Orkin Exterminating Co., Inc. v. Traina

• Decision Date: 02 January 1986
• Docket Number: No. 29S04-8601-CV-2,29S04-8601-CV-2
• Citation: 486 N.E.2d 1019
• Parties: ORKIN EXTERMINATING CO., INC. Appellant, (Defendant Below), v. Charles TRAINA and Michelle Traina, Appellee, (Plaintiff Below),
• Court: Indiana Supreme Court

Page 1019

486 N.E.2d 1019

ORKIN EXTERMINATING CO., INC. Appellant, (Defendant Below), v. Charles TRAINA and Michelle Traina, Appellee, (Plaintiff Below),

No. 29S04-8601-CV-2.

Supreme Court of Indiana.

Jan. 2, 1986.

John P. Price, Jon D. Krahulik, Robin L. Babbitt, Bingham Summers Welsh & Spilman, Indianapolis, for appellant.

Albert George, Duvall, Bell, Babcock & Payne, Robert W. York, Wilson & Kehoe, Indianapolis, Michael A. Howard, Smith Pearce & Howard, Noblesville, for appellee.

PRENTICE, Justice.

This case is before us upon the petition of Defendant (Appellant) to transfer the cause from the Court of Appeals, Fourth District, that court having affirmed the award of punitive damages by the trial court by decision and opinion published at 461 N.E.2d 693. Said decision contravenes ruling precedents of this Court and conflicts with prior decisions of the Court of Appeals, to-wit: Travelers Indemnity Co. v. Armstrong (1982), Ind., 442 N.E.2d 349; Liston v. State (1969), 252 Ind. 502, 250 N.E.2d 739; Miller Pipeline Corp. v. Broeker (1984), Ind.App., 460 N.E.2d 177, reh. denied 464 N.E.2d 12 in that such award is not sustained by the evidence and is, therefore, contrary to law.

The evidence, insofar as it is relevant to the issue and viewed in the light most favorable to the verdict, discloses that the Defendant was in the pest control business and that the Plaintiff (Appellee) had availed himself of its services to exterminate insects in his residence. It was Defendant's practice to send its technicians, of which Coleman was one, unsupervised into the customer's buildings, including private residences, and to spray chemical solutions.

Defendant's branch office, out of which Coleman worked, was managed by Karl Koch, and Steven Hinkley was the office manager trainee, having worked in that capacity for only three months. Among other duties, Hinkley was responsible for hiring and supervising the technicians and had investigated, interviewed and hired Coleman. Koch was responsible for training Hinkley, whose prior experience in hiring and supervising personnel had been minimal, and acknowledged that his supervision of Hinkley's hiring of Coleman had been limited to counseling him with regard to the Defendant's goals regarding its public image and its employee's attitudes.

Defendant had an elaborate procedure provided in its manuals for the selection of technicians, which procedures were not adhered to by Hinkley in his selection and employment of Coleman. (Neither was Coleman subjected to a six-week training program prescribed by company policy but was sent into residences, alone, to service them after having been accompanied by Hinkley to several residences on but one occasion.) The omissions of Defendant particularly cited by Plaintiff as evidencing culpability in hiring Coleman are its failure to obtain a comprehensive five-year employment background record and hiring him without first obtaining the results of a polygraph test that had been given to him. However, as observed by the Court of Appeals, " * * * an exhaustive background check would have revealed an unremarkable employment history in Coleman's case, that is, no fact which would have put Orkin on notice" that an injury, such as is here involved, was likely to occur as a result of Orkin's proposed employment of Coleman.

Had Defendant's manual of procedure been followed, Hinkley may have learned that his statements as to his prior employment were incomplete and in some respects misleading, and the following stated adverse matters probably would have been revealed; Coleman had been suspended for ten days from his previous job as a security guard for being absent without permission, lying about his whereabouts and being derelict in his duties. He had been discharged from a job three years earlier for absenteeism and for being a "poor worker." He had previously given conflicting answers on job application forms, stating in some that he was in good health and in others that he had left prior employment for "health reasons."

It was Defendant's policy to put technicians into homes, without supervision, only after the second week of the six-week training program. During the third and through the sixth week, they could go without supervision, except for two hours daily, after which time they were regarded as being fully qualified to perform their work unsupervised. This policy was not adhered to in Coleman's case. Rather, he was subjected to "on the job training for at least several days," supplied with some orientation materials and viewed some training films. Except for one day, Coleman's on-the-job training was provided by two other technicians; and Hinkley, whose responsibility it was to train Coleman went with him on but one day to service the homes of several customers.

