RENDERED: DECEMBER 20, 2002; 10:00 a.m. NOT TO BE PUBLISHED NO CA MR OPINION AFFIRMING ** ** ** ** **

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1 RENDERED: DECEMBER 20, 2002; 10:00 a.m. NOT TO BE PUBLISHED C ommonwealth Of K entucky Court Of A ppeals NO CA MR ALICE STANIFORD APPELLANT APPEAL FROM JOHNSON CIRCUIT COURT v. HONORABLE DANIEL SPARKS, JUDGE ACTION NO. 98-CI ALLSTATE INSURANCE COMPANY; AND THE HARTFORD UNDERWRITING INSURANCE COMPANY APPELLEES OPINION AFFIRMING ** ** ** ** ** BEFORE: GUIDUGLI, HUDDLESTON AND JOHNSON, JUDGES. GUIDUGLI, JUDGE. Alice Staniford ("Staniford") appeals from a summary judgment and order dismissing her personal injury claim against Sandra Hampton ("Hampton"), Allstate Insurance Company ("Allstate"), and The Hartford Underwriting Insurance Company ("Hartford"). We affirm. On November 5, 1998, a vehicle driven by Hampton struck the rear of a vehicle operated by Staniford. Staniford was the permissive user of a leased vehicle owned by Josie Price ("Price"). Staniford was injured in the accident.

2 At the time of the accident, Staniford owned an insurance policy with Allstate. As the permissive driver of Price's vehicle, Staniford also was covered by a Hartford policy owned by Price. Each policy contained an underinsured motorist coverage provision ("UIM"). On December 18, 1998, Staniford filed the instant personal injury action against Hampton, Allstate, and Hartford. She later amended her complaint, first to add her daughter as a plaintiff and later to assert a UIM claim against Allstate. The complaint was again amended to assert a similar UIM claim against Hartford. At approximately the same time the third amended complaint was filed, Staniford settled with Hampton, and the claim against Hampton was dismissed. The action proceeded as against the insurers. A somewhat protracted procedural history ensued, which is set forth in the record and need not be addressed herein. Ultimately, Hartford and Allstate filed motions to dismiss Staniford's UIM claims. As a basis for the motions, the insurers argued that Staniford failed to provide them written notice of the proposed settlement with Hampton as required by KRS and related case law. Upon taking proof on the motions, the trial court rendered a summary judgment and order dismissing the action as against each defendant. This appeal followed. Staniford now argues the trial court erred in rendering the summary judgment and dismissing the action. She maintains that Hartford had sufficient notice of the proposed settlement to satisfy KRS (3), and that it was not entitled to -2-

3 complain about lack of notice when it was disputing and allegedly misrepresenting the nature of their coverage prior to settlement. She further argues that since no prejudice resulted to Hartford and/or Allstate due to the settlement, she should be entitled to go forward with her UIM claims against both carriers. She seeks a reversal of the summary judgment and order of dismissal. We have closely studied the record, the law, and the written arguments, and find no error in the entry of summary judgment and order of dismissal. The notice provision at issue, KRS (3) provides, in relevant part, that [I]f an injured person... agrees to settle a claim with a liability insurer and its insured, and the settlement would not fully satisfy the claim for personal injuries or wrongful death so as to create an underinsured motorist claim, then written notice of the proposed settlement must be submitted by certified or registered mail to all underinsured motorist insurers that provide coverage. The corpus of Staniford's argument on this issue is her assertion that her notice to Hartford of the possibility of settlement some seven months before the actual settlement was executed either made Hartford aware, or should have made them aware, that its failure to assert its subrogation rights would result in a loss of those rights. The question, then, is whether the trial court erred in concluding that no notice was given to Hartford sufficient to satisfy KRS (3). We cannot conclude that the court so erred. The letter which Staniford alleges to be notice, dated December 18, 1998, merely advises Hartford of Staniford's retention of counsel and Hartford's option of intervening in the -3-

4 action pursuant to CR 24. It does not address either the possibility of settlement nor UIM coverage. Furthermore, at the time the letter was posted, the complaint had not yet been amended to assert a UIM claim. Given the fact that no UIM claim had been asserted and that no mention of settlement was made in the letter, it cannot reasonably be argued that the letter served as notice of Hartford's subrogation rights sufficient to satisfy KRS (3). Staniford next argues that Hartford was not entitled to complain about the lack of notice because it was disputing and likely misrepresenting the nature of its coverage prior to the settlement. In support of this argument, she maintains that prior to the settlement, Hartford was taking the position that its coverage did not include UIM coverage, but after the settlement availed itself of the notice requirement of KRS (3). We do not find this argument persuasive for two reasons. First, the record does not support the assertion that Hartford was either denying coverage or misrepresenting the nature of that coverage. Hartford points to a letter contained in the record in which it advises Staniford that it has processed all bills which were medically necessary and related to the accident. Second, even if Hartford had denied or misrepresented its coverage, we cannot conclude that this would form a justification for disregarding KRS (3). Lastly, Staniford argues that neither Hartford nor Allstate was prejudiced by the lack of statutory notice and that this lack of prejudice should form a basis for allowing the UIM -4-

5 claim to go forward. She also maintains that the court erred in placing on her the burden to prove that the Hartford and Allstate were not prejudiced by the lack of statutory notice rather than placing the burden of showing prejudice on the insurers. We find no error on this issue. KRS (3) does not require a UIM carrier to prove that prejudice resulted from the lack of statutory notice. The statutory language is clear and unambiguous, and places on the insured the duty to give notice to the UIM carrier. It appears that in the matter at bar, the trial court sought to give Staniford an opportunity to justify the lack of statutory notice and to argue why that it should not bar her from proceeding with her UIM claim. This was not, as Staniford argues, an additional burden the court placed on her, but rather was an opportunity to justify going forward with the claim despite her failure to comply with KRS (3). For the foregoing reasons, we affirm the summary judgment and order of the Johnson Circuit Court. ALL CONCUR. BRIEF FOR APPELLANT: Ned Pillersdorf Prestonsburg, KY BRIEF FOR APPELLEE, ALLSTATE INSURANCE COMPANY: John V. Porter Kevin P. Keene Paintsville, KY BRIEF FOR APPELLEE, THE HARTFORD UNDERWRITING INSURANCE COMPANY: Christopher A. Dawson Ashland, KY -5-