DEMPSEY & CARROLL CO. v. BETH ROGERS
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RENDERED: February 26, 1999; 10:00 a.m.
NOT TO BE PUBLISHED
C ommonwealth O f K entucky
C ourt O f A ppeals
NO. 1997-CA-002963-MR
DEMPSEY & CARROLL CO.
APPELLANT
APPEAL FROM JEFFERSON CIRCUIT COURT
HONORABLE THOMAS B. WINE, JUDGE
ACTION NO. 96-CI-2462
v.
BETH ROGERS
APPELLEE
OPINION
AFFIRMING
** ** ** ** **
BEFORE:
COMBS, DYCHE, AND SCHRODER, JUDGES.
SCHRODER, JUDGE:
This is an appeal by a defaulting party of a
jury’s damage award in an employment termination case.
After
reviewing the pleadings and the uncontroverted evidence, we
affirm.
Beth Rogers was employed by Dempsey & Carroll Co. in
Louisville, Kentucky, and was its de facto general manager.
Sometime in March of 1994, the company was sold to George Ward.
George Ward discussed with Beth Rogers moving part of the
operation to Baltimore.
Beth Rogers was concerned with these
changes and discussed looking for another job.
George Ward
agreed that if she stayed, she would receive nine months’
severance pay upon dismissal.
Production was moved to Baltimore,
but Beth Rogers still ran the Louisville office.
She commuted
frequently to the Baltimore office and occasionally to the New
York facility, and her duties expanded into sales.
In the fall
of 1995, George Ward discussed moving the rest of the Louisville
office to Baltimore and asked Beth Rogers to relocate and
continue working with the company.
arrangements to relocate.
She agreed and made
The relocation move was scheduled for
February 29, 1996, after the Christmas season.
In December of
1995, Beth Rogers attended a Christmas party for employees of the
New York facility.
hotel room.
After the party, George Ward showed up at her
She spurned his advances and he warned her that she
would be sorry.
In late January of 1996, she was at the
Baltimore facility for a scheduled meeting with George Ward and
for finding an apartment, etc.
George Ward kept putting her
meeting off, but asked that she remain over to meet him on
Sunday.
She agreed.
Saturday night she received a call at her
hotel room from a part-time employee notifying her that on Friday
and Saturday, Dempsey & Carroll Co. had cleaned out the entire
Louisville office and shipped everything to the Baltimore
facility, including personal items of Beth Rogers.
One item, a
diamond ring with antique roses, was in a desk drawer and she
never got it back.
Beth Rogers repeatedly tried to contact
George Ward, but he refused to return her calls.
On February 10,
1996, Beth Rogers received a letter of termination effective
immediately.
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Beth Rogers filed suit against her former employer, the
appellant herein, for nine months’ severance pay pursuant to her
employment contract; for conversion of the antique ring; for
damages for the intentional infliction of emotional distress; and
for punitive damages pursuant to KRS 411.184.
for a jury trial on October 23, 1997.
The case was set
The appellant was not
present, so the court granted a default judgment, directing a
verdict for Beth Rogers on all counts.
A jury trial was
subsequently conducted on the issue of damages.
The jury
returned a verdict, and judgment was entered accordingly:
$ 45,000.00 for severance pay;
$
3,600.00 for the antique ring;
$100,000.00 for embarrassment, humiliation, emotional
distress, etc.; and,
$100,000.00 for punitive damages for fraud, malice,
etc., for a total verdict of $248,600.00, plus interest.
Appellant appeals the $100,000.00 award for
embarrassment, etc. and the $100,000.00 award for punitive
damages.
Appellant’s first allegation of error is that the
conduct complained of in the complaint was committed by George
Ward, the president of the appellant corporation, and that KRS
411.184(3) provides that punitive damages cannot be “assessed
against a principal or employer for the act of an agent or
employee” unless the principal or employer ratified or authorized
the act of the employee, or unless the principal or employer
“should have anticipated the conduct in question.”
alleges that no proof was taken as to whether the
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Appellant
principal/employer, Dempsey Carroll Co., “authorized” or
“ratified” or “should have anticipated the conduct” of its
president/employee, George Ward.
Appellant also contends that
Bethesda Engravers bought the stock of the appellant corporation
and never ratified the acts of its employee, George Ward.
Although the appellant’s brief alleges Dempsey &
Carroll Co. was purchased by Bethesda Engravers, there is nothing
in the pleadings about Bethesda Engravers until we received the
appellant’s brief.
The pleadings refer to Dempsey & Carroll Co.
