Bradbury v. Phillips Petroleum Co., 85-1877

Decision Date07 April 1987
Docket NumberNo. 85-1877,85-1877
Citation815 F.2d 1356
Parties22 Fed. R. Evid. Serv. 1744 Alan BRADBURY, an individual, and Thom Panunzio, an individual, Plaintiffs-Appellees, v. PHILLIPS PETROLEUM COMPANY, a corporation, and Phillips Uranium Corporation, a corporation, Defendants-Appellants.
CourtU.S. Court of Appeals — Tenth Circuit

John R. Vranesic of Moyer, Beal and Vranesic, Lakewood, Colo., for plaintiffs-appellees.

John J. Mullins (Robert J. Kapelke and Catherine M. Meyer of Gorsuch, Kirgis, Campbell, Walker and Grover, Denver, Colo., and George M. Paulson, Jr. of Phillips Petroleum Co., Legal Div., Denver, Colo., with him on the briefs), of Gorsuch, Kirgis, Campbell, Walker and Grover, Denver, Colo., for defendants-appellants.

Before HOLLOWAY, Chief Judge, and BARRETT and LOGAN, Circuit Judges.

BARRETT, Circuit Judge.

The defendants, Phillips Petroleum Company and Phillips Uranium Corporation (Phillips), bring this appeal from a final judgment entered upon a jury verdict in favor of the plaintiffs, Alan Bradbury and Thom Panunzio. Phillips appeals the denial of its motion in limine to exclude from evidence certain of the plaintiffs' exhibits and the jury's award to the plaintiffs of exemplary damages.

This case arises out of an altercation between employees for Desert Drilling Company and landowners in southwest Colorado during a large scale uranium exploration project run by Phillips Uranium Corporation. In the summer of 1980, Phillips Uranium Corporation was in the final stages of the three-year project in and around the town of Placerville in San Miguel County, Colorado. The operation involved drilling numerous assessment holes, five inches in diameter and as deep as five hundred feet, for the purpose of sampling and evaluating minerals in the area. Phillips retained the firm of Meuer, Serafina, and Meuer to survey the mining claims upon which the assessment drilling would take place and hired Desert Drilling Company to sink the holes.

In August, 1980, Desert Drilling personnel were in the process of drilling a hole on land they believed to be Lee Claim 74. Phillips had obtained permission to drill there from the investment company that owned the surface rights and from the United States Bureau of Land Management that owned the mineral rights. As a result of a surveying error, however, the drillers were in fact on land owned by one of the plaintiffs, Thom Panunzio, which bordered Lee Claim 74. Panunzio, who was at his home in New Jersey, had denied requests by Phillips for access to his land.

Plaintiff Alan Bradbury resided near Panunzio's property. He first noticed that the drillers were in the wrong place when he heard the noise of their machinery over the hill from his house and, thinking they were on his property, went to investigate. Bradbury, who knew that Panunzio did not want any drilling done on his land, told the Desert Drilling Company employees that they were in the wrong place. The drillers told Bradbury that they had been instructed to drill there by Cathy Suda, a geologist for Phillips Uranium Corporation, and that he should speak to her about it. Suda had been at the site earlier but had left for the day. Bradbury left a message with the drillers for Suda requesting that she stop by his house down the road so he could show her maps indicating they were on the wrong property. He also attempted to phone Suda at her room at the Telluride Lodge but was unable to reach her.

On August 19, 1985, Bradbury phoned Panunzio and apprised him of the situation. Panunzio asked Bradbury to determine for sure whether the workers were drilling on his property and reiterated that he did not want drilling on his land under any circumstances. The next day, Bradbury and Lee Proper, who held a fifty percent mineral interest in Panunzio's property, returned to the site. Proper told the drillers, "Boys, you are violating my claim." Bradbury took photographs of the drillers and their operation, then phoned Panunzio. Upon being informed that the drillers were indeed on his land, Panunzio became angry and hung up. After consulting with an attorney, Panunzio phoned Bradbury and asked him to return to the site to take more pictures.

When Bradbury returned to the drilling site on Panunzio's property he found Cathy Suda along with the drilling crew. Bradbury introduced himself to Suda and discussed the situation with her. After examining the map, Suda finally conceded that they might be on the wrong property. At that point, Bradbury asked Suda if he could take some pictures and explained that he was there on behalf of the land owner. Testimony conflicts as to whether Suda gave her approval for Bradbury to take pictures or simply said, "Don't take any pictures of me."

