Egan v. Butler

Present: All the Justices

JOSEPH EGAN, SR.
OPINION BY
v. Record No. 141365 JUSTICE LEROY F. MILLETTE, JR.
June 4, 2015
DAVID BUTLER

ABILENE MOTOR EXPRESS CO.

v. Record No. 141372

DAVID BUTLER

FROM THE CIRCUIT COURT OF THE CITY OF RICHMOND
Margaret P. Spencer, Judge

In these appeals we consider whether evidence of work

history and quality of past job performance is probative of

future lost income damages, and whether the evidence introduced

at trial was sufficient to subject a corporate employer to

punitive damages liability.

I. FACTS AND PROCEEDINGS

David Lamont Butler worked as a diesel mechanic at Abilene

Motor Express Company, where Joseph F. Egan, Sr., was Butler's

supervisor. After working at Abilene for three months, Butler

was fired by Egan for unsatisfactory job performance. Although

the circumstances of that termination are subject to differing

accounts by the parties, the situation was undisputedly heated.

The same day that Butler was fired, Egan swore out a

misdemeanor assault and battery complaint against Butler for

events that allegedly occurred immediately after Butler's
termination. The following day, Egan told other Abilene

employees that Butler had pushed Egan and that Butler had cut

or stabbed Egan. The misdemeanor assault and battery charge

was dismissed with prejudice several months later.

Based on these circumstances, Butler filed a complaint

against Egan and Abilene alleging one count of malicious

prosecution and one count of defamation. Under both claims

Butler sought compensatory damages, including future lost

income, and punitive damages.

Butler's claims went to a jury trial. After hearing

witness testimony and considering the evidence, the jury

returned a verdict in favor of Butler. On the malicious

prosecution claim, the jury awarded Butler $250,000 in

compensatory damages, and $50,000 in punitive damages against

Egan and $200,000 in punitive damages against Abilene. In

compliance with Code § 8.01-38.1, the circuit court reduced the

punitive damages award against Egan to $38,850 and the punitive

damages award against Abilene to $155,600. On the defamation

claim, the jury awarded Butler $200,000 in compensatory

damages, and $50,000 in punitive damages against Egan and

$150,000 in punitive damages against Abilene. In compliance

with Code § 8.01-38.1, the circuit court reduced the punitive

damages award against Egan to $38,850 and the punitive damages

award against Abilene to $116,700. Apart from reducing the

2
punitive damages awards, the circuit court entered final

judgment on the jury's verdicts against Egan and Abilene.

Egan and Abilene separately filed timely appeals with this

Court.

II. DISCUSSION

A. Future Lost Income

Egan's assignment of error 1 and Abilene's assignment of

error 1 are identical, and read:

The trial court erred when it (1) excluded evidence of
Butler's past employment history and (2) when it
excluded evidence of the quality of Butler's job
performance

1. Standard of Review

"We review a trial court's decision to admit or exclude

evidence using an abuse of discretion standard and, on appeal,

will not disturb a trial court's decision to [exclude] evidence

absent a finding of abuse of that discretion." Harman v.

Honeywell Int'l, Inc., 288 Va. 88, 92, 758 S.E.2d 515, 520

(2014) (internal quotation marks, citation, and alterations

omitted). "In a civil case, the erroneous exclusion of

evidence is reversible error when the record fails to show

plainly that the excluded evidence could not have affected the

verdict." Barkley v. Wallace, 267 Va. 369, 374, 595 S.E.2d

271, 274 (2004).

3
2. The Excluded Evidence Is Probative Of Future Lost Income

At trial, the circuit court denied entry of evidence

pertaining to Butler's work history on the basis that it was

irrelevant to determining Butler's future lost income. The

circuit court also denied entry of evidence pertaining to the

quality of Butler's past job performance. This was error.

