Nicholas v. Miami Burglar Alarm Co., Inc.

• Decision Date: 07 October 1976
• Docket Number: No. 46058,46058
• Citation: 339 So.2d 175
• Court: Florida Supreme Court
• Parties: J. K. NICHOLAS, Individually, and d/b/a J. K. Nicholas & Co., Petitioner, v. MIAMI BURGLAR ALARM CO., INC., Respondent.

Page 175

339 So.2d 175

J. K. NICHOLAS, Individually, and d/b/a J. K. Nicholas & Co., Petitioner, v. MIAMI BURGLAR ALARM CO., INC., Respondent.

No. 46058.

Supreme Court of Florida.

Oct. 7, 1976.

Rehearing Denied Dec. 9, 1976.

Jonathan L. Alpert, Miami, for petitioner.

Robert C. Lane and Robert C. Lane, Jr., of Lane & Lane, Miami, for respondent.

Wayne W. Pomeroy, of Pomeroy & Betts, Fort Lauderdale, as amicus curiae.

Stephen D. Marks, Law Offices of Lessing E. Gold, Beverly Hills, Cal., for National Burglar and Fire Alarm Association, amicus curiae.

OVERTON, Chief Justice.

Upon rehearing we vacate the opinion rendered August 12, 1975.

This cause is before us on petition for writ of certiorari to review the decision of the Third District Court of Appeal reported at 297 So.2d 49. It conflicts with Cooper v. IBI Security Service of Florida, Inc., 281 So.2d 524 (Fla.3d DCA 1973), and we have jurisdiction. ¹

Respondent installed and maintained a burglary alarm system in petitioner's tobacco warehouse, which is located in a high crime rate area. An unauthorized entry into the warehouse would trigger an audible alarm and a silent one that would be transmitted over telephone lines to an answering service. Also, if for any reason there occurred a voltage drop across the lines, a 'trouble signal' would be relayed to the answering service. A 'trouble signal' might indicate just a problem with the telephone lines rather than a possible burglary. The answering service in turn would notify respondent of the signal it had received. Respondent allegedly assumed the duty to notify the police or petitioner upon notice of either an 'alarm' or a 'trouble signal,' even though the contract between petitioner and respondent requires such action only upon notice of an 'alarm.'

Petitioner alleged that on July 30, 1970, respondent's employee received notice of a 'trouble signal' when two of the alarm's telephone wires were cut by burglars. No 'alarm' signal was received. In accordance with company policy, the employee notified the telephone company, but he did not call the police or petitioner as respondent allegedly said he would in an oral conversation with the petitioner. The burglars apparently worked uninterrupted, knocking a two-foot square hole in the concrete wall of the warehouse and passing through it over $15,000 worth of cigarettes.

Petitioner sued respondent for compensatory and punitive damages on four counts. The trial court dismissed all of them. The Third District Court of Appeal affirmed, holding that the dismissal of the three counts claiming compensatory damages was proper because there was no proximate cause. Each count was grounded in negligence despite being styled actions for breach of contract, breach of warranty, and negligence. The District Court identified the burglary as an intervening criminal act and applied the rule that such an act,

'. . . breaks the chain of causation, and therefore the original negligence of the defendant cannot be the proximate cause of the damage resulting from the intervening criminal act . . .. See Bryant v. Atlantic Car Rental, Inc., Fla.App.1961, 127 So.2d 910; Lingefelt v. Hanner, Fla.App.1960, 125 So.2d 325.' Nicholas v. Miami Burglar Alarm Co., 266 So.2d 64, 66 (Fla.3d DCA 1972).

On the fourth count which included a demand for punitive damages based on allegations of wanton negligence, the Third District reversed and remanded. The District Court held this cause of action was not precluded by the intervening criminal act, and,

'Where the allegations of a complaint show the invasion of a legal right, the plaintiff may recover at least nominal damages, and a motion to dismiss by the defendant should be denied.' Id. at 66.

On remand, petitioner attempted to obtain both compensatory and punitive damages. The trial court ruled that compensatory damages were not available and that punitive damages could be awarded only upon a showing of gross negligence. The trial court then directed a verdict for respondent because its actions did not amount to gross negligence. Petitioner appealed and the Third District affirmed, reiterating that there could be no recovery of damages sustained in the burglary and holding that the gross negligence necessary to a claim of punitive damages had not been established. Nicholas v. Miami Burglar Alarm Co., Inc., 297 So.2d 49 (Fla.3d DCA 1974).

