Champlin v. Washington Trust Co., of Westerly

• Decision Date: 27 July 1984
• Docket Number: No. 82-119-A,82-119-A
• Citation: 478 A.2d 985
• Parties: Barbara B. CHAMPLIN v. The WASHINGTON TRUST COMPANY, OF WESTERLY. ppeal.
• Court: Rhode Island Supreme Court

Page 985

478 A.2d 985

Barbara B. CHAMPLIN v. The WASHINGTON TRUST COMPANY, OF WESTERLY.

No. 82-119-Appeal.

Supreme Court of Rhode Island.

July 27, 1984.

Bradford Gorham, Providence, for plaintiff.

Archibald B. Kenyon, Jr., Wakefield, for defendant.

Thomas D. Pucci, Samuel A. Olevson, Providence, for R.I. Bankers Assoc. amicus curiae.

OPINION

KELLEHER, Justice.

The crucial issue in this appeal is whether certain conduct by the attorney representing the defendant bank is sufficient to impose liability in a Superior Court civil action in which the plaintiff seeks damages for the negligent or intentional infliction of mental distress. Our answer is in the negative, and our rationale will follow a brief recitation of the pertinent facts.

This litigation revolves around a single 1976 telephone call plaintiff, Barbara B. Champlin (Barbara), received from the attorney for defendant, The Washington Trust Company, of Westerly (the bank), in which the attorney sought payment on a series of notes allegedly executed by Barbara and her husband, Thomas Champlin (Thomas). Barbara and Thomas were married in 1954. During the next several years they became the parents of three children and the builders of a home situated on Post Road in the Matunuck section of South Kingstown. In the early 1970s, Thomas, who then worked for Electric Boat in nearby Groton, Connecticut, decided to go into business for himself. In furtherance of this goal, he formed a corporation called Noise & Vibration Control, Inc. (Vibration Control) and began "balancing turbines for the [United States] Navy." Subsequently, in 1973 the couple mortgaged their Matunuck real estate to the bank. Both Barbara and Thomas executed the requisite promissory note and mortgage deed. The couple's signatures also appear on a number of other records of the bank, including those of a joint checking account and the Vibration Control account.

Later, in April 1974, the couple separated; divorce proceedings soon followed. Matters reached the point where a final decree of divorce was entered in the Family Court in January 1975. Things worsened when in 1976 the bank foreclosed the mortgage on the Post Road property, and Barbara, who had been awarded the use of this property as part of the divorce litigation, was forced to vacate the premises and find lodging elsewhere for herself and her three children.

Thomas, who was as unfortunate in business as he had been in matrimony, instituted bankruptcy proceedings. He was adjudged and declared a bankrupt by the United States Bankruptcy Court for the District of Rhode Island in January 1977. Among the obligations discharged by virtue of those proceedings was a series of promissory notes made payable to the bank. The notes--four in number--were actually renewals of earlier notes. Each instrument was a ninety-day note.

The first note, for $8,000, was dated June 30, 1975, and bore the signatures of Vibration Control by Thomas and Barbara as makers and as endorsers. The second note, for $10,000, was dated August 25, 1975, and bore the signatures of Vibration Control by Thomas as maker and of Thomas and Barbara as endorsers. The third note, for $4,700, was dated September 8, 1975, and bore the signatures of Barbara and Thomas as makers and endorsers; and the final note, for $8,000, dated September 10, 1975, like the August 25 note, bore the signatures of Vibration Control by Thomas as maker and of Thomas and Barbara as endorsers.

When no payments were made, the bank's vice president sent a letter dated December 26, 1975, to Thomas and Barbara by certified mail, asking that they contact him about the overdue notes. The letter was received by Barbara at the Post Road address in mid-January 1976, almost a year after she and Thomas had been divorced. Barbara discussed the bank's request with her father. On his advice she took no action. At that time the father was terminally ill, was hospitalized, and had become his daughter's chief adviser and confidant following the breakdown of her marriage. He served in such capacity until his death on February 1, 1976.

The bank, having had no success in collecting on the four notes, turned the matter over to its attorney, Thomas H. Eyles, for collection. He sent a letter dated January 30, 1976, to Thomas and Barbara, asking that they contact him about the four notes. The letter also informed the couple that the bank had set off whatever was in their accounts against the outstanding indebtedness.

