas Dept. <strong>of</strong> Revenue<br />

296 Kan. 13, 290 P.3d 555 (Dec. 14, <strong>2012</strong>) (Nuss, C.J.)<br />

<strong>Case</strong> No. 103,334<br />

After watching Kenneth Sloop make a hesitant left-hand turn during which he was "sitting unusually close<br />

to his steering wheel," police <strong>of</strong>ficer Cris Bergerh<strong>of</strong>er followed Sloop for 8 to 10 blocks. Although Sloop<br />

committed no traffic infractions, Bergerh<strong>of</strong>er stopped him because Sloop's tag light was out. Sloop said he<br />

had consumed one beer; Bergerh<strong>of</strong>er smelled alcohol and saw that Sloop's eyes were watery and bloodshot.<br />

Bergerh<strong>of</strong>er performed a preliminary breath test, after which he arrested Sloop and took him to the station<br />

for field sobriety tests, on which Sloop showed only three clues <strong>of</strong> impairment. Sloop then refused to take<br />

the requested evidentiary breath test and the Kansas Department <strong>of</strong> Revenue suspended his driver's license.<br />

On appeal, the district court and the Court <strong>of</strong> Appeals both affirmed the suspension. In order to request an<br />

evidentiary breath test, (1) Bergerh<strong>of</strong>er needed reasonable grounds to believe Sloop was operating his<br />

vehicle under the influence <strong>of</strong> alcohol or drugs or both and (2) Sloop must have been arrested or otherwise<br />

taken into custody for an <strong>of</strong>fense involving such illegal operation. The Supreme Court held that in order to<br />

satisfy the second requirement, the arrest must be lawful. Explicitly disapproving language used by the<br />

Court <strong>of</strong> Appeals defining probable cause as information that "leads a reasonable <strong>of</strong>ficer to believe that<br />

guilt is more than a possibility," the Supreme Court found that Bergerh<strong>of</strong>er did not have probable cause to<br />

support his warrantless arrest <strong>of</strong> Sloop; therefore, his subsequent request that Sloop take an evidentiary<br />

breath test was improper. Accordingly, because the driver's license suspension was based on Sloop's refusal<br />

to take the test, the suspension was invalid and the Supreme Court reversed and reinstated Sloop's driving<br />

privileges.<br />

In Re Tax Appeal <strong>of</strong> Burch<br />

___Kan. ___, 294 P.3d 1155 (Feb. <strong>22</strong>, 2013) (Moritz, J.)<br />

<strong>Case</strong> No. 102,354<br />

Burch’s motor home was pulled over for no license tag, but then the <strong>of</strong>ficer noticed a temporary tag in the<br />

window. <strong>Office</strong>r asked for the driver’s license and registration. The temporary tag identified Burch, a<br />

passenger, as the owner. When a passenger opened the door to find the VIN number, <strong>of</strong>ficers saw an open<br />

alcoholic beverage and then once inside the motor home found drugs, drug paraphernalia and $15,000 in<br />

cash. Burch was charged with drug crimes, but the district court suppressed all the evidence from the stop<br />

finding that once the <strong>of</strong>ficer had information that the temporary tag was legal, there was no reasonable<br />

suspicion to extend the stop. One week after the district court dismissed Burch’s criminal charges, the<br />

Kansas Department <strong>of</strong> Revenue issued a tax assessment notice indicating that Burch owed $17,761 in taxes<br />

and penalties on the drugs found in the motor home. The Court <strong>of</strong> Tax Appeals rejected Burch’s argument<br />

that the exclusionary rule applied to the unlawfully seized drugs and would thus invalidate the tax<br />

assessment. COTA granted summary judgment to KDOR and allowed collection <strong>of</strong> the taxes.<br />

Court held the COTA erroneously determined that K.S.A. 79-5205(b) precluded it from considering<br />

application <strong>of</strong> the exclusionary rule to the Director's assessment <strong>of</strong> taxes against Burch. Based on this<br />

erroneous conclusion, COTA improperly granted summary judgment to KDOR, disregarding Burch's<br />

factual arguments. Therefore, Court remanded the case to COTA to consider application <strong>of</strong> the<br />

exclusionary rule to the circumstances <strong>of</strong> this case. Court stated it was unclear from the record whether<br />

Burch had an adequate opportunity to conduct discovery on the issue <strong>of</strong> application <strong>of</strong> the exclusionary<br />

18


ule. Thus, on remand, COTA must first determine the scope and duration <strong>of</strong> additional discovery, if any.<br />

Once any additional discovery is completed, COTA should determine whether the tax assessment<br />

proceeding was within the <strong>of</strong>ficer's zone <strong>of</strong> primary interest at the time <strong>of</strong> the Fourth Amendment violation.<br />

If so, COTA must then consider whether the deterrent benefits <strong>of</strong> suppression outweigh its heavy costs.<br />

DUE PROCESS<br />

Friedman v. Kansas State Board <strong>of</strong> Healing Arts<br />

___ Kan. ___, 294 P.3d 287 (Feb. 15, 2013) (per curiam)<br />

<strong>Case</strong> No. 102,921<br />

On appeal, Dr. Friedman seeks the reversal <strong>of</strong> an order <strong>of</strong> the Kansas State Board <strong>of</strong> Healing Arts (Board)<br />

in which the Board revoked his license to practice medicine and surgery in the state <strong>of</strong> Kansas. Friedman<br />

presents several issues, including whether the Board had jurisdiction to initiate a revocation proceeding<br />

after Friedman's license expired, whether the Board denied him due process, and whether there was<br />

substantial evidence to support the Board's findings. Our Supreme Court held the Board had jurisdiction to<br />

revoke Friedman's license to practice medicine and surgery because Friedman was practicing medicine<br />

under the authority <strong>of</strong> a license issued by the Board when he committed the misconduct at issue in the<br />

revocation proceeding. Our Court also rejected Friedman's other arguments, concluding he effectively<br />

abandoned a due process argument by failing to adequately brief it and he failed to establish a lack <strong>of</strong><br />

substantial evidence to support the administrative hearing <strong>of</strong>ficer's initial order and the Board's final order.<br />

The Court then affirmed the Board's order and the district court's decision upholding that order.<br />

In re Marriage <strong>of</strong> Hutchison<br />

47 Kan. App. 2d 851, 281 P.3d 1126 (<strong>June</strong> 29, <strong>2012</strong>) (Arnold-Burger, J.)<br />

<strong>Case</strong> No. 106,292<br />

The court held that a weighing <strong>of</strong> the three Mathews, 424 U.S. 319, due process factors leads to the<br />

conclusion that when the case manager's recommendations materially affect a parent's right to the care,<br />

custody, and control <strong>of</strong> a child and the case manager's report relies upon material facts that are either not<br />

supported by specific factual references or are specifically disputed by a parent, due process requires that<br />

the district court conduct an evidentiary hearing prior to ruling on the recommendations. The court<br />

recognized that although this holding may result in courts having busier dockets, the information received<br />

at such a hearing will aid the courts in deciding whether the case manager's recommendations are in the<br />

best interests <strong>of</strong> the child and insure that due process, one <strong>of</strong> the most sacred and essential constitutional<br />

guarantees, is provided to the parties. The court also found that the failure to timely file a motion requesting<br />

that the trial judge recuse himself or herself from the proceedings below bars the party from raising the<br />

issue on appeal.<br />

Village Villa v. Kansas Health Policy Authority<br />

296 Kan. 315, 291 P.3d 1056 (Jan. 11, 2013) (Biles, J.)<br />

<strong>Case</strong> No. 102,324<br />

Three corporations, each <strong>of</strong> which owns a nursing home facility, want their Medicaid reimbursement rates<br />

recalculated because they believe there was a change <strong>of</strong> ownership authorizing the adjustments. The Kansas<br />

Department on Aging (KDOA) and Kansas Health Policy Authority (KHPA) denied recalculation because<br />

<strong>of</strong> common ownership between the buyers and sellers, which they determined barred the rate changes. On<br />

review, the district court agreed. Court held there is factual support for KHPA's action. Village Villa<br />

conceded the three corporations that purchased the nursing facilities were solely owned by Goracke and<br />

that he previously owned 20 percent <strong>of</strong> the corporations that sold the nursing facilities to the three<br />

purchasing companies. Court denied Village Villa's equal protection claim stating that the commonownership<br />

classification <strong>of</strong> K.A.R. 30-10-1a(a)(9) bears a reasonable relationship to a valid legislative<br />

purpose <strong>of</strong> controlling Medicaid coasts. As far as the due process/vagueness argument, court found the<br />

19


pertinent part <strong>of</strong> K.A.R. 30-10-la(a)(36)(C) states: "Related parties shall include parties related by family,<br />

business, or financial association, or by common ownership or control." These are commonly used words.<br />

Village Villa failed to elaborate as to why it argues vagueness other than its bald allegation that the<br />

regulation is vague. Without any substance behind it, Court deemed the argument to be abandoned.<br />

ECONOMIC LOSS DOCTRINE<br />

Coker v. Siler<br />

___ Kan. App. 2d ___, ___ P.3d ___, 2013 WL 1850756 (<strong>May</strong> 3, 2013)<br />

(Standridge, J.)<br />

<strong>Case</strong> No. 107,696<br />

After Coker's new home was damaged, he filed a lawsuit for breach <strong>of</strong> express warranty against the<br />

company that sold him the house and for negligence against the plumber whose act caused the damage. The<br />

district court ultimately dismissed Coker's claim <strong>of</strong> negligence against the plumber based on the economic<br />

loss doctrine, which, as it existed under Kansas law at the time, barred a homeowner from bringing a tort<br />

action under circumstances governed by contract where the only damages claimed are economic losses.<br />

However, a subsequent Kansas Supreme Court ruling refused to extend the economic loss doctrine to<br />

homeowner claims against construction contractors. Thus, the Court <strong>of</strong> Appeals held that the economic loss<br />

doctrine did not preclude Coker from seeking economic damages from the plumber for negligently<br />

performed residential construction services. However, it noted Coker's tort claims would survive only if he<br />

could establish that the plumber owed him a duty imposed by law to perform his services free from<br />

negligence. Because there was no evidence <strong>of</strong> an underlying agreement between Coker and the plumber,<br />

the court found Coker's claim that the plumber breached a duty under an implied warranty failed. However,<br />

the court found the plumber owed Coker a legal duty to perform plumbing services without negligently<br />

causing economic injury to third parties. Noting that the district court had found Coker <strong>of</strong>fered sufficient<br />

evidence to present a question <strong>of</strong> fact, the Court <strong>of</strong> Appeals reversed and remanded so that Coker could go<br />

forward with his tort claim against the plumber.<br />

EMINENT DOMAIN AND INVERSE CONDEMNATION<br />

City <strong>of</strong> Wichita v. Denton and Clear Channel Outdoor, Inc.<br />

296 Kan. 244, 294 P.3d 207 (Jan. 4, 2013) (Per Curiam)<br />

<strong>Case</strong> No. 97,952<br />

City <strong>of</strong> Wichita brought eminent domain proceedings to condemn landowner's real property for highway<br />

purposes. Billboard Company had leased from landowner approximately 500 square feet <strong>of</strong> the property for<br />

the operation <strong>of</strong> a billboard. Appraiser valued entire tract at $1,075,600 with no compensation given for the<br />

billboard structure and with no consideration as to the advertising income produced by billboard company's<br />

leasehold. Billboard company appealed appraisers value to district court. District court granted summary<br />

judgment in favor <strong>of</strong> City, affirming appraiser's award. On direct appeal to the Supreme Court, billboard<br />

company argued that the sign structure was a leasehold improvement destroyed by the taking rather than<br />

merely noncompensable personal property. In the alternative, even if the sign structure was only personal<br />

property, billboard company argued that the sign structure's value was relevant to overall value <strong>of</strong> the tract<br />

because lost rental income from it was the direct result <strong>of</strong> the leasehold location. Billboard company also<br />

argued that the value <strong>of</strong> the leasehold for advertising purposes was relevant because it enhanced the value<br />

<strong>of</strong> the property as a whole. The Supreme court affirmed, finding that the district court did not err in<br />

granting the City's motion for summary judgment because billboard company did not come forward with<br />

relevant and admissible evidence that could alter the appraiser' valuation <strong>of</strong> the land at issue. The Supreme<br />

Court reasoned that summary judgment in City's favor was proper because even though some <strong>of</strong> the<br />

structural components were or would be destroyed upon removal, the sign structure retained its character as<br />

mere personality or a trade fixture.<br />

20


Miller v. Preisser<br />

295 Kan. 356, 284 P.3d 290 (Aug. 31, <strong>2012</strong>) (Luckert, J.)<br />

<strong>Case</strong> No. 103,938<br />

Landowners appealed from a damages award in an eminent domain action. The Kansas Supreme Court<br />

reversed to allow landowner to present evidence related to the doctrine <strong>of</strong> assemblage, which is a theory <strong>of</strong><br />

valuation that allows consideration <strong>of</strong> condemned property as an integrated economic unit with an adjacent<br />

property. The court held that pro<strong>of</strong> <strong>of</strong> unity <strong>of</strong> ownership is unnecessary to use that doctrine to establish the<br />

highest and best use <strong>of</strong> the property; rather, the landowner must establish that there is a reasonable<br />

probability <strong>of</strong> joinder <strong>of</strong> the properties, which is a jury question. The court cautioned, however, that while<br />

landowners can present evidence regarding use <strong>of</strong> their property as an integrated economic unit with<br />

adjacent property, they cannot seek damages related to the impact on the value <strong>of</strong> the adjacent property.<br />

The court upheld the district court's ruling that damages could not be realized based on a change <strong>of</strong> traffic<br />

patterns. This is because the condemned property had the same direct access to the abutting roadway before<br />

and after the condemnation, and a change in the traffic pattern is not a compensable loss. The court further<br />

held that it and the district court lacked jurisdiction in an eminent domain action to consider landowners'<br />

challenge to reasonableness <strong>of</strong> the government's exercise <strong>of</strong> its police power in regulating traffic flow<br />

because if the government's action was unreasonable, it is a void action, not a compensable taking.<br />

EMPLOYMENT LAW<br />

Milano's, Inc. v. Kansas Dept. <strong>of</strong> Labor, Contributions Unit<br />

___ Kan. ___, 293 P.3d 707 (Feb. 1, 2013) (Beier, J.)<br />

<strong>Case</strong> No. 102,114<br />

After Milano's, Inc., purchased Club Orleans , it began treating the club's exotic dancers as independent<br />

contractors rather than employees. A dancer filed an unemployment claim and the auditor assigned by the<br />