"In order to form a reliable basis for a calculation of

future lost income or loss of earning capacity, such evidence

must be grounded upon facts specific to the individual whose

loss is being calculated." Bulala v. Boyd, 239 Va. 218, 233,

389 S.E.2d 670, 677 (1990). "Although mathematical precision

is not required, the plaintiff must furnish evidence of

sufficient facts or circumstances to permit at least an

intelligent and probable estimate of [such] damages." Id. at

232-33, 389 S.E.2d at 677 (internal quotation marks and

citation omitted).

To this end, we have held that an expert's opinion about

future lost income or future lost earning capacity is

inadmissible when such testimony fails to consider the

plaintiff's work history. E.g., Vasquez v. Mabini, 269 Va.

155, 160-61, 606 S.E.2d 809, 811-12 (2005); Greater Richmond

Transit Co. v. Wilkerson, 242 Va. 65, 71-72, 406 S.E.2d 28, 33

(1991). The inverse of the principle expressed in these cases

applies here: that is, a plaintiff's work history and quality

4
of past job performance is admissible evidence probative of the

plaintiff's claimed damages in the form of future lost income

or future lost earning capacity. See Virginia Rule of Evidence

2:401 ("'Relevant evidence' means evidence having any tendency

to make the existence of any fact in issue more probable or

less probable than it would be without the evidence.");

Virginia Rule of Evidence 2:402 ("All relevant evidence is

admissible, except as otherwise provided by . . . statute,

Rules of the Supreme Court of Virginia, or other evidentiary

principles."); Breeden v. Roberts, 258 Va. 411, 416, 518 S.E.2d

834, 837 (1999).

This is the very type of evidence Egan and Abilene sought

to introduce but which the circuit court excluded as

irrelevant. Specifically, the court excluded evidence of

Butler's work history from 1999 to 2010, including proof

relating to his employers, employment dates, pay rates, and

reasons for leaving the job. The court also excluded evidence

of the quality of Butler's past job performance. In each

instance, the court held that evidence of past work had no

bearing on future income. Utilizing this incorrect legal

standard to bar admission of relevant evidence was an abuse of

discretion. Lawlor v. Commonwealth, 285 Va. 187, 212-13, 738

S.E.2d 847, 861-62 (2013).

5
3. The Error Is Not Harmless

Reversal is required because this excluded evidence,

probative of Butler's future lost income, could have affected

the verdict. Barkley, 267 Va. at 374, 595 S.E.2d at 274. Two

principles arising from related circumstances, in which we

addressed the issue of speculative future lost income,

underscore this point.

First, we have held that expert testimony regarding future

lost income is too speculative to go to the jury when the

expert's opinion is based upon too scant of a work history.

Compare Cassady v. Martin, 220 Va. 1093, 1095-96, 1100, 266

S.E.2d 104, 104-05, 108 (1980) (8 weeks of work history

insufficient to make 21 year old decedent's 44 years of future

lost income not speculative), with Clark v. Chapman, 238 Va.

655, 665-67, 385 S.E.2d 885, 891-92 (1989) (6 weeks of work

history, in addition to a minimal and intermittent string of

jobs, sufficient to make 41 year old plaintiff's 11 years of

future lost income not speculative).

Second, in the context of remedying wrongful termination

pursuant to the Virginia Fraud Against Taxpayers Act, Code

§ 8.01-216.1 et seq., we have observed that "the longer the

period over which front pay is requested, the more speculative

a front pay award becomes." Lewis v. City of Alexandria, 287

Va. 474, 483 n.7, 756 S.E.2d 465, 471 n.7 (2014).

6
 Directed to the circumstances of this case, these

principles establish that a jury award for future lost income

damages must be predicated upon evidence sufficiently

establishing the plaintiff's work history and continuing

ability to work absent the wrongful actions of the defendant,

so that such an award is not impermissibly speculative.

Further, the degree of evidence required to remove the award

from the realm of impermissible speculation corresponds to the

amount of time the future lost income damages cover. That is,

the longer the timeframe of future lost income claimed, the

more significant the evidentiary basis required to support such

an award.

