Dodrill v. Nationwide Mut. Ins. Co.

• Decision Date: 21 July 1997
• Docket Number: No. 23090,23090
• Court: West Virginia Supreme Court
• Parties: Alton E. DODRILL, Plaintiff Below, Appellee, v. NATIONWIDE MUTUAL INSURANCE COMPANY, Defendant Below, Appellant.

Page 1

491 S.E.2d 1

201 W.Va. 1

Alton E. DODRILL, Plaintiff Below, Appellee, v. NATIONWIDE MUTUAL INSURANCE COMPANY, Defendant Below, Appellant.

No. 23090.

Supreme Court of Appeals of West Virginia.

Submitted May 2, 1996.

Decided Oct. 15, 1996.

Dissenting Opinion of

Justice Workman July 21, 1997.

Syllabus by the Court

1. "The standard of review recited in Syllabus Point 1 in Mildred L.M. v. John O.F., 192 W.Va. 345, 452 S.E.2d 436 (1994) and in Syllabus Point 1 in Barefoot v. Sundale Nursing Home, 193 W.Va. 475, 457 S.E.2d 152 (1995), and their progeny, is clarified to read as follows: In reviewing a trial court's denial of a motion for judgment notwithstanding the verdict, it is not the task of the appellate court reviewing facts to determine how it would have ruled on the evidence presented. Its task is to determine whether the evidence was such that a reasonable trier of fact might have reached the decision below. Thus, in ruling on a denial of a motion for judgment notwithstanding the verdict, the evidence must be viewed in the light most favorable to the nonmoving party. If on review, the evidence is shown to be legally insufficient to sustain the verdict, it is the obligation of the appellate court to reverse the circuit court and to order judgment for the appellant." Syllabus point 1, Alkire v. First National Bank of Parsons, 197 W.Va. 122, 475 S.E.2d 122 (1996).

2. "In reviewing a trial court's granting of a motion for judgment notwithstanding the verdict, it is not the task of the appellate court reviewing facts to determine how it would have ruled on the evidence presented. Its task is to determine whether the evidence was such that a reasonable trier of fact might have reached the decision below. Thus, in ruling on the granting of a motion for judgment notwithstanding the verdict, the evidence must be view in the light most favorable to the nonmoving party. If on review, the evidence is shown to be legally sufficient to sustain the verdict, it is the obligation of the appellate court to reverse the circuit court and to order judgment for the appellant." Syllabus point 2, Alkire v. First National Bank of Parsons, 197 W.Va. 122, 475 S.E.2d 122 (1996).

3. "More than a single isolated violation of W.Va. code, 33-11-4(9), must be shown in order to meet the statutory requirement of an indication of 'a general business practice,' which requirement must be shown in order to maintain the statutory implied cause of action." Syllabus point 3, Jenkins v. J.C. Penney Casualty Insurance Company, 167 W.Va. 597, 280 S.E.2d 252 (1981).

4. To maintain a private action based upon alleged violations of W.Va. code § 33-11-4(9) in the settlement of a single insurance claim, the evidence should establish that the conduct in question constitutes more than a single violation of W.Va. code § 33-11-4(9), that the violations arise from separate, discrete acts or omissions in the claim settlement, and that they arise from a habit, custom, usage, or business policy of the insurer, so that, viewing the conduct as a whole, the finder of fact is able to conclude that the practice or practices are sufficiently pervasive or sufficiently sanctioned by the insurance company that the conduct can be considered a "general business practice" and can be distinguished by fair minds from an isolated event.

5. "Punitive damages may be awarded to an insured if the insurer actually knew that the claim was proper and the insured can prove that it was willfully, maliciously and intentionally denied. Therefore, in such a case, it is not error for a trial court to give an instruction stating that punitive damages may be awarded." Syllabus point 5, Berry v. Nationwide Mut. Fire Ins. Co., 181 W.Va. 168, 381 S.E.2d 367 (1989).

6. "The West Virginia Rules of Evidence and the West Virginia Rules of Civil Procedure allocate significant discretion to the trial court in making evidentiary and procedural rulings. Thus, rulings on the admissibility of evidence and the appropriateness of a particular sanction for discovery violations are committed to the discretion of the trial court. Absent a few exceptions, this Court will review evidentiary and procedural rulings of the circuit court under an abuse of discretion standard." Syllabus point 1, McDougal v. McCammon, 193 W.Va. 229, 455 S.E.2d 788 (1995).

Timothy R. Ruckman, Callaghan & Ruckman, Summersville, for Appellee.

Maria Marino Potter, McQueen & Brown, L.C., Charleston, for Appellant.

