CP & B ENTERPRISES, INC. v. MELLERT.

• Decision Date: 03 March 2000
• Citation: 762 So.2d 356
• Parties: CP & B ENTERPRISES, INC., d/b/a World Gym v. Kimberly MELLERT. Brad Rhoades v. Kimberly Mellert.
• Court: Alabama Supreme Court

762 So.2d 356

CP & B ENTERPRISES, INC., d/b/a World Gym v. Kimberly MELLERT.

Brad Rhoades v. Kimberly Mellert.

1979.

Supreme Court of Alabama.

March 3, 2000.

William W. Watts III of Hudson & Watts, L.L.P., Mobile, for appellant CP & B Enterprises, Inc., d/b/a World Gym.

Suzanne Paul of Paul & Smith, P.C., Mobile; Christ N. Coumanis of Briskman & Binion, P.C., Mobile; David G. Wirtes, Jr., of Cunningham, Bounds, Yance, Crowder & Brown, L.L.C., Mobile; Bruce J. McKee of Hare, Wynn, Newell & Newton, L.L.P., Birmingham; and Kenneth R. Raines of Wilkins, Bankester, Biles & Wynne, Bay Minette, for appellee.

HOOPER, Chief Justice.

Kimberly Mellert sued Brad Rhoades and his employer, CP & B Enterprises, Inc., d/b/a World Gym ("World Gym"). She alleged assault and battery and invasion of privacy based upon claims that she had been subjected to sexual harassment by Brad Rhoades while she was an employee of World Gym and was working at its place of business. Mellert also alleged negligence and wantonness on the part of World Gym in retaining Brad Rhoades as an employee; Mellert alleged that World Gym had retained Brad Rhoades as an employee although it had known of allegations that he had sexually harassed other females at the workplace. Mellert also sought to impose on World Gym vicarious liability for Brad Rhoades's actions. At trial, the court ruled that, as a matter of law, when the alleged harassment of Mellert occurred, Brad Rhoades was not acting in the line and scope of his employment or in furtherance of the business of his employer; therefore, ratification was the sole ground upon which the question of World Gym's vicarious liability was submitted to the jury. The jury returned a verdict in favor of the plaintiff and against both defendants, assessing compensatory damages of $25,000 and punitive damages of $250,000. The court entered a judgment against both defendants, making each defendant liable for the full amount awarded by the jury. The defendants filed separate appeals.¹ We reverse and remand.

I.

The evidence presented at trial indicated that Charles Rhoades and Pamela Rhoades were the sole stockholders in the corporation that did business as World Gym. The corporation began operation of a fitness center in May 1995. The Rhoadeses' son, Brad Rhoades, was installed as director of operations for World Gym. The business hired Mellert on a part-time basis in June 1995 to work in the nursery. In February 1996, Mellert was hired to work full-time as the front-desk receptionist. Mellert testified that while she was working part-time at the gym, Brad Rhoades made offensive comments to her, saying, for example, that she "had a great body," that she "had a nice rear end," and that "he wanted to have sex with [her]." Mellert also testified that Brad threatened her that if she did not have sex with him her job would be endangered, and she testified that he told her that if she told what he had said no one would believe her. Mellert stated that after she began working full-time, Brad's conduct escalated to offensive touchings, including rubbing against her breasts, putting his hand up her shorts, and kissing her. These physical touchings, she said, all occurred within one week.

Mellert testified that after Brad kissed her, she told Shelley Beall, World Gym's general manager, and that Ms. Beall stated that she "would handle it." Mellert said she also told James Andress, the comptroller, about Brad's conduct. Mellert testified that Andress told her that "he had known of other things that have happened like this and he would handle it." Mellert said that after she had these discussions with Beall and Andress, Brad's work schedule was rearranged so that he would not be alone with Mellert in the gym. Mellert left World Gym in April 1996. Mellert's testimony was disputed by Brad Rhoades. He denied putting his hand up her shorts, and he testified that any conduct between them was consensual and that the kiss was mutual.

