Wammock v. Celotex Corp.

• Decision Date: 15 January 1988
• Docket Number: No. 85-8608,85-8608
• Parties: Prod.Liab.Rep.(CCH)P 11,623 Julian P. WAMMOCK, Plaintiff-Appellee, v. CELOTEX CORPORATION, et al., Defendants, National Gypsum Company, Defendant-Appellant.
• Court: U.S. Court of Appeals — Eleventh Circuit

Page 818

835 F.2d 818

Prod.Liab.Rep.(CCH)P 11,623

Julian P. WAMMOCK, Plaintiff-Appellee, v. CELOTEX CORPORATION, et al., Defendants, National Gypsum Company, Defendant-Appellant.

No. 85-8608.

United States Court of Appeals, Eleventh Circuit.

Jan. 15, 1988.

William D. Barwick, Atlanta, Ga., Lawrence T. Hoyle, Jr., Hoyle, Morris & Kerr, Philadelphia, Pa., Mara McRae, Kilpatrick & Cody, A. Stephens Clay, Atlanta, Ga., for defendant-appellant.

Richard H. Middleton, Savannah, Ga., Ron L. Motley, Ann Kimmel, Michael J. Brickman, Charleston, S.C., for plaintiff-appellee.

Gary B. Blasingame, Henry G. Garrard, III, Sidney O. Smith, III, C. Ronald Ellington, Professor of Law, Athens, Ga., for amicus curiae.

Appeal from the United States District Court for the Southern District of Georgia.

Before TJOFLAT and ANDERSON ^*, Circuit Judges, and MORGAN, Senior Circuit Judge.

MORGAN, Senior Circuit Judge:

The panel opinion dated September 8, 1987, is hereby withdrawn and this opinion is substituted in lieu thereof.

The primary issue in this case concerns the applicability under Georgia law of punitive damages in asbestos cases. Appellant/defendant National Gypsum manufactured a joint compound, used to cover seams between sheets of wallboard, that contained asbestos. Appellee/plaintiff Julian P. Wammock, a carpenter, was exposed to asbestos through the use of National Gypsum's joint compound. After Wammock was diagnosed in 1981 as having asbestosis, Wammock sued National Gypsum under negligence and strict liability theories. ¹ As his basis for a punitive damage award, Wammock claimed that National Gypsum willfully or with a conscious indifference to the consequences failed to warn of the dangers of its products containing asbestos even though they allegedly knew that such materials were hazardous. The jury rendered a general verdict in favor of Wammock in the amount of $40,000 in compensatory damages and $250,000 in punitive damages. National Gypsum appealed the verdict, claiming that it was based upon erroneous evidentiary rulings and a generally unfair trial atmosphere. Additionally, National Gypsum alleged that the punitive damages award was based upon insufficient evidence. We affirmed the verdict except for the punitive damages award. See Wammock v. Celotex Corp., 793 F.2d 1518 (11th Cir.1986). We certified to the Georgia Supreme Court the following two questions on the punitive damages issue:

(1) Can a plaintiff recover punitive damages under Georgia law in asbestos tort litigation where the defendants may be liable for multiple awards of punitive damages for the same conduct?

(2) Was the evidence concerning the conduct of defendant sufficient to justify an award of punitive damages under Georgia law?

The Georgia Supreme Court declined to answer either certified question. See National Gypsum Co. v. Wammock, 256 Ga. 803, 353 S.E.2d 809 (1987). The Georgia Supreme Court regarded the first question as anticipatory because there had only been one punitive damages award against National Gypsum. As to the second question, the Georgia Supreme Court stated that the district court had not correctly instructed the jury on the reasons for awarding punitive damages under Georgia law. Therefore, the Georgia Supreme Court declined to answer the question. Consequently, the case is back before us for resolution. We affirm the jury's verdict in favor of Wammock in the amount of $40,000 compensatory damages and $250,000 punitive damages.

Georgia law governs this diversity case, and we must interpret the law as would a Georgia court. Erie Railroad v. Tompkins, 304 U.S. 64, 58 S.Ct. 817, 82 L.Ed.2d 1188 (1938). Even "[i]n the absence of controlling precedent, we must nonetheless decide ... issue[s] as we believe a [Georgia] court would decide [them] ..." Green v. Amerada-Hess Corp., 612 F.2d 212, 214 (5th Cir.), cert. denied, 449 U.S. 952, 101 S.Ct. 356, 66 L.Ed.2d 216 (1980). ² In the absence of evidence to the contrary, we presume that the Georgia court would adopt the prevailing rule if called upon to do so. Hensley v. E.R. Carpenter Co., 633 F.2d 1106, 1109 (5th Cir.1980).

