Haynam v. Laclede Elec. Co-op., Inc.

• Court: Missouri Supreme Court
• Writing for the Court: THOMAS
• Citation: Haynam v. Laclede Elec. Co-op., Inc., 827 S.W.2d 200 (Mo. 1992)
• Decision Date: 24 March 1992
• Docket Number: No. 73556,73556
• Parties: Frank HAYNAM and Sondra Haynam, Plaintiffs-Appellants-Respondents, v. LACLEDE ELECTRIC COOPERATIVE, INC., Defendant-Respondent-Appellant.

Page 200

827 S.W.2d 200

Frank HAYNAM and Sondra Haynam, Plaintiffs-Appellants-Respondents, v. LACLEDE ELECTRIC COOPERATIVE, INC., Defendant-Respondent-Appellant.

No. 73556.

Supreme Court of Missouri En Banc.

March 24, 1992.

Rehearing Denied April 21, 1992.

David W. Ansley, Michael P. Mergen, Springfield, for appellants.

Cynthia O. MacPherson, Mountain Grove, for respondent.

THOMAS, Judge.

This appeal arises out of a suit for wrongful termination of electrical service. Frank and Sondra Haynam sued Laclede Electric Cooperative. At trial, the jury awarded the Haynams $945 in actual damages and $30,000 in punitive damages. Laclede filed a Motion for Judgment Notwithstanding the Verdict or, in the alternative, for a New Trial. The trial court granted Laclede's Motion for New Trial on all issues without specifying the grounds for the new trial. Both parties appealed from the trial court. The Court of Appeals, Southern District, set aside the order granting a new trial and remanded the case to the trial court for entry of a judgment notwithstanding the verdict in favor of Laclede. The court of appeals found that the Haynams did not present sufficient evidence to conclude that Laclede's termination of services was malicious, willful or wanton.

The Haynams own and operate a dairy farm. Laclede billed the Haynams each month. The Haynams read their own meter each month, and the billing was based upon the reported usage each month. Prior to the events that led up to this suit, Sondra Haynam routinely read the meter. In March 1986, however, Frank Haynam read the meter and reported the reading to Laclede as required. According to this reading, the Haynam's electric usage for the month was 13,299 kilowatt hours, an increase of six times their normal usage, resulting in a net charge of $683.91. Frank Haynam contacted James Snavely, an area foreman for Laclede, about the increase in usage. Snavely visited the Haynam farm to look at the meter but did not find a problem; however, he did not test the meter. He told Frank Haynam that the high reading resulted from the actual use of too much electricity, possibly due to a surge and not to a malfunction of the meter. Upon the recommendation of Snavely, the Haynams hired an electrician to inspect their appliances, but the inspection failed to disclose any defects.

The Haynams protested the large bill, claiming the meter must have malfunctioned. Laclede refused to reduce the bill, claiming the high usage resulted from the Haynam's fraudulent reading of the meter during the previous year.

In order to continue electrical service, the Haynams agreed to pay the bill pursuant to special arrangements. Sondra claims that Laclede agreed to allow them to pay one half in April and the other half by May 30, 1986. Laclede's accounts manager recorded May 16, 1986, as the date of final payment in her log book. Both the Haynams testified that they were told by several officials of Laclede including both Kenneth Miller, the general manager, and James Snavely, the area foreman, that the electricity would not be disconnected without a personal visit from Laclede to inform the Haynams that the electricity would be disconnected. Miller later testified that he authorized the disconnection of service without notice to the Haynams.

On May 22, 1986, Laclede terminated electrical service without notice to the Haynams when the final payment was not received. Laclede had removed the meter and left a note that said "when you pay your bill we will bring your meter back." Frank Haynam called his wife immediately after the disconnection. Sondra Haynam called the Lebanon office of Laclede to inquire about the disconnection, but the representatives told her the electricity could not be restored until the bill was paid in full. Laclede restored the electricity to the farm within four hours after the disconnection following a call from an attorney for the Haynams. The Haynams reluctantly agreed to pay all reconnection fees and an additional security deposit, along with the amount due on the bill.

Contrary to the court of appeals, the Haynams argue that they presented a submissible case for wrongful termination based upon Laclede's conduct in terminating their electricity without notice, despite the special arrangements that had been made. First, the Haynams contend that a cause of action for wrongful termination only requires the defendants act negligently, which, according to the Haynams, is easily satisfied in this case. In the alternative, the Haynams assert that, even if the cause of action for wrongful termination requires the higher standard of willful and wanton conduct, the punitive damage award evidences the submissibility of their claim because the jury must have found the defendants acted maliciously in order to award punitive damages. Laclede, on the other hand, claims that the tort of wrongful termination requires the defendants act with intentional maliciousness and that the Haynams did not satisfy this element of the tort, much less the standard for a punitive damage award.

