Huether v. Mihm Transp. Co.

• Decision Date: 23 December 2014
• Docket Number: No. 26784.,26784.
• Citation: 857 N.W.2d 854
• Court: South Dakota Supreme Court
• Parties: Curtis HUETHER, Plaintiff and Appellant, v. MIHM TRANSPORTATION CO., Paul Radloff and Rod Spartz, Defendants and Appellees, and David Bisson, and Jeff Dietrich, Defendants.

857 N.W.2d 854

Curtis HUETHER, Plaintiff and Appellant

v. MIHM TRANSPORTATION CO., Paul Radloff and Rod Spartz, Defendants and AppelleesandDavid Bisson, and Jeff Dietrich, Defendants.

No. 26784.

Supreme Court of South Dakota.

Considered on Briefs Nov. 17, 2014.

Decided Dec. 23, 2014.

Scott R. Swier, Brooke Swier Schloss, Swier Law Firm, Prof. LLC, Avon, South Dakota, Attorneys for plaintiff and appellant.

Sabrina L. Sayler, Crary, Huff, Ringgenberg, Hartnet & Storm, PC, Dakota Dunes, South Dakota, Attorneys for defendants and appellees Mihm and Paul Radloff.

Scot D. Mannschreck, Vermillion, South Dakota, Attorney for defendant and appellee Rod Spartz.

Opinion

SEVERSON, Justice.

[¶ 1.] Curtis Huether brought this action alleging fraudulent misrepresentation and deceit and civil conspiracy against David Bisson, Mihm Transportation Co. (Mihm), Paul Radloff, Rod Spartz, and Jeff Dietrich (collectively Defendants). Bisson did not defend the lawsuit, and as a result, the circuit court entered a default summary judgment against him for fraudulent misrepresentation and deceit in the amount of $100,004 in actual damages and $1,000,000 in punitive damages. A jury trial was held on the remaining claims against Defendants. The jury found in favor of Huether on the civil conspiracy claim as to Mihm and Radloff. The jury awarded Huether $1,891 against Mihm and $500 against Radloff, and the circuit court imposed joint and several liability for the total jury award ($2,391) against Mihm and Radloff. Huether appeals asserting that the circuit court erred in failing to impose upon Bisson, Mihm, and Radloff joint and several liability for the totality of the summary judgment award, including punitive damages, and in denying his motion for judgment as a matter of law against Spartz. We affirm.

Facts and Procedural History

[¶ 2.] In September 2008, Bisson contacted Huether with a proposed deal wherein Huether would purchase 70 “open” (i.e., non-pregnant) heifers from Bisson at $1,425 per head (totaling $99,750), Huether would breed the open heifers, and then Bisson would purchase the “springing” (i.e., impregnated) heifers from Huether at $2,000 per head (totaling $140,000). Huether and Bisson had entered a written agreement in the past, and the two proceeded under an understanding similar to the terms of the prior agreement. Although Bisson promised a written contract, none was provided or entered into. Bisson hired Mihm to transport the heifers from Indiana to Huether's farm in Hutchinson County, South Dakota. Mihm contracted with Radloff to transport the heifers and sent load information to Radloff. Radloff transported the heifers to Huether and, upon arrival to Huether's farm on September 9, 2008, Radloff gave Huether the heifers' health certificates and the transportation bill, which totaled $2,391. Huether did not review the health certificates at that time.

[¶ 3.] Bisson called Huether a few days after the heifers arrived and arranged for Bisson and Bisson's veterinarian, Jeff Dietrich, to dehorn some of the heifers and further “work” the heifers on September 24, 2008, even though Huether would not be at his farm that day. Bisson assured Huether that he did not need to be present. Huether alleged at trial that Bisson and Dietrich altered the heifers' identification tags that day so that the heifers would appear to originate from South Dakota.

[¶ 4.] In January of 2009, some of the heifers began calving early.¹ As a result, Huether called a local veterinarian to examine the heifers in March of 2009, and the veterinarian ascertained that some of the supposedly open heifers were actually pregnant when Radloff delivered them in September of 2008. In addition, the veterinarian or the veterinarian's assistant noticed that the heifers' identification tags appeared to have been altered or removed. Huether then examined the health certificates that accompanied the heifers when they were delivered by Radloff. Huether's examination revealed that the heifers' state of origin, ages, identification information, cosignor and cosignee information, and interstate movements appeared to be falsified or altered.

