Hibschman Pontiac, Inc. v. Batchelor, s. 3--1073A128

• Decision Date: 13 May 1977
• Docket Number: 577S312,Nos. 3--1073A128,s. 3--1073A128
• Parties: HIBSCHMAN PONTIAC, INC., Respondent-Appellant, v. James B. BATCHELOR, Petitioner-Appellee, General Motors Corporation, Respondent-Appellee.
• Court: Indiana Supreme Court

Page 845

362 N.E.2d 845

266 Ind. 310

HIBSCHMAN PONTIAC, INC., Respondent-Appellant, v. James B. BATCHELOR, Petitioner-Appellee, General Motors Corporation, Respondent-Appellee.

Nos. 3--1073A128, 577S312.

Supreme Court of Indiana.

May 13, 1977.

R. Wyatt Mick, Jr., Mishawaka, for respondent-appellant. respondent-appellant.

Myron J. Hack, Edward A. Chapleau, South Bend, for petitioner-appellee.

GIVAN, Chief Justice.

Batchelor brought an action for breach of contract and oppressive conduct by Hibschman Pontiac, Inc. and General Motors Corporation. A trial before a jury resulted in a verdict for Batchelor and against Hibschman Pontiac and General Motors Corporation in the amount of $1,500.00. Further, the jury assessed punitive damages against Hibschman Pontiac, Inc. in the amount of $15,000.00.

The Court of Appeals, Third District, reversed the grant of punitive damages. See 340 N.E.2d 377. Batchelor now petitions for transfer.

The record reveals the following evidence: Prior to buying the Pontiac GTO automobile involved in this case, Batchelor inquired of the salesman, the service manager and the vice president as to the quality of Hibschman Pontiac's service department, as it was important that any deficiencies in the car be corrected. The salesman and the service manager responded that the service department at Hibschman Pontiac was above average. Jim Hibschman, the vice president, assured him that he would personally see that any difficulties would be corrected. Batchelor stated that he relied on the statements of the three men and ordered a 1969 GTO Pontiac automobile.

When Batchelor picked up his new car he discovered several problems with it. As requested by the service manager of Hibschman Pontiac, Batchelor made a list of his complaints and brought the car in for repair a few days later. The service manager attached the list to a work order but did not list the deficiencies on the work order. Later the manager called Batchelor and said that the car was ready. When he picked up the car Batchelor noticed that several items on the list had not been touched. Batchelor testified that there were many occasions when he took the car to Hibschman Pontiac for repairs and the service manager told him that the defects had been fixed when in fact they were not fixed. Batchelor testified that the service manager knew the defects were not corrected, but represented to him that the defects were corrected. Batchelor stated that he relied on the service manager's statements and took the car on several trips, only to have it break down. Some of the deficiencies resulted in abnormal wear of the car and breakdowns after the warranty period had expired.

Batchelor testified that he had taken the car in for repairs five times before he had owned it a month but that the defects had not been corrected. Batchelor had taken the car in 12 times during the warranty period for overnight repair and at least 20 times in all during the period. During the warranty period Batchelor lost use of the car approximately 45 days while it was at Hibschman Pontiac.

Batchelor had appealed to Jim Hibschman on several occasions to take care of his car. Hibschman replied that he realized the repairs were not effected properly but that Hibschman Pontiac would 'do everything to get you happy.' On another occasion Jim Hibschman responded they had done all they could with the car but that Batchelor was just a particular, habitual complainer whom they could not satisfy and 'I would rather you would just leave and not come back. We are going to have to write you off as a bad customer.'

On several occasions Batchelor attempted to see Dan Shaules, an area service representative from Pontiac Division, about the car but was kept waiting so long that he had to leave without seeing him. Batchelor did see Shaules in Buchanan, Michigan, when he took the car to an authorized Pontiac dealer there after the warranty had expired. Shaules inspected the car and told Batchelor to return the car to Hibschman Pontiac for repairs.

Hugh Haverstock, the owner of the garage where several of the deficiencies where corrected after the expiration of the warranty, testified that Batchelor was a good customer and paid his bills. He stated that an average transmission man could have corrected the problem with the transmission and that a problem with the timing chain was discovered and corrected when a tune up lasted only 800 miles. Haverstock stated that the difference in value of the car without defects and with the defects it had was approximately $1,500.00. Haverstock testified that when a person complains about problems with cars that have not been fixed by dealerships, word gets out and others do not want to work on the cars.

Arnold Miexel, the service manager for Hibschman Pontiac during the time in question, testified that his representation to Batchelor regarding Hibschman Pontiac service department was based on the fact that the mechanics were factory trained and that he had received no complaints regarding their work. He further stated that he could not check the work of the mechanics. Miexel testified that if their work was unsatisfactory it was done over but no work order was written for it. He stated that it was possible Batchelor made complaints about the car, but the defects were not corrected. The warranty expired and, as a consequence, later work was not considered under warranty.

Dan Shaules testified that Miexel was an average service manager. He testified that not all of the deficiencies in the car were corrected properly. He further stated that if any defects in the car were brought to their attention within the warranty period, items would be corrected if necessary after the warranty had expired.

Appellant first argues that there was insufficient evidence to permit the issue of punitive damages to go to the jury and that the court should have rendered a directed verdict on the issue of punitive damages on behalf of Hibschman Pontiac. This Court has recently dealt with the question of punitive damages in a contract action. In Vernon Fire & Casualty Ins. Co. v. Sharp (1976), Ind., 349 N.E.2d 173, the majority restated the general provision that punitive damages are not recoverable in contract actions and went on to state exceptions to this rule. Where the conduct of a party, in breaching his contract, independently establishes the elements of a common law tort, punitive damages may be awarded for the tort.

Punitive damages may be awarded in addition to compensatory damages 'whenever the elements of fraud, malice, gross negligence or oppression mingle in the controversy.' (emphasis supplied.) Vernon Fire & Casualty Ins. Co. v. Sharp, supra, Ind., 349 N.E.2d 173, 180, quoting Taber v. Hutson (1854), 5 Ind. 322.

Further, where a separate tort accompanies the breach or the elements of tort mingle with the breach, it must appear that the public interest will be served by the deterrent effect of the punitive damages. Vernon Fire & Casualty Ins. Co. v. Sharp, supra.

Appellant urges that the evidence presented does not indicate tortious conduct of any sort on its part. While a reasonable inference could be made from the evidence that appellant merely attempted to fulfill its contract and to do no more than that contract required, it is also reasonable to infer that Hibschman Pontiac acted tortiously and in willful disregard of the right of Batchelor. This Court has often stated the maxim that it will not reweigh the evidence nor determine the credibility of witnesses, but will sustain a verdict if there is any evidence of probative value to support it. Moore v. Waitt (1973), Ind.App., 298 N.E.2d 456; Smart and...