ALBRIGHT, Justice:

This is an appeal by Nationwide Mutual Insurance Company from an order of the Circuit Court of Nicholas County in a civil action alleging violations of W.Va. code § 31-11-4(9), relating to unfair insurance claim settlement practices. The order denied Nationwide's motion for judgment notwithstanding the verdict or, in the alternative, for a new trial, after a jury verdict was returned against Nationwide in the case. On appeal, Nationwide claims that the evidence adduced was insufficient to support the verdict, that the award of punitive damages was not supported by evidence of willful, malicious, and intentional conduct, and that the award of damages for annoyance and inconvenience was improper in the absence of testimony on that subject from the appellee, Mr. Dodrill. Nationwide also claims that the trial court erred in making various procedural and evidentiary rulings. After reviewing the issues presented and the record, this Court does not find reversible error. The judgment of the circuit court is, therefore, affirmed.

This case arises from the resolution of a claim in which Nationwide insured William E. Phares, the driver of a vehicle owned by Ralph Phares, collided with a vehicle owned and operated by the appellee, Mr. Dodrill. The circumstances of that underlying claim were described in a stipulation of facts which was presented by the parties to the court and read to the jury in this case. The stipulation states:

On or about October 24, 1987, the Plaintiff, Alton E. Dodrill owned and operated a 1980 Ford automobile which was struck from behind by a 1981 Chevrolet automobile owned by Ralph Phares and operated by William E. Phares. The collision occurred on West Virginia Route 41, also known as Webster Road in the Town of Summersville, Nicholas County, West Virginia. Alton E. Dodrill was taken to the Summersville Memorial hospital where he was treated and released.

The Phares' automobile was insured by Nationwide Mutual Insurance Company whose adjuster, Tim Porter, was responsible for investigating, evaluating, and adjusting the personal injury claim of Alton E. Dodrill. On December 11, 1987, Mr. Tim Porter, on behalf of Nationwide Mutual Insurance Company, offered to settle Mr. Dodrill's claim for the sum of Eighteen Hundred Dollars ($1800), which offer was rejected. On March 1, 1988, Mr. Porter offered, on behalf of Nationwide Mutual Insurance Company, the sum of Two Thousand Dollars ($2,000), plus a Scheduled Release to settle the claims of Mr. Dodrill.

In May, 1988, Mr. Dodrill retained an attorney and suit was subsequently filed and after trial, a jury awarded to Mr. Dodrill the sum of Eleven Thousand Three Hundred Eighty-Six Dollars ($11,386) which was subsequently paid by Nationwide Mutual Insurance Company to Alton E. Dodrill, with interest.

On or about July 24, 1991, Mr. Dodrill filed his complaint in this action against Nationwide. The charging paragraph of the complaint stated:

The actions of Nationwide Mutual Insurance Company, through its agents, servants and employees, constituted a violation of West Virginia Code § 33-11-4(9) in that said defendant did not attempt in good faith to effectuate a prompt, fair and equitable settlement of plaintiff's claim, even though liability was reasonably clear on the part of its insured; and failed to promptly provide a reasonable explanation to plaintiff for the basis of its offer of a compromise settlement.

In the complaint, Mr. Dodrill sought punitive damages based upon Nationwide's conduct, which he alleged was "intentional, willful and wanton and in derogation of the defendant's statutory and common law duties to the plaintiff." Nationwide filed an answer to the complaint in which it denied conduct which constituted a violation of W.Va. code § 33-11-4(9). ¹

A two-day jury trial of this action commenced May 24, 1994. The pre-trial order endorsed by the parties specified three issues to be tried before the jury: (1) whether W.Va. code § 33-4-11-4(9) had been violated by Nationwide "failing in good faith to effectuate a prompt, fair and equitable settlement ...", (2) whether Mr. Dodrill sustained damages by reason of such violation and, if so, how much, and (3) whether Mr. Dodrill was entitled to punitive damages by reason of such violation.

In the course of the trial, three witnesses were called. These three witnesses were Timothy William Porter, the employee for Nationwide Mutual Insurance Company who initially handled Mr. Dodrill's claim, Donald K. Bischoff, an attorney of Summersville, West Virginia, and Mr. Dodrill himself.

Mr. Porter testified extensively regarding the procedures which he followed in assessing and handling Mr. Dodrill's claim. The activity log which Mr. Porter maintained while handling the claim was also admitted into evidence, without objection. The evidence adduced showed that Mr. Porter was a claims adjuster for Nationwide, who worked by telephone from Canton, Ohio, solely on small personal injury claims received by Nationwide. The property damage portion of any such claims were handled elsewhere, and Mr. Porter did not receive information regarding the settlement of that portion of the claims he handled. Instead, when advised of a personal injury claim, he contacted the claimants by phone and sought information from them about their alleged personal injuries. Based on that information and any received with the file, he evaluated the claim, attempted to settle it by telephone, and...