Dunfee v. Baskin-Robbins, Inc.

No. 85-455

I N THE SUPREME COURT OF THE STATE OF MONTANA

1986

TERRENCE DUNFEE a n d PATRICIA DUNFEE,

P l a i n t i f f s a n d ~ e s ~ o n. t ; e,
&d

-vs-
BASKIN-ROBBINS, INC.,

Defendant and A p p e l l a n t .

APPEAL FROM: D i s t r i c t C o u r t o f t h e Second J u d i c i a l D i s t r i c t ,
I n a n d f o r t h e C o u n t y o f S i l v e r Bow,
The H o n o r a b l e Mark S u l l i v a n , J u d g e p r e s i d i n g .

COUNSEL OF RECORD:

For Appellant:

James A. R o b i s c h o n a r g u e d , B u t t e , Montana
T e r e s e Lowney G a r r e t t , G l e n d a l e , C a l i f o r n i a

For Respondent:

K n i g h t , Dahood, McLean & E v e r e t t ; B e r n a r d E v e r e t t
a r g u e d , A n a c o n d a , Montana

F o r Amicus C u r i a e : ( I n t e r n a t i o n a l ~ r a n c h i s eAssoc.)

A n d e r s o n , Brown, G e r b a s e , C e b u l l & J o n e s ; J a m e s L .
J o n e s , B i l l i n g s , Montana
Andrew A . C a f f e y , W a s h i n g t o n , D . C .
Lewis G. Rudnick, C h i c a g o , I l l i n o i s

Submitted: A p r i l 1 1 1986

Decided: June 4 , 1986

Clerk
Mr. Justice Frank B. Morrison, Jr., delivered the Opinion of
the Court.