At trial, Butler did not call an expert witness to testify

as to damages, but testified on his own behalf as a fact

witness. Butler claimed approximately 23 years of lost future

income totaling $137,842. Butler based this claim upon the

difference between his $18 per hour wage at Abilene and his

lower hourly wage with a subsequent employer – a difference

totaling approximately $6,000 per year – and multiplied that

figure by the approximately 23 years until when Butler planned

to retire at age 65. 1 Accordingly, by excluding the very

1
Though not material to our analysis, we note that Butler
testified at trial that he was 43 years of age, about to turn
44, suggesting a projected work life to age 65 of less than 23
years.

7
evidence that Egan and Abilene sought to introduce, the circuit

court made this future lost income claim more speculative than

if such evidence had been admitted. When the record shows that

excluded evidence would have made an award less speculative,

such evidence could have affected the verdict so as to require

reversal. Barkley, 267 Va. at 374, 595 S.E.2d at 274.

We decline to affirm, as Butler argues, under the "right

result for the wrong reason" doctrine. Under that doctrine,

"however erroneous may be the reasons of the court for its

judgment upon the face of the judgment itself, if the judgment

be right, it will not be disturbed on account of the reasons."

Perry v. Commonwealth, 280 Va. 572, 579, 701 S.E.2d 431, 435

(2010) (internal quotation marks, citation, and alterations

omitted). Butler makes two arguments for such affirmance, and

we disagree with both.

First, Butler argues that the excluded evidence is more

prejudicial than probative, as it "make[s] Butler out to be

unreliable, when he [is] not." However, if that is what the

evidence shows, then that is simply the nature of the evidence.

The excluded evidence remains highly probative to establish the

amount of Butler's future lost income. "Evidence that is

highly probative invariably will be prejudicial to the

[opposing party]." United States v. Grimmond, 137 F.3d 823,

833 (4th Cir. 1998). Virginia Rule of Evidence 2:403(a) only

8
authorizes the trial court to exclude relevant evidence when

the probative value is substantially outweighed by the danger

of unfair prejudice. Any prejudice in the form of the jury's

perception of Butler's future employment prospects, arising

from this excluded evidence which tends to more accurately

establish Butler's future lost income, is not unfair prejudice

such that its admission could properly be barred under Virginia

Rule of Evidence 2:403(a).

Second, Butler argues that the substance of the excluded

evidence is duplicative of other evidence admitted into the

record, by way of exhibits or witness testimony, which the jury

was already entitled to consider. However, upon review of the

record, we find that the excluded evidence is sufficiently

different in kind and degree with such admitted evidence so

that its admission would not be barred under Virginia Rule of

Evidence 2:403(b) as needlessly cumulative.

B. Punitive Damages Liability

Abilene's assignment of error 3 reads:

The trial court erred when it denied Abilene's Motion
to Strike the Punitive Damages Claims – and
instructing the jury on punitive damages – as to
Abilene. There was no evidence that Abilene had
authorized or ratified Egan's actions in filing the
criminal charges against Butler or the statements Egan
made, and Butler never even pled any ratification or
authorization.

9
1. Standard Of Review

When reviewing a circuit court's decision on a motion to

strike, we must "review the evidence in the light most

favorable to the non-moving party." Kiddell v. Labowitz, 284

Va. 611, 629, 733 S.E.2d 622, 632 (2012). That is, the non-

moving party must be given "the benefit of all substantial

conflict in the evidence, and all fair inferences that may be

drawn therefrom." Hadeed v. Medic-24, Ltd., 237 Va. 277, 281,

377 S.E.2d 589, 590 (1989) (internal quotation marks and

citation omitted).

