Franklin Life Ins. Co. v. Davy
| Decision Date | 22 December 1999 |
| Docket Number | No. 96-1762.,96-1762. |
| Citation | 753 So.2d 581 |
| Parties | The FRANKLIN LIFE INSURANCE COMPANY, a corporation registered to do business in the State of Florida, Appellant/Cross-Appellee, v. Robert J. DAVY and Roland Rousselle, Cross-Appellants/Appellees, v. Robert Vega Murray, individually and as agent for the Franklin Life Insurance Company, Appellee. |
| Court | Florida District Court of Appeals |
Thomas R. Julin, Edward M. Mullins and Denise Wallace of Steel Hector & Davis, Miami; R. Dennis Comfort, P.A., Gainesville, for Appellant/Cross-Appellee Franklin Life Insurance Company.
Phil C. Beverly, Jr. and Eric C. White, Gainesville, for Cross-Appellants/Appellees Robert J. Davy and Roland Rousselle.
Joel B. Toomey of Peek, Cobb, Edwards & Ashton, P.A., Jacksonville, for Appellee Robert Vega Murray.
The Franklin Life Insurance Company appeals, and Robert J. Davy and Roland Rousselle cross-appeal, an order granting Franklin Life's motion for a new trial and/or a remittitur. For the reasons that follow, we affirm in part, reverse in part and remand.
Appellant, Franklin Life, is a life insurance company based in Springfield, Illinois, which underwrites life insurance policies sold to Floridians by agents who work on a commission basis. In late December 1990 or early January 1991, appellees Robert J. Davy, a Franklin Life agent based in Jacksonville, and Roland Rousselle, a Franklin Life agent based in the Gainesville area, contacted another Franklin Life agent, Robert Vega Murray, based in South Florida, for the purpose of gaining Murray's assistance in selling policies in the South Florida market. It was the position of Davy that he was interested in contacting only those policyholders who were considered so-called "orphans," that is, policyholders whose active agent (i.e., the agent who sold the policy) was no longer associated with Franklin Life.1 In return for his assistance, Murray was to receive 25% of the commissions generated by Davy and Rousselle. Murray declined the offer.
Even without Murray's assistance, Davy and Rousselle were able to obtain a listing of all Franklin Life policyholders in South Florida, and they began acting upon this information, to the displeasure of Murray. The record reflects that, from motel rooms in the Miami area, Davy and Rousselle contacted by telephone numerous individuals who held whole life insurance policies from Franklin Life to inquire if these persons were interested in a review of their policy. Policyholders who were contacted and who testified at trial stated that appellees represented themselves as agents from the Franklin Life "home office" currently visiting the area; appellees, however, denied making such a representation. Out of approximately 60 such contacts, the appellees were able to make 56 sales of new policies, which involved canceling an existing policy and replacing it with a new one. As a result, the appellees were able to realize a commission for themselves based on the new premiums, while policyholders obtained a new policy with substantially less cash value. On frequent occasion, appellees sold policies with so-called "vanishing premiums;" that is, the premium was taken out of the dividend paid by the policy or was taken from the accumulated cash value of the policy. Davy and Rousselle's sales techniques were described in the record as "rolling" or "churning." While appellees have maintained that they exercised the utmost ethical conduct while selling these polices, there was evidence at trial that policyholders did not fully understand the nature of these new policies in general and the premiums in particular.
Davy and Rousselle alleged further that the defamatory content of the letter was repeated in a recorded message left by Murray on his office telephone.
During 1991, Franklin Life began receiving numerous complaints about the polices sold in South Florida by Davy and Rousselle. It conducted an audit, thereby freezing Davy's and Rousselle's commissions. In November 1991, Franklin Life severed its respective agency contracts with Davy and Rousselle. At about the same time, Franklin Life mailed a letter to the 1,600 policyholders in the Miami area who had received the letter from Murray. In this letter, Franklin Life apologized for any confusion caused by Murray's previous letter and explained that Davy and Rousselle were active agents with Franklin Life at the time of the Murray letter and were based in the Gainesville and Jacksonville areas, respectively, although they had maintained services contracts with a few clients in South Florida. Franklin Life also advised that it would be to the policyholder's advantage to work with the Franklin Life agent, Murray, already established in the area.
