King v. Zimmerman, 94-026
| Citation | 878 P.2d 895,266 Mont. 54 |
| Decision Date | 01 August 1994 |
| Docket Number | No. 94-026,94-026 |
| Parties | Robert KING, Plaintiff and Respondent, v. Robert ZIMMERMAN and Connie Zimmerman and Big Z, Inc., a Montana corporation, Defendants and Appellants. |
| Court | United States State Supreme Court of Montana |
Michael G. Majerus, Billings, for appellants.
Brad L. Arndorfer, Billings, for respondent.
Robert King filed an action in the District Court for the Thirteenth Judicial District in Yellowstone County in which he alleged breach of contract, breach of the implied covenant of good faith and fair dealing, and conversion of property by defendants Robert and Connie Zimmerman and Big Z, Inc. Following a five-day jury trial, a verdict was returned for King and judgment was entered against Big Z and Connie Zimmerman. King was awarded compensatory damages for breach of contract and conversion in the amount of $9,654.24. He was awarded punitive damages in the amount of $1.00 against Big Z, and $35,000 against Connie Zimmerman, on the basis that they had acted with actual malice when they wrongfully converted King's property. Big Z and Connie Zimmerman appeal.
We affirm.
The following issues are raised on appeal:
1. Did the District Court err when it refused to grant the defendants' motion for a directed verdict on the issue of conversion?
2. Did the District Court err when it refused to grant the defendants' motion for a directed verdict on the issue of whether Connie Zimmerman was personally liable for conversion of property?
3. Did the District Court err when it affirmed the jury's award and assessed punitive damages against Big Z and Connie Zimmerman?
4. Did the District Court abuse its discretion when it allowed into evidence an audio taped deposition of a witness for the plaintiff?
5. Did the District Court abuse its discretion when it allowed King to introduce evidence in support of claims which the defendants contend were not raised in the pretrial order?
This litigation involves a lease agreement between Robert King and a trucking firm known as Big Z, Inc., owned by Robert and Connie Zimmerman. Robert Zimmerman, as president of Big Z, owned 1899 of the 1900 shares of stock of the corporation. Connie Zimmerman, the corporation's secretary, owned the remaining one share of stock.
On May 10, 1991, King and Big Z entered into an agreement whereby King leased to Big Z a truck that he owned, and Big Z agreed to dispatch commercial loads to be hauled across the country by King or King's drivers. King was to receive 85 percent of the gross revenue from each haul, minus certain adjustments, and the remaining 15 percent of the gross revenue was to go to Big Z.
The agreement stated that King would provide the necessary permits, licenses, and insurance to haul commercial loads. King testified that Big Z initially purchased the required permits in the name of Big Z and King, and that he was reimbursing Big Z for these costs out of his monthly receipts. The agreement further provided that King, as lessor, could terminate the lease agreement 30 days after providing written notice, and that Big Z, as lessee, could terminate the lease "in a 24 hour period with extreme cause, such as failure to perform."
The dispute leading to this lawsuit began with a load of cherries which were to be transported from the west coast to the east coast by Greg Ramey. The load was delivered late and resulted in substantial losses to Big Z. Ramey remained on the east coast with King's truck, and King eventually flew to the east coast in order to retrieve his truck. In connection with his return to Montana, King agreed to deliver a load of gambling "pull tabs" to the west coast. The specific events which occurred are in dispute, but King apparently returned to Montana with the load of pull tabs and then declined to deliver the load to Washington state.
In response, the Zimmermans terminated the lease agreement and immediately attempted to retrieve the license plates and other permits from King's truck which were in Big Z's name. Unable to do so, Connie Zimmerman contacted the Yellowstone County Sheriff's office on July 27, 1991, and reported that the semi-tractor had been stolen from their business. The sheriff's office refused to impound the truck, but did retrieve the license plates and permits, as requested by Connie Zimmerman.
On May 5, 1992, King filed a complaint against Big Z and Robert Zimmerman in which he alleged breach of contract, breach of the implied covenant of good faith and fair dealing, and conversion of property. King claimed that Robert Zimmerman and Big Z breached the lease by "willfully and intentionally refusing to dispatch plaintiff and making false reports of theft to the Yellowstone County Sheriff's Department" and that they had converted King's property when they caused the sheriff's office to confiscate "tags, insurance and permits ... in the name of Big Z for which the plaintiff had paid." Finally, the complaint alleged that "defendants are further liable for punitive damages for their intentional and malicious act of making false police reports in order to convert them [the property seized] from the plaintiff's use to their own." On June 15, 1993, the complaint was amended to include Connie Zimmerman as a defendant.
