Hoovestol v. Security State Bank of New Salem
Decision Date | 14 January 1992 |
Docket Number | No. 910084,910084 |
Citation | 479 N.W.2d 854 |
Parties | Darlene HOOVESTOL and Gregory Hoovestol, Personal Representative of the Glenn Hoovestol Estate, Plaintiffs, Appellees and Cross-Appellants, v. SECURITY STATE BANK OF NEW SALEM, Defendant, Appellant and Cross-Appellee. Civ. |
Court | North Dakota Supreme Court |
James L. Norris, Bismarck, for plaintiffs, appellees and cross-appellants.
Wheeler Wolf, Bismarck, for defendant, appellant and cross-appellee; argued by Albert A. Wolf.
Security State Bank of New Salem (the Bank) has appealed from an amended district court judgment in favor of Darlene Hoovestol and Gregory Hoovestol, Personal Representative of the Glenn Hoovestol Estate (hereinafter collectively referred to as Hoovestol), and from an order denying the Bank's motion for j.n.o.v. or new trial. Hoovestol cross-appealed. We affirm.
Throughout their marriage, Glenn and Darlene Hoovestol were loan customers of the Bank. When they executed notes, Glenn and Darlene took credit life insurance provided through the Bank. When Glenn died on January 6, 1988, he and Darlene owed the Bank money on two renewal notes executed in 1987. After Glenn's death, the Bank notified Hoovestol that there was only $25,000 of credit life insurance coverage to apply to the indebtedness. After the credit life insurance proceeds of $25,000 were applied to the indebtedness, there remained a balance of $103,044.87. Darlene made a number of payments to the Bank on the notes and paid the notes in February 1989 with funds borrowed from the New Salem Credit Union.
By complaint dated February 16, 1989, Hoovestol sued the Bank and the credit life insurance company to recover the amount of the notes Glenn and Darlene owed the Bank, plus interest thereon, less the credit life insurance paid, "as a joint and several liability of both defendants." The complaint alleged, among other things: (1) that the defendants were "estopped to deny credit life insurance coverage for the unpaid balance, plus accrued interest, on both loans ... because of their violating state law and because they breached their duty to Glenn and Darlene Hoovestol to inform them, in writing, of any credit life insurance coverage limitations before the death of Glenn Hoovestol" 1; (2) that "defendants acted unreasonably and in bad faith in withholding payment of the full amount of unpaid loan balances ... plus accrued interest"; and (3) that "defendants have breached their duty of good faith and fair dealing to plaintiffs."
By motion of February 6, 1990, Hoovestol sought permission to file an amended complaint against both defendants, alleging (1) promissory or equitable estoppel; (2) breach of implied warranty of good faith and fair dealing; (3) breach of contract; (4) negligence in failing to disclose that credit life insurance coverage was limited to $25,000; (5) deceit; (6) fraud, malice, and oppression; (7) exemplary damages; and (8) additional compensatory damages for Darlene Hoovestol's mental pain and suffering. On March 16, 1990, Hoovestol settled with the credit life insurance company for $40,000. On March 22, 1990, the trial court granted Hoovestol's motion to amend the complaint.
Trial of the action against the Bank resulted in a jury verdict awarding Hoovestol $25,000. Finding "an irregularity in the proceedings ... which prevented the plaintiffs from having a fair trial on the damages arising from the defendant's negligence", the trial court ordered a new trial. The court let stand the jury's verdict of liability for negligence against the Bank and ordered that the new trial be limited to determining if Hoovestol sustained damages as a result of the Bank's negligence and, if so, the amount of damages to be awarded.
The second trial against the Bank resulted in a jury verdict awarding Hoovestol $115,191.05, with interest at the rate of six percent per annum from January 6, 1988. Judgment was entered accordingly. After postjudgment proceedings, the trial court granted the Bank's motion to set off Hoovestol's $40,000 settlement with the credit life insurance company, reduced the interest component of the verdict, and allowed prejudgment interest only from September 13, 1990, rather than from January 6, 1988, as the jury had awarded. An amended judgment was entered against the Bank for $76,799.76.
The Bank raised the following issues on appeal:
Hoovestol raised the following issues on cross-appeal:
The Bank contends that the trial court abused its discretion in ordering a new trial after the first jury verdict. At the first trial, the trial court orally instructed the jury:
The court also allowed the jurors to bring written copies of the instructions into the jury room. The jury returned a $25,000 verdict in favor of Hoovestol.
On October 9, 1990, the day the first trial ended, counsel for Hoovestol reported to the trial judge that on his way to lunch a juror told him "that the jury was unable to award more than $25,000 ... because the instruction said that ... the plaintiffs had to prove beyond a reasonable doubt that ... Mr. Hoovestol would have been or could have been insurable." The trial judge then went into the jury room and discovered that one set of instructions contained the instruction quoted above, except that the second sentence stated: "Stated differently, plaintiffs can only prove damages for negligence if they show by evidence beyond a reasonable doubt that they would have taken action to secure other insurance to replace that which they claim they did not receive from defendant." (Emphasis added.) The court told counsel for the parties:
At an October 15, 1990, hearing on the matter of the instruction, Hoovestol presented a juror affidavit stating:
Hoovestol offered the affidavit "to prove the jury did consider the beyond a reasonable doubt language" and moved for a mistrial. The trial court told counsel:
The trial court found the provision of the beyond-a-reasonable-doubt instruction "to be an irregularity in the proceedings ... which prevented the plaintiffs from having a fair trial on the damages arising from the defendant's negligence" and, pursuant to Rule 59(b)(1), N.D.R.Civ.P., 2 ordered a new trial to determine the amount of damages, if any, to be awarded to Hoovestol.
The Bank argues that the trial court abused its discretion in considering the juror's affidavit and copies of jury instructions after the verdict, and that any irregularity resulting from the inclusion of erroneous language in one set of jury instructions was harmless. We disagree.
A trial court's decision to grant a new trial pursuant to Rule 59(b), N.D.R.Civ.P., "will not be disturbed on appeal absent a showing of a manifest abuse of discretion." Okken v. Okken, 325 N.W.2d 264, 269 (N.D.1982). "Furthermore, because ... the granting of a new trial merely results in the trial of the case to another jury, we require a strong showing that the trial court abused its discretion in granting the motion for a new trial before we will reverse the granting of the motion." Id.
Ordinarily, juror affidavits are not admissible to impeach a jury's verdict. They may be used "to show juror misconduct based upon extraneous prejudicial information, outside...
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