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Transfer of Liability

March 7, 2005

A foundation created by Western Kentucky University to manage its dormitories does not have the university's immunity from lawsuits, a Kentucky appeals court ruled Friday.

The ruling sends a lawsuit against the foundation back to a lower court for additional hearings, and the ruling could complicate the arrangements some public colleges have set up with foundations or related entities to manage some of their operations.

The legal dispute at Western Kentucky comes out of the 2003 death of Melissa Kaye Autry, then a freshman at the university. Authorities charge that two men assaulted and raped her in her dorm room, and then set her on fire. She subsequently died from the burn wounds, one of the men has pleaded guilty and the other is facing charges in the case.

Autry's estate sued Western Kentucky and the foundation it created to manage the dormitories several months after her death, charging that they were negligent in failing to assure her security. Early in 2004, a trial court threw out the charges against the university and the foundation, accepting their arguments that Western Kentucky's government immunity from lawsuits protected them.

The appeals court ruling agreed that the university itself was immune. But it rejected the foundation's argument that because it was acting as an agent for the university, it was entitled to the same immunity.

Both parts of the decision are expected to be appealed to Kentucky's Supreme Court.

Bob Edwards, a spokesman for the university, told the Louisville Courier-Journal that some or all of the dorms might have to be sold if the foundation is found negligent.  "In theory, it could bankrupt the foundation, and where would the university be?" Edwards said. "When all of this was set up, nothing like this was considered."

 

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