Before reaching the submissibility issue, this Court must first determine the elements of the cause of action for wrongful termination of electrical service. In Ellyson et ux. v. Missouri Power & Light Co., 59 S.W.2d 714, 716 (Mo.App.1933), plaintiffs successfully plead the tort of wrongful failure to supply electricity by pleading the following elements: (1) defendant was engaged in the discharge of a public enterprise or service; (2) plaintiffs fell within the class of persons whom defendant was obligated to serve; (3) plaintiffs had performed all conditions precedent entitling them to service; (4) defendant had wrongfully refused or neglected to supply such service to them; and (5) plaintiffs had been damaged. Furthermore, in 1973, the Court of Appeals, Eastern District, held that an electric company is required to exercise reasonable care in fulfilling the obligation to provide adequate and continuous service arising from either contracts or regulatory enactments. National Food Stores, Inc. v. Union Electric Co., 494 S.W.2d 379 (Mo.App.1973).

In 1979, the Court of Appeals, Western District, decided Rose v. Missouri Public Service Co., 586 S.W.2d 767 (Mo.App.1979). The court held that the electrical supplier was liable for damages due to interrupted service only if the interruption was caused by or due to the willful and wanton misconduct of the company. Id. at 767. This decision, however, was based upon a contractual obligation that provided the utility would only be liable for damages caused by or due to the willful and wanton misconduct of the company. DeLong v. Osage Valley Electric Cooperative Ass'n, 716 S.W.2d 320 (Mo.App.1986), continued the application of the willful and wanton standard, despite the fact that Rose was based upon a contractual provision and DeLong was not.

We hold that, in the absence of a contrary provision in a contract, a plaintiff seeking recovery in tort for wrongful termination of electrical service is required to show that defendant acted negligently in its failure to supply electrical service. In the alternative, a plaintiff may show the termination was an intentional wrongful act, i.e., with knowledge that plaintiff was entitled to receive service under the contract.

The Haynams plead their cause of action for actual damages based upon intentional conduct that was "malicious, wanton and willful," and as such were bound by their pleadings. ¹ A plaintiff is not entitled to relief on the basis of what he claims he could, but did not, plead as a theory of recovery. Zobel v. General Motors Corp., 702 S.W.2d 105, 106 (Mo.App.1985). Moreover, the Haynams requested instructions that required a finding of "outrageous conduct because of defendant's evil motive or reckless indifference to the rights of others" for both actual damages for wrongful termination and for punitive damages. ² Therefore, we need only determine whether the Haynams made a submissible case on the standard of conduct necessary to award punitive damages as set forth in Burnett v. Griffith, 769 S.W.2d 780, 789 (Mo. banc 1989), because plaintiffs submitted their claim for actual damages as well as punitive damages based upon this standard.

Based upon the Burnett standard, we believe the Haynams made a submissible case. The Haynams presented evidence that they were told their electricity would not be disconnected without a personal visit from a representative of Laclede, which was not done. Sondra Haynam testified that Kenneth Miller, the general manager of Laclede, agreed that the Haynams could pay the first half of the disputed electric bill by the end of April and that they would have until the end of May to pay the second half. Miller testified that he would never have extended the second payment beyond May 16. On the same day Laclede turned off the electricity, Sondra Haynam went to Laclede's office to finalize arrangements to have the electricity turned back on. She was complaining to Miller that he had agreed to extend the second half of the payment to the end of May but had, nevertheless, shut off the electricity earlier that day without notice to the Haynams.

Sondra Haynam testified Miller said, "There is no log of these arrangements [to allow until the end of the month for the payment of the second half of the bill]. We don't extend beyond May 16. And until it's paid, there won't be any electricity."

Sondra Haynam testified she then said, "Is there anybody above you that I could speak to?"

Miller said, "No."

Sondra Haynam then said, "Well, who are you? I mean, there's nobody above you?"

Again, Miller replied, "No."

Sondra Haynam testified she then said, "Then you're God, and there's nobody else, you know, above that?"

Miller replied, "That's right, lady."

Although this conversation occurred some four hours after Laclede had terminated the electric service, the jury was entitled to consider this...