Talbert v. Farmers Ins. Exchange

WOLLHEIM, J.,

concurring in part and dissenting in part.

Defendants’ argument that plaintiffs acceptance of judgment benefits creates a potential for inconsistent verdicts is a red herring. I agree that, as a general rule, prejudicial trial error requires remand for a retrial on all factual issues. See Maxwell v. Port. Terminal RR. Co., 253 Or 573, 577, 456 P2d 484 (1969), and Pac. Gen. Contrs. v. Slate Const. Co., 196 Or 608, 611, 251 P2d 454 (1952). However, it is also the rule in Oregon that where a judgment concerns two separate claims, acceptance of the benefits on one claim does not bar an appeal on the remaining claim. Pac. Gen. Contrs., 196 Or at 612. Accordingly, neither the majority opinion nor defendants dispute that our current case law permits a limited remand on the issue of punitive damages, even where it is impossible to tell from the jury instructions or verdict form on what underlying theory the jury found defendants liable. See McGregor v. Barton Sand & Gravel, Inc., 62 Or App 24, 660 P2d 175 (1983). I concede that remanding such a case for punitive damages raises the potential for inconsistent verdicts, but that is true whether plaintiff has accepted the benefits of the judgment or not. Again, that potential does not, as a matter of law, require full retrial or dismissal of the appeal.

I would remand on the narrow issue of punitive damages with special instructions that eliminate the potential for inconsistent judgments. In particular, I would order that the trial court submit to the jury a special interrogatory that first asks the jury whether fraud committed by defendants was “intentional.” If the answer to that question is “Yes,” the judge would then instruct the jury to consider the punitive *608damages claim. If the answer to the first question is “No,” the judge would instruct the jury to proceed no further.

My disagreement with the majority is a limited, albeit sizeable, one. The majority concludes that a limited remand on punitive damages would give plaintiff two bites at the proverbial apple. 166 Or App at 605.1, on the other hand, conclude that the only just result is to remand the case and allow plaintiff the opportunity to pursue only that issue that he was, in fact, entitled to pursue if the trial court had not erred. The majority’s opinion is driven by the simple fact that it is plaintiff who appealed and, therefore, bears the risk of that appeal. What is driving my view is that plaintiff should not be punished for the trial court’s error. The majority’s ultimate conclusion imposes on plaintiff “an unnecessarily heavy burden” for prevailing on his appeal. Wells v. Marleau, 79 Or App 784, 789, 720 P2d 409, rev den 302 Or 159 (1986).

My view of the case law and the facts in this matter persuade me that remand is necessary. In McGregor, the trial court erred in submitting a jury instruction that would have permitted the jury to award punitive damages on a finding that the defendants had trespassed with only “reckless indifference.” 62 Or App at 27. We explained that, while the jury could have found that the defendants did not act with deliberate disregard for the plaintiffs rights pertaining to the trespass claim, evidence existed from which the jury could have found that defendants did, in fact, act with deliberate disregard. Id. at 30. Therefore, on remand of the punitive damages claim, we noted that “the questions on remand are both whether punitive damages are warranted by defendants’ conduct and, if so, what if any amount plaintiffs should recover as punitive damages.” Id. at 35 (emphasis in original).

The same is essentially true here. As in McGregor, the majority agrees that the evidence supports the liability verdict generally and, specifically, could support a verdict for punitive damages. I would not presume that the jury found only reckless fraud where the jury could have found intentional fraud. As a result, plaintiff is entitled to consideration of his punitive damages claim.

*609We have implicitly held that it is not incumbent on the plaintiff to submit to the jury a verdict form that specifies intentional fraud over reckless fraud to permit submission of punitive damages to the jury. See McMullin v. Murphy, 89 Or App 230, 234-35 n 3, 748 P2d 171, rev den 305 Or 576 (1988) (affirming jury verdict on punitive damages where, based on the verdict form and instructions not objected to at trial, one could not tell if fraud judgment was, in fact, based on reckless or intentional fraud). That is not to say that plaintiffs are always entitled to a jury determination on the basis of a verdict in that posture. However, I would hold that the trial court erred, as a matter of law, in not submitting the punitive damages claim to the jury. If the trial court had not erred, both parties would have submitted their jury instructions on the fraud claim in contemplation of the jury’s consideration of the punitive damages claim. Thus, had defendants then raised, as they do now on appeal, the concern that the jury instructions did not ask the jury to specify intentional versus reckless fraud, the trial court could have remedied that ambiguity by submitting a jury instruction requesting such specification.

I disagree strongly with the majority opinion that plaintiffs choices at trial and subsequent appeal are calculated decisions to gain tactical advantage. 166 Or App at 605. Certainly, if the issue of punitive damages was relevant to plaintiffs case at the time the jury was instructed, or if there was some evidence of tactical manipulation on the part of plaintiff, I would not afford plaintiff a partial remand. However, the majority believes that

(1) plaintiff should have anticipated that the trial court was in error in its directed verdict ruling on the punitive damages;
(2) plaintiff should have anticipated that he would win on the fraud claim;
(3) plaintiff should have then anticipated receiving satisfaction of the judgment; and
(4) despite the numerous reasons that weigh in a decision of this kind, plaintiff should have anticipated at trial that he would appeal the directed verdict on punitive damages.

*610The bare fact remains, however, that at the time the instructions were submitted to the jury, the punitive damages claim was not an issue in the case and was not relevant. On that basis, I would not here disparage plaintiffs failure at soothsaying as a calculated attempt at a second bite of the apple.1

Rather, I would limit the remedy to fulfill our function as an error-correcting court while protecting the integrity of the jury’s verdict. It seems unnecessary to abrogate that function and decline to formulate a remedy within our authority that places the parties in the position they would have been had the trial court not erred. My remedy would permit the issue of punitive damages to be considered by the jury, which, through no fault of plaintiff, was not submitted to the jury. Such a result would protect the integrity of the liability verdict from which plaintiff has benefitted and permit plaintiff to litigate and, perhaps, vindicate only those issues he would have been entitled to litigate had the trial court not erred as a matter of law.

I dissent.2

DeMuniz, Haselton, and Armstrong, JJ., join in this dissent.

Indeed, it would appear that the majority believes that, in addition to the considerations listed above that plaintiff should have anticipated, that the fraud verdict was going to be on the recklessness claim only, that he would, in fact, receive satisfaction of the judgment, that he would prevail on the punitive damages appeal, and that he would secure a partial remand that would provide him a second opportunity essentially to prove intentional fraud. That is too far a stretch in my estimation.

concur in the majority’s disposition of the cross-appeal.