The object of our review depends upon the circuit court's

treatment of the motion to strike. Where, as here, the circuit

court denied the motion to strike, we must review the evidence

to determine if that action was in error because either "it is

conclusively apparent that [the] plaintiff has proven no cause

of action against [the] defendant," or "it plainly appears that

the [circuit] court would be compelled to set aside any verdict

found for the plaintiff as being without evidence to support

it." Blue Ridge Serv. Corp. v. Saxon Shoes, Inc., 271 Va. 206,

218, 624 S.E.2d 55, 62 (2006) (internal quotation marks and

citation omitted).

To the extent we determine what type of evidence must be

presented, as an initial matter, to subject an employer to the

possibility of punitive damages liability for the actions of an

10
employee is a question of law we review de novo. Cf. Shevlin

Smith v. McLaughlin, __ Va. __, __, 769 S.E.2d 7, 17 (2015)

("Whether a factual issue constitutes a prima facie element of

a claim . . . is a question of law reviewed de novo.").

2. Punitive Damages Liability Against A Corporate Employer

The circuit court denied Abilene's motion to strike

Butler's claims for punitive damages against Abilene. This was

error.

A corporate employer may be liable for the compensatory

damages caused by the acts of its employees when such actions

are done "in the scope of [the employee's] employment and which

grow out of an act connected with the employment."

Oberbroeckling v. Lyle, 234 Va. 373, 381-82, 362 S.E.2d 682,

687 (1987). The analysis for determining whether a corporate

employer may be liable for punitive damages, however, is

different.

"A principal, . . . though of course liable to make

compensation for the injury done by his agent, within the scope

of his employment, cannot be held for . . . punitive damages,

merely by reason of wanton, oppressive[,] or malicious intent

on the part of the agent." Hogg v. Plant, 145 Va. 175, 180,

133 S.E. 759, 760 (1926) (internal quotation marks and citation

omitted). Consequently, "punitive damages cannot be awarded

against a master or principal for the wrongful act of his

11
servant or agent in which he did not participate, and which he

did not authorize or ratify." Id. at 181, 133 S.E. at 761.

Alternatively stated, punitive damages may be awarded against a

corporate employer only if either (1) that employer

participated in the wrongful acts giving rise to the punitive

damages, or (2) that employer authorized or ratified the

wrongful acts giving rise to the punitive damages. 2 Hewes v.

Doddridge, 40 Va. (1 Rob.) 143 (1842) (monographic note)

(citing Lake Shore & M. S. Ry. Co. v. Prentice, 147 U.S. 101

(1893)). The evidence at trial failed to establish that

Abilene either engaged in, or authorized or ratified, Egan's

alleged wrongful conduct.

a. Punitive Damages Liability When The Corporate Employer
Participated In The Wrongful Acts

Although our case law establishes that an employer is

subject to punitive damages liability if it participates in the

wrongful acts, we have not gone further to address how to

determine whether a corporate employer itself is acting for

2
Butler argues that Abilene waived and conceded this issue
by failing to object to, and by stipulating to, the fact that
Egan was operating within the scope of Abilene's employment
when he engaged in the wrongful acts giving rise to the
punitive damages awards. This, of course, is important for
purposes of establishing Abilene's vicarious liability for
compensatory damages. But the fact that Egan was acting within
the scope of his employment is not dispositive as to Abilene's
liability for punitive damages. Butler ignores this
distinction, but once made, Butler's arguments of waiver and
concession are meritless.

12
purposes of punitive damages liability. Instead, we have

repeatedly focused only on the separate avenue of establishing

an employer's punitive damages liability by ascertaining

whether a corporate employer authorized or ratified an

employee's wrongful conduct. See, e.g., Freeman v. Sproles,

204 Va. 353, 358, 131 S.E.2d 410, 414 (1963); W. T. Grant Co.

v. Owens, 149 Va. 906, 913, 141 S.E. 860, 862-63 (1928).