Notwithstanding the aforementioned policy, Coleman began performing his work, unsupervised, on September 5, 1979, the fourth day of his employment. The course of Coleman's employment was uneventful until September 15th, when Hinkley discovered him working on an improvised device which he called a pen-gun, which was the barrel and firing mechanism from a tear gas gun which Coleman had modified to fire a .25 caliber cartridge with the powder charge reduced by about fifty percent. Coleman acknowledged that he was aware of the company policy against workmen carrying firearms but said that he carried it to protect himself against large dogs, one of which had chased him to the top of his truck. Coleman had previously told Hinkley of his fear of dogs and Hinkley had instructed him a few days earlier how to cope with them. Hinkley was very stern in his reprimand of Coleman. He reminded him of the anti-gun policy and told him to get rid of the device and that he would be fired if he did not. Coleman said that he understood the reason for such policy and agreed with it and assured Hinkley that he would not carry it anymore. Hinkley accepted Coleman's assurance, said nothing more about the matter and did not notify his supervisor, Koch.

On September 22nd, notwithstanding the reprimand and warning from Hinkley, Coleman carried the gun in his shirt pocket when he went to the residence of Charles and Michelle Traina. While Plaintiff and Coleman were in the basement, it fell from his pocket, by accident, and discharged. The projectile struck Charles in the right forearm and caused a severe injury, for which he was awarded $65,000.00 in damages and Michelle was awarded $2,000.00 for loss of consortium. Defendant was liable for these damages under the doctrine of respondeat superior, and there has been no appeal upon that issue. The judgment also included an award of punitive damages in the sum of $400,000.00. Defendant's motions in trial and post trial clearly challenged the sufficiency of the evidence to sustain the punitive damages award and were erroneously overruled.

The Court of Appeals was correct in determining that the Armstrong clear and convincing evidence rule applies in pure tort cases as well as in those rare breach of contract cases where it is clear that the breach contained "elements that enable the court to regard them as falling within the field of tort or as closely analogous thereto," 5 Corbin, Contracts Sec. 1077 (1964), quoted in Vernon Fire and Casualty Insurance Co. v. Sharp (1976), 264 Ind. 599, 349 N.E.2d 173, although such a resolution may not be necessary to our determination of this case, as it is doubtful that the award of punitive damages under the facts before us could be affirmed under any standard.

Whatever standard of proof is required at the trial level, if it can be said that either of two conclusions can be reasonably drawn from the evidence, it is immaterial, upon appeal, that one of such conclusions appears to be more likely than the other, and we are bound by the finding of the trier of fact. However, when, as here, the conclusion reached by the fact finder simply cannot be reasonably arrived at under the evidence, that is to say that no reasonable person could draw such conclusion from the evidence, then the judgment resting thereon is contrary to law and cannot stand. Loyd v. State (1980), 272 Ind. 404, 407, 398 N.E.2d 1260, 1264 cert. denied 449 U.S. 881, 101 S.Ct. 231, 66 L.Ed.2d 105 (conflicting evidence); Osbon v. State (1937), 213 Ind. 413, 13 N.E.2d 223 (no evidence); Citizens Street Railroad Co. v. Reed (1898), 151 Ind. 396, 51 N.E. 477 (conflicting evidence).

Punitive damages are not compensatory in nature but are designed to punish the wrongdoer and to dissuade him and others from similar conduct in the future. Indianapolis Bleaching Co. v. McMillan (1916), 64 Ind.App. 268, 113 N.E. 1019. They are awarded in addition to the awards for financial loss, pain and suffering and other such considerations. Hence, when the question of whether or not punitive damages should be given is considered, it must be done with the realization that the plaintiff has already been awarded all that he is entitled to receive as a matter of law. What, if anything, he may be given in addition is a windfall, and in making that decision all thoughts of benefiting the injured party should be laid aside and the sole issues are whether or not the Defendant's conduct was so obdurate that he should be punished for the benefit of the general public. Punitive damages may be likened to a fine imposed for breach of the criminal statutes. Although the State receives the fine and thus benefits, the purpose is not to raise revenue.

It is because the concept of punitive damages is penal in character that a standard of proof akin to that required in criminal trials is utilized, rather than the preponderance of the evidence standard employed in trials of civil actions. Travelers Indemnity Co. v. Armstrong (1982), Ind., 442 N.E.2d 349.

In a criminal action, the defendant is presumed to be innocent, and...