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State v. Kentucky Insurance Guaranty Association5/30/1997
ht suit to enjoin the setoff, the circuit court and appellate court held that the five- year statute of limitations had run before the Secretary's counterclaim seeking reimbursement was filed. This court concluded that the earlier notice of setoff pursuant to
KRS 44.030 was not sufficient to toll the applicable statute of limitations. In this context, the court made the aforequoted statement regarding the applicability of the statutes of limitation to judicial proceedings. More specifically, the Metts court held that "the proper use of KRS 44.030 is not an action to which the statute of limitations apply." 665 S.W.2d at 319.
The summary setoff provision at issue in Metts is easily distinguishable from the administrative proceedings available to the Cabinet in this case. The Cabinet's hearing officers have quasi-judicial powers; they make findings of fact which are binding on appeal to the circuit and appellate courts unless not supported by substantial evidence. They are granted authority by statute to impose fines, revoke permits and order the forfeiture of performance bonds. Clearly the Metts case did not require the court to consider the applicability of statutes of limitations to administrative proceedings such as these quasi-judicial proceedings available to the Cabinet. The Cabinet's attempts to characterize the holding in Metts as controlling simply do not survive a reading of that case.
Similarly unpersuasive is the Cabinet's citation to Vessels v. Brown-Forman Distillers Corporation, Ky., 793 S.W.2d 795 (1990), a case which addressed whether a worker's compensation claimant could appeal a Court of Appeals decision to the Supreme Court as a matter of right or must seek discretionary review. In that case the Court stated "nothing in Section 109 [of the Kentucky Constitution] contemplates an administrative agency, much less the Workers' Compensation Board, as the equivalent of a court." 783 S.W.2d at 798. This statement was made in the course of the Supreme Court's holding that the guarantee in Section 115 of the Kentucky Constitution of "at least one appeal to another court" required the Conclusion that a workers's compensation claimant could appeal to the Supreme Court as a matter of right. As the Vessels court reasoned, under the workers' compensation statute the Court of Appeals is the first court contemplated by Section 115 and the Supreme Court is "another court" which must necessarily hear the appeal as a matter of right.
Again the Cabinet attributes too much to an isolated statement in a dissimilar case. Determining which tribunals constitute courts for purposes of assuring that litigants in Kentucky receive their constitutional right to at least one appeal to "another court" is a different inquiry from determining whether a statute of limitations applicable in judicial proceedings is also applicable in administrative proceedings. For this determination we must examine the limitations provisions of KRS Chapter 413 and case law addressing administrative hearing procedures where no time limitations are provided.
KRS 413.250 provides that "an action shall be deemed to commence on date of the first summons or process issued in good faith from the court having jurisdiction of the cause of action." While "court" may be generally understood to be limited to tribunals of the judicial branch of government, one provision of KRS Chapter 413 expressly rejects that circumscribed meaning. KRS 413.270 provides:
(1) If an action is commenced in due time and in good faith in any court of this state and the defendants or any of them make defense, and it is adJudged that the court had no jurisdiction of the action, the plaintiff or his representat
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