Unemployment Tax Contributions Unit <strong>of</strong> the Kansas Department <strong>of</strong> Labor concluded that the dancers<br />

were employers under K.S.A. 44-703(i)(3)(D), which states that "employment" also includes "services<br />

performed by an individual for wages" unless certain exceptions are met. Milano's challenged the<br />

determination, but a Department <strong>of</strong> Labor hearing <strong>of</strong>ficer determined that the dancers' tips qualified as<br />

wages and therefore, under the same statutory subsection, the dancers were employees. On further appeal,<br />

the district court agreed with the hearing <strong>of</strong>ficer and the Court <strong>of</strong> Appeals affirmed the district court. The<br />

Kansas Supreme Court found it unnecessary to perform the analysis under K.S.A. 44-703(i)(3)(D) because<br />

the more direct and straightforward analysis pursuant to K.S.A. 44-703(i)(1)(B) answered the question <strong>of</strong><br />

whether the dancers were employees or independent contractors. The Court held that the exotic dancers<br />

were employees under the common law rules expressly incorporated into K.S.A. 44-703(i)(1)(B); the Court<br />

further stated that the critical common-law factor was the club's right <strong>of</strong> control over the dancers and their<br />

work.<br />

EQUAL PROTECTION<br />

See also, Village Villa v. Kansas Health Policy Authority, 296 Kan. 315, 291 P.3d 1056<br />

(Jan. 11, 2013) (Biles, J.) (Due Process)<br />

EXCLUSIONARY RULE<br />

See also, In Re Tax Appeal <strong>of</strong> Burch, ___Kan. ___, 294 P.3d 1155, No. 102,354 (Feb.<br />

<strong>22</strong>, 2013) (Moritz, J.) (Drug Tax)<br />

21


FAMILY LAW<br />

In re Marriage <strong>of</strong> Taber<br />

47 Kan. App. 2d 841, 280 P.3d 234 (<strong>June</strong> 29, <strong>2012</strong>) (Arnold-Burger, J.)<br />

Petition for Review filed July 20, <strong>2012</strong><br />

<strong>Case</strong> No. 105,9<strong>22</strong><br />

The court held that lump-sum SSDI benefits for back benefits received by Mother on behalf <strong>of</strong> her minor<br />

child because <strong>of</strong> Father's disability may be credited toward Father's child support arrearage that<br />

accumulated during the months covered by the lump-sum payments.<br />

In re Marriage <strong>of</strong> Merrill<br />

47 Kan. App. 2d 943, 281 P.3d 559 (July 6, <strong>2012</strong>) (Marquardt, J.)<br />

<strong>Case</strong> No. 106,707<br />

The court stated that the district court should not rubber stamp a request for costs and pr<strong>of</strong>essional fees<br />

against a party who objects to a case manager's recommendation. The court held that the district court must<br />

make findings as to the reasonableness <strong>of</strong> the charges, taking into consideration whether the fees were<br />

incurred for services involving custody decisions or whether they were incurred for reassignment or<br />

withdrawal <strong>of</strong> the case manager. The court held that because a motion to withdraw is not advancing the<br />

statutorily defined role <strong>of</strong> case manager, a case manager's time spent preparing a motion to withdraw as<br />

case manager and time spent defending against a motion to reassign the case manager are not appropriate<br />

bases for assessing fees to either party. The district court's assessment <strong>of</strong> costs and fees against Merrill<br />

constituted an abuse <strong>of</strong> judicial discretion. The case was remanded to the district court for a determination<br />

<strong>of</strong> the amount <strong>of</strong> fees appropriately attributable to the case manager's role and not the time spent in<br />

justifying his continued employment as the case manager. The court remanded the case to a different<br />

district court judge; affirmed the district court's decision on the case manager's motion to withdraw;<br />

reversed the district court's denial <strong>of</strong> the motion to assign a new case manager; charged the district court<br />

with determining whether a case manager is necessary, and if a case manager is required, appoint a<br />

different case manager; and vacated the fee award with instructions to hold an evidentiary hearing for the<br />

purpose <strong>of</strong> determining the amount, if any, <strong>of</strong> the case manager's billable time and whether it was<br />

legitimately based on his role as a case manager.<br />

In re Marriage <strong>of</strong> Hall<br />

295 Kan. 776, 286 P.3d 210 (Oct. 5, <strong>2012</strong>) (Luckert, J.)<br />

<strong>Case</strong> No. 101,834<br />

At a hearing in a divorce proceeding, the wife asked the court to order the husband to cooperate with her<br />

efforts to obtain a life insurance policy on the husband—which she would pay for—as security for the<br />

payment <strong>of</strong> any maintenance or child support the court would order the husband to pay. The husband<br />

objected to the request, arguing the court lacked jurisdiction to enter the order, but the district court ordered<br />

the husband to cooperate with the wife's attempts to obtain the life insurance. The Court <strong>of</strong> Appeals<br />

affirmed the district court's order. On review, the Supreme Court reversed, holding that a district court<br />

cannot issue such an order because the order would be contrary to public policy as expressed by the Kansas<br />

Legislature in K.S.A. 40-453(a). The statute provides that an insurable interest does not exist if a person<br />

whose life is insured makes a written request for the termination or nonrenewal <strong>of</strong> the policy.<br />

See also, Frazier v. Goudschaal, ___ Kan. ___, 295 P.3d 542 (2013) (Feb. <strong>22</strong>, 2013)<br />

(Johnson, J.) (Coparenting Agreement); In re Marriage <strong>of</strong> Hutchison, 47 Kan. App. 2d<br />

851, 281 P.3d 1126 (<strong>June</strong> 29, <strong>2012</strong>) (Arnold-Burger, J.) (Due Process)<br />

<strong>22</strong>


FOREIGN JUDGMENTS<br />

FRAUD<br />

Master Finance Co. <strong>of</strong> Texas v. Pollard<br />

47 Kan. App. 2d 820, 283 P.3d 817 (<strong>June</strong> <strong>22</strong>, <strong>2012</strong>) (Arnold-Burger, J.)<br />

<strong>Case</strong> No. 106,673<br />

Master Finance Co. <strong>of</strong> Texas (Master Finance) and Kim Pollard entered into a payday loan contract. Master<br />

Finance loaned Pollard $100 with a 199.91% interest rate. Pollard defaulted on the loan payment, and<br />

Master Finance filed a lawsuit in Missouri against Pollard. When Pollard failed to answer or appear, Master<br />

Finance was granted a default judgment against Pollard in Missouri, with the postjudgment interest rate set<br />

at the contract rate—199.91%. Later, the Missouri judgment was filed in Kansas as a foreign judgment.<br />

Master Finance requested an order for wage garnishment, which was granted. Pollard objected to the wage<br />

garnishment. After a hearing, the district court adjusted the postjudgment interest rate to the Kansas<br />

statutory interest rate, ordered the parties to enter into a voluntary withholding order, and ordered Master<br />

Finance to release the wage garnishment. The court stated that Pollard failed to allege any exemption<br />

recognized under Kansas law. Likewise, she failed to present any evidence at the hearing entitling her to an<br />

exemption under Kansas law. The court held that the district court abused its discretion by essentially<br />

creating its own exemption. The court compared Pollard's income and expenses and determined that she<br />

could not afford the garnishment <strong>of</strong> 25% <strong>of</strong> her disposable income. But the Kansas garnishment statutes do<br />

not allow for any consideration <strong>of</strong> the debtor's actual expenses. Calculation <strong>of</strong> the garnishment amount is<br />

based solely upon the debtor's income. Therefore, the district court's decision fell outside the statutory<br />

framework. The result was the quashing <strong>of</strong> a garnishment that complied with all legal requirements.<br />

Likewise, the district judge lacked the statutory authority to order the judgment debtor to complete a<br />

"voluntary" withholding order, and the court lacked the authority to order Master Finance to release its<br />

garnishment and accept less money per Pollard's pay period than it was entitled to under the law. The court<br />

also held that because the Missouri judgment includes the applicable interest rate in the judgment itself,<br />

there is no conflict and the judgment as a whole, including the postjudgment interest rate, must be given<br />

full faith and credit. The court agreed that the facts <strong>of</strong> this case cry out for equitable relief. But any<br />

challenge to the Missouri judgment must be raised before the Missouri courts and not in a collection action<br />

in this state.<br />

See also, Kincaid v. Dess, ___ Kan. App. 2d ___, 298 P.3d 358, <strong>Case</strong> No. 107,970 (Mar.<br />

8, 2013) (Green, J.) (Contracts)<br />

INDEMNITY FOR ATTORNEY FEES IN ACTIONS INVOLVING LIMITED<br />

LIABILITY COMPANIES<br />

Davis v. Winning Streak Sports, LLC<br />

___ Kan. App. 2d ___, ___ P.3d ___ , 2013 WL 10106<strong>22</strong> (Mar. 15, 2013)<br />

(McAnany, J.)<br />

<strong>Case</strong> No. 107,613<br />

In 2006, Christopher J. Davis sued Winning Streak Sports, LLC (WSS), claiming breach <strong>of</strong> fiduciary duty<br />

and asserting that he was a 49% member in WSS. WSS countersued, claiming that Davis had breached his<br />

contract with WSS. A jury awarded Davis $600,000 in damages and found he was a member <strong>of</strong> WSS. The<br />

jury also determined that Davis had breached his contract with WSS and awarded WSS about $75,000 in<br />

damages. Following the jury trial, the district court took up the competing declaratory judgment claims and<br />

determined that Davis had a .96% membership interest in WSS. WSS appealed the $600,000 jury verdict,<br />

and Davis cross-appealed the district court's declaratory judgment. The Court <strong>of</strong> Appeals rejected both<br />

23


claims <strong>of</strong> error, and the Kansas Supreme Court denied further review. Davis then brought an<br />

indemnification action against WSS, seeking attorney fees under K.S.A. 17-7670(b). The statute governs<br />

indemnification in actions involving limited liability companies. The parties filed cross-motions for<br />

summary judgment, and the district court found that Davis was not entitled to attorney fees because he was<br />

only nominally successful in his suit against WSS. The Court <strong>of</strong> Appeals reserved, finding that K.S.A. 17-<br />

7670(b) provides a right to indemnity to the extent that "a member . . . has been successful on the merits or<br />

otherwise." Noting this language, the Court <strong>of</strong> Appeals held that Davis was entitled to an award <strong>of</strong> attorney<br />

fees that was proportionate to his success in the litigation against WSS. K.S.A. 17-7670(b) is mandatory; it<br />

declares that indemnity shall be provided when the party making a claim for indemnity "has been<br />

successful on the merits or otherwise." The Court <strong>of</strong> Appeals held that while the award <strong>of</strong> fees is<br />

mandatory, the district court has discretion determine the amount <strong>of</strong> fees awarded.<br />

INEFFECTIVE ASSISTANCE OF COUNSEL<br />

Edgar v. State<br />

294 Kan. 828, 283 P.3d 152 (July 27, <strong>2012</strong>) (Luckert J.) (Johnson, J., dissenting)<br />

<strong>Case</strong> No. 100,477<br />

A jury convicted Edgar <strong>of</strong> felony murder and two counts <strong>of</strong> child abuse. Approximately 1 year after the<br />

court affirmed Edgar's convictions, Edgar filed a K.S.A. 60-1507 motion, raising five main issues and<br />

multiple sub-issues. The district court summarily rejected Edgar's 1507 motion. The Court <strong>of</strong> Appeals<br />

stated that due to the summary denial <strong>of</strong> Edgar's motion, there was no evidence from which the court could<br />

determine whether defense counsel's statements constituted a concession <strong>of</strong> guilt and, if so, whether this<br />

was an objectively reasonable trial strategy. The court reversed the summary denial <strong>of</strong> this issue and<br />

remanded for "an evidentiary hearing to determine whether trial counsel's comment was a concession <strong>of</strong><br />

guilt during [trial] and, if so, whether it was an objectively reasonable trial strategy. [Citation omitted.]"<br />

The court affirmed the district court judge's decision on all other issues. The Kansas Supreme Court held<br />

that before remanding the case for an evidentiary hearing, the Court <strong>of</strong> Appeals should have assumed<br />

defense counsel's performance was deficient and then examined whether the district court judge erred in<br />

concluding that "[g]iven the overwhelming evidence in this case and the nature <strong>of</strong> the crimes, the Court<br />

cannot conclude that trial counsel was ineffective for making these statements or concessions or that a<br />

different approach would have changed the outcome as required by Chamberlain." The Court stated that<br />

had the Court <strong>of</strong> Appeals conducted that review, it would have undertaken a de novo review to determine if<br />

the motion, files, and records <strong>of</strong> the case conclusively showed that Edgar failed to establish a reasonable<br />

probability that, but for defense counsel's errors, the outcome <strong>of</strong> his trial would have been different. Court<br />

concluded that defense counsel's concessions or proposed compromises did not contradict the defense but<br />

actually continued the theme <strong>of</strong> the defense. A reasonable jury could have found Edgar guilty beyond a<br />

reasonable doubt. The Kansas Supreme Court affirmed the district court's denial <strong>of</strong> Edgar's 1507 motion.<br />

The dissent asserted that there is no logical difference between this case and State v. Carter, 270 Kan. 426.<br />

Both defendants pled not guilty to all charges against them and both defense attorneys told the jury their<br />

clients were guilty <strong>of</strong> some <strong>of</strong> the charges. Both defendants possessed a fundamental right to decide how to<br />

plead, which rights their attorneys were not entitled to unilaterally waive. The dissent would have reversed<br />

and remanded.<br />

Shumway v. State<br />

48 Kan. App. 2d 290, 293 P.3d 772 (Jan. 18, 2013) (Green, J.)<br />

Petition for Review file Feb. 15, 2013<br />

<strong>Case</strong> No. 107,248<br />

Defendant was convicted <strong>of</strong> intentional second-degree murder and attempted theft. his convictions were<br />

affirmed on direct appeal. Later, defendant filed a habeas corpus motion under K.S.A. 60-1507 (60-1507)<br />

alleging that he had received ineffective assistance <strong>of</strong> counsel. After an evidentiary hearing, the district<br />

24


court denied the 60-1507 motion. On appeal, defendant argued that the district court erred (1) when it<br />

concluded that defense counsel's decision not to call two alibi witnesses was reasonable trial strategy and<br />

