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American General Life & Accident Insurance Company v. Hall3/21/2002
TO BE PUBLISHED
REVERSING
Appellee Sharon Hall brought this action in the Perry Circuit Court against her employer, American General Life & Accident Insurance Company, and her supervisor, James Robert Lyons, seeking "damages for mental and emotional injuries inflicted by sexually discriminatory practices, including emotional and psychological distress, humiliation, and personal indignity, pursuant to KRS 344, et. seq." The Perry Circuit Court ultimately entered summary judgments in favor of both defendants, and Hall appealed. The Court of Appeals affirmed as to Lyons and reversed and remanded as to American General. We granted American General's motion for discretionary review and now reverse the Court of Appeals and reinstate the judgment of the trial court.
Hall was one of five life insurance agents employed in American General's Hazard, Kentucky, office. From January 1992 through July 1993, Lyons was the office manager and Hall's immediate supervisor. Hall claims that during that period, Lyons subjected her daily to unwelcome, sexually explicit comments about their respective body parts, his sex life, and his sexual fantasies about her; that he occasionally "brushed" against her breasts as he walked past her in the office; and that, in July 1993, he called her into his office and exposed his genitalia to her. Shortly thereafter, Hall terminated her employment and sought treatment for psychological injuries, including sleeping and eating disorders, depression, uncontrollable crying, suicidal thoughts, auditory hallucinations, and panic attacks.
Hall filed this action on August 24, 1994. Count I of the complaint alleges that Lyons's sexual harassment was intentional and constituted sexually discriminatory conduct that "had a substantial detrimental affect on Plaintiffs employment and psychological well-being," specifically causing her "to suffer humiliation, indignity, injury to her feelings, emotional and psychological distress with physical manifestations, and past and future lost wages." Count I also alleges that American General had notice of Lyons's actions, both because Hall personally notified American General's district manager of such and because Lyons's harassment was "pervasive and obvious," and that American General failed to investigate or take remedial action. Thus, Count I contained the allegations necessary to state a cause of action for a statutory civil rights violation under KRS 344.010(5), KRS 344.020(1)(b), KRS 344.040(2) and KRS 344.450. See Meyers v. Chapman Printing Co., Inc., Ky., 840 S.W.2d 814, 820-21 (1992) citing Meritor Savings Bank. FSB v. Vinson, 477 U.S. 57, 65-67, 106 S.Ct. 2399, 2404-06, 91 L.Ed.2d 49 (1986).
Count II of the complaint alleged that American General "ratified, sanctioned and condoned [Lyons's] conduct and served to conceal this conduct from proper address." Count II also alleged that American General did not have any procedures in place for reviewing complaints of sexual harassment or alerting employees that sexual harassment would not be tolerated. Hall subsequently admitted in her deposition that American General did have such policies and procedures in place and that she was aware of them even before Lyons became her supervisor. Count III of the complaint stated a cause of action against both Lyons and American General for intentional infliction of emotional distress, the so-called "tort of outrage." Craft v. Rice, Ky., 671 S.W.2d 247, 251 (1984).
On October 14, 1994, Hall filed an application for workers' compensation benefits against American General claiming a work-related disability, specifically, "[plsychological problems resulting from sexual harassment by immediate superviso
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