Pedah Co. v. Hunt

• Decision Date: 17 May 1973
• Parties: PEDAH COMPANY, an Oregon corporation, Respondent, v. Dennis M. HUNT and Valley Newspapers, Inc., Appellants, David J. Nelson and C. E. Darling, Defendants.
• Court: Oregon Supreme Court

Page 1197

509 P.2d 1197

265 Or. 433

PEDAH COMPANY, an Oregon corporation, Respondent, v. Dennis M. HUNT and Valley Newspapers, Inc., Appellants, David J. Nelson and C. E. Darling, Defendants.

Supreme Court of Oregon.

Argued and Submitted Feb. 8, 1973.

Decided May 17, 1973.

Theodore R. Kulongoski, Eugene, argued the cause for appellants. On the briefs were Dwyer, Jensen & Naslund, Eugene.

William Frye, Eugene, argued the cause for respondent. With him on the briefs were Husband, Johnson & Frye, Eugene.

Before O'CONNELL, C.J., and McALLISTER, DENECKE, TONGUE, HOWELL, and BRYSON, JJ.

BRYSON, Justice.

Plaintiff Pedah Company commenced this suit in equity seeking a permanent injunction to restrain defendants from using or publishing under the name 'Valley News.' The complaint also prayed for general and punitive damages. After a trial, the court issued an injunction as prayed for and awarded $500 general damages and $2,500 punitive damages. Defendants appeal.

The first assignment of error states, 'The trial court sitting in equity erred in awarding punitive damages.'

We have not passed on the question of whether punitive damages can be recovered in a suit in equity. We have sanctioned the award of punitive damages by a jury in law actions when the evidence discloses malice and 'a wrongful act done intentionally, with knowledge that it would cause harm to a particular person or persons. * * * (T)he question of award of punitive damages is for the jury. (Citations omitted)' McElwain v. Georgia-Pacific, 245 Or. 247, 249, 421 P.2d 957, 958 (1966). In Van Lom v. Schneiderman, 187 Or. 89, 108, 210 P.2d 461 (1949), the court stated:

'The allowance of exemplary damages in a proper case is approved in Oregon (Citations omitted) and in most of the other states of the union. McCormick on Damages § 78.

'In the trial of a case where exemplary damages are sought the judge determines as a matter of law whether there is evidence of malice, and, if he decides that there is, the assessment of such damages is committed to the discretion of the jury. Cholia v. Kelty, 155 Or. 287, 291, 63 P.2d 895; Martin v. Cambas, 134 Or. 257, 262, 293 P. 601; Gill v. Selling, 125 Or. 587, 591, 267 P. 812. * * *'

The majority of jurisdictions which have considered the question have concluded that punitive damages are not recoverable in a court of equity. Annot., 48 A.L.R.2d 947. Justifications commonly relied upon for this rule include:

'* * * (1) a court of equity, in the absence of statutory authorization, is without power to award punitive damages; (2) punitive damages are inconsistent with the principle that equity will award only what is due Ex aequo et bono--in justice and fairness--without regard to the reprehensibility of defendant's conduct; (3) an aggrieved party by suing for equitable relief waives all claims to punitive damages; and (4) an award of punitive damages lies within the exclusive province of a jury and usurpation of that function by the chancellor would deprive defendant of his state-guaranteed constitutional right to a jury trial before punishment. * * *' Note, 63 Colum.L.Rev. 175, 176--177 (1963) (Citations omitted.)

For a discussion of these rationales, see Hodel, The Doctrine of Exemplary Damages in Oregon, 44 Or.L.Rev. 175, 178 (1965).

In Perez v. Central Nat'l Ins. Co., 215 Or. 107, 110, 332 P.2d 1066, 1067 (1958), we stated:

'The doctrine of punitive damages viewed in the most favorable light is subject to criticism. Van Lom v. Schneiderman, supra. It should not be extended past the point to which our precedents commit us. * * *'

See also, dissenting opinions of Justices Denecke and O'Connell in McElwain v. Georgia-Pacific, Supra, and Van Lom v. Schneiderman, Supra. In Noe v. Kaiser Foundation Hosp., 248 Or. 420, 425, 435 P.2d 306, 308, 27 A.L.R.3d 1268 (1967), we stated:

'* * * It is only in those instances where the violation of societal interests is sufficiently great and of a kind that sanctions would tend to prevent, that the use of punitive damages is proper. * * *'

The...