(2) when it concluded that defendant's remaining ineffective assistance <strong>of</strong> counsel claims should be<br />

dismissed because defendant had failed to show manifest injustice. The court <strong>of</strong> appeals reversed<br />

defendant's convictions and remanded for a new trial. The court <strong>of</strong> appeals reasoned that defense counsel's<br />

decision not to call two alibi witnesses could not be approved as a matter <strong>of</strong> trial strategy because defense<br />

counsel had no other witnesses who could have established defendant's innocence. Moreover, defense<br />

counsel failed to investigate a disinterested witness with no reason to lie for defendant, who would have<br />

testified that the victim was with her, alive and well, both during and well past the time the State's witness<br />

claimed that the victim was beaten to death by defendant, was unreasonable. Because the evidence that<br />

defense counsel failed to present could have caused reasonable doubt in the minds <strong>of</strong> jurors, failure to<br />

present this evidence was prejudicial to defendant's theory <strong>of</strong> defense. In other words, the court <strong>of</strong> appeals<br />

believed that the inconsistent statements and credibility problems <strong>of</strong> the State's key witnesses coupled with<br />

the possible favorable testimony from uncalled witnesses would have cast doubt on the State's case. The<br />

court also held that the district court erred when it found that the claims in defendant's amended motion<br />

were untimely because there was nothing to bar defendant's amended claims from relating back to his<br />

original 60-1507 motion.<br />

INSURANCE<br />

Riley v. Allstate Insurance Co.<br />

48 Kan. App. 2d 60, 281 P.3d 591 (Aug. 3, <strong>2012</strong>) (Greene, C.J.)<br />

<strong>Case</strong> No. 106,817<br />

The district court's summary judgment in favor <strong>of</strong> Allstate was affirmed for different reasons. K.S.A. 40-<br />

3109(a)(3) is more applicable in this case than K.S.A. 40-3109(b). Where a single insurer has written<br />

separate automobile policies for both the automobile owner and the person injured while occupying the<br />

vehicle, the injured person may not stack PIP coverage under both policies.<br />

Gold Mine Investments, Inc. d/b/a Gold Realty v. Mount Vernon Fire Insurance Co.<br />

and Med James, Inc.<br />

___ Kan. App. 2d ___, ___ P.3d ___, 2013 WL 1694796 (Apr. 15, 2013)<br />

(McAnany, J.)<br />

<strong>Case</strong> No. 108,390<br />

Appellant Gold Realty filed a claim for fire coverage with its insurance company, Defendant Mount<br />

Vernon Fire Insurance Company, after a commercial building it owned was destroyed by fire. Mount<br />

Vernon denied coverage, claiming that Gold Realty breached a clause in the insurance policy by having<br />

both a fuse box and circuit breakers protecting the electrical service in the building. The language <strong>of</strong> the<br />

policy stated: "All Electric is on Functioning and Operational Circuit Breakers." Mount Vernon argued that<br />

the policy stated the building's electrical circuits had to be protected by circuit breakers to the exclusion <strong>of</strong><br />

any fuses. The district court granted summary judgment in Mount Vernon's favor, and Gold Realty<br />

appealed. The Court <strong>of</strong> Appeals reversed the district court's order <strong>of</strong> summary judgment, finding that the<br />

record did not resolve whether the electrical system violated the policy. The Court noted that the test for<br />

determining the meaning <strong>of</strong> an insurance policy is what a reasonable person in the position <strong>of</strong> the<br />

policyholder would understand the language to mean. Applying this test, the Court held that "[a] reasonable<br />

policyholder would not read the language <strong>of</strong> the policy as prohibiting the use <strong>of</strong> fuses." The Court reversed<br />

the order <strong>of</strong> summary judgment, stating that it was unwilling to read into the policy a new provision that<br />

required no fuses in any electrical circuit serving the building. The case was remanded to the district court<br />

for further proceedings.<br />

25


INVOLUNTARY CIVIL COMMITMENT<br />

In the Matter <strong>of</strong> the Care and Treatment <strong>of</strong> Timothy J. Burch<br />

296 Kan. 215, 291 P.3d 78 (Dec. 28, <strong>2012</strong>) (Moritz, J.)<br />

<strong>Case</strong> No. 102,468<br />

Burch had been involuntarily civilly committed as a sexually violent predator when he petitioned the<br />

district court for a transitional release. The district court denied Burch's petition finding that there was no<br />

probable cause under K.S.A. 59-29a08(c)(1) and (2). The Court <strong>of</strong> Appeals affirmed the district court's<br />

decision. Burch then appealed to our Supreme Court. First, our Supreme Court held that a de novo standard<br />

<strong>of</strong> review applies to a district court's probable cause determination under K.S.A. 59-29a08(c)(1). Next, our<br />

Supreme Court held the petitioner, Burch, has the burden <strong>of</strong> pro<strong>of</strong> and that the facts should be viewed in a<br />

light most favorable to the petitioner. Finally, our Supreme Court held that Burch failed to establish the<br />

requisite probable cause to entitle him to a full evidentiary hearing on his petition for transitional release<br />

under K.S.A. 59-29a08. The Court held that Burch failed to show probable cause that his mental<br />

abnormality or personality disorder had changed to the extent that he was safe to be placed in transitional<br />

release.<br />

JURIES AND INSTRUCTIONS<br />

Foster v. Klaumann<br />

296 Kan. 295, 294 P.3d <strong>22</strong>3 (Jan. 11, 2013) (Biles, J.) (Jerome P. Hellmer,<br />

District Judge, assigned vice Justice Moritz)<br />

<strong>Case</strong> No. 100,286<br />

Plaintiffs, a minor child and her parents, sued defendant, a pediatric orthopedic surgeon, for medical<br />

malpractice after the minor child suffered nerve damage following surgery to remove tumors from her<br />

bones. The jury returned a verdict in favor <strong>of</strong> defendant. The Court <strong>of</strong> Appeals reversed, finding that the<br />

jury instructions reasonably could have misled the jury. The Supreme Court granted defendant's petition for<br />

review to consider two issues: (1) whether it was error to instruct the jury on both a general physician<br />

standard <strong>of</strong> care (PIK Civ. 4th 123.01) and a specialist standard <strong>of</strong> care (PIK Civ. 4th 123.12) when the<br />

only trial evidence established the standard <strong>of</strong> care <strong>of</strong> a specialist; and (2) whether the "best judgment"<br />

instruction (PIK Civ. 4th 123.11) improperly suggests that a physician's subjective beliefs should be<br />

considered when establishing negligence because it states the physician has a right to use his or her best<br />

judgment when determining the course <strong>of</strong> treatment. The Supreme Court reversed the Court <strong>of</strong> Appeals and<br />

affirmed the district court, holding: (1) it was harmless error to instruct on both a general physician and<br />

specialist standard <strong>of</strong> care because the two instructions were not inconsistent where the only standard <strong>of</strong><br />

care evidence presented was that <strong>of</strong> a specialist; and (2) the "best judgment" instruction as a whole did not<br />

misstate the law where it also referred to an objective standard <strong>of</strong> care and the instruction was factually<br />

supported because plaintiffs claimed that defendant erred in choosing one <strong>of</strong> multiple acceptable treatment<br />

options.<br />

JURISDICTION<br />

The S & T Telephone Co-op. Assoc., Inc. v. KCC<br />

48 Kan. App. 2d 290, 291 P.3d 490 (Nov. 2, <strong>2012</strong>) (Leben, J.)<br />

<strong>Case</strong> No. 108,411<br />

The Kansas Corporation Commission (KCC) ordered S&T Telephone Cooperative to provide information<br />

that would be used to determine future payments to the company from the Kansas Universal Service Fund,<br />

and the telephone company provided some <strong>of</strong> that information. When the KCC failed to take further action<br />

within 30 days, the telephone company moved for an order directing increased support from the service<br />

26


fund based on the information the company had provided. The telephone company sought to apply a<br />

deadline found in K.S.A. 66-117(c), a Kansas statute that comes into play when a common carrier or utility<br />

has applied for some change in rates or charges. But the KCC denied the motion because it said that the<br />

telephone company had made no application under K.S.A. 66-117. The Court <strong>of</strong> Appeals agreed with the<br />

KCC. The Court stated that an application is a request for some action or relief, not the mere filing <strong>of</strong><br />

information in response to the order <strong>of</strong> a regulatory agency. No application was made here, and the 30-day<br />

limit found in K.S.A. 66-117(c) was not at issue. The telephone company's assertion that the KCC took<br />

final action here is solely dependent upon its claim that the KCC's failure to act constituted action because<br />

<strong>of</strong> the 30-day time limit in K.S.A. 66-117(c). Since that time limit has no application to this case, the KCC<br />

has not taken any appealable action. The Court dismissed for lack <strong>of</strong> jurisdiction.<br />

See also, Church <strong>of</strong> God in Christ, Inc. v. Board <strong>of</strong> Trustees <strong>of</strong> Emmanuel Church <strong>of</strong><br />

God in Christ, 47 Kan. App. 2d 674, 280 P.3d 795 (<strong>June</strong> 8, <strong>2012</strong>) (Bruns, J.) (Default<br />

Judgment); Friedman v. Kansas State Board <strong>of</strong> Healing Arts, ___ Kan. ___, 294 P.3d<br />

287 (Feb. 15, 2013) (per curiam) (Due Process); Miller v. Preisser, 295 Kan. 356, 284<br />

P.3d 290 (Aug. 31, <strong>2012</strong>) (Luckert, J.) (Eminent Domain and Inverse Condemnation)<br />

KANSAS SEXUALLY VIOLENT PREDATOR ACT (KSVPA)<br />

In re Care and Treatment <strong>of</strong> Ontiberos<br />

295 Kan. 10, 287 P.3d 855 (Aug. 17, <strong>2012</strong>) (Biles, J.)<br />

<strong>Case</strong> No. 100,362<br />

This appeal arises under the Kansas Sexually Violent Predator Act (KSVPA), K.S.A. 59-29a01 et seq. A<br />

civil jury declared Ontiberos a sexually violent predator and determined he should be committed for<br />

treatment until he is safe for release. The Court <strong>of</strong> Appeals vacated the commitment and remanded for a<br />

new trial after it found that Ontiberos received ineffective assistance <strong>of</strong> counsel and that the State's attorney<br />

committed misconduct during the trial. The Supreme Court held that due process guarantees a person<br />

facing civil commitment under the KSVPA a right to counsel at trial, and that person may challenge the<br />

effectiveness <strong>of</strong> his or her trial counsel on direct appeal or under K.S.A. 60-1501. The Court determined the<br />

KSVPA is not unconstitutional. The Court also held that Ontiberos' trial counsel was ineffective and that<br />

the State committed misconduct, which required that the case be remanded for a new trial.<br />

K.S.A. 60-1507<br />

Fischer v. State<br />

___ Kan. ___, 295 P.3d 560 (Mar. 1, 2013) (Biles, J.)<br />

<strong>Case</strong> No. 100,248<br />

Fischer was convicted <strong>of</strong> attempted first-degree murder, aggravated kidnapping, attempted rape, and<br />

criminal possession <strong>of</strong> a firearm. His convictions were upheld on direct appeal. Fischer then filed a pro se<br />

K.S.A. 60-1507 motion arguing ineffective assistance <strong>of</strong> counsel. At the evidentiary hearing on his motion,<br />

Fischer was only allowed to be present by telephone. During the hearing, Fischer complained he could not<br />

hear witness testimony and counsel argument, and objected to not being physically present. The district<br />

court denied Fischer's motion and he appealed. A split panel <strong>of</strong> the Court <strong>of</strong> Appeals reversed holding that<br />

Fischer's physical presence was required and that the district court had no discretion to order otherwise.<br />

Our Supreme Court reversed the Court <strong>of</strong> Appeals finding that the district court had not adequately<br />

supported its decision to have Fischer participate by telephone and because it did not properly address<br />

whether Fischer's complaints about not being able to hear portions <strong>of</strong> the proceedings adversely impacted in<br />

a material way the presentation <strong>of</strong> his arguments.<br />

27


The case was remanded to the district court for further proceedings to include development <strong>of</strong> a more<br />

comprehensive record as to whether this particular inmate should be transported to the courthouse for his<br />

evidentiary hearing or whether alternative means <strong>of</strong> his production, such as telephone conference originally<br />

ordered, will be sufficient.<br />

See also, Edgar v. State, 294 Kan. 828, 283 P.3d 152 (July 27, <strong>2012</strong>) (Luckert J.)<br />

(Johnson, J., dissenting) (Ineffective Assistance <strong>of</strong> Counsel); Shumway v. State, 48 Kan.<br />

App. 2d 290, 293 P.3d 772 (Jan. 18, 2013) (Green, J.) (Ineffective Assistance <strong>of</strong><br />

Counsel); Wright v. State, ___ Kan. App. 2d ___, 294 P.3d 1201 (Feb. 15, 2013)<br />

(Malone, C.J.) (Alternative Means)<br />

LABOR AND EMPLOYMENT<br />

Hague v. Hallmark Cards, Inc. et al.<br />

48 Kan. App. 2d 118, 284 P.3d 369 (Aug. 24, <strong>2012</strong>) (Leben, J.)<br />

<strong>Case</strong> No. 106,470<br />

The Federal Arbitration Act applies when a case involves a written agreement and interstate commerce.<br />

The Act establishes a strong federal policy in favor <strong>of</strong> arbitration. Under the Act, once it has been<br />

determined that there is a valid agreement between the parties to arbitrate disputes, arbitration should be<br />

ordered unless the arbitration clause is not susceptible <strong>of</strong> an interpretation that covers the dispute at issue.<br />

Doubts should be resolved in favor <strong>of</strong> arbitration. Courts held that under the facts <strong>of</strong> this case, an arbitration<br />

agreement that applied to claims "under the law" and "arising out <strong>of</strong> the employee's employment" requires<br />

arbitration <strong>of</strong> the employee's claims for employer-provided disability benefits, unpaid wages, and other<br />

damages all arising out <strong>of</strong> the employment. Court stated that Hague's claims are subject to arbitration under<br />

her employment agreement, which includes the Hallmark dispute-resolution program. Court reversed the<br />

district court's order and remanded the case with directions to grant Hallmark's motion to stay further<br />

proceedings in the lawsuit and to compel arbitration.<br />

See also, USD No. 446 v. Sandoval, 295 Kan. 278, 286 P.3d 542 (Aug. 31, <strong>2012</strong>) (Rosen,<br />

J.) (Luckert, J., concurring and dissenting) (Nuss, C.J., dissenting) (Contracts)<br />

MANDAMUS<br />

Ramcharan-Maharajh v. Gilliland<br />

48 Kan. App. 2d 137, 286 P.3d 216 (Sept. 7, <strong>2012</strong>) (Leben. J.)<br />

Petition for Review filed Oct. 5, <strong>2012</strong><br />

<strong>Case</strong> No. 106,906<br />

Osage City authorized contracts to participate in federal rails-to-trails project. Four years later, Ramcharan-<br />

