AmSouth Bank v. Gupta

• Decision Date: 21 November 2002
• Docket Number: No. 2000-CA-01517-SCT.,2000-CA-01517-SCT.
• Parties: AMSOUTH BANK f/k/a Deposit Guaranty National Bank v. Krishan K. GUPTA and Rishi Enterprises, Inc.
• Court: Mississippi Supreme Court

838 So.2d 205

AMSOUTH BANK f/k/a Deposit Guaranty National Bank v. Krishan K. GUPTA and Rishi Enterprises, Inc.

No. 2000-CA-01517-SCT.

Supreme Court of Mississippi.

November 21, 2002.

Rehearing Denied March 6, 2003.

Andrea La'Verne Ford Edney, Robert L. Gibbs, Jackson, attorneys for appellant.

Jan F. Gadow, Ridgeland, Douglas G. Mercier, David Wayne Baria, Jackson, attorneys for appellees.

EN BANC.

COBB, J., for the Court.

¶ 1. This case originated when Dr. Krishan K. Gupta and his closely-held corporation, Rishi Enterprises, Inc. (collectively "Gupta"), filed a complaint in the Hinds County Circuit Court, First Judicial District, against Deposit Guaranty National Bank ("AmSouth").¹ Gupta's complaint sought actual and punitive damages for alleged breach of fiduciary duties, negligent misrepresentation, interference with business relationship, breach of contract, fraud, and breach of duty of good faith and fair dealing.² After AmSouth answered, denying all claims, Gupta amended his complaint, adding allegations of breach of duty of disclosure and lack of commercial reasonableness. These new allegations were also denied by AmSouth. Following a trial on the merits, the jury found for Gupta, awarding actual damages of $600,000 and punitive damages of $2.5 million. Accordingly, the trial judge entered a final judgment for $3.1 million on June 30, 2000.

¶ 2. Aggrieved by the final judgment and the denial of its JNOV/new trial motion, AmSouth appeals, assigning as error the following matters (renumbered for clarity):

I. WHETHER THE EVIDENCE WAS UNCONTRADICTED THAT THE SUBJECT PROPERTY CONSISTED OF ONLY 13.73 ACRES, NOT 15.25.

II. WHETHER A REASONABLE JURY COULD HAVE FOUND AMSOUTH LIABLE ON GUPTA'S TORTIOUS INTERFERENCE CLAIM.

III. WHETHER THE EVIDENCE SUPPORTS A CLAIM FOR BREACH OF FIDUCIARY DUTY.

IV. WHETHER THE JURY WAS INADEQUATELY INSTRUCTED ON THE APPLICABLE STANDARD OF PROOF REGARDING BREACH OF FIDUCIARY DUTY.

V. WHETHER THE EVIDENCE SUPPORTS A CLAIM FOR BREACH OF DUTY OF DISCLOSURE.

VI. WHETHER THE EVIDENCE SUPPORTS A CLAIM FOR BREACH OF THE DUTY OF COMMERCIAL REASONABLENESS.

VII. WHETHER THE JURY'S AWARD OF ACTUAL DAMAGES WAS SPECULATIVE AND SHOULD THUS BE REVERSED.

VIII. WHETHER THE TESTIMONY OF GUPTA'S EXPERT WITNESS WAS WRONGLY ADMITTED.

IX. WHETHER A JNOV OR NEW TRIAL SHOULD BE AWARDED ON THE ISSUE OF PUNITIVE DAMAGES.

¶ 3. Although Gupta's claim of negligent misrepresentation went to the jury, and AmSouth includes "negligent misrepresentation" in a single-sentence listing of all Gupta's claims in the summary of argument portion of its brief, AmSouth omits the issue from its headings and makes no further mention of this claim in its brief or its reply brief. It is settled precedent that issues on which a party fails to expend any discussion or citation of authority are not reviewed by this Court. See, e.g., Smith v. Dorsey, 599 So.2d 529, 532 (Miss.1992)

.

¶ 4. On the issues actually argued by AmSouth, the assignments of error are well taken. The judgment should be affirmed in part (insofar as the uncontested negligent misrepresentation issue is concerned), reversed and rendered in part (insofar as the other liability issues and the issue of punitive damages are concerned), and remanded for a new trial on the actual damages, if any, to be awarded for negligent misrepresentation.

FACTS

¶ 5. On March 18, 1997, Gupta contacted his banker at AmSouth, Renee Rice, about securing a loan to purchase 15.25 acres on Lake Harbour Drive in Ridgeland. On March 25, 1997, Rice and Ken Farmer, a loan officer brought in to assist because of the size of the loan, met with Dr. and Mrs. Gupta at Gupta's office to discuss the $1.3 million loan.

¶ 6. Following this meeting, both of the Guptas phoned Rice and Farmer on several occasions, trying to speed the loan process because the subject property, known as lot 3 J, was "hot" and asking whether the bank needed any additional information. Mrs. Gupta testified that each time she spoke with Farmer, he advised her that it would be another couple of days before their loan was approved.

¶ 7. At some point while Gupta was waiting for AmSouth to process his loan request, he heard that some unspecified buyer was interested in a portion of the property. Gupta phoned Farmer, shared all of this information, and again urged that his loan be processed quickly.