C.B., a former aerobics-exercise instructor at World Gym, testified that Brad subjected her to offensive comments and touchings from May to December 1995. She testified that Brad attempted to kiss her several times and exposed himself to her several times. She testified that on one occasion Brad took off all his clothes while they were alone in the aerobics room. C.B. testified that she told Dolly Banks, the assistant manager, about Brad's conduct and that Banks "laughed and said she [could] believe it." C.B. also testified that in July 1995 she told Andress about Brad's conduct. Beall, Banks, and Andress had a meeting with Charles and Pamela Rhoades, at which they discussed the allegation that Brad had exposed himself to C.B. Banks testified that, about the time of that meeting, she had revealed that Brad had also made offensive sexual comments to her. After the meeting, Beall was supposed to investigate the "rumors" about Brad's exposing himself or committing other sexual impropriety at the gym. Beall orally reported back to the Rhoadeses that she thought the exposure had happened while Brad and C.B. were involved in a "relationship" and that the Rhoadeses should not worry about it. C.B. left her employment with World Gym in December 1995. H.S., a member at the gym, testified that during the fall of 1995 Brad exposed himself to her. H.S. stated that she reported this incident to Andress and that Brad later indicated to her that his parents knew about the incident. Another member at World Gym, S.K., who had been formerly employed as the director of Gymnastics World, a separate business owned by the Rhoadeses, but located in the same building as World Gym, testified that Brad made sexual comments to her on several occasions during June 1995. S.K. left her employment with Gymnastics World in July 1995.

In January 1996, World Gym instituted what it called an "improved" sexual-harassment policy; that policy prohibited dating between employees and prohibited any discussions of a sexual nature by employees within the facility. Charles Rhoades testified that he believed this policy was instituted as a direct result of Brad's prior conduct. However, Brad was never reprimanded, suspended, fired, or otherwise punished for his conduct. Brad testified that at the time of the trial he was still employed as World Gym's director of operations.

II.

World Gym raises six issues on appeal. However, because of our resolution of one issue, we need not address the other issues. World Gym contends that the trial court erred in submitting to the jury a verdict form that prevented the jury from awarding punitive damages against Brad Rhoades only. The verdict form provided the jury with three alternatives: 1) to find in favor of the plaintiff and against both defendants, with a blank for both compensatory and punitive damages to be filled in; 2) to find in favor of the plaintiff and against only the defendant Brad Rhoades, with a blank for both compensatory and punitive damages; or 3) to find in favor of both defendants. World Gym argues that the verdict form should have provided the option of finding against both defendants but awarding punitive damages against Brad only. The trial court overruled World Gym's objection to the verdict form, on the grounds that joint tortfeasors are jointly and severally liable for damages awards.

World Gym argues that, from the evidence, the jury could have found that World Gym was only negligent and that its culpability did not rise to the level required for an award of punitive damages. However, the jury was not given this option; the verdict forms did not permit the jury to find World Gym liable for compensatory damages only, while finding Brad Rhoades liable for both compensatory and punitive damages. Mellert contends that the trial court did not abuse its discretion in submitting this verdict form to the jury. She argues that the defendants were joint tortfeasors and that under Alabama law, punitive damages are not apportionable among joint tortfeasors, either according to fault or otherwise. Further, Mellert contends, she presented clear and convincing evidence indicating that World Gym had acted wantonly and presented clear and convincing evidence supporting the imposition of vicarious liability; therefore, she argues, the jury's award of punitive damages against World Gym was supported by the evidence.

The jury was charged that it could award damages against World Gym, based on a theory of vicarious liability, on Mellert's claim alleging an assault and battery by Brad and on her claim alleging that he had violated a right of privacy. The court also charged the jury that it could award damages against World Gym for its own actions, based on Mellert's claims that it had negligently or wantonly hired, supervised, and retained Brad Rhoades as an employee. Given the evidence in this case, a finding for the plaintiff on any of these causes of action would carry a possibility of a punitive-damages award, with the exception of the negligence claim.

III.

As an initial matter, we must determine whether World Gym's objection to the verdict form was properly preserved for our review. While instructing the jury, the trial court read the verdict forms it was submitting to the jury. The verdict form under which the jury found World Gym liable was described by the court as follows:

"In this case there will be three alternative forms of the verdict. The first will read as follows, and should be used if you find that the plaintiff has carried her burden of proof and has proved all of the elements of one or more causes of action against both defendants. In that case, the form of your verdict would be: `We, the jury, find in favor of the plaintiff and against the defendants, Brad Rhoades and CP & B Enterprises, Inc., and award damages in the amount of —.' Thereafter there will be two blanks. If you find in favor of the plaintiff, then you would be required to enter an award of

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