Maharajh submitted petitions for a referendum vote on that project. The county clerk declined to review the<br />

signatures because there was no legal basis for a petition to compel an election. Ramcharan-Maharajh<br />

sought mandamus in district court to compel the clerk to accept, verify, and certify the names on the<br />

petition. The district court dismissed the petition and Ramcharan-Maharajh appealed. The Court <strong>of</strong> Appeals<br />

held that referendums are distinguished from initiative process and no statute authorizes the referendum<br />

sought in this case. No evidence <strong>of</strong> any contract between Ramcharan-Maharajh and the city to put a<br />

referendum on the ballot, and such an agreement would contravene public policy because a Kansas city<br />

cannot agree to hold a referendum not provided for by statute. The United States Constitution does not<br />

require states to provide for initiative or referendum rights, and the First Amendment does not require that<br />

government take action in response to a citizen's petition.<br />

28


MEDICAL EVIDENCE<br />

Adamson v. Bicknell<br />

295 Kan. 879, 287 P.3d 274 (Oct. 26, <strong>2012</strong>) (Biles, J.) (Luckert, Beier, Johnson,<br />

JJ., concurring in part, dissenting in part)<br />

<strong>Case</strong> No. 99,503<br />

Adamson sued Bicknell for negligence after he rear-ended him. The trial court denied Adamson's motion<br />

to amend for a claim <strong>of</strong> punitive damages. Regarding Bicknell's motion in limine, the trial court ultimately<br />

permitted introduction <strong>of</strong> expenses paid by Medicaid, PIP benefits, and Adamson's out-<strong>of</strong>-pocket expenses.<br />

A jury found that Adamson sustained damages <strong>of</strong> $11,100 in medical expenses, $7,500 in economic loss,<br />

and $5,000 in present noneconomic loss, for a total award <strong>of</strong> $23,600. Court <strong>of</strong> Appeals reversed the trial<br />

court's denial <strong>of</strong> Adamson's motion for punitive damages. Court <strong>of</strong> Appeals also stated there was sufficient<br />

evidence to support a finding that the medical evidence <strong>of</strong> adjustment was related to Medicaid<br />

reimbursement and the trial court did not err in excluding evidence <strong>of</strong> the Medicaid write-<strong>of</strong>f. Court found<br />

the Court <strong>of</strong> Appeals failed to address whether Bicknell knew the risk and drove with knowledge <strong>of</strong> a<br />

dangerous condition. Court stated that the district court must consider all the evidence cited by Adamson<br />

in her motions seeking punitive damages, not just Bicknell's testimony. But the evidence <strong>of</strong> Bicknell's<br />

knowledge <strong>of</strong> his impairment presents a closer question than the Court <strong>of</strong> Appeals acknowledged, and it<br />

should not have made the findings reserved to the district court. Court remanded to the district court for a<br />

rehearing on Adamson's motion seeking punitive damages because factual findings must still be made. The<br />

issue <strong>of</strong> medical expenses was not properly preserved for appeal.<br />

CONCURRING IN PART/DISSENTING IN PART: Justices Luckert, Beier & Johnson dissented from the<br />

majority's decision to reverse the district court's denial <strong>of</strong> Adamson's motion to amend to add a claim for<br />

punitive damages. Justice Luckert concurred in the majority's conclusion that Adamson did not preserve<br />

the medical expense issue for appeal.<br />

MEDICAID REIMBURSEMENT<br />

See also, Village Villa v. Kansas Health Policy Authority, 296 Kan. 315, 291 P.3d 1056<br />

(Jan. 11, 2013) (Biles, J.) (Due Process)<br />

MEDICAL LICENSE REVOCATION<br />

See also, Friedman v. Kansas State Board <strong>of</strong> Healing Arts, ___ Kan. ___, 294 P.3d 287<br />

(Feb. 15, 2013) (per curiam) (Due Process)<br />

MEDICAL MALPRACTICE<br />

Martin v. Naik,<br />

___ Kan. ___, ___ P.3d ___, 2013 WL 1850661 (<strong>May</strong> 3, 2013) (Per curiam)<br />

(Johnson, J. concurring, joined by Nuss, C.J.) (Luckert, J. concurring in part and<br />

dissenting in part, joined by Rosen and Biles, JJ.)<br />

<strong>Case</strong> No. 101,146<br />

This appeal raised issues regarding when the statute <strong>of</strong> limitations begins to run in a wrongful death and<br />

survival action brought against a physician and hospital. The Kansas Supreme Court held that a cause <strong>of</strong><br />

action for wrongful death accrues on the date <strong>of</strong> death unless information regarding the fact <strong>of</strong> death or the<br />

wrongful act that causes the death was concealed, altered, falsified, inaccurate, or misrepresented. And in<br />

construing K.S.A. 60-513(c)—which controls when the statute <strong>of</strong> limitations period begins to run in a<br />

29


medical malpractice action—our Supreme Court held that the legislature stated an objective standard when<br />

it provided that a cause <strong>of</strong> action accrues at the time <strong>of</strong> the occurrence <strong>of</strong> the act giving rise to the cause <strong>of</strong><br />

action "unless the fact <strong>of</strong> injury is not reasonably ascertainable." Consequently, the fact a particular patient<br />

is incapacitated, which would be a subjective factor, does not affect whether the fact <strong>of</strong> injury was<br />

reasonably ascertainable.<br />

See also, Foster v. Klaumann, 295 Kan. 295, 294 P.3d <strong>22</strong>3 (Jan. 11, 2013) (Biles, J.)<br />

(Jerome P. Hellmer, District Judge, assigned vice Justice Moritz) (Juries and Instructions)<br />

MINERAL, OIL, AND GAS<br />

Northern Natural Gas Co. v. Oneok Field Services<br />

___ Kan. ___, 296 P.3d 1106, 2013 WL 1010609 (Mar. 15, 2013) (Moritz, J.)<br />

<strong>Case</strong> No. 104,279<br />

Natural-gas company (company) sued four gas buyers, alleging that they wrongfully converted gas by<br />

purchasing gas from two well operators that were producing and selling gas from company's underground<br />

injected-gas storage field. The buyers filed third-party indemnification claims against the operators, which<br />

in turn filed numerous claims against the company and the buyers. The trial court granted summary<br />

judgment to the operators on the third-party indemnification claims. The company appealed and the case<br />

was transferred to the Supreme Court. The Supreme Court first held that the company had standing to<br />

appeal as a sufficiently aggrieved party. Next, the Court held that the company lost title to any injected gas<br />

that migrated horizontally beyond the property adjoining the certificated boundaries <strong>of</strong> its storage field, and<br />

under the rule <strong>of</strong> capture, the operators, which first produced the migrated gas, took title to it, regardless <strong>of</strong><br />

whether the company intended to abandon it. In reaching this decision, the Court rejected the company's<br />

expansive interpretation <strong>of</strong> K.S.A. 55-1210(c). Instead, the Court agreed with the trial court that section (c)<br />

preserved the rule <strong>of</strong> capture as to injected gas which migrates horizontally within a stratum and beyond<br />

adjoining property or vertically to another stratum in which the injector has not obtained storage rights.<br />

Then, the court held that the trial court did not abuse its discretion in denying the company's request for<br />

additional discovery. Next, the court held that the trial court did not abuse its discretion in denying the<br />

company's motion for relief from the summary judgment ruling. And finally, the court held that the<br />

summary judgment ruling was not a taking <strong>of</strong> the company's property without just compensation in<br />

violation <strong>of</strong> the Takings Clause.<br />

RAMA Operating Co. v. Barker<br />

47 Kan. App. 2d 1020, 286 P.3d 1138 (July 27, <strong>2012</strong>) (Greene, C.J.) (Atcheson,<br />

J., concurring)<br />

<strong>Case</strong> No. 105,589<br />

The court concluded that in the absence <strong>of</strong> a lawful claim by a third party to the interest conveyed to the<br />

assignee <strong>of</strong> an oil and gas lease, the assignor had no duty to defend and did not breach his warranty <strong>of</strong> title.<br />

The court found that lack <strong>of</strong> production after the primary term <strong>of</strong> the lease, together with (i) no factual<br />

assertions to support its being merely temporary, (ii) no allegations that the well was a shut-in well with<br />

royalty payments being made, and (iii) at least one undisputed release <strong>of</strong> record by the prior<br />

operator/lessee, rendered a conclusion that the prior leases had expired. The court found that a longdistance<br />

phone call with the individual executing the second release indicating that it was a "mistake" has<br />

little if any evidentiary value on the question <strong>of</strong> continuing lease validity. The court held that because <strong>of</strong> the<br />

oil and gas lease operator's failure to successfully controvert the production history on the gas production<br />

unit and the resulting 23 months <strong>of</strong> nonproduction, its failure to factually support a temporary cessation <strong>of</strong><br />

production, its failure to support constructive production by reason <strong>of</strong> shut-in royalty payments on a well<br />

capable <strong>of</strong> producing in paying quantities, and the fact <strong>of</strong> at least one undisputed release <strong>of</strong> record by the<br />

operator/lessee <strong>of</strong> the prior lease on this acreage, there was no breach <strong>of</strong> the assignor's covenant <strong>of</strong> warranty<br />

30


<strong>of</strong> title and the assignor <strong>of</strong> the oil and gas lease was entitled to judgment as a matter <strong>of</strong> law at summary<br />

judgment. The concurrence commented on the question <strong>of</strong> whether a denial <strong>of</strong> summary judgment is<br />

appealable following a trial on the merits to a judge or jury.<br />

See also, City <strong>of</strong> Neodesha v. BP Corporation North America Inc, et al., 295 Kan. 298,<br />

287 P.3d 214 (Aug. 31, <strong>2012</strong>) (Biles, J.) (Class Action)<br />

MOOTNESS<br />

See also, In the Interest <strong>of</strong> A.E.S., ___ Kan. App. 2d ___, 298 P.3d 386, 2013 WL<br />

1364746, No. 108,108 (Apr. 5, 2013) (Hebert, J.) (Child in Need <strong>of</strong> Care)<br />

MORTGAGES<br />

Bank <strong>of</strong> America, N.A. v. Inda<br />

___ Kan. App. 2d ___, ___ P.3d ___ , 2013 WL 856468 (Mar. 8, 2013) (Green,<br />

J.)<br />

<strong>Case</strong> No. 107,999<br />

Bank <strong>of</strong> America brought an action to foreclose on Inda's mortgage after he defaulted on his loan. The trial<br />

court granted Bank <strong>of</strong> America's motion for summary judgment, finding that Bank <strong>of</strong> America was the<br />

holder <strong>of</strong> the note and <strong>of</strong> the mortgage and that Inda had defaulted on the loan. The issues on appeal are<br />

whether Bank <strong>of</strong> America is the undisputable holder <strong>of</strong> the note, and whether Bank <strong>of</strong> America had the<br />

authority to enforce the mortgage. Inda argues that Bank <strong>of</strong> America is not the holder <strong>of</strong> the note and that it<br />

is simply a servicer <strong>of</strong> the note. Bank <strong>of</strong> America contends that it is the holder <strong>of</strong> the note and presented the<br />

note to the court to show that it was in its possession. The Court <strong>of</strong> Appeals held that Bank <strong>of</strong> America was<br />

the holder <strong>of</strong> the note because it presented the original note to the trial court which showed the previous<br />

endorsements, with the last endorsement made "in blank." The Court further held that the record<br />

conclusively establishes that at all times Bank <strong>of</strong> America was the holder <strong>of</strong> the Note executed by Inda, that<br />

Bank <strong>of</strong> America was the successor to the Mortgage, and that Inda was in default on the Note. Thus, the<br />

Court held that Bank <strong>of</strong> America was entitled to summary judgment on its mortgage foreclosure action as a<br />

matter <strong>of</strong> law.<br />

MetLife Home Loans v. Hansen<br />

48 Kan. App. 2d 213, 286 P.3d 1150 (Sept. 28, <strong>2012</strong>) (Arnold-Burger, J.)<br />

<strong>Case</strong> No. 106,846<br />

Homeowners appealed from a summary judgment for the lender in a mortgage foreclosure action,<br />

challenging lender's standing to foreclose on mortgage. The Court <strong>of</strong> Appeals held the promissory note and<br />

the mortgage were not irreparably split when the Mortgage Electronic Registration Systems, Inc. (MERS)<br />

held the recorded mortgage solely as the nominee or agent for the lender and its successors and assigns<br />

while the note was validly assigned between various lenders. The Court <strong>of</strong> Appeals found the plain<br />

language <strong>of</strong> both the note and the mortgage indicated that the parties' intended to keep them together,<br />

intertwined, as part <strong>of</strong> one transaction. Because the valid transfer <strong>of</strong> the note also transferred the mortgage,<br />

a formal assignment <strong>of</strong> the mortgage was unnecessary to secure the note holder's right to foreclose the<br />

mortgage. Thus, any defect in the assignment <strong>of</strong> the mortgage would not deprive the lender—as the valid<br />

holder <strong>of</strong> the note that was indisputably in default—<strong>of</strong> standing to foreclose.<br />

31


U.S. Bank v. Howie<br />

47 Kan. App. 2d 690, 280 P.3d <strong>22</strong>5 (<strong>June</strong> 8, <strong>2012</strong>) (Malone, J.)<br />

<strong>Case</strong> No. 106,415<br />

James Howie executed a promissory note to U.S. Bank, and later that day James and his wife, Georgia<br />

Howie, executed a mortgage granting a security interest in certain real property to secure payment <strong>of</strong> the<br />

note. Under the terms <strong>of</strong> the mortgage, U.S. Bank was named as "Lender," and Mortgage Electronic<br />

Registration Systems, Inc. (MERS) was named as the mortgagee "acting solely as a nominee for Lender<br />

and Lender's successors and assigns." More than one year after James' death, Georgia defaulted on the note<br />

and U.S. Bank filed a petition to foreclose the mortgage. The district court filed an order granting summary<br />

judgment in favor <strong>of</strong> U.S. Bank, and Georgia appealed, claiming that U.S. Bank was barred from<br />

foreclosing on the mortgage for two reasons. In part, Georgia claimed that the note and underlying debt<br />

were irreparably severed from the mortgage because the note and mortgage were held by separate entities.<br />

