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Kentucky Center for Arts Corp. v. Berns12/27/1990
In November, 1987, Hendrik J. Berns filed suit in Jefferson Circuit Court alleging he fell and sustained permanent injuries at the Kentucky Center for the Arts, 530 W. Main Street, Louisville, Kentucky, when a railing on the steps loosened and came out while he was attempting to use it for balance.
The issues in this case involve sovereign immunity: first, whether the Kentucky Center for the Arts Corporation is immune from liability for negligence as an agency of the Commonwealth; and second, if so, whether there has been a waiver of that immunity by reason of the purchase of liability insurance.
Initially, the answer failed to raise the sovereign immunity defense. Then, in March, 1988, the Arts Corporation moved to dismiss on grounds of sovereign immunity. The motion was sustained, and this appeal followed. The Court of Appeals sustained the decision of the trial court that sovereign immunity applied, but reversed the order of dismissal and remanded finding a waiver of sovereign immunity because the legislation creating the Arts Corporation provides in part that "revenues derived by the corporation from the use of the Kentucky Center for the Arts, or contributions . . . shall be solely used to defray the expenses of the Kentucky Center for the Arts, including . . . the procurance of insurance." KRS 153.430(3). The Court of Appeals relied principally on Green River District Health Department v. Wigginton, Ky., 764 S.W.2d 475 (1989) and Taylor v. Knox County Board of Education, 292 Ky. 767, 167 S.W.2d 700 (1942) in reaching this decision.
The Kentucky Center for the Arts Corporation moved for discretionary review claiming these two cases do not apply because of changes in the wording of the Board of Claims Act effective in 1986. Berns filed a cross-motion for discretionary review claiming that the Kentucky Center for the Arts Corporation is not an agency of the Commonwealth constitutionally protected by sovereign immunity. We granted both motions, and we now affirm on grounds the state's sovereign immunity does not extend to the Kentucky Center for the Arts Corporation.
I. SOVEREIGN IMMUNITY
The decision when the sovereign immunity defense applies to an entity created by an act of the General Assembly has been historically troublesome to our Court, resulting in diverse decisions difficult to reconcile. At the heart of the matter is the tension between our constitutional provisions, Kentucky Constitution §§ 14, 54 and 241, protecting our citizens against legislative action to limit or deny access to the courts to pursue existing causes of action for personal injury and wrongful death, and our constitutional provision, Kentucky Constitutions § 231, interpreted through the years to constitutionalize the common law doctrine of sovereign immunity in suits brought against the Commonwealth. Section 231 limits sovereign immunity to "suits . . . against the Commonwealth." The crux of the decisions to date has been that § 231 as a specific provision overrides §§ 14, 54 and 241 as general provisions, but only in suits which may be legitimately classified as "brought against the Commonwealth." See Wood v. Board of Education of Danville, Ky., 412 S.W.2d 877 (1967) and Rooks v. University of Louisville, Ky.App., 574 S.W.2d 923 (1978).
Where sovereign immunity exists, the General Assembly has the power of statutory waiver which it exercises through the Board of Claims Act. KRS 44.070 et seq. With this power of waiver comes the power to control the extent to which waiver shall be permitted. But, the General Assembly has no power to
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