## Facts

- Coy Turner, Jr., driving a feed truck owned by his employer, M & W Milling Co., Inc., caused a movable auger to swing into oncoming traffic and strike a dump truck owned by Billy Andrew, Jr.
- Andrew owned several dump trucks individually but operated a trucking business through a single-member limited liability company, Billy Andrew, Jr. Trucking, LLC.
- Andrew sued Turner and M & W in his individual capacity for (1) property damage to his truck and (2) lost business income from loss of use of the truck in the trucking business.
- The LLC was not named as a plaintiff, and M & W disputed Andrew’s ability to recover business-income losses allegedly belonging to the LLC.
- The trial court granted partial summary judgment against Andrew on the lost-business-income claim.
- After repeated discovery noncompliance regarding damages documentation, the trial court excluded all damages evidence and entered judgment for defendants, effectively ending the case.
- The Court of Appeals reversed, allowing Andrew to pursue the lost-income claim individually and reversing the discovery sanction.
- The Kentucky Supreme Court granted discretionary review.

## Issues

1. Whether a sole member of an LLC may sue in his own name for lost business income allegedly suffered by the LLC, when the LLC is not a party.
2. Whether a discovery sanction excluding all damages evidence and resulting in judgment for the opposing party is the functional equivalent of dismissal requiring findings of fact and conclusions of law.

## Decision

- The court held that any claim for lost business income belonged to the LLC as a separate legal entity and could not be pursued by Andrew individually.
- The court recognized Andrew could sue individually for damage to the truck he personally owned.
- The court held that excluding all evidence of damages was the functional equivalent of dismissing both claims and therefore required findings of fact and conclusions of law.
- The court reversed the Court of Appeals insofar as it permitted Andrew to prosecute the LLC’s lost-business-income claim in his own name.
- The court vacated the remainder of the Court of Appeals’ decision and remanded for further proceedings, directing the trial court to make the required findings if imposing dismissal-level discovery sanctions.

## Legal Principles

- An LLC is a distinct juridical entity separate from its members, including a single-member LLC.
- Lost-profit or lost-business-income claims arising from LLC operations are assets of the LLC and must be brought by the LLC as the real party in interest.
- A member’s individual ownership of business assets used by the LLC does not convert the LLC’s business-income losses into the member’s personal claim.
- A discovery sanction that effectively terminates a case (including exclusion of all damages evidence) must be supported by findings of fact and conclusions of law sufficient for appellate review.

## Conclusion

The Kentucky Supreme Court reaffirmed that LLC entity separateness controls standing for business-income losses even in single-member LLCs, and it required trial courts to issue findings and legal conclusions when discovery sanctions operate as case-ending dismissals.


Turner v. Andrew, 413 S.W.3d 272 (Ky. 2013)