The Court <strong>of</strong> Appeals found that although a mortgage is generally unenforceable when it is not held by the<br />

same entity that holds the promissory note, an exception exists where there is an agency relationship<br />

between the holder <strong>of</strong> the mortgage and the holder <strong>of</strong> the promissory note. The Court <strong>of</strong> Appeals concluded<br />

that the plain language <strong>of</strong> the mortgage provided sufficient and undisputed evidence that an agency<br />

relationship existed between MERS and U.S. Bank because the mortgage expressly authorized MERS to<br />

act on behalf <strong>of</strong> U.S. Bank in all situations related to enforcement <strong>of</strong> the mortgage. Although the mortgage<br />

used the term "nominee" rather than "agent," the Court <strong>of</strong> Appeals found that this terminology did not alter<br />

the character <strong>of</strong> the relationship between MERS and U.S. Bank. Thus, the Court <strong>of</strong> Appeals held that the<br />

mortgage and the note were never severed and U.S. Bank, as present holder <strong>of</strong> both the note and the<br />

mortgage, was entitled to foreclose on the mortgage. Georgia also argued that the mortgage debt was<br />

extinguished because U.S. Bank had failed to timely demand payment <strong>of</strong> the note after James' death as<br />

prescribed by K.S.A. 59-<strong>22</strong>39(1), which establishes time deadlines for making claims against a decedent's<br />

estate. The Court <strong>of</strong> Appeals found that under the plain language <strong>of</strong> K.S.A. 59-<strong>22</strong>39(1), liens existing at the<br />

date <strong>of</strong> the decedent's death are expressly exempted from the filing obligations set forth in the statute.<br />

Accordingly, because U.S. Bank's lien against the property was secured prior to James' death, the court held<br />

that K.S.A. 59-<strong>22</strong>39(1) did not bar U.S. Bank from foreclosing its mortgage against the property.<br />

See also, U.S. Bank National Association, as Trustee <strong>of</strong> the Security National<br />

Mortgage Loan Trust 2006-2 v. Steven R. McConnell, et al., ___ Kan App. 2d. ___, ___<br />

P.3d ___ (<strong>May</strong> 3, 2013) (McAnany, J.) (<strong>Civil</strong> Procedure)<br />

MOTION IN LIMINE<br />

Schlaikjer v. Kaplan<br />

296 Kan. 456, 293 P.3d 155 (Jan. 25, 2013) (Per Curiam)<br />

<strong>Case</strong> No. 98,932<br />

In this medical malpractice case against Dr. James Kaplan, plaintiff Donna Schlaikjer filed K.S.A. 60-<br />

<strong>22</strong>6(b)(6)(B) expert witness designation, identifying Joel Cooper, M.D., as her only expert witness and her<br />

treating physician. During Cooper's two depositions, he had difficulty providing exact calculations <strong>of</strong> how<br />

he spent his pr<strong>of</strong>essional time, as he worked primarily in a teaching hospital and so much <strong>of</strong> his researching<br />

and teaching time overlapped with direct patient care. Kaplan filed a motion in limine seeking to exclude<br />

any standard <strong>of</strong> care opinions from Cooper, arguing that Schlaikjer had not shown Cooper met the statutory<br />

requirement <strong>of</strong> K.S.A. 60-3412 that he spent 50% <strong>of</strong> his pr<strong>of</strong>essional time in actual clinical practice. The<br />

district court granted the motion in limine and then granted summary judgment in favor <strong>of</strong> Kaplan. The<br />

Court <strong>of</strong> Appeals affirmed, but the Supreme Court reversed, finding that the district court erred in<br />

concluding that Cooper failed to meet the 50% requirement. The Court held that "actual clinical practice"<br />

means "patient care," which includes advising on or addressing patient care and is not limited to face-t<strong>of</strong>ace<br />

patient interaction. Therefore, almost everything in Cooper's pr<strong>of</strong>essional schedule had either direct or<br />

32


indirect influence on patient care and the district court's factual finding that Cooper failed to meet the 50%<br />

requirement was not supported by substantial competent evidence. Because the summary judgment ruling<br />

stemmed from this finding, the Supreme Court reversed the summary judgment as well. In addition, the<br />

Court stated that the district court correctly limited expert standard <strong>of</strong> care treatment based on physician<br />

treatment preferences, stating that it could not be introduced by either party on direct examination.<br />

MULTIPLE APPEALS<br />

See also, Snider v. American Family Mut. Ins. Co. (Snider II), ___ Kan. ___, ___ P.3d<br />

___, 2013 WL 1694786 (Apr. 19, 2013) (Luckert, J.) (Moritz and Johnson, JJ. dissenting)<br />

(Attorney Fees)<br />

MUNICIPAL CORPORATIONS<br />

See also, State ex rel. Hecht v. City <strong>of</strong> Topeka, ___ Kan. ___, 293 P.3d 713 (Feb. 1,<br />

2013) (Per curiam) (Daniel A. Duncan, District Judge, assigned vice Justice Mortiz)<br />

(Contracts)<br />

NEGLIGENCE<br />

See also, Adamson v. Bicknell, 295 Kan. 879, 287 P.3d 274 (Oct. 26, <strong>2012</strong>) (Biles, J.)<br />

(Luckert, Beier, Johnson, JJ., concurring in part, dissenting in part) (Medical Evidence)<br />

NEGLIGENT MISREPRESENTATION<br />

See also, Kincaid v. Dess, ___ Kan. App. 2d ___, 298 P.3d 358 (Mar. 8, 2013) (Green, J.)<br />

(Contracts)<br />

OIL AND GAS<br />

See also, In the Matter <strong>of</strong> the Equalization Appeal <strong>of</strong> Wedge Log-Tech, L.L.C./Pioneer<br />

Wireline Services for the Year 2008 in Ellis County, Kansas, and In the Matter <strong>of</strong> the<br />

Application <strong>of</strong> Wedge Log-Tech, L.L.C./Pioneer Wireline Services for Exemption from<br />

Ad Valorem Taxation in Ellis County, Kansas, ___ Kan. App. 2d ___, ___ P.3d ___,<br />

2013 WL 1497338 (Apr. 12, 2013) (Malone, C.J.) (Ad Valorem Taxation)<br />

PARTNERSHIP LAW<br />

Giles v. Giles Land Company, L.P., et. al.<br />

47 Kan. App. 2d 744, 279 P.3d 139 (<strong>June</strong> 15, <strong>2012</strong>) (Green, J.)<br />

Petition for Review filed July 12, <strong>2012</strong><br />

<strong>Case</strong> No. 105,537<br />

Kelly Giles is a general partner in a family owned and operated limited farming partnership, Giles Land<br />

Company, L.P. (partnership). Kelly filed suit against the partnership and his partners, arguing that he had<br />

not been provided access to partnership books and records. The remaining members <strong>of</strong> the partnership then<br />

33


filed a counterclaim requesting that Kelly be dissociated from the partnership. The district court held that<br />

Kelly was not denied access to the partnership books and records and that Kelly should be dissociated from<br />

the partnership under K.S.A. 56a-601(e)(3) or, in the alternative, K.S.A. 56a-601(e)(1) because, due to<br />

Kelly's behavior, it was not practicable to carry on the business <strong>of</strong> the partnership so long as Kelly was a<br />

partner. On appeal, Kelly challenged the district court's ruling and argued that there was insufficient<br />

evidence to support dissociation. Under the Kansas Uniform Partnership Act, dissociation <strong>of</strong> a partner in a<br />

family partnership is warranted when a partner harbors animosity toward his or her partners; the partners<br />

have mutual distrust for each other; the partnership has reached an impasse regarding partnership business;<br />

and the partner has implicitly and expressly used threatening language toward the other partners. In this<br />

case <strong>of</strong> first impression, the Court <strong>of</strong> Appeals explained that in order to dissociate Kelly under K.S.A. 56a-<br />

601(e)(3), the record must demonstrate that (1) Kelly engaged in conduct relating to the partnership<br />

business and (2) such conduct makes it not reasonably practicable to carry on the business in partnership<br />

with Kelly. And in order to dissociate Kelly under K.S.A. 56a-601(e)(1), the record must demonstrate (1)<br />

that Kelly engaged in wrongful conduct and (2) that the wrongful conduct adversely and materially affected<br />

the partnership business. The Court <strong>of</strong> Appeals found that substantial competent evidence supported the<br />

district court's finding that Kelly did not trust the general partners, the general partners as well as all <strong>of</strong> the<br />

other partners did not trust Kelly, and the relationship between Kelly and the other family members was<br />

irreparably broken due to Kelly's behavior. Thus, in light <strong>of</strong> the animosity that Kelly harbored toward his<br />

partners and the mutual distrust between them, the appropriate remedy under the circumstances was the<br />

dissociation <strong>of</strong> Kelly under K.S.A. 56a-601(e)(3). The Court <strong>of</strong> Appeals further found that there was<br />

enough evidence in the record to support Kelly's dissociation under K.S.A. 56a-601(e)(1) because Kelly<br />

made threats or berated his parents (wrongful conduct), and his conduct materially or adversely affected the<br />

partnership (business was at a standstill). The Court <strong>of</strong> Appeals explained that even though there was no<br />

evidence that Kelly had been dishonest, and even though the partnership had continued to be successful,<br />

this did not mean that the other partners should be forced to remain in partnership with an uncooperative<br />

and distrustful partner.<br />

POST-CONVICTION DNA TESTING<br />

Haddock v. State<br />

295 Kan. 738, 286 P.3d 837 (Oct. 5, <strong>2012</strong>) (Luckert, J.)<br />

<strong>Case</strong> No 101,508<br />

Haddock was convicted <strong>of</strong> the first-degree murder <strong>of</strong> his wife Barbara after her body was found crushed<br />

under a wood pile. Postconviction DNA testing produced some results favorable to Haddock, some results<br />

that confirmed evidence at trial, and some results that were inconclusive because the small amount and the<br />

degradation <strong>of</strong> the DNA prevented DNA matching. Weighing the mixed results <strong>of</strong> the evidence, the district<br />

court concluded there was not a reasonable probability that the new evidence would have changed the<br />

outcome <strong>of</strong> the trial and denied Haddock's motions for new trial.<br />

Court agreed with the district court and held that while the evidence that the hair and eyeglasses <strong>of</strong> the<br />

victim had the DNA <strong>of</strong> two unknown people—one male and one female—could be used to suggest others<br />

may have also been present when Barbara was murdered, that evidence does not dispute the overwhelming<br />

evidence <strong>of</strong> Haddock's guilt to which the State and district court point. Court held that in light <strong>of</strong> the<br />

evidence adduced at trial and through Haddock's second motion for DNA testing, it concluded that a<br />

reasonable person could agree with the district court's ruling that it is not reasonably probable the<br />

postconviction DNA testing results would change the jury's verdict that Haddock premeditated the murder<br />

<strong>of</strong> Barbara.<br />

34


POSTMARITAL AGREEMENTS<br />

In re Marriage <strong>of</strong> Traster<br />

48 Kan. App. 2d 356, 291 P.3d 494 (Dec. 7, <strong>2012</strong>) (Standridge, J.)<br />

Petition for Review filed Jan. 7, 2013<br />

<strong>Case</strong> No. 106,092<br />

During their marriage, Debra and David Traster executed a postmarital agreement which set forth the<br />

respective legal rights and obligations <strong>of</strong> each spouse in the event <strong>of</strong> a divorce. David later filed for divorce<br />

and, contrary to the terms <strong>of</strong> the postmarital agreement, requested that the district court equitably divide the<br />

marital property. Debra moved for summary judgment, asking the court to find that the postmarital<br />

agreement was valid, enforceable, and controlled the disposition <strong>of</strong> the parties' real and personal property.<br />

The district court construed the postmarital agreement as a separation agreement, and, as required by<br />

K.S.A. 60-1610(b)(3), reviewed it to determine whether it was valid, just, and equitable. The court<br />

ultimately held that the postmarital agreement (1) was invalid because it ran counter to public policy by<br />

encouraging divorce and (2) was unjust and inequitable in the distribution <strong>of</strong> property because Debra<br />

received virtually all <strong>of</strong> the personal property acquired during the marriage. The Court <strong>of</strong> Appeals<br />

concluded that the district court erred in finding the postmarital agreement ran counter to public policy and<br />

in construing the postmarital agreement as a separation agreement under K.S.A. 60-1610(b)(3) for purposes<br />

<strong>of</strong> determining its enforceability. In the absence <strong>of</strong> a statute governing the law related to postmarital<br />

agreements between spouses who plan to continue their marriage, the court held that the appropriate<br />

standard for assessing the enforceability <strong>of</strong> a postmarital agreement is review <strong>of</strong> the agreement by the court<br />

to determine whether (1) each party had an opportunity to obtain separate legal counsel <strong>of</strong> each party's own<br />

choosing; (2) there was fraud or coercion in obtaining the agreement; (3) all assets were fully disclosed by<br />

both parties before the agreement was executed; (4) each spouse knowingly and explicitly agreed in writing<br />

to waive the right to a judicial equitable division <strong>of</strong> assets and all marital rights in the event <strong>of</strong> a divorce;<br />

(5) the terms <strong>of</strong> the agreement were fair and reasonable at the time <strong>of</strong> execution; and (6) the terms <strong>of</strong> the<br />

agreement are not unconscionable at the time <strong>of</strong> dissolution. Applying this standard to the postmarital<br />

agreement between Debra and David, the court found it enforceable and, therefore, reversed the district<br />

court's decision and remanded the case with directions to enforce the postmarital agreement as written and<br />

agreed to by the parties.<br />

PRESCRIPTIVE EASEMENT<br />

Joseph R. Koch, Trustee <strong>of</strong> the Joseph R. Koch Revocable Trust dated March 12, 1993<br />

v. E. Lynn Packard and Jayne E. Packard, Cotrustees <strong>of</strong> the E. Lynn Packard<br />

Revocable Trust dated July 10, 2003, and Jayne E. Packard and E. Lynn Packard,<br />

Cotrustees <strong>of</strong> the Jayne E. Packard Revocable Trust dated July 10, 2003<br />

48 Kan. App. 2d 281, 294 P.3d 338 (Nov. 2, <strong>2012</strong>) (Hill, J.)<br />

Petition for Review filed Nov. 30, <strong>2012</strong><br />

<strong>Case</strong> No. 107,585<br />

The Barber County District Court held that Joseph R. Koch acquired a prescriptive easement over a<br />

roadway owned by E. Lynn Packard and Jayne E. Packard. In reaching this conclusion, the district court<br />

found, in part, that Koch had exclusive use <strong>of</strong> the roadway. On appeal, the Court <strong>of</strong> Appeals reversed the<br />

decision <strong>of</strong> the district court, finding Koch failed to demonstrate a prescriptive easement. Exclusive use <strong>of</strong><br />

the property is required in order to prove a prescriptive easement, and the evidence in this case showed<br />