Judge Haverfield dissented stating:

'The majority opinion in this case is based upon this court's determination of appellant's prior appeal in Nicholas v. Miami Burglar Alarm Company, Fla.App.1972, 266 So.2d 64, wherein the court adopted the principal (sic) of law that a burglar alarm company is not liable for a burglary even though its system fails to function properly. I do not quarrel with this principal (sic) of law, but rather I believe that it was applied incorrectly to the facts of the instant action. In the case sub judice, the wires to the alarm system were severed and thereupon, as the system was supposed to function, a trouble signal was transmitted to and received by the defendant company. There facts conclusively demonstrate that this cause of action does not involve a system malfunction or spontaneous failure and, therefore, the above principal (sic) of law is not pertinent.' Id. at 50.

Judge Haverfield further reasoned that since the burglary was foreseeable, it was not an intervening cause of petitioner's losses which would bar recovery. He would have remanded to jury trial the action for compensatory damages.

We agree with Judge Haverfield. Florida recognizes the general rule that though a person's negligence is a cause in fact of another's loss, he will not be liable if an act unforeseeable to him and independent of his negligence intervenes to also cause the loss. See, e.g., Benedict Pineapple Co., v. Atlantic Coast Line R. Co., 55 Fla. 514, 46 So. 732 (1908). From this rule some have concluded that a burglar alarm company is not liable for a burglary if its equipment malfunctions, for normally the occurrence of the theft at that moment would be both unforeseeable and independent of the breakdown. This derivative rule has no place in determining liability in the instant case.

In Cooper v. IBI Security Service of Florida, Inc., supra, a life insurance premium collector was shot when an armed guard failed to accompany him into a dangerous area as provided for in a contract between the collector's employer and a security service. The trial court dismissed with prejudice the collector's complaint for damages. In the trial court's view, the defendant's negligence or breach of contract could not have been the proximate cause of plaintiff's injury. In this decision, the Third District Court of Appeal held that the attack on the collector was sufficiently foreseeable to disqualify it as a superseding cause, and 'the defendants' motion to dismiss should have been denied.' Id. at 526. The Third District distinguished its first Nicholas decision on the facts, saying that the degree of foreseeability of loss in that case was small.

We agree with the principle expressed in Cooper. In our opinion the foreseeability in the instant case was sufficient to withstand a motion to dismiss for lack of proximate cause. We hold a burglar alarm company under contract to monitor an alarm system may be negligent for failure to inform the police or the warehouse owner of a trouble signal which its employees had received. In the instant case there was no system malfunction or spontaneous failure. The monitoring employees followed company policy and directions in handling this telephone circuit disruption trouble signal in only notifying the telephone company. Whether the company was negligent in the policy it prescribed to handle the trouble signal is a jury issue.

On the issue of punitive damages, we hold that the District Court correctly affirmed the directed verdict for respondents. The allegations do not establish an intentional wrong that amount to an independent tort, nor do they establish the entire want of care or attention to duty that would allow a jury to impute malice to the burglar alarm company. Petitioner contends, however, that Griffith v. Shamrock Village, 94 So.2d 854 (Fla.1957), requires reversal. We disagree. In that instance, the employee wilfully failed to carry out his assigned duties.

Punitive damages are not recoverable for breach of contract, irrespective of the motive of defendant except where the acts constituting a breach of contract also amount to a cause of action in tort, in which event there may be a recovery of punitive damages upon proper allegations and proof. In order to permit a recovery, however, the breach must be attended by some intentional wrong, insult, abuse, or gross negligence the extent of which amounts to an independent tort. American International land Corporation v. Hanna, 323 So.2d 567 (Fla.1975); Griffith v. Shamrock Village, supra.

The decision of the District Court is approved in part and disapproved in part. The cause is remanded for further proceedings consistent with this opinion.

It is so ordered.

ROBERTS, BOYD, ENGLAND, SUNDBERG and HATCHETT, JJ., concur.

ADKINS, J., dissents in part and concurs in part with an opinion.

ADKINS, Justice (dissenting in part and concurring in part).

This is an action wherein petitioner, hereinafter referred to as plaintiff, seeks to recover a loss from a burglary resulting from the alleged failure of the respondent, hereinafter referred to as defendant, to take affirmative action after receiving a trouble signal from the plaintiff's tobacco warehouse. Such failure is alleged to have permitted a burglar to escape with merchandise valued at $15,000. Additionally, plaintiff seeks punitive damages.

The trial court dismissed all four counts of the complaint. The District Court affirmed the dismissal of the first three counts which alleged the loss was due to the failure of the burglar alarm system to...