Bradbury then began taking photographs of the drilling operations. Bradbury testified that as he was taking a picture of the license plate of a Desert Drilling Company vehicle, one of the drillers approached him, asked what he was doing, and demanded the film from his camera. Bradbury refused, and when the drillers began advancing on him, he turned and ran.

Bradbury ran past Suda and up the road toward his property with three drillers in pursuit. Upon reaching his property line, he climbed the barbed wire fence and proceeded about fifty feet before stopping. Bradbury testified that as the drillers approached, he ordered them to stay off his property. Two of the drillers also climbed the fence, however, and demanded the film from his camera. When Bradbury again refused, a scuffle ensued in which Bradbury, who was wearing a brace to mend a broken collar bone, was pushed and jostled violently enough that his shirt was torn. Bradbury was briefly choked and strangled before the camera was wrestled away from him. The drilling company employees exposed the film and took the camera back to the drilling site. Suda asked the drillers to give her the camera and it was ultimately recovered from Suda by sheriff's officers. Suda, then eight weeks pregnant, took no part in the chase or scuffle.

As a result of these events, Bradbury brought suit against Phillips Petroleum Company and its subsidiary, Phillips Uranium Corporation, for trespass, assault and battery, and outrageous conduct. In particular, Bradbury complained that the scuffle caused him severe pain in his throat and injured shoulder as well as emotional distress. Panunzio also brought suit for trespass and outrageous conduct. A jury found in favor of both plaintiffs and awarded Bradbury $1 in actual damages for trespass, $1 in actual damages for outrageous conduct, $500 in actual damages for assault and battery, $50,000 in exemplary damages for outrageous conduct and $25,000 in exemplary damages for assault and battery. The jury awarded Panunzio $1,000 in actual damages for trespass, $10,000 in actual damages for outrageous conduct, $25,000 in exemplary damages for trespass and $50,000 in exemplary damages for outrageous conduct.

On appeal, Phillips raises four issues. First, Phillips maintains that the district court erred in permitting the jury to impose tort liability and punitive damages upon Phillips for the conduct of Desert Drilling Company personnel. It argues that Desert Drilling Company was an independent contractor and that the actions of the drilling personnel were outside the scope of their employment. Second, Phillips contends that the trial court erred in admitting exhibits and testimony regarding compromises of previous claims by landowners against Phillips. It argues that these settlements should have been excluded as compromises or offers to compromise pursuant to Fed.R.Evid. Rule 408 and should have been excluded as character evidence pursuant to Rule 404. Third, Phillips contends that the punitive damage awards should be reduced or set aside for being so excessive and disproportionate to the actual damages as to suggest bias or prejudice on the part of the jury.

We find little merit in Phillips' fourth contention that there was an insufficient threshold showing of outrageous conduct. Under Colorado law in effect at the time of the trial, a "preponderance of evidence" standard was required for a finding of outrageous conduct. The more stringent "beyond a reasonable doubt" standard, adopted by the Colorado Supreme Court in Tri-Aspen Construction Co. v. Johnson, 714 P.2d 484 (Colo.1986) and followed by this court in Juarez v. United Farm Tools, Inc., 798 F.2d 1341 (10th Cir.1986), was not announced until well after the trial in this case had taken place. There was sufficient evidence that reasonable minds might differ on the outrageous conduct claim, especially under the "preponderance of evidence" standard. Thus we hold, without further discussion, that the district court did not err in submitting the outrageous conduct issue to the jury.

I.

In support of its argument that it should not be held responsible for the actions of Desert Drilling Company personnel, Phillips points out that its contract with the drilling company explicitly refers to the latter as an "independent contractor." Phillips notes that Desert Drilling Company provided its own employees and equipment and contends that there was no showing that Phillips had any right of control over the manner in which the work was done.

The plaintiffs respond that the designation of a party as an "independent contractor" in an agreement does not resolve the issue of agency and that the existence of an agency relationship may be established by the intentions of the parties and by their conduct. The plaintiffs argue that there is ample evidence in the record to indicate that the employees of Desert Drilling Company did as they were told by Phillips.

While the contract between Desert Drilling Company and Phillips does suggest that in many respects Desert Drilling Company was an independent contractor, we held in Milligan v. Anderson, 522 F.2d 1202, 1207 (10th Cir.1975), that the terms "agents" and "independent...

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