Koch's use <strong>of</strong> the roadway was not exclusive.<br />

35


PROBATE<br />

See also, U.S. Bank v. Howie, 47 Kan. App. 2d 690, 280 P.3d <strong>22</strong>5 (<strong>June</strong> 8, <strong>2012</strong>)<br />

(Malone, J.) (Mortgages)<br />

PUNITIVE DAMAGES<br />

See also, Adamson v. Bicknell, 295 Kan. 879, 287 P.3d 274 (Oct. 26, <strong>2012</strong>) (Biles, J.)<br />

(Luckert, Beier, Johnson, JJ., concurring in part, dissenting in part) (Medical Evidence)<br />

RATE CASE<br />

See also, The S & T Telephone Co-op. Assoc., Inc. v. KCC, 48 Kan. App. 2d 290, 291<br />

P.3d 490 (Nov. 2, <strong>2012</strong>) (Leben, J.) (Jurisdiction)<br />

REAL PROPERTY<br />

Bank <strong>of</strong> Blue Valley v. Duggan Homes, Inc. et. al<br />

___ Kan App. 2d. ___, ___ P.3d ___, 2013 WL 1786013 (Apr. 26, 2013)<br />

(Green, J.)<br />

<strong>Case</strong> No. 107,738<br />

Over the course <strong>of</strong> several years, developer granted multiple mortgages to Bank in part consideration for<br />

loans to fund its real estate development projects in Johnson County. Developer later defaulted on loans<br />

and bank sued to collect on notes and sought to foreclose on the mortgages. After suit was filed, Bank and<br />

developer entered into a settlement agreement. Under the agreement, developer agreed to convey several<br />

properties to Bank in full satisfaction <strong>of</strong> the indebtedness. Bank took the properties subject to the judgment<br />

liens <strong>of</strong> several subcontractors <strong>of</strong> developer. Later, Bank filed amended petition naming subcontractors as<br />

defendants. The amended petition sought to foreclose the mortgages that were included in the Bank's and<br />

developers' settlement agreement. Bank moved for summary judgment, and subcontractors filed a crossmotion<br />

for summary judgment. Subcontractors maintained that Bank was not entitled to foreclose on its<br />

mortgages. The district court held that although Bank "identifies the cause <strong>of</strong> action as a foreclosure," the<br />

Bank "simply desires to quiet title to the property." As a result, the district court granted summary<br />

judgment in favor <strong>of</strong> Bank and quieted title to the real property in Bank. On appeal, subcontractors contend<br />

that the trial court erred in granting summary judgment in favor <strong>of</strong> Bank based on a quiet title theory that<br />

was never requested nor pleaded by Bank. The Court <strong>of</strong> Appeals agreed, and therefore reversed and<br />

remanded. The Court <strong>of</strong> Appeals reasoned that because subcontractors objected to the quiet title theory and<br />

because they never consented to the use <strong>of</strong> this theory, the district court erred in granting Bank's motion for<br />

summary judgment.<br />

Hansford v. Silver Lake Heights, LLC<br />

294 Kan. 707, 280 P.3d 756 (July 13, <strong>2012</strong>) (Rosen, J.)<br />

<strong>Case</strong> No. 102,1<strong>22</strong><br />

An executor <strong>of</strong> a decedent's estate filed a partition action to divide property held as tenants in common with<br />

Hansford and others. On the court's order, the property was sold at auction to a real estate developer.<br />

Because <strong>of</strong> a dispute about the boundaries <strong>of</strong> the property sold, Hansford brought a quiet title action. The<br />

court held that Hansford, as a tenant in common <strong>of</strong> the property, could not bring a collateral action<br />

challenging the partition action. The court ruled that Hansford was obligated to bring the boundary dispute<br />

in the partition action and that the facts did not support a claim for estoppel.<br />

36


Reicherter et al. v. McCauley<br />

47 Kan. App. 2d 968, 283 P.3d 219 (July 13, <strong>2012</strong>) (Hill, J.)<br />

<strong>Case</strong> No. 106,6<strong>22</strong><br />

The Court <strong>of</strong> Appeals held that a joint tenant can self-convey and thus destroy a joint tenancy in this case<br />

where there are just two joint tenants. The court found that under Kansas law, any joint tenant may<br />

unilaterally sever his or her joint tenancy interest in real property and create a tenancy in common by<br />

conveying his or her interest to a third person. Next, the court stated that when the intent to create a joint<br />

tenancy is clearly manifested, a joint tenancy may be created by a transfer to persons as joint tenants from<br />

an owner or a joint owner to himself or herself and one or more persons as joint tenants. Last, the court<br />

agreed with persuasive authority from other jurisdictions that unilateral self-conveyance severs a joint<br />

tenancy and have dispensed with the old requirements <strong>of</strong> deeding property to a straw man. The court held<br />

that upon an effective delivery during the grantor's life, a quitclaim deed by a joint tenant to himself or<br />

herself as a tenant in common effectively severs the joint tenancy and creates a tenancy in common.<br />

See also, First National Bank <strong>of</strong> Omaha v. Centennial Park LLC, et al, (Mar. <strong>22</strong>, 2013)<br />

(Green, J.) (Debtor-Creditor); Prime Lending II, LLC v. Trolley's Real Estate Holdings,<br />

LLC, et. al, ___ Kan App. 2d. ___, ___ P.3d ___, 2013 WL 17860<strong>22</strong> (Apr. 26, 2013)<br />

(Green, J.) (<strong>Civil</strong> Procedure); Stechschulte v. Jennings, __ Kan. __, __ P.3d __ (Apr. 12,<br />

2013) (Beier, J.) (Donald R. Noland, District Judge, assigned vice Justice Moritz)<br />

(Kansas Consumer Protection Act); Turner v. Steele, 47 Kan. App. 2d 976, 282 P.3d 632<br />

(July 20, <strong>2012</strong>) (Marquardt, J.) (Default Judgment); U.S. Bank National Association, as<br />

Trustee <strong>of</strong> the Security National Mortgage Loan Trust 2006-2 v. Steven R. McConnell,<br />

et al., ___ Kan App. 2d. ___, ___ P.3d ___ (<strong>May</strong> 3, 2013) (McAnany, J.) (<strong>Civil</strong><br />

Procedure)<br />

RESIDENTIAL CONSTRUCTION CONTRACTS<br />

See also, Coker v. Siler, __ P.3d __ 2013 WL 1850756 (<strong>May</strong> 3, 2013) (Standridge, J.)<br />

(Economic Loss Doctrine)<br />

RES JUDICATA<br />

See also, Church <strong>of</strong> God in Christ, Inc. v. Board <strong>of</strong> Trustees <strong>of</strong> Emmanuel Church <strong>of</strong><br />

God in Christ, 47 Kan. App. 2d 674, 280 P.3d 795 (<strong>June</strong> 8, <strong>2012</strong>) (Bruns, J.) (Default<br />

Judgment)<br />

RIGHT TO APPELLATE COUNSEL<br />

Markovich v. Green, et al.<br />

___ Kan. App. 2d ___, 297 P.3d 1176 (Feb. 8, 2013) (Buser, J.)<br />

Petition for review filed Mar. 8, 2013<br />

<strong>Case</strong> No. 106,937<br />

District court denied inmate's K.S.A. 60-1501 petition and refused to appoint appellate counsel. This court<br />

held that under K.S.A. <strong>22</strong>-4506(c), an indigent inmate has a statutory right to the appointment <strong>of</strong> appellate<br />

counsel. The case was remanded for appointment <strong>of</strong> appellate counsel.<br />

37


RULE AGAINST PERPETUITIES<br />

Rucker v. Delay<br />

295 Kan. 826, 289 P.3d 1166 (Oct. 19, <strong>2012</strong>) (Biles, J.)<br />

<strong>Case</strong> No. 101,766<br />

In 1924 husband and wife executed a general warranty deed transferring real property. Under the terms <strong>of</strong><br />

the warranty deed, husband and wife (grantors) kept for themselves and their heirs what was described as a<br />

portion <strong>of</strong> the landowners' one-eighth interest in the oil, gas, or other minerals that might later be<br />

developed. In 2008, the current property owners filed a quiet title action against grantors and their heirs<br />

arguing that the reservation in the deed was a royalty interest that violated the rule against perpetuities. In<br />

part, the grantors and their heirs maintained that the rule against perpetuities did not apply. The district<br />

court held that the deed created a perpetual, nonparticipating, royalty interest that was subject to<br />

termination under Kansas case law. Further, it held that the royalty interest was void because it violated the<br />

rule against perpetuities. Like the district court, the Court <strong>of</strong> Appeals held that the deed created a royalty<br />

interest and it applied the rule against perpetuities to void the interest. The Supreme Court affirmed in part<br />

and reversed in part, holding that the royalty interest was not void under the rule against perpetuities. The<br />

Supreme Court found that the royalty interest in this case was a reversion because the grantors retained a<br />

portion <strong>of</strong> it when they executed the deed in question. The Supreme Court then reasoned that the royalty<br />

interest did not violate the rule against perpetuities based on its precedent that reversionary interests are not<br />

subject to the rule against perpetuities.<br />

RULE OF CAPTURE ON MIGRATING GAS<br />

See also, Northern Natural Gas Co. v. Oneok Field Services, ___ Kan. ___, 296 P.3d<br />

1106, 2013 WL 1010609 (Mar. 15, 2013) (Moritz, J.) (Mineral, Oil, and Gas)<br />

SAME SEX COUPLES<br />

See also, Frazier v. Goudschaal, 296 Kan. 336, 295 P.3d 542 (2013) (Feb. <strong>22</strong>, 2013)<br />

(Johnson, J.) (Coparenting Agreement)<br />

SETTLEMENT AGREEMENT<br />

See also, Coulter v. Anadarko Petroleum Corp., ___ Kan. ___, 292 P.3d 289 (Jan. 11,<br />

2013) (Johnson, J.) (Adequacy <strong>of</strong> Counsel)<br />

SEXUALLY VIOLENT PREDATOR<br />

In re Care & Treatment <strong>of</strong> Lowry<br />

__ Kan. App. 2d __, __ P.3d __, 2013 WL 1490946 (<strong>June</strong> 8, <strong>2012</strong>; ordered<br />

published Mar. 25, 2013),<br />

Petition for Review denied Mar. 25, 2013 (Standridge, J.)<br />

<strong>Case</strong> No. 102,862<br />

A jury determined Lenny D. Lowry was a sexually violent predator under the Kansas Sexually Violent<br />

Predator Act (KSVPA), K.S.A. 59-29a01 et seq. Lowry appealed from the jury's verdict, arguing that the<br />

district court lacked jurisdiction over him, that he was denied his statutory right to effective assistance<br />

counsel, and that the State's attorney committed reversible misconduct during closing arguments. On<br />

38


appeal, the Court <strong>of</strong> Appeals held: (1) The State's failure to comply with K.S.A. 59-29a04(a) by attaching a<br />

document to the petition alleging that Lowry was a sexually violent predator and stating sufficient facts to<br />

support the allegation did not deprive the district court <strong>of</strong> jurisdiction because K.S.A. 59-29a04(b) provides<br />

that the statute's provisions "are not jurisdictional, and failure to comply with such provisions in no way<br />

prevents the attorney general from proceeding." Regardless, the court held that the petition clearly set forth<br />

facts sufficient to support the allegation that Lowry may be a sexually violent predator. (2) Lowry's<br />

statutory right to counsel was not violated because he failed to show that counsel's representation fell below<br />

an objective standard <strong>of</strong> reasonableness under the circumstances. Specifically, the court held that counsel<br />

was not ineffective in stipulating to the foundation <strong>of</strong> certain documents contained in Lowry's file; in<br />

failing to confront the State's doctor with certain reports on cross-examination; or in failing to seek the<br />

assistance <strong>of</strong> an expert based on a mistaken belief that funds for an expert were unavailable. Lowry also<br />

argued that counsel was ineffective for failing to argue that the elements <strong>of</strong> pedophilia contained in the<br />

DSM-IV were not established in his case, but the court held that there is no requirement under the Kansas<br />

Sexually Violent Predator Act that the State must establish that a person suffers from a mental abnormality<br />

recognized by the DSM-IV before that person can be found to be a sexually violent predator. (3) The twostep<br />

analysis used in criminal cases to judge alleged instances <strong>of</strong> prosecutorial misconduct claims is<br />

inapplicable in sexually violent predator proceedings. Instead, the central consideration for a court<br />

reviewing comments made by counsel during a sexually violent predator proceeding is whether the<br />

comments deprived the respondent <strong>of</strong> a fair trial. Here, the prosecutor's comments during closing argument<br />

were simply comments on the evidence and were also made in response to defense counsel's closing<br />

arguments. As such, they did not deprive Lowry <strong>of</strong> a fair trial.<br />

STANDARDS OF REVIEW<br />

STANDING<br />

See also, Edgar v. State, 294 Kan. 828, 283 P.3d 152 (July 27, <strong>2012</strong>) (Luckert J.)<br />

(Johnson, J., dissenting) (Ineffective Assistance <strong>of</strong> Counsel)<br />

See also, Turner v. Steele, 47 Kan. App. 2d 976, 282 P.3d 632 (July 20, <strong>2012</strong>)<br />

(Marquardt, J.) (Default Judgment)<br />

STATUTE OF LIMITATIONS<br />

Seaboard Corp. v. Marsh, Inc.<br />

295 Kan. 384, 284 P.3d 314 (Aug. 31, <strong>2012</strong>) (Luckert, J.)<br />

<strong>Case</strong> No. 104,294<br />

Insurance client brought several tort, contract, and statutory claims against an insurance company for an<br />

alleged "bid-rigging" scheme. In an interlocutory appeal, the court applied the standard <strong>of</strong> review for<br />

summary judgment because the district court had relied on facts outside the pleadings. The court then<br />

upheld the district court's refusal to dismiss the action based upon the applicable statute <strong>of</strong> limitations. The<br />

court interpreted the Kansas savings statute, K.S.A. 60-518, to apply to actions originally filed outside <strong>of</strong><br />

Kansas and held that the dismissal <strong>of</strong> the former class action suit in New Jersey met the requirements <strong>of</strong><br />

K.S.A. 60-518.<br />

39


Law v. Law Company Building Associates<br />

295 Kan. 551, 289 P.3d 1066 (Sept. 28, <strong>2012</strong>) (Luckert, J.)<br />

<strong>Case</strong> No. 101,497<br />

Margaret Russell Law filed claims for breach <strong>of</strong> contract, breach <strong>of</strong> the implied duty <strong>of</strong> good faith and fair<br />

dealing, reformation <strong>of</strong> contract, and declaratory judgment against The Law Company, Inc. and Law<br />