Butler argues that any action of any employee taken on

behalf of a corporate employer is necessarily the action of the

corporate employer. After all, Butler continues, a corporate

employer such as Abilene "can only act through agents" such as

Egan. Bardach Iron & Steel Co. v. Charleston Port Terminals,

143 Va. 656, 672, 129 S.E. 687, 692 (1925). Consequently,

Butler contends that any employee's action is the corporate

employer's action for purposes of punitive damages liability.

We hold that this position is inconsistent with established

Virginia law, as it would render obsolete establishing a

corporate employer's punitive damages liability by way of

proving the employer's authorization or ratification of an

employee's wrongful conduct.

Instead, to subject a corporate employer to punitive

damages liability on the basis that the corporate employer

itself committed the wrongful acts, the employee who committed

the wrongful acts must be in a sufficiently high position in

13
the employer's corporate structure. Restatement (Second) of

Torts § 909 ("Punitive damages can properly be awarded against

a master or other principal because of an act by an agent if

. . . (c) the agent was employed in a managerial capacity and

was acting in the scope of employment."); see also, e.g.,

Hodges v. Gibson Prods. Co., 811 P.2d 151, 163 (Utah 1991);

Sweet v. Roy, 801 A.2d 694, 713-14 (Vt. 2002).

We hold that this standard applies in Virginia. The

question then becomes, how high a position in the corporate

ranks is sufficient to make the actions of an employee the

actions of the corporate employer? This is a fact-sensitive

question, dependent upon the power, role, and independence of

the employee relative to the nature and structure of the

corporate employer. See Bardach, 143 Va. at 672, 129 S.E. at

692 ("[When an agent] is a permanent employee or officer of the

company, the question as to the authority and power of such a

representative should be left to the jury, unless the evidence

shows that this authority on the occasion in question was

necessarily limited."); see also White v. Ultramar, Inc., 981

P.2d 944, 954 (Cal. 1999) ("[S]upervisors who have broad

discretionary powers and exercise substantial discretion

authority in the corporation could be managing agents.

Conversely, supervisors who have no discretionary authority

over decisions that ultimately determine corporate policy would

14
not be considered managing agents even though they may have the

ability to hire or fire other employees."); Chavarria v.

Fleetwood Retail Corp. of N.M., 143 P.3d 717, 725 (N.M. 2006)

("An employee has managerial capacity if he or she has the

discretion or authority to speak and act independently of

higher corporate authority." (internal quotation marks and

citation omitted)). We therefore decline to create a bright-

line rule, and instead supply the facts of this case for future

guidance.

The record shows that Egan had been working at Abilene for

four and a half years, and was the Director of Maintenance. As

Director of Maintenance, Egan "did the hiring and firing and

scheduling work. [He] was in charge of [Abilene's] entire

fleet as far as maintenance, purchasing." This is the totality

of evidence establishing Egan's position within Abilene's

corporate structure. As a matter of law, this limited evidence

is insufficient to establish whether Egan was in a sufficiently

high position within Abilene's business structure so that

employee Egan's actions were actually the corporate employer

Abilene's actions for purposes of punitive damages liability.

Butler makes additional arguments for why Abilene itself

committed the alleged acts of malicious prosecution and

defamation. We remain unpersuaded.

15
 First, Butler points to the fact that the dismissal of

Egan's criminal complaint against Butler was accompanied by

Butler's agreement to stay off of Abilene's property for an

extended period of time. Butler argues that this establishes

that Abilene "benefitted" from the criminal action, and thus

Abilene was "involve[d] in the criminal case." Butler also

points to the fact that it was Abilene's president, Keith

Jones, who notified Butler that a warrant had been issued for

Butler's arrest. However, the fact that an aspect of the

criminal action related to Abilene's property, without further

evidence of Abilene's alleged involvement with the criminal

action, does not establish that Abilene itself engaged in

malicious prosecution or defamation. Similarly, the fact that

Abilene's president was aware of the existence of a warrant

does not establish that Abilene itself engaged in malicious

prosecution or defamation.

