Todd v. South Carolina Farm Bureau Mut. Ins. Co.

• Decision Date: 28 March 1984
• Docket Number: No. 0237,0237
• Citation: 283 S.C. 155,321 S.E.2d 602
• Court: South Carolina Court of Appeals
• Parties: , 118 L.R.R.M. (BNA) 2931 John Wendell TODD, Respondent, v. SOUTH CAROLINA FARM BUREAU MUTUAL INSURANCE COMPANY, Southern Farm Bureau Casualty Insurance Company, Southern Farm Bureau Life Insurance Company, and Equifax Services, Inc., Appellants. . Heard

Page 602

321 S.E.2d 602

283 S.C. 155, 118 L.R.R.M. (BNA) 2931

John Wendell TODD, Respondent, v. SOUTH CAROLINA FARM BUREAU MUTUAL INSURANCE COMPANY Southern Farm Bureau Casualty Insurance Company Southern Farm Bureau Life Insurance Company, and Equifax Services Inc., Appellants.

No. 0237.

Court of Appeals of South Carolina.

Heard March 28, 1984.

Decided Aug. 21, 1984.

Harold W. Jacobs and James W. Orr, both of Nexsen, Pruet, Jacobs & Pollard, Columbia; J. Dwight Hudson, and John B. McCutcheon, Jr., of McCutcheon, McCutcheon & Baxter, Conway, E. Ellison Walker of McKay, Sherrill, Walker & Townsend, Columbia, for appellants.

James P. Stevens, Sr., and James P. Stevens, Jr., both of Stevens, Stevens, Thomas, Hearn & Hearn, Loris, and Terry E. Richardson, Jr. of Blatt & Fales, Barnwell, for respondent.

Debora Faulkner, Richard G. Hepfer, Columbia, David Simpson, Rocky Hill, and Deborah Weimer, Columbia, amicus curiae for South Carolina Legal Services Ass'n.

Herbert E. Buhl, III, Columbia, amicus curiae for South Carolina Brown Lung Ass'n.

Stephen J. Henry, Columbia, amicus curiae for The Workers' Rights Project of the Southerns for Economic Justice.

Robert T. Thompson, John P. Mann and E. Scott Smith, Greenville, amicus curiae for South Carolina Chamber of Commerce.

CURETON, Judge:

The broad issue raised on this appeal is whether on the evidence presented, respondent Todd, an employee-at-will of the appellants South Carolina Farm Bureau Mutual Insurance Company (Mutual), Southern Farm Bureau Casualty Insurance Company (Casualty) and Southern Farm Bureau Life Insurance Company (Life), is entitled to damages for termination of his employment on the theories of outrage, intentional interference with a contract, and bad faith termination of a contract. The trial court, in denying the appellants' motions for summary judgment, nonsuit, directed verdict and judgment notwithstanding the verdict, found the evidence sufficient to support the jury's general verdict for Todd for $20,000 actual damages against the four appellants, $40,000 punitive damages against Mutual, $30,000 punitive damages against Equifax and $10,000 punitive damages against Casualty. We believe this was error and reverse.

The evidence, viewed in the light most favorable to Todd as is required when reviewing the denial of motions challenging the sufficiency of the evidence to sustain a verdict, reveals the following.

Todd was hired by Bill Lee as an insurance agent for the Mutual, Casualty and Life companies in March, 1970, under a separate contract with each. The contracts were terminable without cause upon ten days written notice. Todd was assigned to the Loris office under the supervision of Brice Hardwick.

Though separate companies, Mutual, Casualty and Life shared common sales agents pursuant to corporate policies requiring that an agent represent all three companies. Life offered life insurance contracts. Both Casualty and Mutual offered homeowner and automobile insurance policies.

The authority to hire and fire sales agents for the three companies was centralized in Bill Lee, vice-president of sales for Mutual and state sales manager for Life and Casualty. Employment with one company required employment with the other two; discharge from one required discharge from the remaining companies.

During the first six months of 1978, a suspiciously large number of homes insured by Mutual or Casualty burned to the ground within the Loris territory. Gerald Garnett, claims manager for both Mutual and Casualty, hired Equifax to investigate for arson. Equifax assigned J.K. Parrish and Ed Pope, investigators in its employ, the task of carrying out the investigation.

In early February, 1979, Parrish met with Todd and his supervisor, Hardwick, in Hardwick's office where Parrish informed Todd that they had learned through an informant that Todd was leaking information about the investigation to a torch man. Parrish stated that he wanted to give Todd a voice stress analysis test (PSE), a test allegedly designed to determine deception. The use of the test in South Carolina is illegal since it fails to record certain physiological responses. S.C.Code Ann. Section 40-53-40 (1976). Garnett, the claims manager for Mutual and Casualty, had been advised that Todd would be asked to take the PSE test and had tacitly approved it. Todd agreed to take the test which was administered by Parrish the next day in the presence of Hardwick, whose presence Todd requested. Todd was asked twelve questions which he answered into a regular tape recorder. The tape was then sent to Atlanta, Georgia, for analysis.

