Case Name: Patricia Frickey, A Minor By and Through James H. Frickey and Kay T. Frickey, Her Parents and Natural Guardians, Appellant, v. Equity Mutual Insurance Company and Farmers Insurance Company, Inc., Appellees
Court: Kansas Court of Appeals
Jurisdiction: Kansas
Decision Date: 1978-03-31
Citations: 2 Kan. App. 2d 163
Docket Number: No. 49,372
Parties: Patricia Frickey, A Minor By and Through James H. Frickey and Kay T. Frickey, Her Parents and Natural Guardians, Appellant, v. Equity Mutual Insurance Company and Farmers Insurance Company, Inc., Appellees.
Judges: Before Rees, P.J., Swinehart and Meyer, JJ.
Reporter: Kansas Court of Appeals Reports
Volume: 2
Pages: 163–175

Head Matter:
(576 P.2d 702)
No. 49,372
Patricia Frickey, A Minor By and Through James H. Frickey and Kay T. Frickey, Her Parents and Natural Guardians, Appellant, v. Equity Mutual Insurance Company and Farmers Insurance Company, Inc., Appellees.
Petition for review denied May 5, 1978.
Opinion filed March 31, 1978.
Ward P. Ferguson of Weelborg, Embers & Ferguson, Chtd., of McPherson, for the appellant.
John W. Mize of Clark, Mize & Linville, Chartered, of Salina, for appellee Equity Mutual Insurance Company.
David S. Knudson of King, Stokes, Knudson & Nitz, Chartered, of Salina, for appellee Farmers Insurance Company, Inc.
Before Rees, P.J., Swinehart and Meyer, JJ.

Opinion:
Meyer, J.:
On June 15, 1975, one Bradley Holm picked up plaintiff at the Sonic Drive-In in McPherson, Kansas, to drive around awhile and then to take plaintiff home. Plaintiff asked to drive the car and Bradley Holm permitted her to do so. Plaintiff was 14 years of age at the time and had no driver's license. When plaintiff appeared to have trouble with the clutch, Bradley Holm shifted gears for her while she steered the car and operated the accelerator. As plaintiff turned a corner, she collided with a parked car, forcing it against a second parked car. All three cars were damaged.
Although the car which plaintiff was driving was titled in the name of Arlie Holm (Bradley Holm's father) only, it is undisputed that Bradley Holm paid for the car, that he paid for its maintenance and upkeep, and that he had the unrestricted use of it.
The owners of the parked cars and their insurers claimed damages from plaintiff, and plaintiff in turn demanded coverage from both her father's insurance carrier, Farmers Insurance Company, Inc. (hereinafter referred to as "Farmers"), and from Arlie Holm's insurance carrier, Equity Mutual Insurance Company (hereinafter referred to as "Equity"). Both insurance carriers denied coverage. In November, 1975, the owners of one of the damaged parked cars, the Hobsons, sued the plaintiff. Neither Farmers nor Equity appeared to defend plaintiff in this case. However, on May 7, 1976, Equity paid the Hobsons (the owners of one of the damaged parked cars) for their loss, and on June 21, 1976, they paid the Hasletts for the damage to their parked car. On May 18, 1976, the Hobsons dismissed their action against the Holms; and although suit was never filed by the Hasletts, their damages, as aforesaid, have now been paid and the statute of limitations has now run.
Meanwhile, on December 3, 1975, plaintiff filed her action against both Equity and Farmers, praying for statutory attorney fees, damages for mental anguish and for punitive damages.
Both Farmers and Equity filed motions for summary judgment, both of which were sustained by the trial court on November 5, 1976 (journal entry filed of record on December 3, 1976); hence this appeal.
