## Facts

- Delbert Wayne Reeder lived next door to Paul Hampton’s parents; the households shared a common driveway.
- While visiting his parents, Hampton accidentally drove into a support post for Reeder’s carport, collapsing it and damaging Reeder’s home and personal property stored under the carport.
- Hampton’s parents had liability insurance with State Farm Mutual Automobile Insurance Company, and State Farm was promptly notified of the loss.
- State Farm obtained a repair estimate of $8,471 and later offered $8,961; Reeder’s lowest estimate was $13,392, and he refused the offer.
- Reeder sued seeking property damages and expenses, attorney’s fees, and $250,000 for alleged unfair claims settlement practices under KRS 304.12-230.
- The trial court dismissed the statutory unfair-practices claim, tried the remaining property-damage claim to a jury, and entered judgment on a $11,000 verdict (which was satisfied); it also denied prejudgment interest.

## Issues

1. Whether a third-party claimant may recover damages from an insurer for violations of KRS 304.12-230 through KRS 446.070.
2. Whether Reeder was entitled to prejudgment interest on the $11,000 verdict or whether the damages were unliquidated.

## Decision

- The Supreme Court of Kentucky affirmed recognition of a private damages action for violations of KRS 304.12-230 through KRS 446.070, available to third-party claimants as well as insureds.
- The Court affirmed denial of prejudgment interest because the damages were unliquidated.
- The Court affirmed the Court of Appeals on both issues.

## Legal Principles

- Under KRS 446.070, a person injured by the violation of a statute enacted for public protection may recover damages unless the legislature clearly indicates otherwise.
- KRS 304.12-230 imposes statutory duties concerning claims handling; violations may support a private damages action through KRS 446.070 even though the statute also authorizes administrative enforcement.
- A third-party claimant may sue an insurer for damages caused by unfair claims settlement practices under KRS 304.12-230 via KRS 446.070.
- Prejudgment interest is generally available as a matter of right only on liquidated claims; where the amount of loss is not readily ascertainable and is fixed by a jury, the claim is treated as unliquidated and does not bear prejudgment interest.

## Conclusion

Kentucky’s high court held that unfair claims settlement practices under KRS 304.12-230 are privately enforceable for damages through KRS 446.070 by injured third-party claimants, but it denied prejudgment interest because the property-damage award required a jury valuation and was unliquidated.


State Farm Mut. Auto. Ins. Co. v. Reeder, 763 S.W.2d 116 (Ky. 1988)