In our role as a Georgia court, we must first outline the Georgia law on punitive damages. ³ O.C.G.A. Sec. 51-12-5 (1982), the statute applicable to this case, ⁴ states that "in a tort action in which there are aggravating circumstances, in either the act or the intention, the jury may give additional damages to deter the wrongdoer from repeating the trespass or as compensation for the wounded feelings of the plaintiff." ⁵ To authorize the imposition of punitive damages, there must be "evidence of willful misconduct, malice, fraud, wantonness or oppression, or that entire want of care which would raise the presumption of a conscious indifference to consequences." ⁶ General Refractories Co. v. Rogers, 240 Ga. 228, 230, 239 S.E.2d 795, 798 (1977). See also Kicklighter v. Nails by Jannee, Inc., 616 F.2d 734, 737 (5th Cir.1980); Gilman Paper Co. v. James, 235 Ga. 348, 219 S.E.2d 447 (1975); Southern R. Co. v. O'Bryan, 119 Ga. 147(1), 45 S.E. 1000 (1903). Punitive damages cannot be awarded for mere negligence. Molton v. Commercial Credit Corp., 127 Ga.App. 390, 193 S.E.2d 629 (1972); Louisville & Nashville Railroad Co. v. Young, 112 Ga.App. 608, 145 S.E.2d 700 (1965). With these guidelines in mind, the jury must determine when punitive damages should be allowed as well as the amount of such damages. Walk v. Carter, 110 Ga.App. 273, 138 S.E.2d 390 (1964). See also Alliance Transp., Inc. v. Mayer, 165 Ga.App. 344, 301 S.E.2d 290 (1983).

National Gypsum contends that the limited deterrent purpose of punitive damages under Georgia law ⁷ renders punitive damages inappropriate in asbestos litigation where there is the possibility of multiple punitive damages awards against the same company. ⁸ However, we do not have to decide the issue of multiple punitive awards in this case as it does not appear from the record that this appellant, National Gypsum, has been assessed multiple punitive awards in any other of the asbestos cases filed.

Another question is whether there was sufficient evidence to support an award of punitive damages in this case. The district court instructed the jury in the following manner on the reasons to award punitive damages:

In addition to actual damages such as I have tried to explain to you, the law permits the jury, under certain circumstances, to award an injured [party] punitive or exemplary damages, in order to punish the wrongdoer for some extraordinary misconduct, and to serve as an example or warning to others not to engage in such conduct.

This instruction is an incorrect statement of Georgia law.

In the court below, National Gypsum failed to object to the jury instruction. On appeal, National Gypsum did not discuss the problem. Only after the Georgia Supreme Court refused to answer the certified question because of the inaccuracy of the jury instruction did National Gypsum ask this court to vacate the punitive damages award and remand with instructions for a new trial. We do not find the jury instruction was plain error, and we refuse to reverse and remand on this issue. See Andres v. Roswell-Windsor Village Apartments, 777 F.2d 670 (11th Cir.1985) (Eleventh Circuit refused to reverse on alleged error in jury charge not objected to at trial).

City of Massachusetts v. Kibbe, 480 U.S. ----, 107 S.Ct. 1114, 94 L.Ed.2d 293 (1987), discusses this issue. In Kibbe, the Supreme Court dismissed the writ of certiorari as improvidently granted because the city had failed to preserve for review the negligence issue. The attorney had not objected to the gross negligence instruction, had proposed an instruction to the same effect, and had not raised the question before the United States Court of Appeals for the First Circuit. See Rule 51 of the Federal Rules of Civil Procedure ("[n]o party may assign as error the giving ... [of] an instruction unless he objects thereto before the jury retires to consider the verdict."). We also refuse to reverse an incorrect jury instruction on punitive damages never objected to at trial or challenged on appeal.

Accordingly, we address the issue National Gypsum did raise: whether there was sufficient evidence to support an award of punitive damages under Georgia law? For the jury properly to award punitive damages, Wammock had to present evidence of National Gypsum's willful misconduct, malice, fraud, wantonness or oppression, or that entire want of care which would raise the presumption of a conscious indifference to consequences. ⁹

At trial, Wammock presented evidence that National Gypsum was aware of hazards of asbestos exposure in other contexts, such as the hazards faced by miners, plant workers and others who were exposed to higher concentrations of asbestos fiber than were workers in Wammock's position. National Gypsum contends that there is no evidence that National Gypsum extrapolated from known risks of high level exposure and drew any conclusion whatsoever about risks of lower level exposures to users of joint compound.

Wammock also presented the testimony of Dr. Gerritt Schepers, the former director of the Saranac Laboratory and Albert Fay, a former National Gypsum officer. Dr. Schepers testified that he wrote a letter to National Gypsum before 1964, criticizing the company for continuing to sell asbestos wallboard without warnings. Albert Fay testified that National Gypsum had failed to label its products until ordered to do so in 1972 by the government. After 1972, National Gypsum did not immediately label its products because customer demand for its products was too great to permit the delay that would result from labeling. We do not find it implausible for the jury to consider National Gypsum's actions as demonstrating an entire want of care which would raise the presumption of a conscious indifference to consequences. Accordingly, there is sufficient evidence to support the...