Plaintiff claims the following as error by the trial court:
1. In granting the motions of the defendants for a summary judgment inasmuch as there are genuine issues as to material facts;
2. In making its findings of fact and conclusions of law on the defendants' motions for summary judgment as reflected in the journal entry of judgment of November 5, 1976;
3. In having no basis in fact or in law for the court's decision of November 5, 1976; and,
4. In failing to consider and to differentiate between attorney fees for the defense of the plaintiff under the insurance policies and the attorney fees incurred in establishing coverage in this action.
Equity alleges:
1. That it acted in good faith in denying plaintiff's request for coverage, precluding any claim for attorney fees; and,
2. That as a matter of law plaintiff is precluded from recovering punitive damages or damages for mental anguish.
Farmers alleges it exercised good faith in this litigation for the following assigned reasons:
1. Equity had primary coverage; or,
2. If Equity did not have primary coverage, Farmers did not afford coverage; or,
3. Farmers acted in good faith in interpreting the omnibus clauses of the respective policies to require the permission of Arlie Holm for Patricia Frickey to operate the automobile.
The respective omnibus clauses of the insurance companies are as follows:
Equity's policy under Part I — LIABILITY reads:
"Persons Insured: The following are insureds . . .
"(a) with respect to the owned automobile,
(1) the named insured or any resident of the same household,
(2) any other person using such automobile with the permission of the named insured provided his actual operation . is within the scope of such permission . . ."
Farmer's policy, Part I — Liability Insurance, reads as follows:
"DEFINITION OF INSURED
"The unqualified word 'insured' includes
"(b) with respect to a non-owned automobile,
(1) the named insured or a relative, and
(2) any other person or organization not owning or hiring such automobile if legally responsible for its use by the named insured or a relative, but only in the event such named insured or relative is legally liable for the occurrence; provided the actual use of the non-owned automobile by the persons in (1) and (2) above is with the permission of the owner."
We turn first to plaintiff's argument that there are genuine issues as to material facts. In this regard the court notes there is no disagreement as to the following facts: that Arlie Holm was the title holder of the car in question, that he is the named insured in the Equity policy, that his son Bradley paid for the car and maintained it, that Bradley had the unrestricted use of the car, and that he permitted plaintiff (a 14-year-old girl with no driver's license) to operate the car. Nor is there any dispute as to the fact plaintiff was driving the car with Bradley's assistance in shifting the gears. These are the undisputed material facts. It is also uncontroverted that Equity and Farmers at all times denied coverage. The denial was based on Equity's original investigation (soon after the accident) which disclosed to both insurance companies that the situation set out above existed. Nor are the dates when Equity made payment disputed.
Appellant, in her argument, alleges that the following facts are in dispute: (1) ownership, (2) bad faith investigation by Equity and none by Farmers, (3) whether others were permitted to drive the car prior to this case, (4) that plaintiff was not driving the car alone, and (5) that there was a delay on the part of Equity in paying the Hasletts and Hobsons. It should be noted that the facts upon which ownership could be determined are undisputed, that the manner of investigation which Equity performed is not disputed, nor is the fact that Farmers relied upon Equity's investigation disputed. The fact that one other person was permitted to drive the car prior to the incident giving rise to this case is not disputed, and that plaintiff was not driving the car alone is not disputed. It should be noted that regarding each of appellant's alleged disputed facts, appellant is arguing conclusions of law. Appellant is in effect attempting, in the foregoing four situations, to convince this court that the facts shown give rise to a disputed legal issue. This does not, however, constitute a dispute as to the facts involved. As to the fifth contention of disputed fact argued by appellant, which alleged a six-month delay in Equity's paying of the claims: there is no dispute as to the dates upon which Equity made payment. Appellant is again attempting to get this court to hold that such delay is a disputed fact. It is not. In reality what appellant would have us decide is a conclusion of law based upon such facts. Moreover, Equity alleges, and this court believes, that the payments of the Haslett and Hobson claims were made because of Bradley Holm's negligence in permitting appellant to operate the car.
From the foregoing two paragraphs, it is clear that all of the material facts in this case were before the trial court, and there is no ground for reversing the trial court as to the summary judgments on a claim of disputed facts. The trial court had the material facts before it and did not err in reaching its conclusions of law based on such facts; therefore, the first three errors claimed by appellant are without merit.