The uncontroverted evidence at trial was that this was Mr. Ward’s
company and he was proud of it.
14:13:17.)
(See video of the trial at
Likewise, appellant asserts that “. . . no proof was
taken as to whether the principal/employer, Dempsey & Carroll
Company, ‘authorized’ or ‘ratified’ or ‘should have anticipated
the conduct’ of its President/employee George Ward.”
disagree.
We
The uncontroverted testimony of Beth Rogers was that
George Ward bought the company in March of 1994, and that George
Ward still owned the company in 1995.
We recognize that, as
president, George Ward can be both an employee and an owner of a
corporation.
In Simpson County Steeplechase Ass’n. v. Roberts,
Ky. App., 898 S.W.2d 523, 527 (1995), this Court recognized that
an employer can be held liable for acts of an employee if the
owner “. . . authorized or ratified or should have anticipated
the conduct in question.”
It would be a bit facetious to contend
that George Ward, as owner, did not anticipate that George Ward,
as president, would do such a thing.
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If the facts are not as
Beth Rogers testified, the appellant cannot complain because it
failed to produce any evidence or even cross-examine Beth Rogers.
Appellant alleges the trial court erred in allowing the
jury to be instructed on intentional infliction of emotional
distress and in awarding punitive damages against the appellant.
Appellant maintains that the plaintiff must elect whether to
proceed for breach of contract or in tort, and the breach of an
employment contract does not give rise to an award for
intentional infliction of emotional distress.
Appellant’s allegation that the instructions were
erroneous was not preserved for appellate review.
CR 51(3)
states that “[n]o party may assign as error the giving or the
failure to give an instruction unless he . . . makes objection
before the court instructs the jury, stating specifically the
matter to which he objects and the ground or grounds of his
objection.”
In Chaney v. Slone, Ky., 345 S.W.2d 484, 486 (1961),
the Court stated as follows:
The object of this requirement [making
known the specific grounds for an objection]
is to give the trial court an opportunity to
avoid error. Unless the stated ground or
grounds for the objection were valid it
cannot be said that the court was given that
opportunity. For this reason the error we
observe on reviewing this record was not
preserved and thus would not authorize a
reversal.
See also Young v. DeBord, Ky., 351 S.W.2d 502, 503 (1961).
Appellant did not tender any instructions.
Appellant’s
failure to attend the trial and specifically object to the
allegedly erroneous instruction precludes our consideration of
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any such error on appeal.
Lewis v. Bledsoe Surface Mining
Company, Ky., 798 S.W.2d 459, 460 (1990).
While appellant cannot complain about the instructions,
it is also incorrect on the law in the instructions.
KRS
411.184(4) provides that “[i]n no case shall punitive damages be
awarded for breach of contract”, but the Supreme Court, in
Wittmer v. Jones, Ky., 864 S.W.2d 885, 890 (1993), stated as
follows:
“It suffices to say that this Court could not interpret
KRS 411.184 to destroy a cause of action for punitive damages
otherwise appropriate without fatally impaling upon jural rights
guaranteed by the Kentucky Constitution, Sections 14, 54, and
241.”
Thus, appellant’s liability for breach of contract could,
in some circumstances, constitute a basis for the punitive
damages award.
See Curry v. Fireman’s Fund Ins. Co., Ky., 784
S.W.2d 176 (1989).
The case sub judice goes a step further.
Our
Courts recognize that there can be a separate tort associated
with breach of contract, and in such cases of “separately
tortious” conduct, the jury may be instructed on punitive
damages, and award them.
Ford Motor Co. v. Mayes, Ky. App., 575
S.W.2d 480, 486 (1978); Faulkner Drilling Co. v. Gross, Ky. App.,
943 S.W.2d 634 (1997).
We are satisfied from the record that
George Ward’s conduct after the December 1995 Christmas party and
the conduct at the end of January and into February of 1996 was
sufficient to warrant a jury instruction on intentional
infliction of emotional distress or outrage as a theory of
separately tortious conduct which would also support an award of
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punitive damages.
See Kroger Co. v. Willgruber, Ky., 920 S.W.2d
61 (1996).
For the foregoing reasons, the judgment of the
Jefferson Circuit Court is affirmed.
COMBS, JUDGE, CONCURS.
DYCHE, JUDGE, CONCURS IN RESULT ONLY.
BRIEF FOR APPELLANT:
BRIEF FOR APPELLEE:
Timothy Denison
Louisville, Kentucky
Don Meade
Louisville, Kentucky
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