¶ 8. Thereafter, Gupta learned that a local bank and a tire store had purchased a portion of the property. After the sale to the bank and to the tire store, 13.73 acres remained available. However, in Gupta's opinion, a large part of the remaining acreage lacked adequate access to the main street. Therefore, of the remaining 13.73 acres, Gupta was interested in purchasing only 5.345 acres which enjoyed superior access.

¶ 9. A month after the initial discussion of Gupta's loan, Farmer submitted Gupta's loan application to the loan committee on April 24, 1997, and it was approved on that date. Gupta rejected the AmSouth loan and bought the five-acre tract with a loan from Union Planters Bank. He applied for this loan on May 9, 1997, and it was approved May 16.

¶ 10. As it turned out, the "local bank" which purchased a portion of the property was actually AmSouth itself, whose acquisitions department had been planning to buy land on Lake Harbour Drive since December 1996. AmSouth made a firm offer on March 27, 1997 (two days after Gupta's initial meeting with Rice and Farmer), and the deal was closed April 7. On April 23, two AmSouth officers who were involved with the acquisition, and who also sat on the loan committee, received part of Gupta's loan application which referred to purchasing acreage on Lake Harbour.

¶ 11. Gupta argued at trial that AmSouth delayed approval of his loan so that AmSouth could purchase a portion of the subject property before Gupta was able to purchase it himself. AmSouth essentially argued that its purchase of a portion of Gupta's intended acquisition was purely a coincidence.

STANDARD OF REVIEW

¶ 12. This Court reviews denial of a motion for judgment notwithstanding the verdict by considering the evidence in the light most favorable to Gupta, the appellee, giving him the benefit of all favorable inferences that may be reasonably drawn from the evidence. MBF Corp. v. Century Bus. Communications, Inc., 663 So.2d 595, 598 (Miss.1995). Only if the facts and inferences so considered point so overwhelmingly in favor of AmSouth that reasonable persons could not have arrived at a contrary verdict should the motion be granted. C & C Trucking Co. v. Smith, 612 So.2d 1092, 1098 (Miss.1992). Substantial evidence in support of the verdict will require this Court to affirm. Reese v. Summers, 792 So.2d 992, 996 (Miss.2001).

DISCUSSION

I. WHETHER THE EVIDENCE WAS UNCONTRADICTED THAT THE SUBJECT PROPERTY CONSISTED OF ONLY 13.73 ACRES, NOT 15.25.

¶ 13. Because the consistent allegation in Gupta's pleadings was that the dispute centered on a 13.73 acre tract (i.e., on the 3-J lot after AmSouth and the tire store had bought their portions), AmSouth claims that Gupta changed the whole case on the eve of trial by seeking to amend the pleadings to reflect a 15.25-acre tract in dispute (i.e., the lot in its original form). In AmSouth's view, no evidence was offered at trial to show that the 15.25 acres were ever what Gupta sought to buy, so that he was entirely lacking a case: the 13.73 acres he wanted did not include the AmSouth lot. Gupta responds that the 13.73 figure was his counsel's error and that he signed an affidavit including that figure because he trusted his counsel.

¶ 14. AmSouth argues that "proof must conform to the allegations of the declaration. A litigant must not be permitted to base his claim on one theory, and then introduce evidence and recover a verdict, based, in large measure, on an entirely different one." Miss. State Hwy. Comm'n v. Jacobs, 248 Miss. 476, 478, 160 So.2d 201 (1964). In Jacobs, the plaintiff alleged various specific nuisances in his complaint, but at trial he offered evidence that the highway work in question had also caused him damage due to its alleged diversion of water. This Court's holding was based on the injustice of seeking damages on a new issue not alleged in the pleadings. Id.

¶ 15. This Court has also held that pleadings may be amended to conform to the proof, and that leave to do so should be liberally granted as justice may require. Robison v. Robison, 722 So.2d 601, 603-04 (Miss.1998); see Miss. R. Civ. P. 15(b). In this case, Gupta's counsel stated in pretrial conference that he "screwed things up, Your Honor, because I put 13.73 in some of the pleadings and when I caught it, I tried to fix it and Mr. Gibbs [AmSouth's counsel] said you can't do that, it's too late."³

¶ 16. In Gupta's deposition, AmSouth asked about the 15.25 figure, and it appears that Gupta's recollection was influenced by his counsel's version of the correct number:

[AmSouth]: And have you done calculations again to see whether or not 1.3 million for 15.25 acres of land would amount to $2.10 per square feet [sic]?

[Gupta]: Bruce Payne did all of the calculations.

By Mr. Baria [Gupta's counsel]:

For the record, I think that the acreage was decreased at 13.73 by the time they got to that point, Robert.

Q. Dr. Gupta, is that your recollection?

A. Well, I say somewhere around 15 or 13 acres, that's what.

. . . .

Q. What I want to make sure I understand, Dr. Gupta, is, there are some contracts in here from Payne Realty that has [sic] 15.25 acres of land where there is $1,000 that is written in and I assume your signature's at the bottom as a buyer. I'll show you that document.

A. It says 15.25 acres, one million dollar offer.

. . . .

Q. So, do you—is it your understanding, then, that this particular offer for the 15.25 acres is what was conveyed by Bruce Payne to Mr. Boydston?

A. Yeah, that's my understanding.

Q. And what is your understanding of what a counteroffer was made

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