Montgomery Ward v. Wilson

• Decision Date: 01 September 1994
• Docket Number: No. 135,135
• Citation: 664 A.2d 916,339 Md. 701
• Parties: MONTGOMERY WARD et al. v. Frances WILSON. ,
• Court: Maryland Court of Appeals

Page 701

339 Md. 701

664 A.2d 916

MONTGOMERY WARD et al. v. Frances WILSON.

No. 135, Sept. Term, 1994.

Court of Appeals of Maryland.

Sept. 15, 1995.

Reconsideration Denied Nov. 3, 1995.

John B. Kaiser (McCarthy, Bacon & Costello, all on brief), Lanham, for petitioners.

E. Gregory Lardieri, Greenbelt, for respondent.

Argued before MURPHY, C.J., and ELDRIDGE, RODOWSKY, CHASANOW, KARWACKI, BELL and RAKER, JJ.

ELDRIDGE, Judge.

We issued a writ of certiorari in this case to review the rulings by the courts below concerning the torts of malicious prosecution and false imprisonment, as well as the requirements for the allowability of punitive damages in malicious prosecution and false imprisonment actions.

I.

Frances Wilson filed a complaint in the Circuit Court for Prince George's County against Montgomery Ward Stores and one of its "Loss Prevention Managers," Jeffrey Bresnahan, alleging false imprisonment and malicious prosecution, and seeking both compensatory damages and punitive damages. On March 5, 1992, the defendants filed a motion for partial summary judgment with respect to punitive damages. They argued that, in light of Owens-Illinois v. Zenobia, 325 Md. 420, 601 A.2d 633 (1992), which had been decided a few weeks earlier, no award of punitive damages could be recovered in Maryland absent clear and convincing evidence of tortious conduct characterized by actual malice. Contending that "the Complaint fails to state any facts which would amount to evil motive, intent to injure, ill will or fraud by [Montgomery Ward] or its employees," the defendants argued that punitive damages were not recoverable in the case as a matter of law. The circuit court, after a hearing, denied the defendants' motion.

The case was tried before a jury in May 1993. The evidence established that during the summer of 1987 several customers of the Montgomery Ward store in Temple Hills, Maryland, had complained of unauthorized credit charges for women's clothing which had appeared on their monthly statements, and that Jeffrey Bresnahan, a loss prevention manager with Montgomery Ward, had investigated the unauthorized charges. Frances Wilson had become a target of Montgomery Ward's investigation, and Wilson was ultimately arrested for credit card fraud as a result of information given to a District Court commissioner by Bresnahan on behalf of Montgomery Ward.

The plaintiff and the defendants presented entirely different versions of the facts underlying Bresnahan's investigation of Wilson. The defendants' version of events was presented to the jury principally through the testimony of the defendant Bresnahan and of two other Montgomery Ward employees, Sandra Fuller and Lisa Holmes. Bresnahan testified that he used personnel records and register receipts to establish that Fuller had operated the register in the women's clothing department when the unauthorized transactions were made. Bresnahan interviewed Fuller. According to both Bresnahan and Fuller, Fuller told Bresnahan that she had rung up credit charges for a co-employee, Wilson, although Wilson had not produced a charge card. According to Fuller, Wilson had on several occasions asked Fuller to charge purchases to a charge account number which was handwritten on a piece of paper. Sometimes Wilson told Fuller that the account number was her cousin's, and at other times that it was her sister's. Although company policy required employees to check the identification of customers charging purchases without producing a credit card, Fuller stated that she permitted Wilson to charge the goods without showing identification. According to Fuller, Wilson later told Fuller that nobody could get in trouble for making the unauthorized charge purchases because the store would be unable to prove what had been done.

Bresnahan testified at trial that he had found Fuller to be forthright and cooperative in her interview with him. He went on to testify that, after the interview, he had tried to verify Fuller's story. Bresnahan checked additional personnel records and established that Wilson had indeed been working in the women's clothing department when the unauthorized purchases had been made. Bresnahan interviewed Fuller again, and then told his superiors of the status of his investigation. Next, he interviewed Wilson. Wilson told Bresnahan that she knew nothing about the fraudulent credit charges, and she refused to give a written statement. Bresnahan testified at trial that Wilson had been curt and unhelpful during the interview. Nevertheless, he also stated that he had wanted to investigate the matter further before concluding that Wilson had been responsible for the unauthorized credit charges.