This is an appeal from judgment entered upon a jury
verdict in the Second Judicial District. The jury found in
favor of plaintiffs, assessing compensatory damages in the
amount of $232,138.88 and $300,000 in punitive damages.
Defendant appeals. We affirm.
Baskin-Robbins, Inc. (appellant) and Terrance Dunfee and
Patricia Dunfee (respondents) entered into a franchise
contract for the operation of a Baskin-Robbins store in
Butte, Montana. Initially appellant explored the possibility
of locating a store in the Butte Plaza Shopping Center but
was unable to secure a space. Subsequently, a site was
obtained across Harrison Avenue in the "Raymond Mini-Mall."
Appellant signed a lease with Raymond on October 5, 1979, and
commenced construction at the Mini-Mall site.
Respondents first saw the Baskin-Robbins store in July,
1980, and decided to approach appellant about the business.
Respondents submitted a franchise application on July 31,
1980. Following interviews and training sessions sponsored
by appellant, the respondents signed the franchise contract
on October 29, 1980. Prior to signing respondents consulted
legal counsel, who suggested certain changes in the franchise
agreement. Appellant insisted the standard agreement be
signed without change and this was done.
The purchase price of the store was $71,000. The
respondents obtained the funds through a loan from Montana
Bank guaranteed by the Small Business Administration.
The store opened on October 29, 1980, and sales were
brisk through the first 10 months of operation. In the
spring of 1981, the parking lot in front of the store was
paved pursuant to the contract between appellant and the
Raymond. Mini-Mall. The paving of the lot reduced. the amount
of parking and also changed the flow of traffic so that
automobiles entering from Harrison Avenue could not exit upon
the same thoroughfare. Rather, customers had to drive out
through an alley, over a large hump to a side street. The
respondents received numerous complaints about traffic flow.
Thereafter, sales slumped dramatically. During the first 10
months of operation, the store averaged $13,359 in monthly
sales; the next twelve months the average monthly sales
dipped to $8,088.
In the fa.11 of 1981, the respondents had problems making
their payments. A representative from the Small Business
Administration evaluated the business and recommended it be
sold. Respondents were advised the store was in a poor
location. Thereafter, respondents sought to persuade
appellant that the store should be moved across Harrison
Avenue to the Butte Plaza Shopping Center. Terrance Dunfee
began discussing the possibility of relocation with Harold
Donahue, manager of the Plaza Shopping Center. The Plaza had
no similar store and Donahue encouraged the move. There was
a vacancy next to the movie theatre. Mr. Dunfee spoke to
' Sharon McCa.rthy, District Manager for Baskin-Robbins, about
the move. McCarthy consulted with Baskin-Robbins' Division
Manager, Bob Miller. No written correspondence reflected any
discussions between Miller and McCarthy.
Site location, under the franchise agreement,
exclusively belonged to Baskin-Robbins. Any site relocation
had to be authorized and approved by a Baskin-Robbins Vice
President. The vice president in charge was never consulted
by McCarthy or Miller regarding relocation of the store.
Patricia. Dunfee testified that Sharon McCarthy told her
Baskin-Robbins could not move because they were committed to
a fifteen year lease in the Raymond Mini-Mall. However, the
Baskin-Robbins lease with the Raymond Mini-Mall had a
termination right after five years and a right to sublease at
any time. These facts were not communicated to respondents.
Sharon McCarthy testified, contrary to the testimony of
Patricia Dunfee, that she only told respondents that
relocation was not in their best interests.
Following denial of the relocation request, and
continued losses each month, the respondents closed the store
on August 23, 1982. The Small Business Administration took
possession and sold the store in December, 1982 for $25,000.
As of April 9, 1983, the respondents still owed over $82,000
in long term debts on the business.
The respondents filed this action on May 26, 1983,
alleging breach of fiduciscry duty, breach of the implied
covenant of good faith and fair dealing, and fraud. The case
was submitted to a jury on a general verdict form. Following
a plaintiffs' verdict appellant filed this appeal raising the
following issues:
1. Whether the court properly instructed the jury that
Baskin-Robbins owed a fiduciary duty to the Dunfees?
2. Whether the District Court properly instructed the
jury on the duty of good faith and fair dealing?
3. Whether there was substantial credible evidence in
the record to support submission of the case to the jury on
either theory?
4. Whether the evidence supported an award for
emotional distress damages?
5. Whether there was sufficient evidence in the record
to support submission of a punitive damage issue to the jury?
ISSUE ONE
Whether the court properly instructed the jury that
Baskin-Robbins owed a fiduciary duty to the Dunfees?
Generally a franchisor does not owe a fiduciary duty to
a franchisee. Picture Lake Campground v. Holiday Inns, Inc.
(E.D. Va. 1980), 497 F.Supp. 858, 869 ("[a] franchise
relationship is inherently a business relationship, not a
fiduciary relationship") . Accord Arnoco Oil Company v.
Cardinal Oil Co., Inc. (E.D. Wis. 1982), 535 F.Supp. 661, 666
(court refused to allow amendment of pleadings on the ground
that a breach of fiduciary duty complaint failed to state a
claim for relief in action by franchisee against
franchisor); Murphy v. White Hen Pantry, Inc. (7th Cir.
1982), 691 F.2d 350, 354 ("the [district] court correctly
determined that there was no legal basis for the argument
that [franchisor] owed a fiduciary duty to [franchisee]").
Respondents recognize the general rule that under a
franchise agreement a fiduciary relationship does not
ordinarily develop. However, the respondents argue that
special trust and confidence was reposed by the respondents
in the expertise of appellant and that under the authority of
Deist v. Wachholz (Mont. 19841, 678 P.2d 188, 41 St.Rep. 286,
a fiduciary duty resulted.
When a fiduciary duty exists the one in the stronger
position owes an obligation, by virtue of that trust
relationship, to act in the best interests of the
beneficiary. Deist v. Wachholz, supra.
We find that we need not decide whether the special
facts and circumstances of this case gave rise to a fiduciary
duty on the part of appellant. Although fiduciary duty was
defined in the instructions, the court only held appellant to
the responsibility of acting in good faith and dealing fairly
with respondents. The questioned instruction is court's
instruction no. 15 which stated:
YOU ARE INSTRUCTED THAT a fiduciary relationship
exists in all cases where there has been a special
confidence reposed in one who in equity and. good
conscience is bound to act in good faith, and with
due regard to the interests of the one reposing the
confidence. A fiduciary relationship implies a
condition of superiority held by one of the parties
over the other.
A fiduciary relationship may exist when there is
both a reposing of faith, confidence and trust, the
placing of reliance by one person on the judgment
and advice of another, and the acceptance by the
other of the confidence reposed in him. There must
exist a just foundation for a belief that in giving
advice or presenting arguments one is acting not in
his own behalf, but in the interest of the other
party.
A careful reading of this instruction shows that the court
defined fiduciary relationship as being a relationship where
one person has reposed trust and confidence in another person
and that for the relationship to exist the stronger person
must be acting in the interest of the other party and not in
his own behalf. The entire second paragraph of the
instruction definitional. The only duty stated the
instruction is found in the first sentence where the court
advised the jury that, where a fiduciary relationship exists,
one is bound to act in good faith, and with due regard to the
interests of the one reposing the confidence. Instruction
no. 15 must be read in conjunction with instruction no. 16
which stated:
YOU ARE INSTRUCTED that a party who has a fiduciary
duty in its relationship with another party has a
duty to act in good faith in its dealings with the
other party.
When read together the instructions informed the jury
that a person in a fiduciary relationship owes an obligation
to deal fairly and in good faith. The court did not instruct
the jury that liability atta.ched if Baskin-Robbins acted in
their own interest to the detriment of the interest of
Dunfees.
Instruction no. 15 is not artfully worded. However, the
instruction is not clearly erroneous nor does the
instruction, when read with the other instructions,
substantially prejudice the interests of appellant.
ISSUE TWO
Whether the District Court properly instructed the jury
on the duty of good faith and fair dealing?
Appellant objects to court's instruction no. 13 which
amplified upon the obligation of dealing fairly and in good
faith. That instruction stated:
YOU ARE INSTRUCTED THAT in every contract, such as
the contract with BASKIN-ROBBINS, INC. in this
case, there is an implied covenant that neither
party shall do anything which will have the effect
of injuring the right of the other party to receive
the benefit of the contract, which means that in
every contract there exists an implied covenant of
good faith and fair dealing.
Appellant argues that this instruction does not accord
with the definition set forth recently by this Court in
Nicholson v. United Pacific Ins. Co. (Mont. 1985), 710 P.2d