Second, Butler points to the fact that various videotapes

which should have recorded the areas of Abilene's property

where Butler's termination and any subsequent altercation

occurred remained in possession of Abilene and were accessible

by Abilene's president. But mere possession of such videotapes

does not establish that Abilene itself engaged in malicious

prosecution or defamation.

16
 Seeking to bolster his point, Butler repeats his argument

from trial that these tapes were destroyed or altered, because

either the video does not show certain locations that should

have been recorded, or the video of what is recorded is missing

events that actually occurred. Even accepting as true the

premise that someone destroyed or altered the relevant

videotapes, the record here fails to establish that such party

was Abilene. Such evidence alone does not establish that

Abilene destroyed or altered the tapes, and this evidence does

not establish that Abilene itself engaged in malicious

prosecution or defamation.

Third, Butler argues that because Abilene knew that the

unaltered videotapes exonerated Butler, but did nothing to stop

Egan's malicious prosecution or Egan's defamation, Abilene was

therefore sufficiently involved with the malicious prosecution

and defamation so that Abilene engaged in such wrongful

conduct. However, accepting as true that the record is

sufficient to warrant an inference that Abilene was aware of

the substance of the unaltered videotapes, the record does not

establish that Abilene itself engaged in malicious prosecution

or defamation. It may be – but we need not establish for

purposes of Virginia law – that the "person who places before a

prosecuting officer information upon which criminal proceedings

are begun" has "an obligation to disclose" the discovery of

17
"additional information casting doubt upon the accused's

guilt." Clarke v. Montgomery Ward & Co., 298 F.2d 346, 348

(4th Cir. 1962) (establishing such a rule for federal courts in

Virginia while recognizing that "there appear to be no Virginia

cases specifically [on] point"). But such a duty would apply

only to Egan, who filed the misdemeanor complaint against

Butler, and whose actions are not those of Abilene. And we

have never held that a third party, such as Abilene, who fails

to disseminate truth to counteract the false defamation

published by another, such as Egan, will be considered to have

engaged in another's defamatory act.

For these reasons, at the time of Abilene's motion to

strike, it plainly appears that the circuit court would have

been compelled to set aside, as being without evidence to

support it, any punitive damages verdict found for Butler

against Abilene based on the theory that Egan's actions were

actually the actions of Abilene. Blue Ridge, 271 Va. at 218,

624 S.E.2d at 62.

b. Punitive Damages Liability When The Corporate Employer
Authorized Or Ratified The Wrongful Acts

Butler did not plead, and failed to introduce any evidence

at trial to prove, that Abilene authorized or ratified Egan's

alleged actions of malicious prosecution and defamation. For

these reasons, at the time of Abilene's motion to strike, it

18
plainly appears that the circuit court would have been

compelled to set aside, as being without evidence to support

it, any punitive damages verdict found for Butler against

Abilene based on the theory that Egan's actions were authorized

or ratified by Abilene. Id.

C. Proceedings On Remand

In light of these errors, 3 Egan and Abilene request a new

trial upon remand. Determining the nature of the proceedings

upon remand is informed by our actions on appeal, which in turn

are guided by assignments of error. Accordingly, the analysis

starts with the parties' assignments of error.

Rule 5:17(c)(1) requires an appellant to assign error to a

"ruling[] below." Only "sufficient" assignments of error are

recognized by this Court. Rule 5:17(c)(1)(iii). "A litigant's

failure to include any sufficient assignments of error in a

petition for appeal can deprive this Court of active

3
We do not address Egan's and Abilene's identical
assignments of error 2, regarding whether Butler's future lost
income awards were too speculative. Egan and Abilene failed to
adequately brief this issue, and it is waived. Muhammad v.
Commonwealth, 269 Va. 451, 478, 619 S.E.2d 16, 31 (2005).
We do not address Egan's assignment of error 3 and
Abilene's assignment of error 4, regarding whether the
compensatory damage verdicts were duplicative; Egan's
assignment of error 4 and Abilene's assignment of error 6,
regarding whether the verdicts should have been set aside; and
Abilene's assignment of error 5, regarding whether the punitive
damages awarded against an employer can exceed the punitive
damages awarded against an employee. Our holdings on appeal
render it unnecessary to resolve these issues. Jimenez v.
Corr, 288 Va. 395, 404, 764 S.E.2d 115, 118 (2014).

