Party Produced Sufficient Evidence to Prove Medical Malpractice Settlement Proceeds Were Nonmarital – Published Opinion from Ky. Court of Appeals

100 Dollar Bill

Bond v. Bond

Carter Circuit Court

During a dissolution of marriage action, Husband had a medical malpractice claim pending. Family Court reserved the issue of classification of any award. After the claim was settled, although the settlement did not classify the awards by type, the money from several medical malpractice actions were pooled and divided among the claimants in two phases. Phase 1 compensated the claimants for unnecessary procedures. To determine the amount of compensation, each claimant received various points based on the type(s) of unnecessary procedures that were performed on him. There was no accounting for any medical bills or lost wages, etc. A certain portion of the settlement was set aside to provide additional, Phase 2 compensation to claimants who suffered extraordinary damages not captured in the award for having had the unnecessary procedures. Phase 2 damages included things such as allergic reactions, disability, lost wages, aneurysms, and death. The excess funds not dispersed from the extraordinary injury fund were reallocated proportionally to all claimants. Husband made no claim for the Phase 2 compensation. At a hearing to classify and divide the settlement, Husband’s attorney testified that Husband did not make a claim for Phase 2 compensation, and that all the funds received by Husband were awarded to compensate him for unnecessary procedures he underwent. Family Court concluded that the entirety of the award was Husband’s nonmarital property, as pain and suffering damages are nonmarital property.

The Court of Appeals held that Husband provided sufficient evidence to prove that the funds were nonmarital. Funds received for pain and suffering are nonmarital property. A settlement silent on the type of award is not to be automatically classified as marital property. The burden is on the spouse receiving the settlement to prove it is nonmarital, which Husband did. Family Court did not err in classifying the funds as nonmarital property.

Digested by Nathan R. Hardymon

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