As to appellant's claim of error relative to damages in the way of attorney fees, it seems clear to this court that the defendants acted in good faith in denying coverage to appellant for her defense of the original action. For them to incur liability for attorney fees, appellant must prove the insurance companies acted in bad faith. This appellant failed to do, and therefore the trial court was correct in denying attorney fees. See Sturdy v. Allied Mutual Ins. Co., 203 Kan. 783, 794, 457 P.2d 34, where the court states:
". . . A good faith legal controversy as to policy interpretation existed, being one of first impression in this jurisdiction . . . We think the defendant has not been unreasonable in its position, though mistaken, and we cannot say it refused without just cause or excuse to pay the full amount of the loss as now determined. Hence we hold attorney fees are not allowable here."
See also Koch, Administratrix v. Prudential Ins. Co., 205 Kan. 561, 470 P.2d 756, and Forrester v. State Farm Mutual Automobile Ins. Co., 213 Kan. 442, 452, 517 P.2d 173. Moreover, attorney fees may not be taxed as costs unless authorized by a statute [K.S.A. 60-2003(6)].
Likewise, appellant is not entitled to attorney fees under K.S.A. 40-256. First, that statute applies only when the insurer refuses to pay a judgment rendered against the plaintiff. Second, as a predicate for liability of the insurance carrier for attorney fees, the statute requires that such carrier ". . . has refused without just cause or excuse to pay the full amount of such loss." It is the opinion of this court that the insurance carriers in this case acted in good faith and that they did not decline coverage "without just cause."
Appellant cites as authority Jones v. Smith, 1 Kan. App. 2d 331, 564 P.2d 574, where this court held the insurer liable for the actions of a second permittee. This case is distinguishable. In the Jones case the father (the insured) permitted his daughter to retain possession despite the fact he knew of her past violations of his instructions. Additionally, the trial court found that the driver had the implied consent and permission of the insured, and this court on appeal held:
". . . On appellate review, this court accepts as true the evidence and all inferences to be drawn therefrom which supports or tends to support the findings of the trial court . . ." (p. 336).
As to appellant's claim for punitive damages, it is clear that such damages are not recoverable for breach of contract in the absence of an independent tort connected therewith.
"As a general rule, damages for breach of contract are limited to pecuniary loss sustained and the breach of contract alone does not form a basis for recovery of punitive damages." (Hess v. Jarboe, 201 Kan. 705, 443 P.2d 294 [Syl. 1].)
Also, "[a] party may recover punitive damages [for breach of contract] when some independent tort results in additional injury and such tortious act indicates malice, fraud or wanton disregard for the rights of others." (Hess v. Jarboe, supra, [Syl. 2].) See also Hass v. Preferred Risk Mutual Ins. Co., 214 Kan. 747, 522 P.2d 438.
We turn now to plaintiff's claim for damages due to mental suffering. To recover for mental suffering, plaintiff would have to prove that the actions of the defendant insurance companies in this case were wanton or reckless. See Restatement, Contracts § 341, where it is stated:
"In actions for breach of contract, damages will not be given as compensation for mental suffering, except where the breach was wanton or reckless and caused bodily harm . . ." (p. 559)
See also Henry Morrison Flagler Museum v. Lee, 268 So. 2d 434 (Fla. App. 1972), and Am. Jur. 2d, Damages § 196, p. 276.
It should be noted that in Kansas the question of insurance coverage of a second permittee who is 14 years of age, unlicensed, and an incompetent driver has not been settled. Bad faith should not be attributed to insurance carriers who do not pay under such situations.
It is clear to this court that damages for mental suffering, for punitive damages, and for attorney fees are not recoverable by the appellant for the reasons set out above.
The judgment of the trial court in this case in granting summary judgment in favor of both insurance companies was correct, and same is affirmed.