Request By:
Ronald W. May
Attorney at Law
P.O. Box 575
Pikeville, Kentucky 41501
Opinion
Opinion By: David L. Armstrong, Attorney General; By: Martin Glazer, Assistant Attorney General
You seek an opinion of this office as to whether the Kentucky Board of Claims may approve (without taking any proof) an "Agreed Order Dismissing as Settled" when the basis of the settlement is for reasons other than admitted negligence on the part of the Commonwealth or its agents.
Our research has disclosed only one previous opinion of this office (OAG 62-226, copy enclosed) which opined that friendly settlements are not authorized.
KRS 44.070(1) authorizes the Board of Claims "to investigate, hear proof and to compensate persons for damages sustained to either person or property as a proximate result of negligence on the part of the Commonwealth, any of its departments or agencies or any of its officers, agents or employes while acting within the scope of their employment by the Commonwealth or any of its departments or agencies. . . ." (Emphasis supplied.)
Further, KRS 44.120 provides:
An award shall be made only after consideration of the facts surrounding the matter in controversy, and no award shall be made unless the board is of the opinion that the damage claimed was caused by such negligence on the part of the Commonwealth or its agents as would entitle claimant to a judgment in an action at law if the state were amenable to such action.
KRS 44.086 allows the board to investigate in-house claims under $1,000 and requires the holding of hearings on contested claims over $500. This statute is mirrored in a little more detail in board regulation 108 KAR 1:010.
Both the statutes and regulations require that there be established negligence by the Commonwealth which proximately causes the injury complained of before the Commonwealth shall be liable to a claimant.
A settlement which does not admit negligence or which denies negligence and in which there is no "proof" either by hearing or other procedure cannot be sufficient to authorize the Board to enter an order requiring the payment of monies out of the state treasury for such claims.
Of course, the parties can stipulate facts (rather than take formal proof) and the board can accept as true (or reject same, if it has knowledge contrary to such stipulations) those facts and determine liability of the Commonwealth based upon such stipulations.
But, if a claimant were to file a complaint asserting $500 damages and the state agency denied liability, the Board could not (under its present statutory scheme) preclude a hearing or a stipulation establishing facts that the agency was negligent. Thus, the board with just the pleadings (without stipulation or other proof) could not allow a settlement (which did not admit liability) to be carried out. The Commonwealth is only to pay in instances where it is negligent and that negligence is the proximate cause of a specific injury.