Phillips Colleges of Alabama, Inc. v. Lester

• Decision Date: 30 April 1993
• Citation: 622 So.2d 308
• Court: Alabama Supreme Court
• Parties: 85 Ed. Law Rep. 350 PHILLIPS COLLEGES OF ALABAMA, INC., and Southern Junior College v. William LESTER, Jr. 1920162.

Page 308

622 So.2d 308

85 Ed. Law Rep. 350

PHILLIPS COLLEGES OF ALABAMA, INC., and Southern Junior College v. William LESTER, Jr.

1920162.

Supreme Court of Alabama.

April 30, 1993.

Rehearing Denied June 11, 1993.

M. Wayne Wheeler, Birmingham, for appellants.

Ralph Bohanan, Jr. of Pittman, Hooks, Marsh, Dutton & Hollis, P.C., Birmingham, for appellee.

HOUSTON, Justice.

In this fraud action William Lester, Jr., a licensed cosmetologist, sought damages from Phillips Colleges of Alabama, Inc., and Southern Junior College ("the school"), based on allegations that the school had misrepresented the nature of its cosmetology instructor program. ¹ A jury awarded Lester $15,000 in compensatory damages and $35,000 in punitive damages. The trial court entered a judgment on that verdict and later denied the school's motion for a judgment notwithstanding the verdict, or to alter, amend, or vacate the judgment, or for a new trial. The school appealed. We affirm.

The following issues have been presented for our review:

1) Whether the school was entitled to a judgment notwithstanding the verdict on the ground that the evidence was insufficient to submit Lester's fraud claim to the jury;

2) Whether the school was entitled to a judgment notwithstanding the verdict on the ground that Lester's fraud claim was not pleaded with sufficient particularity under Rule 9(b), A.R.Civ.P.;

3) Whether the school was entitled to a new trial on the ground that the trial court improperly admitted the testimony of Donay Sturgeon;

4) Whether the school was entitled to a new trial on the ground that the trial court first admitted the testimony of Jean Salary and later excluded it, with an appropriate instruction to the jury;

5) Whether the school was entitled to a new trial on the ground that Lester's attorney intentionally discriminated against certain potential jurors, in violation of the rule announced in Batson v. Kentucky, 476 U.S. 79, 106 S.Ct. 1712, 90 L.Ed.2d 69 (1986);

6) Whether the school was entitled to a new trial on the ground that Lester's attorney made an impermissible comment concerning the school's financial status;

7) Whether the school was entitled to a new trial on the ground that the trial court erred in refusing certain written jury instructions requested by the school; and,

8) Whether the school was entitled to a new trial on the ground that the damages were excessive.

Considering the first two issues together, we note the record shows that Lester initially made the following allegations in his complaint:

"1. On or about October 12, 1987, the defendants and the plaintiff entered into an enrollment agreement whereby the plaintiff would pay the defendants total costs of Two thousand eight hundred seventy five dollars ($2,875.00) and would enter the defendants' study program of cosmetology instructor.

"2. At that time the defendants represented to the plaintiff that he would be placed in a curriculum designed specifically and exclusively for persons interested in obtaining a cosmetology instructor's diploma and cosmetology instructor's license.

"3. At that time the defendants wantonly, negligently, knowingly and fraudulently concealed the fact that the plaintiff would not be placed in a curriculum designed specifically for the purpose of providing training which would provide plaintiff with a cosmetology instructor's diploma and cosmetology instructor's license.

"4. At that time the defendants misrepresented to the plaintiff that he would be placed in a curriculum designed specifically for the purpose of providing training which would provide plaintiff with a cosmetology instructor's diploma and cosmetology instructor's license.

"5. Defendants also knowingly, fraudulently and wantonly concealed the fact that their program of study was not, and had never been, designed to provide a course of study exclusively for cosmetologists to obtain a cosmetology instructor's diploma and a cosmetology instructor's license.

"6. The above stated facts were of such a nature that the failure to communicate them induced the plaintiff to enroll in the defendants' program, and as a result, plaintiff was damaged.

"7. By virtue of the relationship between the plaintiff and defendants, in that the defendants had superior knowledge and expertise in the field of education[,] defendants were under a duty to relate these material facts."

(Emphasis added.) Lester amended his complaint shortly before trial by adding the following allegation:

"The defendants represented to the plaintiff, William Lester, Jr., that they would provide him with defendants' cosmetology instructor's course."