The PSE test results were returned to Garnett who informed Bill Lee that Todd had "stressed" on several questions, indicating deception. Based on this information, of which Todd was unaware, Lee met with Todd and Hardwick on February 8, 1979, and told Todd "we want you to take a polygraph exam. [W]e are going to clear up things ...." Todd agreed to the polygraph test which was scheduled for February 14, 1979.

On February 13, 1979, Todd called Bill Lee in Columbia and requested that Lee postpone the polygraph test until Todd's attorney, who was in the middle of a trial, could be present. Lee refused, informing Todd that his resignation would be requested if he failed to take the test the next day. When Todd stated he would not take the test the next day or resign, Lee fired him immediately. Two days later, Todd received a letter from Lee terminating his contracts with Mutual, Life and Casualty effective ten days from the date of the letter.

The existence of an informant who fingered Todd as the source of the leak was seriously called into question by evidence that Parrish first identified the informant, retracted the identification, then named a captain of the Conway Police Department who testified at trial that he never told Parrish that Todd was leaking information. Todd consistently maintained his innocence and subsequently took a polygraph test in preparation for trial. ¹

As a result of the accusations, administration of the illegal PSE test and termination of his contracts, Todd testified that he suffered "a lot of stress and strain," embarrassment and shame. He did not seek medical treatment although for several years previously, he had been treated for stress.

Todd initiated this suit against Mutual, Casualty, Life and Equifax, each, for (1) intentional interference with a contract, (2) outrageous conduct causing severe emotional distress, (3) bad faith termination of a contract, and (4) invasion of privacy. Various pre-trial motions were made, denied and appealed to the Supreme Court. Todd v. South Carolina Farm Bureau Mutual Insurance Co., 276 S.C. 284, 278 S.E.2d 607 (1981).

During the trial, the court directed verdicts in favor of Life on the action for intentional interference, Equifax on bad faith termination, and all four appellants on invasion of privacy. The jury returned a general verdict for Todd against the four appellants for $20,000 actual damages. Mutual, Equifax and Casualty were also found liable for punitive damages of $40,000, $30,000 and $10,000, respectively.

The appellants contend the trial court erred in, among other things, denying their motions for summary judgment, nonsuit, directed verdict and judgment n.o.v., as to each of the remaining actions. Our review of the record and relevant legal principles convinces us of the merit of the appellants' contention.

First, we feel it appropriate to dispose of the parties' contentions regarding what is commonly called the "two issue" rule. Relying on Anderson v. West, 270 S.C. 184, 241 S.E.2d 551 (1978), Todd asserts that where the jury returns a general verdict involving two or more issues and its verdict is supported as to at least one issue, the verdict will not be reversed on appeal. Based on this legal principle, Todd argues that if the evidence as to either of the three causes of action supports liability, this Court may not reverse the judgment.

The appellants concede that this State recognizes the "two-issue" rule. They contend, however, that because they moved for directed verdicts as to each action, there must now be sufficient evidence as to each action to sustain the verdict. In support of this argument, appellants cite Dillon v. Barnard, 328 Mass. 53, 101 N.E.2d 345 (1951) and 89 C.J.S. Trial § 505 (1955).

While we recognize a minority view to the contrary, we believe the better rule is that the general verdict will be affirmed even against motions for directed verdicts as to each action where evidence supports the verdict as to at least one action. Dunlap v. Jimmy GMC of Tucson, Inc., 136 Ariz. 338, 666 P.2d 83 (Ariz.App.1983); see, Filisko v. Bridgeport Hydraulic Co., 176 Conn. 33, 404 A.2d 889 (1978); Colonial Stores, Inc. v. Scarbrough, 355 So.2d 1181 (Fla.1977); Siegal v. Health Care Service Corp., 81 Ill.App.3d 784, 36 Ill.Dec. 899, 401 N.E.2d 1037 (1980); Roth v. Meeker, 72 Ill.App.3d 66, 27 Ill.Dec. 840, 389 N.E.2d 1248 (1979); Leigh Furniture and Carpet Co. v. Isom, 657 P.2d 293 (Utah 1982).

In extending the holding of Anderson v. West, supra, we note, as other jurisdictions have, that the remedy to any perceived injustice occasioned by this rule is always in the hands of defense counsel. Counsel may request special verdicts after a motion for a directed verdict is denied. Having agreed to submit the case to the jury on a general verdict, the appellants cannot now be heard to challenge the validity of the general verdict if evidence sustains the award of damages on at least one action. We must now determine if the evidence sustains the verdict.

I.

Todd contends that the jury could reasonably infer from the evidence in support of his first cause of action for intentional interference with contractual relations that each of the Farm Bureau companies, through the actions of its employees and in concert with Equifax, interfered with his contract...