19
jurisdiction to consider the appeal." Amin v. County of

Henrico, 286 Va. 231, 236, 749 S.E.2d 169, 171 (2013) (emphasis

added). However, so long as an assignment of error is

sufficient, this Court has jurisdiction to consider the appeal.

A sufficient assignment of error puts before this Court an

"alleged error" committed by the court below. Rule 5:17(c)(1).

That alleged error defines the focus of what this Court can

address on appeal. See, e.g., Sarafin v. Commonwealth, 288 Va.

320, 323 n.1, 764 S.E.2d 71, 73 n.1 (2014). After all, "when a

party fails to assign error to a particular holding by the

circuit court, that holding becomes the law of the case and is

binding on appeal." Maine v. Adams, 277 Va. 230, 242, 672

S.E.2d 862, 869 (2009). Thus, for example, Egan's and

Abilene's assignments of error 1 put before this Court the

circuit court's action of excluding evidence, and Abilene's

assignment of error 3 put before this Court the circuit court's

action of denying a motion to strike. By way of these

assignments of error, we have authority to address whether

those actions were in error and, because they were, to reverse

the circuit court's actions.

Once we identify and reverse actions taken in error, and

remand is required, we must ascertain the appropriate nature of

such remand proceedings. The nature of remand proceedings may

be governed either by statute or by this Court's holding of

20
error on appeal; or, in the absence of such sources mandating a

specific form of proceedings, the lower court retains

discretion to resolve outstanding issues in the manner it sees

fit. Bailey v. Loudoun Cnty. Sheriff's Office, 288 Va. 159,

181-82, 762 S.E.2d 763, 774 (2014). When the nature of remand

proceedings is governed by our holding of error on appeal, we

must determine what portions of the lower court proceedings

were affected by such error. And it is those proceedings,

tainted by error, which must be accomplished anew upon remand.

See, e.g., Velocity Express Mid-Atlantic v. Hugen, 266 Va. 188,

203, 585 S.E.2d 557, 566 (2003) (error in allowing a

prejudicial closing argument to a jury in a non-bifurcated

trial typically requires remand of a new trial on all issues,

but specific circumstances of the case required only a new

trial on damages); Rawle v. McIlhenny, 163 Va. 735, 747-50, 177

S.E. 214, 220-21 (1934) (discussing how an appeal should be

resolved in five different scenarios of when a plaintiff

challenges the sufficiency of a verdict on an appeal).

In this case, remand proceedings are governed by our

holdings of error on appeal. Pursuant to Abilene's assignment

of error 3, we hold that the circuit court erred in denying

Abilene's motion to strike Butler's claims for punitive damages

against Abilene. Any issues falling within the scope of that

motion to strike are subject to final judgment. See Isle of

21
Wight Cnty. v. Nogiec, 281 Va. 140, 156, 704 S.E.2d 83, 91

(2011); Blue Ridge, 271 Va. at 219, 624 S.E.2d at 62. Thus,

Abilene is not subject to punitive damages on remand, and

Butler is foreclosed from presenting evidence to establish

Abilene's punitive damages liability.

Pursuant to Egan's and Abilene's assignments of error 1,

we hold that the circuit court erred in excluding evidence

probative of Butler's future lost income. The nature of the

circuit court's action, embodied in the assignment of error, is

not itself confined to a specific segment of the trial. Contra

Baker v. Carrington, 138 Va. 22, 23-25, 120 S.E. 856, 856-57

(1924) (plaintiff assigned error to lower court's striking

words from a jury instruction relating to punitive damages, and

thus the error affected only damages rather than liability).

