Thomas v. Durham Motors, Inc.

• Citation: 389 S.W.2d 412
• Decision Date: 05 April 1965
• Docket Number: No. 24168,24168
• Parties: Alfred THOMAS, Appellant, v. DURHAM MOTORS, INC., et al., Respondents.
• Court: Court of Appeal of Missouri (US)

Page 412

389 S.W.2d 412

Alfred THOMAS, Appellant, v. DURHAM MOTORS, INC., et al., Respondents.

No. 24168.

Kansas City Court of Appeals, Missouri.

April 5, 1965.

Benard Eveloff, Kansas City, for appellant.

Richard K. Phelps, Lee's Summit, for respondents.

HUNTER, Judge.

This is a suit for actual and punitive damages resulting from the alleged fraud of respondent, Durham Motors, Inc. through its employee, respondent Robert Vallencourt, in the sale of an automobile to Alfred Thomas, appellant. The jury's verdict was for appellant and against both respondents in the sum of $849.70 actual damages and $2,000 punitive damages. Respondents filed a motion for new trial alleging prejudicial error in the giving of Instruction No. 5. The trial court, after giving appellant the opportunity of remitting the punitive damages which appellant refused to do, sustained the motion and granted a new trial. This appeal followed.

Since the only issue concerns Instruction No. 5 the pertinent facts may be briefly stated. Durham Motors, Inc., a corporation, was engaged in the used car business in Kansas City. Robert Vallencourt was its employee-salesman. About March 2, 1961, Thomas discussed the purchase of a 1959 Lincoln automobile with Vallencourt, and after reaching an agreement as to price and terms Thomas signed a purchase money chattel mortgage and note setting forth the terms of sale. Commercial Credit Corporation purchased 'this note' and sent Thomas a 'credit book' which according to Thomas showed different terms than those agreed upon. Thomas stated the mortgage and note sold to Commercial Credit was a forgery in that it contained someone else's and not his signature on it and contained different terms from the one he had signed. He attributed this to respondents. He testified he had to pay a difference of $849.70 more by the terms of the forgery and this is what he asserts is his actual damage.

During the trial Thomas's attorney, without objection being made, read to the jury a statement giving the net worth of Durham Motors, Inc., as between $150,000 and $175,000. There was no evidence as to the financial worth of Vallencourt.

Instruction No. 4 told the jury if they found the named acts of defendants were maliciously and willfully done that in addition to actual damages 'you may assess against the defendants by way of punishment * * * such sum as you think proper and fair.'

Objected to Instruction No. 5 read: 'The Court instructs the jury that if you find for the plaintiff and if you assess punitive damages against defendants, then you may thke into consideration in arriving at the amount of such punitive damages defendants' financial condition.'

It is the general rule that in a suit involving exemplary damages against one person or one corporation the defendant's worth or financial condition is competent and relevant.

However, many jurisdictions, including Missouri, follow the rule that where a number of defendants are sued jointly, their wealth, either individually or collectively can not be shown for the purpose of punitive damages, for one defendant cannot be punished for the wealth of another. Dawes v. Starrett, Mo.Sup., 82 S.W.2d 43; Gray v. Phillips Bldg. Co., Mo.App., 51 S.W.2d 181; Wolfersberger v. Miller, 327 Mo. 150, 39 S.W.2d 758; Stansberry v. McDowell, Mo.App., 186 S.W. 757; Schafer v. Ostmann, 148 Mo.App. 644, 129 S.W.2d 63; Leavell v. Leavell, 114 Mo.App. 24, 89 S.W. 55; Annotation, 63 A.L.R. 1405.

In the Dawes case, supra, 82 S.W.2d loc. cit. 60, our Supreme Court stated, 'The general rule is that where exemplary or punitive damages are recoverable, as in this case, it is proper for the jury to consider defendant's wealth and pecuniary ability in fixing the amount of such damages. But where the action is against two or more defendants jointly, our courts have approved and followed the rule announced by the Supreme Court of the United States in Washington Gas Light Co. v. Lansden, 172 U.S. 534, 19 S.ct. 296, 303, 43 L.Ed. 543. It is there said: 'As the verdict must be for one sum against all defendants who are guilty, it seems to be plain that, when a plaintiff voluntarily joins several parties as defendants, he must be held to thereby waive any right to recover punitive damages against all, founded upon evidence of the ability of one of the several defendants to pay them.'' In the Stansberry case, supra, 186 S.W. loc. cit. 762, it was expressed, 'The suit is against two defendants, and a joint judgment is sought which must be identical in amount as to each defendant. In such cases, evidence as to the financial worth of either or both defendants is not admissible.' (Italics ours.) In the Wolfersberger case, supra, 39 S.W.2d loc. cit. 765, the Supreme Court stated, 'We are unable to see * * * (that) evidence relating to the wealth of any defendant, was justified. Where a number of defendants are sued jointly, their wealth, either individually or collectively, cannot be shown for the purpose of punitive damages, for one defendant cannot be punished because of the wealth of another.'

In the light of the above authority, Instruction No. 5 is clearly erroneous. The instruction improperly instructs the jury that in assessing the amount of punitive damages against the defendants it may consider 'defendants' financial condition'. This is not a correct statement of the law for one defendant is not to be punished according to or as a result of considering the financial condition of both defendants.

Appellant suggests the error is cured by respondents' failure to object to the offer in evidence of the testimony concerning the corporation's net assets. If such an objection had been made it should have been sustained. Even so, if through failure to object irrelevant or improper evidence is...