A jury trial was held on August 23-27, 1993. The jury found a breach of contract or the obligation of good faith and fair dealing, and assessed damages against Big Z in the amount of $8,288.33 as compensatory damages, plus interest and costs. The jury also found conversion by Big Z and Connie Zimmerman, and awarded compensatory damages of $1,117.23. Furthermore, the jury found that Big Z and Connie Zimmerman had acted maliciously with respect to the conversion, and returned exemplary damages against Big Z in the amount of $1.00 and against Connie Zimmerman in the amount of $35,000. No damages were assessed against Robert Zimmerman personally.
The court entered findings of fact and conclusions of law related to the amount of punitive damages on September 8, 1993, and awarded punitive damages to King in the amounts assessed by the jury. From the judgment entered on September 16, 1993, Big Z and Connie Zimmerman appeal.
Did the District Court err when it refused to grant the defendants' motion for a directed verdict on the issue of conversion?
Big Z and Connie Zimmerman contend that the court should have granted their motion for a directed verdict on the issue of conversion because the items that Connie Zimmerman requested the sheriff's department to return were license plates and permits which were owned by Big Z. They assert that King could not demonstrate that he owned the property or had a right of possession, and therefore, could not prove conversion or wrongful possession of this property by Big Z or Connie Zimmerman.
A court may grant a directed verdict only when it appears as a matter of law that the nonmoving party could not recover upon any view of the evidence, including the legitimate inferences to be drawn from the evidence. Kearney v. KXLF (1994), 263 Mont. 407, 869 P.2d 772, 777. A directed verdict for the defendant is not proper if reasonable persons could differ regarding the conclusions which could be drawn from the evidence, and a directed verdict is proper only in the complete absence of any evidence to warrant submission to the jury. Dees v. American National Fire Insurance (1993), 260 Mont. 431, 442, 861 P.2d 141, 148; Moralli v. Lake County (1992), 255 Mont. 23, 27, 839 P.2d 1287, 1289.
The standard we use in reviewing denials of motions for directed verdicts only requires substantial evidence in the record to support the finding of the jury. Lane v. Dunkle (1988), 231 Mont. 365, 369, 753 P.2d 321, 323. We review the evidence in a light most favorable to the prevailing party, and will reverse only where there is a lack of substantial evidence to support the judgment. Lane, 753 P.2d at 323. Substantial evidence is evidence which a reasonable mind might accept as adequate to support a conclusion, even if it is weak or conflicting. Arnold v. Boise Cascade (1993), 259 Mont. 259, 265, 856 P.2d 217, 220.
Conversion requires property ownership, the owner's right of possession, and the unauthorized control over the property by another resulting in damages. Lane, 753 P.2d at 323. However, in an action for conversion, "property ownership" does not mean that the plaintiff must have absolute or unqualified title to the property in question, but rather that he or she must have an interest in the property and the right to possess the property at the time of the alleged conversion. Kinsman v. Stanhope (1914), 50 Mont. 41, 144 P. 1083; 18 Am.Jur.2d Conversion § 75 (1985). Ordinarily, an immediate right to possession at the time of conversion is all that is required to enable a plaintiff to maintain an action. 18 Am.Jur.2d Conversion § 76 (1985).
This statement of the law of conversion was properly reflected in the following instruction which was given to the jury:
Conversion is the unauthorized assumption and exercise of the right of ownership over goods or personal chattels belonging to another, to the alteration of their condition or the exclusion of the owner's rights. To entitle the plaintiff to recover, the jury must believe, from the evidence, that the plaintiff was the owner of the property in question, or that he had some special interest therein, which entitled him to possession of the property at the time of the alleged conversion. [Emphasis added].
Although the defendants consistently maintained that no conversion had occurred, the trial transcript reveals that the defendants specifically consented to this instruction regarding the law of conversion. However, on appeal, Zimmerman and Big Z contend that King cannot maintain a conversion action because he cannot prove that Big Z had actually transferred title or ownership of the items in question to King. The...
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