In Nicholson we stated:
Rut whether performing or breaching, each party has
a justifiable expectation that the other will act
as a reasonable person. Neal v. Farmers Ins.
Exchange (Cal. 1978), 582 P.2d 980. The nature and
extent of an implied covenant of good faith and
fair dealing is measured in a particular contract
by the justifiable expectations of the parties.
Where one party acts arbitrarily, capriciously or
unreasonably, that conduct exceeds the justifiable
expectations of the second party. The second party
then should be compensated for damages resulting
from the other's culpable conduct.

The Nicholson case had not been decided at the time the
court instructed this jury. Court's instruction no. 13 does
however contain the language approved by this Court in Gibson
v. Western Fire Ins. Co. (Mont. 1984), 682 ~ . 2 d725, 41
St.Rep. 1048. In that case Justice Sheehy defined the
implied covenant of good faith and fair dealing as follows:
The duty to accept a reasonable offer within policy
coverage limits arises from an implied covenant of
good faith and fair dealing that neither party will
do anything which will injure the right of the
other to receive the benefits of the agreement.

The District Court was offered, in place of the given
instruction, defendant's proposed instruction no. 7 which
stated:
You are instructed that both parties to any
commercial transaction have the duty to fairly deal
with each other in good faith. Good faith is
defined as meaning honesty in fact in the conduct
or transaction involved.
Therefore, in this case if you find that the
Defendant did some dishonest act or acts that
harmed the Plaintiffs, then it is guilty of the
tort of bad faith and liable for any damages
proximately caused thereby.
Conversely, if you find that Defendant did not do
anything dishonest in its dealing with the
Plaintiffs, then your verdict must be in favor of
the Defendant.
The court wisely chose to refuse the defendant's offered
instruction. In McGregor v. Mommer (Mont. 1985), 714 P.2d
536, 43 St.Rep. 206, this Court held that it was insufficient
to define good faith as "honesty in fact." While the
majority did not specifically disa.pprove of good faith as
"honesty in fact," the majority did hold that a more complete
duty had to be submitted to the jury. The trial court here,
gave a more complete definition. In fact the court gave,
nearly verbatim, the definition previously approved by this
Court in Gibson, supra.
The implied covenant of good faith and fair dealing has
presented problems in its application. In a commercial
setting we now have held that where the conduct of one party
unreasonably breaches the justifiable expectations of the
other party, an action in tort results. Nicholson v. United
Pacific Ins. Co. , supra. The rule, whether defined as the
District Court defined it here, or as defined in Nicholson,
should allow for the functioning of a free enterprise
marketplace. Parties must be permitted to openly and
forthrightly breach contracts electing to pay contract
damages only.
The right to intentionally breach a contract is
recognized in Nicholson, where the Court stated:
Historically, a party to a contract generally had
the right to breach and pay damages rather than
perform. The non-breaching party, theoretically is
"made whole" from the damages paid following the
breach and thus still received benefits from the
agreement.
The Court quoted with approval the following rule:
"Tontract law is based in part upon the assumption
that certain intentional breaches are to be
encouraged. Permitting parties to breach their
contracts promotes an efficient economy, at least
when the gains from the breach exceed the expected
pecuniary injuries of the promisee.'"

