In the case of James Malone v. Kentucky Farm Bureau Mutual Insurance Company, the Kentucky Supreme Court affirmed the Opinion of the Court of Appeals, upholding the trial court's summary judgment.
The primary issue under consideration in this case was the requirement under KRS 304.39-320 and Coots v. Allstate Ins. Co. for an injured person or personal representative who "agrees to settle a claim with a liability insurer and its insured" to provide written notice of "the proposed settlement" by certified or registered mail to all uninsured motorist insurers that provide coverage.
After sustaining injuries from a car accident, James Malone filed suit against Timothy Bruce, the other driver involved in the collision, and against Kentucky Farm Bureau Mutual Insurance Company, Malone's underinsured motorist insurance (UIM) carrier. Prior to trail, Malone accepted the offer of Bruce's liability insurance carrier, Atlanta Casualty, for the limits of the policy in exchange for a release from further liability. Malone's counsel sent a certified letter to Farm Bureau stating, in part:
"Atlanta Casualty has advised that they have policy limits of $25,000.00 and this amount has been offered to settle their portion of Mr. Malone's claim. We are considering whether to accept this offer. In the meantime, because of the seriousness of Mr. Malone's injuries, we are making a claim for the policy limits of all applicable policies issued by Kentucky Farm Bureau for underinsured motorist coverage."
Farm Bureau filed a motion for summary judgment seeking a dismissal of Malone's UIM claim on the grounds that Malone's written notice stated only that he was "considering whether to accept this offer," which was not sufficient notice of an agreement to settle as required by KRS 304.39-320. They claimed that this lack of proper notice released Farm Bureau from responsibility for the UIM claim made by Malone. The McCracken Circuit Court agreed, and the summary judgment was affirmed by the Court of Appeals and Kentucky Supreme Court.