[¶ 5.] Huether alerted the South Dakota State Veterinarian and the United States Department of Agriculture, both of which began investigating. The State investigator, Dr. Mendel Miller, found that the heifers' identifications and health certificates were incorrect, the heifers' medical information could not be verified, and the heifers' origin could not be determined. As a result, the State quarantined the heifers until they were tested for tuberculosis. The heifers could not be sold or moved while in quarantine. Huether could have had the heifers tested for tuberculosis shortly after the quarantine began, but chose not to do so until more information could be gathered about the heifers' origin.

[¶ 6.] On June 1, 2009, while the heifers were under quarantine, Huether's attorney received a letter from Mihm and Radloff. The letter stated that the heifers actually came from Spartz's farm in Goodwin, South Dakota. Later that same day, when Huether and his attorney called Mihm about the letter, Mihm, and later Radloff, admitted the letter was a lie. Mihm claimed that Bisson had told him what to write. Mihm also claimed that the heifers were from Indiana, so within a matter of hours, Mihm gave two different accounts of the heifers' origin. Radloff asserted that he did not know that Bisson had directed Mihm to write the letter, but Mihm and Radloff admitted they knew the letter was false when it was sent.

[¶ 7.] Having failed to ascertain the origin of the heifers from Mihm or Radloff, Huether and Dr. Miller followed up on a possible lead in Spartz. Spartz was a grain and beef farmer and had a long-standing business relationship with Bisson. Spartz, too, lied about the origin of the heifers, claiming the heifers had indeed come from his farm. Huether believed that Bisson directed Spartz to lie about the origin of the heifers as part of the ongoing fraud against Huether. At trial, Spartz admitted that he lied at Bisson's request.

[¶ 8.] On or about October 29, 2009, Huether finally had the heifers tested for tuberculosis ; they tested negative. The State then lifted the quarantine. The heifers were quarantined for approximately five months from March to October. Huether sold the heifers for about $932 per head, and he alleged that he suffered $100,004 in damages. The heifers were sold at approximately the same time that they would have been sold to Bisson under the original contract.

[¶ 9.] Huether filed suit against Defendants in August of 2010, alleging, inter alia, fraudulent misrepresentation and deceit and civil conspiracy. Huether prayed for actual and punitive damages. Huether's claim for $100,004 was determined primarily by the difference between the claimed contract price of $2,000 per head and the price for which he eventually sold the heifers, $932 per head. Trial testimony established that the market value of the heifers declined from the time when Huether and Bisson settled on the contract price to when Huether sold the heifers. Huether moved for summary judgment against Bisson regarding the fraudulent misrepresentation and deceit claim, and the circuit court held a hearing on April 25, 2013. Bisson did not appear or resist the claim.² The other Defendants filed resistances to the motion for summary judgment by Huether against Bisson because of the possibility of joint and several liability, but the circuit court ruled that the co-defendants could not intervene. The circuit court entered default summary judgment against Bisson for $100,004 in actual damages and $1,000,000 in punitive damages. The circuit court instructed all parties that the summary judgment applied only to Bisson and that any underlying torts for the civil conspiracy claim needed to be established at trial. Although not required by statute, the court entered findings of fact and conclusions of law against Bisson, but none of those findings or conclusions related to the civil conspiracy claim.

[¶ 10.] Huether proceeded to trial against the remaining Defendants. The circuit court again clarified that the default summary judgment only applied to Bisson and only pertained to Huether's fraudulent misrepresentation and deceit claim against Bisson, not the civil conspiracy claim. At trial Dr. Miller testified that what happened with Huether's heifers was “quite in depth and quite complicated, [with] a lot of deception and dishonesty.” The State of South Dakota's Chief Veterinarian testified that “it's one of the most confusing movements of livestock” that he had ever seen. Mihm described its participation in the letter as a “lie,” a “mistake,” and an “error in judgment.” Radloff stated that it was “the biggest mistake I think I have ever made.” Spartz thought that lying to Huether was “no big deal,” he did not think anything of it, and he did not care what happened.

[¶ 11.] At the close of plaintiff's presentation of the evidence, the circuit court denied both Huether's and Defendants' motions for judgment as a matter of law. At the close of the parties' presentation of the evidence, the court again denied Huether's and Defendants' renewed motions for judgment as a matter of law because the court believed there were issues of fact that needed to be decided by the jury. The parties then submitted jury instructions and special interrogatories to the court, and the court reviewed those instructions and interrogatories with the parties' attorneys. The circuit court instructed the jury that the court had previously found that Bisson committed fraudulent misrepresentation and deceit against Huether and that it had already awarded Huether $100,004 in actual damages and additional punitive damages. The circuit court further instructed the jury that Huether bore the burden of proving that two or more of the Defendants conspired to commit fraud and deceit against Huether. The court properly...