The vice president had known Barbara's father and informed Eyles, the attorney, of his passing. In early April 1976 both the vice president and the attorney traveled to the Probate Court clerk's office in Little Compton and there obtained a copy of the father's will. Later, the vice president called Barbara, who was then working, at her place of employment, a small store in Wakefield. When Barbara came to the phone, the vice president turned the phone over to Eyles. Barbara testified that at this point in her life she was in "very bad shape" emotionally because of a lack of money, overdue mortgage payments, and the death of her father.

Eyles identified himself to Barbara as the attorney representing the bank, mentioned the notes, and then asked her what she intended to do about paying them. She responded by telling the attorney that she had never signed the notes. Eyles, however, took issue with Barbara's representation and informed her that he was aware of the provisions of her father's will and asked Barbara if she would be willing, as payment of the debt, to assign whatever interest she had in her father's estate to the bank. According to Barbara, she became "terrified" at this point and told the bank's attorney to call her attorney. Barbara testified she was quite upset by the call and was unable to return to work for about "a week or so." She described herself during this period as extremely nervous, physically ill, and unable to sleep. At no point, however, did she consult a physician.

When the jury returned after completing its deliberations, the foreman gave verbal responses to written questions with which the jury had been furnished, two of which are relevant to this appeal. The jury gave an affirmative answer to the inquiry, "Do you find defendant's conduct intentional and unreasonable in the circumstances of this case?" and awarded compensatory damages of $3,000. It gave similar response to the second question, "[W]as the conduct of defendant willful, wanton, reckless or wicked so as to merit the imposition of punitive damages because of the telephone call from Mr. Eyles to Mrs. Champlin?" and awarded punitive damages of $60,000.

The decisive question in this controversy, as we see it, is what standard of liability is to be imposed upon a creditor whose actions allegedly inflict emotional distress on a debtor? There were three theories presented for the trial justice's consideration. They are set forth in the Restatement (Second) Torts, §§ 46, 312, and 313 (1965). ¹ Section 46 imposes liability on one whose extreme and outrageous conduct intentionally causes severe emotional distress. Section 312 imposes liability on one whose conduct intentionally causes emotional distress; the conduct need not be extreme or outrageous, and the emotional distress need not be severe. Section 313 imposes liability on one whose conduct unintentionally causes emotional distress; as in § 312, the emotional distress need not be severe.

The bank claimed in its motions for a directed verdict at the close of Barbara's case and at the close of the presentation of all the evidence that it should be held liable only under § 46. Barbara claimed instead that the bank should be liable under either § 312 or § 313.

In days gone by, this court has recognized the right to recover damages by one who has been subjected to the intentional or the negligent infliction of mental distress as long as the distress was accompanied by physical ills. Bedard v. Notre Dame Hospital, 89 R.I. 195, 151 A.2d 690 (1959) (intentional) and Simone v. Rhode Island Co., 28 R.I. 186, 66 A. 202 (1907) (negligent). In D'Ambra v. United States, 114 R.I. 643, 338 A.2d 524 (1975), a majority of the justices of this court, acting pursuant to our Rule 6, gave an affirmative response when asked by the U.S. Court of Appeals for the First Circuit whether a mother who looked on, outside the zone of danger, while her infant child was fatally struck by a negligently operated truck could recover damages for "mental and emotional harm, accompanied by physical symptoms." We acknowledge these past pronouncements, but they are of no assistance to Barbara.

In D'Ambra it was noted that "the law should not compensate for every minor psychic shock incurred in the course of daily living; it should not reinforce the neurotic patterns of society." 114 R.I. at 653, 338 A.2d at 529. This comment highlights the fact that "emotional distress" may arise in a variety of interpersonal relationships.

Picture the problem as one individual, in speech or in writing, attempts to persuade another individual to do something that the second individual does not wish to do or is unable to do; that something in this case is to pay a debt. Such a situation demands a balancing of the interest of a creditor in collecting a debt against the interest of the debtor to be free from the infliction of emotional distress. Consequently, courts have uniformly insisted that the creditor's conduct be clearly and obviously excessive in order to sustain a claimant's recovery; "liability usually has rested on a prolonged course of hounding by a variety of extreme methods." Prosser, Handbook of the Law of Torts, § 12 at 57 (4th ed. 1971).

Those jurisdictions that permit recovery for emotional distress in the debt-collection context do so either under the higher threshhold of liability imposed by § 46, Public Finance Corp. v. Davis, 66 Ill.2d 85, 4 Ill.Dec. 652, 360 N.E.2d 765 (1976); Dawson v....