Company Building Associates. The claims arose from a financial agreement regarding a commercial<br />

building in Wichita. The Supreme Court held the following: (1) a cause <strong>of</strong> action for reformation <strong>of</strong> a<br />

contract based on an alleged mutual mistake accrues when the mistake is made, not when the mutual<br />

mistake is discovered; and (2) accrual does not depend on whether a contract is executed or executory and<br />

the rules do not vary simply because the contract relates to the title <strong>of</strong> real property. The Supreme Court<br />

then reversed the Court <strong>of</strong> Appeals' holding and affirmed the district court's order <strong>of</strong> summary judgment,<br />

which found that Margaret Law's reformation claim was barred by K.S.A. 60-511(1) as the mutual mistake<br />

under the contract occurred more than 5 years before the case was filed.<br />

See also, Martin v. Naik, ___ Kan. ___, ___ P.3d ___, 2013 WL 1850661 (<strong>May</strong> 3, 2013)<br />

(Per Curiam) (Medical Malpractice)<br />

STATUTE OF REPOSE<br />

See also, Hemphill v. Shore, 295 Kan. 1111, 289 P.3d 1173 (Dec. 7, <strong>2012</strong>) (Beier, J.)<br />

(Constructive Fraud)<br />

STATUTORY INTERPRETATION<br />

See also, Schlaikjer v. Kaplan, 296 Kan. 456, 293 P.3d 155 (Jan. 25, 2013) (Per Curiam)<br />

(Motion in Limine)<br />

SUMMARY JUDGMENT<br />

TAXATION<br />

See also, Gold Mine Investments, Inc. d/b/a Gold Realty v. Mount Vernon Fire<br />

Insurance Co. and Med James, Inc., ___ Kan. App. 2d ___, ___ P.3d ___, 2013 WL<br />

1694796 (Apr. 15, 2013) (McAnany, J.) (Insurance); RAMA Operating Co. v. Barker, 47<br />

Kan. App. 2d 1020, 286 P.3d 1138 (July 27, <strong>2012</strong>) (Greene, C.J.) (Atcheson, J.,<br />

concurring) (Minerals, Oil, and Gas); Waste Connections <strong>of</strong> Kansas, Inc. v. Ritchie<br />

Corporation, ___ Kan. ___, 298 P.3d 250 (Mar. <strong>22</strong>, 2013) (Beier, J.) (Contracts)<br />

In re Equalization Appeal <strong>of</strong> Johnson County Appraiser<br />

47 Kan. App. 2d 1074, 283 P.3d 823 (July 27, <strong>2012</strong>) (Standridge, J.)<br />

<strong>Case</strong> No. 105,769<br />

Taxpayer appealed from decision <strong>of</strong> the Court <strong>of</strong> Tax Appeals (COTA) reinstating county's original value<br />

for ad valorem tax purposes for fast food restaurant for 2008 tax year. Because the taxpayer did not provide<br />

a complete income and expense statement for the property, under K.S.A. 79-1609, the burden <strong>of</strong> pro<strong>of</strong><br />

remained with the taxpayer at the hearing. The court found that the commercial valuation performed by the<br />

county was a mass appraisal <strong>of</strong> property, the testimony from the valuation specialist sufficiently addressed<br />

40


TORTS<br />

the issue <strong>of</strong> highest and best use and the report was not invalid for failure to explain 10% upward<br />

adjustment was added to the property's replacement cost. The court found sufficient evidence supported the<br />

COTA's decision to reinstate the county's original 2008 assessment <strong>of</strong> the property.<br />

In re National Catastrophe Restoration, Inc.<br />

48 Kan. App. 2d 189, 291 P.3d 89 (Sept. 21, <strong>2012</strong>) (Greene, C.J.)<br />

<strong>Case</strong> No. 106,700<br />

NCRI, a retailer <strong>of</strong> goods and services to restore and repair property damaged by disasters, filed sales tax<br />

returns from <strong>May</strong> 2003 through December 2004 certifying it owed no taxes. The Kansas Department <strong>of</strong><br />

Revenue initiated an audit, and NCRI admitted to numerous untaxed or undertaxed transactions for the<br />

period <strong>of</strong> January 1, 2002 through December 31, 2004. The parties agreed to a sampling method by which 3<br />

months <strong>of</strong> records would be used to determine the total tax liability. NCRI filed a motion for directed<br />

verdict with the Court <strong>of</strong> Tax Appeals after the KDOR submitted its assessment, which was denied. Despite<br />

NCRI's contention, there was no error because the KDOR's assessment was presumed valid and NCRI bore<br />

the burden to prove the assessment was error. Further, NCRI argued that it had rebutted the presumption <strong>of</strong><br />

validity. The COTA made a negative finding on that issue, so NCRI bore the burden on appeal to show the<br />

COTA arbitrarily disregarded undisputed evidence or based its decision on bias, passion, or prejudice.<br />

NCRI did not meet this burden with respect to its challenge to the KDOR's sampling method. Additionally,<br />

K.S.A. 79-3610, which permits the KDOR to determine total tax liability by using the sampling method,<br />

was not unconstitutional. NCRI failed to present facts before the COTA to establish that any out-<strong>of</strong>-state<br />

transactions were actually taxed. As such, there was not a record sufficient for the Court <strong>of</strong> Appeals to<br />

begin to overcome the presumption that K.S.A. 79-3610 was constitutional. The COTA's later rejection <strong>of</strong><br />

earlier agreed-to stipulations, however, was error because NCRI did not have the opportunity to search for<br />

evidence on the issues because it relied on the stipulations. This error implicated NCRI's due process rights<br />

and was arbitrary and capricious. So the Court <strong>of</strong> Appeals remanded the case for a hearing on the<br />

stipulations and a recalculation <strong>of</strong> the tax deficiency in accordance with the findings.<br />

See also, In the Matter <strong>of</strong> the Equalization Appeal <strong>of</strong> Wedge Log-Tech, L.L.C./Pioneer<br />

Wireline Services for the Year 2008 in Ellis County, Kansas, and In the Matter <strong>of</strong> the<br />

Application <strong>of</strong> Wedge Log-Tech, L.L.C./Pioneer Wireline Services for Exemption from<br />

Ad Valorem Taxation in Ellis County, Kansas, ___ Kan. App. 2d ___, ___ P.3d ___,<br />

2013 WL 1497338 (Apr. 12, 2013) (Malone, C.J.) (Ad Valorem Taxation)<br />

Carr v. Vannoster<br />

48 Kan. App. 2d 19, 281 P.3d 1136 (Aug. 3, <strong>2012</strong>) (McAnany, J.)<br />

<strong>Case</strong> No. 106,177<br />

In an appeal from summary judgment on a negligence action against a dog owner's putative landlord for<br />

injuries from a dog attack, the court held that the general rule <strong>of</strong> landlord liability stated in Borders v.<br />

Roseberry, 216 Kan. 486, 532 P.2d 1366 (1975), insulated the landlord because the exceptions stated in<br />

Borders did not apply under the facts <strong>of</strong> the case. Opinions from other jurisdictions expanding landlord<br />

liability were not consistent with Kansas law. In the alternative, the court also rejected the plaintiff's strict<br />

liability claim because, under the facts <strong>of</strong> the case, there was no evidence that the defendant possessed or<br />

harbored the dog.<br />

41


Eastman v. C<strong>of</strong>feyville Resources Refining & Manufacturing, LLC<br />

295 Kan. 470, 284 P.3d 1049 (Sept. 7, <strong>2012</strong>) (Moritz, J.)<br />

<strong>Case</strong> No. 105,805<br />

Trustees filed suit in federal district court for property damage from a crude oil spill. The federal court<br />

certified two questions to the Kansas Supreme Court. The court concluded that, like the common-law strict<br />

liability claim, K.S.A. 65-6203 does not require pro<strong>of</strong> <strong>of</strong> negligence or intent to interfere with a property<br />

right. But, unlike the common-law claim, K.S.A. 65-6203 also does not require a showing that the actor<br />

was engaged in an abnormally dangerous activity. Because K.S.A. 65-6203 created a new substantive right,<br />

the statute <strong>of</strong> limitations period <strong>of</strong> K.S.A. 60-512(2), which governs rights created by statute, applied.<br />

Michaelis v. Farrell,<br />

___ Kan. App. 2d ___, 296 P.3d 439 (Mar. 8, 2013) (Green, J.)<br />

<strong>Case</strong> No. 106,988<br />

Michaelis suffered an electric shock when water surrounding a dock on the Farrells' property became<br />

electrified. Michaelis did not sue for recovery until 5 years later, after a doctor determined he had suffered<br />

a neurological injury as a result <strong>of</strong> the electric shock. The Farrells moved for a directed verdict under<br />

K.S.A. <strong>2012</strong> Supp. 60-250(b) (now known as a judgment as a matter <strong>of</strong> law) maintaining Michaelis<br />

suffered an actionable injury on the date <strong>of</strong> the electric shock or shortly thereafter and, therefore, his action<br />

was barred by the applicable 2-year statute <strong>of</strong> limitations. The district court denied the motion and<br />

submitted the issue to the jury, which found Michaelis did not reasonably ascertain he suffered a substantial<br />

injury until 5 years after the accident. The Court <strong>of</strong> Appeals held (1) the statute <strong>of</strong> limitations starts to run<br />

in a tort action when a negligent act causes injury if both the act and the resulting injury are reasonably<br />

ascertainable by the injured person; (2) but where the evidence regarding when Michaelis reasonably<br />

ascertained his injury and cause <strong>of</strong> the injury were in dispute, the district court properly submitted the<br />

question to the jury and properly denied the Farrells' motion for directed verdict; and (3) instructing the jury<br />

to determine when plaintiff reasonably ascertained he had suffered a substantial injury related to the electric<br />

shock without defining "substantial" could not have reasonably misled the jury and correctly conveyed the<br />

required objective standard.<br />

Miller v. Johnson<br />

295 Kan. 636, 289 P.3d 1098 (Oct. 5, <strong>2012</strong>) (Biles, J.) (Beier, J., and Johnson, J,<br />

concurring in part and dissenting in part)<br />

<strong>Case</strong> No. 99,818<br />

Amy Miller sued her doctor, who mistakenly removed her left ovary during a laparoscopic surgery<br />

intended to take the right ovary, and a jury awarded her $759,679.74 in damages. The district court reduced<br />

that amount by $425,000 because <strong>of</strong> a state law limiting noneconomic damages in personal injury lawsuits<br />

and a posttrial ruling finding her evidence <strong>of</strong> future medical expenses insufficient. The Kansas Supreme<br />

Court held the statutory cap on noneconomic damages in K.S.A. 60-19a02 is constitutional. Court also<br />

found the district court abused its discretion by striking the jury's award for future medical expenses based<br />

on errors <strong>of</strong> fact and remanded the case to the district court with instructions to reinstate that award. Court<br />

denied remaining claims <strong>of</strong> trial error. The dissents would hold the statutory cap on noneconomic damages<br />

is unconstitutional.<br />

See also, Stechschulte v. Jennings, __ Kan. __, __ P.3d __ (Apr. 12, 2013) (Beier, J.)<br />

(Donald R. Noland, District Judge, assigned vice Justice Moritz) (Consumer Protection<br />

Act)<br />

42


TORTIOUS INTERFERENCE WITH CONTRACT AND PROSPECTIVE BUSINESS<br />

RELATIONSHIPS<br />

TRUSTS<br />

Cohen, et al., v. Battaglia<br />

__Kan. ___, 293 P.3d 752 (Feb. 8, 2013) (Nuss, C.J.)<br />

<strong>Case</strong> No. 99,793<br />

The Baron Automotive Group, Inc. (BAG) and others agreed to sell to Group 1 Automotive 100 percent <strong>of</strong><br />

the membership interests in Baron Development Company (BDC). When Battaglia, who was president <strong>of</strong><br />

BAG and had a security interest in BDC, learned <strong>of</strong> the sale agreements, he insisted on knowing the<br />

purchase price and other details. The trustees refused the request because Battaglia was not a "seller" under<br />

the sale agreements, the transactions with Group 1 were confidential, and disclosure <strong>of</strong> such information<br />

might jeopardize the agreements. 4 days before the sales transaction was set to close, Battaglia's attorney,<br />

Louis C. Accurso, filed a civil action for breach <strong>of</strong> fiduciary duty and self-dealing in the circuit court <strong>of</strong><br />

Jackson County, Missouri, naming Cohen, the Cohen Trust, Cass, BAG, and BDC as defendants (the<br />

Missouri action). That same day, Accurso faxed to Group 1's general counsel a copy <strong>of</strong> the Missouri action<br />

along with the following letter: "Please find enclosed a file-stamped copy <strong>of</strong> a lawsuit filed today on behalf<br />

<strong>of</strong> Marion Battaglia. If you have any questions or comments, please do not hesitate to contact me." After<br />

receiving the letter and a copy <strong>of</strong> the Missouri action from Battaglia's attorney, Group 1 refused to close the<br />

transaction without indemnification and escrow. Their demands were met, with the trustees allegedly<br />

incurring substantial attorney fees as a result. After closing, the Cohen and Cass trustees filed a tortious<br />

interference lawsuit against Battaglia. The trial court ultimately granted Battaglia's motion to dismiss. The<br />

Court <strong>of</strong> Appeals panel rejected the rationales <strong>of</strong> the district court, but affirmed nevertheless the dismissal<br />

on a different ground, i.e., § 772 <strong>of</strong> the Restatement (Second) <strong>of</strong> Torts (1979).<br />

Supreme Court reversed because the Court <strong>of</strong> Appeals inappropriately resolved factual issues on a<br />

dispositive motion. Court held the Court <strong>of</strong> Appeals' reliance on § 772 <strong>of</strong> the Restatement <strong>of</strong> Torts and the<br />

truthfulness <strong>of</strong> the communicationwas premature. Court found that it is true that the Missouri lawsuit was<br />

indeed on file and Accurso conveyed a true fact when communicating only that point to Group 1. But<br />