Recently, in Thomas v. Baptist Medical Center-DeKalb, 614 So.2d 997 (Ala.1993), we again explained that although under modern rules of civil practice the pleadings generally need only to put the defending party on notice of the claims against him, Rule 9(b) is an exception to the rule set out in Rule 8(a) permitting generalized pleadings. " 'The pleading must show [the] time, [the] place, and the contents or substance of the false representations, the facts misrepresented, and an identification of what has been obtained.' " Miller v. Mobile County Board of Health, 409 So.2d 420, 422 (Ala.1981), quoting the committee comments to Rule 9(b). Contrary to the school's contention, a careful reading of Lester's allegations show that they were sufficiently specific to inform the school as to the nature of the alleged misrepresentations (i.e., that the school had induced Lester to pay over $2,000 in tuition by misrepresenting the content or scope of its cosmetology instructor program), as to the time of the misrepresentations (i.e., on or about October 12, 1987), and as to the place where Lester claimed the misrepresentations had been made (i.e., at the school). Lester's complaint met the requirements of Rule 9(b).

As to the sufficiency of the evidence, the record shows that Lester's claim was based on allegations that the school had failed to perform as promised by not providing him with adequate practical training. In Hearing Systems, Inc. v. Chandler, 512 So.2d 84, 87 (Ala.1987), this Court, quoting Purcell Co. v. Spriggs Enterprises, Inc., 431 So.2d 515, 519 (Ala.1983), held:

" 'The only basis upon which one may recover for fraud, where the alleged fraud is predicated on a promise to perform or abstain from some act in the future ... is when the evidence shows that, at the time ... the promises of future action or abstention were made, the promisor had no intention of carrying out the promises, but rather had a present intent to deceive. Robinson v. Allstate Insurance Co., 399 So.2d 288 (Ala.1981). If such intent is not substantiated by the evidence, the fraud claim should not be submitted to the jury. The failure to perform, alone, is not evidence of intent not to perform at the time the promise was made. If it were, a mere breach of contract would be tantamount to fraud. Old Southern Life Insurance Co. v. Woodall, 295 Ala. 235, 326 So.2d 726 (1976)....' "

See, also, Centon Electronics, Inc. v. Bonar, 614 So.2d 999 (Ala.1993).

The evidence shows that written materials provided to Lester by the school stated that students in the cosmetology instructor program would receive a certain number of hours of practical training by assisting the instructors in teaching cosmetology students, both in a "clinic" setting and in the "classroom." Lester presented evidence that he paid over $2,000 in tuition and completed the program in reliance on the school's representations. The evidence further indicated that he received far less practical training than he had been led to believe he would receive. Specifically, Margaret Moody, the director of the school's cosmetology instructor program, testified that the school never intended to allow cosmetology instructor students to obtain the kind of practical teaching experience described in the school's materials. She testified further that although the school's materials stated that cosmetology instructor students were to participate in teaching "classes," the school actually intended for these students to practice their teaching before one of the school's instructors, without a "class" actually being present. Two instructors, Anna Johnson and Lana Parker, testified that they were never made aware that cosmetology instructor students were supposed to receive a certain number of hours of practice teaching. Although the school maintained records as to the number of hours that students attended classes, it kept no records documenting any student's activities during those classes. The evidence was sufficient under the "substantial evidence" and the "clear and convincing evidence" standards of review both of which are applicable in this case, see Ala.Code 1975, §§ 12-21-12 and 6-11-20, to create a fact question for the jury as to whether, as Lester maintained, when the school contracted with him it intended not to provide him with the kind of training outlined in its written materials. The trial court properly denied the school's motion for a judgment notwithstanding the verdict.

As to the third and fourth issues, the school contends that the trial court erred in allowing Donay Sturgeon to testify on behalf of Lester. The school also contends that the court erred when it allowed Jean Salary to testify on behalf of Lester and that the prejudice caused by that error was not eradicated when the court later instructed the jury to disregard her testimony. The thrust of the school's complaint appears to be that Lester, for the purpose of setting an "ambush" at trial, concealed an intention to call these witnesses. The school asserts that neither of these witnesses should have been permitted to testify because Lester failed to identify them in a supplemental or amended response to one of its interrogatories that sought disclosure of potential witnesses. The school insists that the subsequent exclusion of Salary's testimony did not...