SOUTHERN PINE ELEC. CO-OP. v. Burch

• Decision Date: 28 March 2003
• Citation: 878 So.2d 1120
• Parties: SOUTHERN PINE ELECTRIC COOPERATIVE v. Christopher BURCH.
• Court: Alabama Supreme Court

878 So.2d 1120

SOUTHERN PINE ELECTRIC COOPERATIVE v. Christopher BURCH.

1020066.

Supreme Court of Alabama.

March 28, 2003.

Opinion on Return from Remand October 24, 2003.

W. Austin Mulherin III and Mary Margaret Bailey of Frazer, Greene, Upchurch & Baker, L.L.C., Mobile, for appellant.

Max Cassady of Cassady & Cassady, P.C., Evergreen, for appellee.

WOODALL, Justice.

Christopher Burch sued Southern Pine Electric Cooperative alleging wrongful termination of his electric service. A jury awarded Burch $20,000 in compensatory damages and $75,000 in punitive damages. Southern Pine Electric Cooperative filed a motion for a remittitur, which the trial court orally denied, without stating its reasons for doing so. Southern Pine Electric Cooperative appealed.

The trial court erred in denying Southern Pine Electric Cooperative's motion for a remittitur without providing a written statement of the reasons for the denial. We remand this case for the trial court to enter an order in compliance with Hammond v. City of Gadsden, 493 So.2d 1374 (Ala.1986), stating its reasons supporting the denial of the motion. See Love v. Johnson, 775 So.2d 127 (Ala.2000); see also Spencer v. Lawson, 815 So.2d 502 (Ala.2001); Guaranty Pest Control, Inc. v. Bush, 851 So.2d 548 (Ala.Civ.App.2002). The trial court is instructed to file a return to this Court within 56 days of the release of this opinion, after which Southern Pine Electric Cooperative will have 14 days to file a supplemental brief, if it chooses to do so. Burch will then have seven days to respond, and Southern Pine Electric Cooperative may file a reply brief within seven days of Burch's response.

REMANDED WITH DIRECTIONS.

MOORE, C.J., and HOUSTON, LYONS, and JOHNSTONE, JJ., concur.

On Return From Remand

WOODALL, Justice.

On March 28, 2003, we remanded this case for the trial court to enter an order in compliance with Hammond v. City of Gadsden, 493 So.2d 1374 (Ala.1986), stating its reasons for denying the motion of the appellant, Southern Pine Electric Cooperative ("Southern Pine"), for a remittitur of a compensatory-damages award of $20,000 and a punitive-damages award of $75,000 in favor of Christopher Burch, without providing a statement of its reasons for the denial. Southern Pine Elec. Coop. v. Burch, 878 So.2d 1120, 1122 (Ala.2003). Following a hearing on remand, the trial court, in a written order, again denied Southern Pine's motion. We now address the merits of Southern Pine's appeal.

Southern Pine is a "[c]ooperative, nonprofit membership corporation[]," as defined by Ala.Code 1975, § 37-6-2, "organized under [Ala.Code 1975, §§ 37-6-1 to -49,] for the purpose of supplying electric energy and promoting and extending the use thereof." This action arose out of an attempt by Southern Pine to collect payment for electrical service it provided to Tracy Burch, who, at some time, was married to Brian Burch, the cousin of the plaintiff, Christopher Burch. That service was provided to a mobile home located on County Road 27 in Castleberry. Southern Pine terminated electrical service at the site in April or May 2001, after it was unable to collect $677.31 on Tracy Burch's past-due account.

On May 7, 2001, Christopher Burch submitted an "Application for Membership and Electrical Service," seeking to reestablish electrical service at the mobile home. Southern Pine approved the application and dispatched district supervisor James Brown and service technician Chet Dolihite to the site to reestablish electrical service. Brown and Dolihite completed their assignment and were leaving the premises, when, they say, they met an automobile, with a male driver and a blonde female passenger, driving toward the mobile home. According to Brown and Dolihite, the vehicle was a white Mercury automobile that had customarily been parked at the mobile home while the account for electrical service to the mobile home was in Tracy Burch's name.

Subsequently, Brown reviewed the account file of Christopher Burch, which contained a copy of Christopher's driver's license. From the photograph on the copy, Brown concluded that Christopher Burch was the driver of the white Mercury. He further concluded that he had seen Christopher at the mobile home on an earlier occasion, while the account was in Tracy's name, and that, on that occasion, Christopher had identified himself to Brown as Tracy Burch. Brown also believed that the blonde woman in the Mercury was someone he had seen in and around the mobile home while the account was in Tracy Burch's name.