A month before his termination by Franklin Life, Davy filed a defamation claim against Murray and, vicariously, Franklin Life. Rousselle filed a similar action. The two causes were consolidated for trial. Davy and Rousselle subsequently filed amended complaints adding a claim of tortious interference with a contract against Murray and Franklin Life (Count II), a claim that Franklin Life wrongfully interfered with advantageous business relationships (Count III), and a claim that Franklin Life breached oral modifications to the written employment contracts by allowing other agents to contact their clients to replace polices sold by the plaintiffs (Count IV).
After a three week jury trial, and after Franklin Life's timely motion for a directed verdict was denied, the jury returned a verdict in favor of Murray and Franklin Life on the first three counts. As for Count IV, the jury found on the interrogatory verdict form as follows:
1a. Did Robert J. Davy and the Franklin Life Insurance Company enter into an enforceable modification of their written contract as claimed by the Plaintiffs concerning a Franklin's agent's rights to business sold by that agent? Yes X No X If your answer to question la is "Yes," then answer question 2. If your answer to question la is "No," then your verdict is for Defendant Franklin Life Insurance Company on Plaintiff Robert J. Davy's breach of contract claim. Then foreperson must date and sign the verdict and return it to the courtroom lb. Did Roland Rousselle and the Franklin Life Insurance Company enter into an enforceable modification of their contract concerning a Franklin agent's right to business sold by that agent? Yes _____ No _____ If your answer to question 1b is "Yes," then answer question 2. If your answer to question 1b is "No," then your verdict is for Defendant Franklin Life Insurance Company on Plaintiff Roland Rousselle's breach of contract claim. Then foreperson must date and sign the verdict and return it to the courtroom 2a. Did the Franklin Life Insurance Company breach the unwritten modification to the agency builder contract with Robert J. Davy? Yes X No _____ If your answer to question 2a is "Yes," then answer question 3. If your answer to question 2a is "No," then your verdict is for Defendant Franklin Life Insurance Company on Plaintiff Robert J. Davy's breach of contract claim 2b. Did the Franklin Life Insurance Company breach the unwritten modification to the agency builder contract with Roland Rousselle? Yes ______ No ______ If your answer to question 2b is "Yes," then answer question 3. If your answer to question 2b is "No," then your verdict is for Defendant Franklin Life Insurance Company on Plaintiff Roland Rousselle's breach of contract claim 3a. What are the total amount of Plaintiff Robert J. Davy's damages as a result of Franklin Life Insurance Company's breach of contract? Bob Davy $600,000 3b. What are the total amount of Plaintiff Roland Rousselle's damages as a result of Franklin Life Insurance Company's breach of contract? Roland Rousselle $600,000
Thereafter, Franklin Life filed a motion styled "Motion for Judgment in Accordance with the Verdict on Counts I, II, and III and Rousselle's Count IV and in Accordance with its Motion for Directed Verdict on Count IV or for New Trial or Remittitur on Count IV." In its accompanying memorandum of law, Franklin Life argued at length that a new trial on both liability and damages was required with respect to Count IV, because the verdict for that count was against the manifest weight of the evidence and the damages awarded were excessive, ten times that which had been sought. Franklin Life argued further that, in the absence of a directed verdict in its favor or the grant of a new trial on liability and damages on Count IV, the court should remit the damage award to $51,000 for each plaintiff.
After receiving extensive argument on Franklin Life's motion, the trial court entered an order—the order under review— granting a remittitur or a new trial on damages only pursuant to section 768.74, Florida Statutes (1995). In the order, the trial court states:
It is ordered and adjudged that the motion of The Franklin Life Insurance Company is granted to the extent it seeks a judgment in accordance with the verdict in favor of Franklin Life and Robert Vega Murray against counts I, II, and III of both plaintiffs' third amended complaints.... It is further ordered and adjudged, upon consideration of the factors set forth in section 768.74, Florida Statutes (1995), the amount awarded by the jury to each of the...
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