Accurso did more: he sent a full copy <strong>of</strong> the petition to Group 1, and it contained mere allegations, i.e.,<br />

their truthfulness had yet to be proven. Court stated that because the litigation was in its early stages when<br />

dismissed, it was unable to ascertain the effect <strong>of</strong> this Accurso communication upon Group 1. Court<br />

remanded to the district court for additional proceedings.<br />

Hamel v. Hamel<br />

___ Kan. ___, ___ P.3d ___, 2013 WL 1365335 (Apr. 5, 2013) (Moritz, J.) (Biles,<br />

J. dissenting)<br />

<strong>Case</strong> No. 102,744<br />

This appeal arose from a dispute over the administration <strong>of</strong> a trust between a beneficiary, Lawrence Hamel<br />

(Lawrence), and the trustees, Dennis Hamel (Dennis) and Leona Newell (collectively Trustees). Lawrence<br />

sought termination <strong>of</strong> his deceased father's trust, the Arthur L. Hamel Living Trust and its First Amendment<br />

(collectively Trust), and immediate distribution <strong>of</strong> Trust assets based on the Trustees' alleged failure to<br />

properly administer the Trust. Lawrence later moved to set aside a contract for deed executed between<br />

Dennis and his wife, as buyers, and the Trustees, as sellers, for the sale <strong>of</strong> farmland owned by the Trust.<br />

The Kansas Supreme Court held the district court reasonably interpreted ambiguous Trust provisions as not<br />

requiring the Trust's immediate termination upon Arthur's death. However, the court concluded the<br />

Trustees lacked authority to sell the farmland to Dennis under a 6-year contract for deed, which violated the<br />

Trust's express provisions requiring disposition <strong>of</strong> the farmland within 3 years <strong>of</strong> Arthur's death. The court<br />

declined to set aside the sale, however, because Lawrence's motion sought either reversion <strong>of</strong> the farmland<br />

43


to the beneficiaries or Dennis' payment <strong>of</strong> the contract price within 3 years, and Dennis had timely paid.<br />

Instead, because the Trustees' execution <strong>of</strong> the contract for deed violated the terms <strong>of</strong> the Trust, the court<br />

held that Lawrence had probable cause to challenge the Trustees' sale <strong>of</strong> the farm to Dennis under that<br />

contract. Therefore, the Kansas Supreme Court reversed both the district court's ruling regarding the<br />

Trustees' authority to finance the sale <strong>of</strong> the farm as well as its enforcement <strong>of</strong> the no-contest clause against<br />

Lawrence. The court remanded for further proceedings necessary, if any, to effectuate its rulings and for<br />

consideration <strong>of</strong> Lawrence's claim for attorney fees and costs.<br />

Biles J., dissented, disagreed with the majority's conclusion the Trustees lacked authority to sell the<br />

farmland, arguing they completed a "purchase" by reducing what was a farmland asset to a contract for<br />

ongoing installment payments and the language <strong>of</strong> the Trust did not prevent such a transaction.<br />

See also, Church <strong>of</strong> God in Christ, Inc. v. Board <strong>of</strong> Trustees <strong>of</strong> Emmanuel Church <strong>of</strong><br />

God in Christ, 47 Kan. App. 2d 674, 280 P.3d 795 (<strong>June</strong> 8, <strong>2012</strong>) (Bruns, J.) (Default<br />

Judgment); Hemphill v. Shore, 295 Kan. 1111, 289 P.3d 1173 (Dec. 7, <strong>2012</strong>) (Beier, J.)<br />

(Constructive Fraud); Jeanes v. Bank <strong>of</strong> America, et al., ___ Kan. ___, 295 P.3d 1045<br />

(Mar. 8, 2013) (Per curiam) (Cause <strong>of</strong> Action)<br />

UNJUST ENRICHMENT<br />

Uhlman v. Richardson<br />

48 Kan. App. 2d 1, 287 P.3d 287 (Aug. 3, <strong>2012</strong>) (Leben, J.)<br />

Petition for Review filed Aug. 30, <strong>2012</strong><br />

<strong>Case</strong> No. 105,147<br />

Generic rules for unjust-enrichment claims do not apply here because more specific ones for contribution<br />

do. The Court <strong>of</strong> Appeals found that this case should not have been submitted to jury under a generic<br />

unjust-enrichment legal theory; the district court's judgment is reversed. Subject to any equitable defenses,<br />

the Richardsons are liable to Uhlmann for their pro rata share <strong>of</strong> the loan deficiency, which in this case is<br />

slightly greater than jury's award. Remand is necessary for trial court's consideration <strong>of</strong> equitable defenses<br />

asserted by the Richardsons. Uhlmann did not lose the right to appeal by getting the Richardsons to post an<br />

appeal bond but not collecting any money on the judgment. A judgment creditor who initiates some part <strong>of</strong><br />

the process <strong>of</strong> executing on a judgment but does not collect any money or sell any <strong>of</strong> the debtor's property<br />

has not acquiesced in the judgment. This is so even if the debtor, in response, posts a supersedeas bond,<br />

which protects the judgment creditor's ability to collect the judgment while the appeal is pending.<br />

UTILITY RATES<br />

Citizens Utility Ratepayer Board v. KCC, et al.<br />

47 Kan. App. 2d 1112, 284 P.3d 348 (July 27, <strong>2012</strong>) (Hill, J.)<br />

<strong>Case</strong> No. 107,897<br />

The court held that the Citizens' Utility Ratepayer Board (CURB) failed to explain how an award <strong>of</strong> rate<br />

case expenses over $2.1 million, which was to be amortized over a 4-year period, rendered the<br />

Commission's overall determination <strong>of</strong> KCP&L's final revenue requirement outside the zone <strong>of</strong><br />

reasonableness. The court stated that it could only nullify a Commission order only when the decision is so<br />

unreasonable as to be outside the realm <strong>of</strong> fair debate. The court held that basic calculations establish that<br />

the Commission's order allowed $1.1 million more in rate case expenses than supported by CURB's expert<br />

witness. This amount, amortized over 4 years, accounts for approximately $275,000—or 1.25 percent—<strong>of</strong><br />

KCP&L's rate increase. The Commission's final decision authorized a $21,846,202 revenue increase. This<br />

increase was determined necessary to give KCP&L the opportunity to earn income to meet its determined<br />

44


evenue requirement <strong>of</strong> $149,121,865. Therefore, even if the Commission acted improperly with respect to<br />

its determination <strong>of</strong> rate case expenses, CURB failed to establish that any error carried the Commission's<br />

overall rate determination outside the zone <strong>of</strong> reasonableness for its rates.<br />

WORKERS COMPENSATION<br />

Douglas v. Ad Astra Info Systems, LLC<br />

___ Kan. ___, 293 P.3d 723 (Feb. 8, 2013) (Johnson, J.)<br />

<strong>Case</strong> No. 101,445<br />

Douglas was awarded benefits under the Workers Compensation Act for an injury he sustained while<br />

operating a go-cart at an event sponsored by his employer, Ad Astra Information Systems, L.L.C.<br />

Employees were given the option <strong>of</strong> either attending the event or remaining at work. Ad Astra appealed the<br />

award, claiming that Douglas' injuries were not compensable under K.S.A. 2006 Supp. 44-508(f) because<br />

they were sustained during a recreational or social event that Douglas was not required to attend. The Court<br />

<strong>of</strong> Appeals, in a split decision, affirmed the Workers Compensation Board. Ad Astra then filed a petition<br />

for review. Our Supreme Court held that circumstances that will exclude an employee's injuries from<br />

coverage under the Workers Compensation Act are where the employee was under no duty to attend the<br />

recreational or social event and where the injury did not result from the performance <strong>of</strong> tasks related to the<br />

employee's normal job duties or as specifically instructed to be performed by the employer. The Court<br />

concluded that the Board applied the incorrect legal standard and reversed and remanded the case to the<br />

Board for further proceedings in conformance with the plain language <strong>of</strong> K.S.A. 2006 Supp. 44-508(f).<br />

Fernandez v. McDonald's<br />

296 Kan. 472, 292 P.3d 311 (Jan. 25, 2013) (Johnson, J.)<br />

<strong>Case</strong> No. 104,951<br />

Plaintiff, an employee <strong>of</strong> McDonald's, was injured on the job. McDonald's filed an accident report and<br />

subsequently learned that Plaintiff was unauthorized to work in the United States. Plaintiff sought a work<br />

disability award under K.S.A. 44-510e(a), but the ALJ denied the award on public policy grounds: since the<br />

purpose <strong>of</strong> the Workers Compensation Act is to assist injured workers to return to work but Plaintiff is not<br />

legally authorized to return to work in the United States, it would be against legislative intent to grant<br />

Plaintiff a work disability award. A divided Board reversed the decision and granted Plaintiff a work<br />

disability award, and McDonald's appealed. The sole issue on appeal before the Supreme Court was<br />

whether Plaintiff's unauthorized work status precluded a work disability award under the applicable version<br />

<strong>of</strong> K.S.A. 44-510e(a) (in effect prior to the 2011 amendments to the Act). The Supreme Court found that<br />

there was no exception in the plain language <strong>of</strong> K.S.A. 44-510e(a) precluding work disability awards for<br />

persons with unauthorized work status and noted that this conclusion was supported by reading the Act as a<br />

whole. It thus held that Plaintiff's unauthorized work status did not preclude her from receiving a work<br />

disability award.<br />

Hall v. Knoll Building Maintenance, Inc.<br />

48 Kan. App. 2d 145, 285 P.3d 383 (Sept. 7, <strong>2012</strong>) (Bruns, J.)<br />

<strong>Case</strong> No. 107,191<br />

Hall was injured when he fell from a ladder while working on a ro<strong>of</strong> for Knoll Building Maintenance, Inc.,<br />

which is a Kansas for-pr<strong>of</strong>it corporation with shareholders who are all related to one another. Hall made a<br />

claim for workers compensation benefits, but his claim was preliminarily denied by an ALJ who found the<br />

Kansas Workers Compensation Act did not apply to Knoll because all <strong>of</strong> its shareholders were members <strong>of</strong><br />

the same family. On review, the Kansas Workers Compensation Board concluded that the exclusion for<br />

family members set forth in K.S.A. 44-505(a)(2) did not apply to Knoll because corporations cannot have a<br />

family by marriage or consanguinity. On petition for review, the Court <strong>of</strong> Appeals affirmed the Board's<br />

decision, finding the Board correctly interpreted K.S.A. 44-505(a)(2) and applied K.A.R. 51-11-6, which<br />

45


states that "[t]he provision in K.S.A. 44-505 excluding the payroll <strong>of</strong> workers who are members <strong>of</strong> the<br />

employer's family shall not apply to corporate employers."<br />

Messner v. Continental Plastic Containers<br />

___ Kan. App. 2d ___, 298 P.3d 371 (Mar. 29, 2013) (McAnany, J.)<br />

Petition for review filed Apr. 25, 2013<br />

<strong>Case</strong> No. 107,035<br />

Messner was awarded benefits under the Workers Compensation Act for two separate injuries she sustained<br />

while working for Continental Plastic Containers. In her first claim, Messner sought compensation for<br />

injuries she sustained as a result <strong>of</strong> a fall. In her second claim, Messner alleged she received additional<br />

injuries to her right shoulder from repetitive job duties after her return to work. Continental appealed the<br />

award, raising three issues. First, Continental challenged the award <strong>of</strong> work disability, asserting that K.S.A.<br />

44-510e(a) prohibits an award <strong>of</strong> work disability because Messner's award would have been paid in full<br />

before she became eligible for work disability upon leaving her employment. The Court <strong>of</strong> Appeals held<br />

that the Board had the authority to enter a lump-sum award that provided benefits for Messner's functional<br />

disability, as well as her later work disability, because Messner showed an increase in disability during the<br />

415-week benefit period. Second, Continental claimed that Messner's shoulder injury did not arise out <strong>of</strong><br />

and in the course <strong>of</strong> her employment. The Court <strong>of</strong> Appeals held the record discloses substantial evidence<br />

to support the Board's finding. Finally, Continental contended the Board erred in awarding Messner<br />

temporary total disability compensation because Messner's list <strong>of</strong> work restrictions that led to her leaving<br />

her employment were imposed by her personal chiropractor, not by an authorized treating physician. The<br />

Court <strong>of</strong> Appeals concluded that no authorized treating physician found that Messner experienced<br />

temporary total disability during the relevant time period as required by K.S.A. 44-510c(b)(2). The court<br />

reversed and remanded the case to the Board for a recalculation <strong>of</strong> Messner's award for her right shoulder<br />

injury.<br />

WRONGFUL DEATH<br />

See also, Martin v. Naik, ___ Kan. ___, ___ P.3d ___, 2013 WL 1850661 (<strong>May</strong> 3, 2013)<br />

(Per Curiam) (Medical Malpractice)<br />

ZONING AND PLANNING<br />

Hacker v. Sedgwick County<br />

48 Kan. App. 2d 164, 286 P.3d <strong>22</strong>2 (Sept. 14, <strong>2012</strong>) (Malone, J.)<br />

Petition for Review filed Oct. 4, <strong>2012</strong><br />

<strong>Case</strong> No. 107,214<br />

A zoning variance permitted the Heins to operate a lawn care business on their rural land. As they grew<br />

their business over time, the Heins requested new variances to allow for further expansion. After review,<br />

the Board <strong>of</strong> Zoning Appeals granted the variances. Hacker and other area businesses filed suit, challenging<br />

the reasonableness <strong>of</strong> the decision to grant the variance. The district court found that self-created business<br />

growth amounted to a self-created hardship that could not be the basis for a variance. Accordingly, the<br />

district court vacated the Board's grant <strong>of</strong> the three new variances. On appeal, the Board argued that<br />

plaintiffs lacked standing because they were not within the narrow class <strong>of</strong> persons "aggrieved by" the<br />

zoning decision under K.S.A. 12-760 or "dissatisfied with" the zoning decision under K.S.A. 12-759(f).<br />

The Court <strong>of</strong> Appeals held that because K.S.A. 12-759(f) is the more specific statute, it is the sole avenue<br />

by which a party has standing to challenge the Board's decision. And to be "dissatisfied with" the Board's<br />

decision sufficient to confer standing a plaintiff must have a substantial grievance that may affect his or her<br />

pecuniary interests. Because the variance allowing the Heins to expand would increase traffic on the roads,<br />

46


the upkeep <strong>of</strong> which plaintiffs are required to pay, plaintiffs had standing to sue. As to the merits, the Court<br />

<strong>of</strong> Appeals held as a matter <strong>of</strong> law that self-created business growth is not an exception to the general rule<br />

that unnecessary hardships sufficient to permit a variance may not be self created. Accordingly, the Court<br />

<strong>of</strong> Appeals affirmed the district court's decision to vacate the variances.<br />

47

Hooray! Your file is uploaded and ready to be published.

Saved successfully!

Ooh no, something went wrong!