Southern Pine concluded that Christopher's membership application was merely an attempt to circumvent the past-due account, for which service to the mobile home had been discontinued. It concluded, in other words, that "Southern Pine was dealing with the not-uncommon problem of members attempting to avoid indebtedness for electrical service by simply changing the name on the account from one resident of the household to another." Brief of Southern Pine, at 7. Therefore, the first electrical bill mailed to Christopher was for $737.39. Of that amount, $60.08 was designated as "current bill," while $677.31, the amount due on Tracy Burch's delinquent account, was designated as "previous balance." On June 15, 2001, Christopher paid the "current bill" amount of $60.08. On June 27, 2001, Southern Pine discontinued electrical service to Christopher for failure to pay the alleged delinquency. The termination occurred while Burch was away from home, resulting in the spoilage of refrigerated perishables worth approximately $100.

On July 13, 2001, Christopher sued Southern Pine, alleging (1) breach of contract, (2) "wrongful termination of electrical power," and (3) "wanton or willful termination of electrical service." Electricity was restored to the mobile home on July 31, 2001, pursuant to a court order; Southern Pine offered no opposition. Subsequently, Southern Pine counterclaimed against Christopher for the delinquent amount on Tracy's account.

After the complaint was filed, Southern Pine's personnel began surveilling Christopher's premises from County Road 27, approximately 200 feet from the mobile home. While doing so, James Brown took a number of photographs of a blonde woman on the premises.

A jury trial began on June 24, 2002. At the close of all the evidence, Southern Pine moved for a judgment as a matter of law ("JML") on all the claims. The trial court granted the motion only as to any claims sounding in negligence. It also granted Burch's motion for a JML on the counterclaim. The case was submitted to the jury on claims of breach of contract and wantonness. The jury awarded Burch $20,000 in compensatory damages and $75,000 in punitive damages.

Southern Pine filed a posttrial motion for JML, as well as a motion for a remittitur or, in the alternative, a new trial. Those motions were denied, and Southern Pine appealed. On appeal, Southern Pine contends (1) that the trial court erred in granting Burch's motion for a JML on the counterclaim; (2) that evidence of mental distress, which formed the primary basis for the compensatory-damages award, was insufficient to support the award; and (3) that the punitive-damages award was excessive.

I. Counterclaim

The theory of Southern Pine's counterclaim against Christopher was (1) that Tracy Burch continued to live at the mobile home after electrical service was reestablished in Christopher's name on May 7, 2001, or (2) that Christopher had lived at the mobile home before May 7, 2001. In either case, Southern Pine argued, it was entitled to terminate Christopher's electrical service and to collect from Christopher the amount Tracy owed Southern Pine. As support for its theory, Southern Pine relied on Ala.Code 1975, § 37-6-30(b), which provides:

"(b) Any rural electric cooperative or gas district may terminate or decline service at all locations if an applicant or customer, or a member of the applicant's or customer's household, is indebted to the rural electric cooperative or gas district for services at the present location or a former location of the applicant or customer. This section shall not apply if a person was not a member of the household of the applicant or customer, or if a person was a minor when the indebtedness was incurred. In the event that such indebtedness for service previously rendered is in dispute, the applicant shall be served or the customer's service shall be continued upon complying with the normal deposit requirements of the rural electric cooperative or gas district and, in addition thereto, by making a special deposit in an amount equal to the net balance in dispute. Upon settlement of the disputed account, the balance, if any, due the applicant or customer or member of applicant's or customer's household shall be promptly repaid."

(Emphasis added.)

Southern Pine argues:

"Rather than [entering a judgment as a matter of law,] the trial judge should have left it for the jury to decide whether Southern Pine had proved that it had sufficient reason to believe either that Plaintiff had been a resident prior to his application or that Tracy Burch had continued to be a resident after his application. The trial court's dismissal of the counterclaim was unduly prejudicial to Southern Pine as it implied to the jury that the trial judge had sanctioned Plaintiff's argument [that neither of those scenarios was true], leaving to the jury only the determination of damages."

Brief of Southern Pine, at 48 (emphasis added). We disagree with Southern Pine's argument.

The success of the counterclaim did not depend on whether Southern Pine had "reason to believe" that Christopher and Tracy were members of the same household, that is, that they were attempting to avoid Tracy's indebtedness to Southern Pine by simply changing the name on the account. The success of the counterclaim depends on whether § 37-6-30(b) authorizes an action against one household member for the debt of ano...