Instead, the nature of our holding of error on appeal is

confined to a specific segment of the trial.

The circuit court's action of excluding certain evidence

was error because such evidence was probative of Butler's

future lost income. The issue of future lost income is an

issue relating to a plaintiff's compensatory damages. See,

e.g., Lewis-Gale Med. Ctr., LLC v. Alldredge, 282 Va. 141, 147,

710 S.E.2d 716, 719 (2011). Thus, our holding of error on

appeal necessitates a new trial as to Butler's compensatory

22
damages upon remand. Egan and Abilene, however, argue that the

reach of remand proceedings should go further. We disagree.

First, Egan and Abilene argue that our holding also

impacts issues of liability as this excluded evidence may have

affected the jury's assessment of Butler's credibility. Egan

and Abilene contend that, contrary to this excluded evidence,

Butler claimed at trial that he had been a well-regarded truck

mechanic before Egan damaged his reputation. Thus, as Butler

testified regarding Egan's and Abilene's liability, improperly

excluded evidence impacting the credibility of a liability

witness is an error that may have affected the jury's

determination of liability. Ryan v. Maryland Casualty Co., 173

Va. 57, 62-63, 3 S.E.2d 416, 418-19 (1939).

We cannot endorse Egan's and Abilene's position because we

cannot reach the issue of whether this evidence relates to

Butler's credibility. This issue was never argued before the

circuit court as a basis to allow admission of the evidence.

Therefore, basic rules of appellate procedure prevent us from

reaching this particular issue. Rule 5:25; Morgen Indus., Inc.

v. Vaughan, 252 Va. 60, 67-68, 471 S.E.2d 489, 493 (1996);

Fisher v. Commonwealth, 236 Va. 403, 414, 374 S.E.2d 46, 52

(1988). We will not circumvent these rules to address an

otherwise waived issue simply because we have found that the

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circuit court's action to which the issue relates was error on

another basis.

Second, we note that Abilene observed during oral

arguments that any retrial of compensatory damages necessarily

requires a retrial of punitive damages because "an award of

compensatory damages is an indispensable predicate for an award

of punitive damages, except in actions for libel and slander."

Syed v. ZH Techs., Inc., 280 Va. 58, 74-75, 694 S.E.2d 625, 634

(2010) (internal quotation marks, citation, and alteration

omitted). It is true that we will vacate a punitive damages

award predicated upon a vacated compensatory damages award if

such relief falls within the scope of an assignment of error

and is adequately argued on appeal. See, e.g., Murray v.

Hadid, 238 Va. 722, 732, 385 S.E.2d 898, 905 (1989). But we

need not address whether Abilene's assignment of error 1

compels a retrial of punitive damages as against Abilene

because, as we have held, Abilene's assignment of error 3

removes that issue from retrial. Moreover, we do not address

whether Egan's assignment of error 1 compels a retrial of

punitive damages as against Egan because Egan waived the issue

at oral argument by conceding that he was "not contesting" the

punitive damages awards, and that the punitive damages awards

did not fall within the scope of his assignments of error.

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 III. CONCLUSION

The circuit court erred in excluding evidence probative of

Butler's future lost income. That error may have affected the

jury's determination of Egan's and Abilene's compensatory

damages. We therefore will reverse that portion of the circuit

court's judgment and remand for a new trial on compensatory

damages against Egan and Abilene.

The circuit court also erred in denying Abilene's motion

to strike Butler's punitive damages claims. We therefore will

reverse that portion of the circuit court's judgment and enter

final judgment in favor of Abilene regarding Butler's punitive

damages claims. Abilene's punitive damages liability is not

subject to retrial.

Our holdings do not disturb the circuit court's affirmance

of the jury's finding of Egan's and Abilene's liability. Our

holdings do not disturb the circuit court's entry of the

punitive damages awards against Egan. These issues are not

subject to retrial on remand.

Reversed and remanded in part,
and final judgment in part.

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