Bresnahan arranged for a security assistant to interview another employee, Lisa Holmes. According to Holmes's trial testimony, she told the security assistant that she had once seen Wilson give Fuller a credit card number handwritten on a piece of white paper, and had seen Fuller charge goods for Wilson using the number. In addition, Holmes stated that Wilson had explained that the handwritten account number was her cousin's. Holmes also said that Wilson had told her not to say anything about the transaction to members of the loss prevention department during the investigation.

Bresnahan testified that he took no immediate action against Wilson. Bresnahan stated that he wanted to see whether additional complaints about unauthorized transactions would be forthcoming, and that he also had to "go through the trail of command" at Montgomery Ward before he could proceed further. Bresnahan testified that at a meeting attended by Bresnahan, two senior loss prevention managers, the Personnel Manager, and the Store Manager of the Temple Hills store, a "group consensus" was reached "that we had enough evidence to press charges." In addition, Bresnahan testified that he had not known Wilson personally before he began his investigation and that he had no feelings of ill will towards her.

The plaintiff's theory of the case at trial was, primarily, that Bresnahan had not performed an adequate investigation before he brought the charges against Wilson. Bresnahan testified during cross-examination that he had not compared Wilson's signature with the signatures on the unauthorized charge slips and that he had not sought expert handwriting analysis of the signatures. In addition, Bresnahan stated that, although the unauthorized purchases included "full-figure" sweaters and a "maternity bra," he nonetheless continued to suspect that Wilson, who apparently was of slight build, was responsible for them.

Wilson's testimony at trial was inconsistent with the testimony of Fuller and Holmes. Wilson testified that she had never made any credit purchases at the Montgomery Ward store. She specifically denied ever having made any credit card purchases in which Fuller was the cashier, or any credit card purchases on behalf of another person. In addition, Wilson stated that she had never asked Holmes and Fuller not to answer the loss prevention department's questions about unauthorized credit card transactions.

As earlier indicated, Bresnahan prepared an application for a statement of charges and presented the application to a District Court commissioner in Prince George's County. The commissioner issued a warrant for Wilson's arrest. Two members of the Prince George's County Police Department subsequently arrested Wilson at the Temple Hills store. Wilson testified at trial that customers and fellow employees saw her being handcuffed and removed from the store, and that she felt "scared, nervous, humiliated and embarrassed." Wilson's mother told the jury that Wilson had been nervous and upset after the incident, but that she had eventually recovered. Both Wilson and her mother stated that Wilson had no criminal record and had never previously been arrested.

Only limited evidence was introduced at trial with respect to the disposition of the criminal prosecution for credit card fraud against Wilson. Before the trial in the present case, the defendants had filed a motion in limine to "preclud[e] the Plaintiff from raising the issue of an erroneous entry in her criminal prosecution marked 'not guilty.' " According to the defendants, the criminal charges against Wilson were dismissed because several witnesses failed to appear for the trial, which had already been rescheduled three times. Wilson did not challenge the accuracy of the assertion. In this civil action, the circuit court limited evidence of the disposition of the criminal case to statements that the charges against Wilson had been dismissed. All parties acquiesced in the circuit court's ruling.

After the plaintiff had presented her case, the defendants moved for judgment on the ground that the evidence showed, as a matter of law, probable cause for Wilson's arrest. The defendants also argued that the plaintiff had failed to establish either false imprisonment or malicious prosecution. The circuit court denied the motion. At the conclusion of all the evidence, the defendants again moved for judgment. They renewed their contentions that, as a matter of law, the evidence demonstrated probable cause and failed to establish either false imprisonment or malicious prosecution. With respect to a possible award of punitive damages, the defendants renewed their argument that an award of punitive damages could not be based on implied malice and that the plaintiff had presented no evidence of actual malice. In addition, the defendants contended that, under Maryland law, evidence of the defendants' financial worth was required to be submitted to the jury before an award of punitive damages could be assessed. The circuit court denied the defendants' motion.

The trial judge instructed the jury that, under the circumstances of the case, the defendants would not be liable for false imprisonment or malicious prosecution if they had probable cause to believe that...