The Court's opinion in Nicholson then distinguished
legitimate breaches of contract from activities which may
constitute a tort. The Court said: "But whether performing
or breaching, each party has a justifiable expectation that
the other will act as a reasonable person." Id.
In the case at bar, the jury had to focus upon
appellant's conduct in performing the contract rather than
breaching the contract. Under the franchise agreement,
appellant had the exclusive right to determine site location
and the inquiry necessarily evaluated the reasonableness of
appellant's conduct in light of the reasonable expectations
of the parties to the franchise agreement.
Were this case to be tried following the Nicholson
decision the court's instruction would reflect the rule
stated in Nicholson. Not having the benefit of our
discussion in Nicholson, the District Court gave an
instruction quoting language from the Gibson decision
rendered only a few months before the trial. The jury was
given a fair and complete definition of "good faith" as
defined by this Court. More cannot be asked of the trial
judge.
ISSUE THREE
Whether there was substantial credible evidence in the
record to support submission of the case to the jury on
either theory?
Appellant contends there was insufficient evidence in
the record to justify submission of appellant's lack of good
faith to the jury. The controversy centers around
appellant's refusal to remove the store from it's Raymond
Mini-Mall location, across Harrison Avenue, to a location
within the larger indoor Butte Plaza Mall.
Both appellant and respondents developed substantial
evidence respecting the merits of relocation. The record
contains evidence showing that business declined rapidly due
to a change of traffic flow the year foll-owing the store's
original opening. This change of circumstance, and the dire
financial condition of the ice cream business in its existing
location, may have reasonably triggered an inquiry regarding
relocation. Unquestionably appellant had the sole
contractual right to determine the location but the law
imposes a duty upon appellant to reasonably consider the
facts regarding relocation.
In determining whether a jury issue exists we must view
the record in a light most favorable to respondents. First
National Bank in Libby v. Twombly (Mont. 1984), 689 P.2d
1226, 41 St.Rep. 1948.
Distil-led to its essence, the respond.entsl case rests
upon evidence that Sharon McCarthy, acting for appellant,
advised Patricia Dunfee that Baskin-Robbins was tied to a
fifteen year commitment at the Raymond Mini-Mall and could.
not move. In fact, Baskin-Robbins had a provision for
sublease and a right to termination after five years. This
information was not conveyed to the respondents and,
therefore, respondents had no opportunity to find a subleasee
and facilitate their move.
Respondents' proof further established the only person
from appellant's organization who could authorize relocation,
namely a vice president, was not told of the relocation
question. Therefore, the merits of respondentsf relocation
argument were never considered by the 01-11-y
person who could
authorize the move.
While this Court must recognize the contractual right of
Baskin-Robbins to refuse relocation on the basis of cost or
other economic circumstances, the law does impose a duty upon
Baskin-Robhins to be reasonable in the exercise of that
right. Respondents have presented evidence that vital
information was withheld from them and from the vice
president in charge of authorizing relocation. This
evidence, if believed, would provide a basis for finding
appellant acted unreasonably, thereby breaching it's duty to
exercise good faith as defined by the court's instructions.
ISSUE FOrJR

Whether the evidence supported an award for emotional
distress damages?
The testimony at trial concerning the Dunfees' mental
and emotional distress consisted of the following: Mr.
Dunfee said they were devastated and felt a sense of loss;
Mrs. Dunfee testified that she was distraught and had lost
her self-esteem. The Dunfees lived in the country and Mrs.
Dunfee tried never to go into Butte; she felt ashamed as
being recognized as a failure.
While the testimony given by the Dunfees shows mental
and emotional distress, appellant argues that the distress is
related to the business failure and not to denial of
relocation. However, whether the respondents would have
failed had the relocation been authorized was a question for
the jury to consider. The jury was properly instructed. on
proximate cause and its members found that the mental
distress damages were related to the appellant's unreasonable
failure to evaluate relocation.
We hold there was a submissible jury issue on mental and
emotional distress and although the award of $1-50,000 is
generous we cannot say, as a matter of law, that the jury was
moved by passion or prejudice.
ISSUE FIVE
Whether there was sufficient evidence in the record to
support submission of a punitive damage issue to the jury?
Punitive damages are governed by § 27-1-221, MCA, which
provides as follows:
When exemplary damages allowed. (1) Subject to
subsection (2), in any action for a breach of an
obligation not arising from contract where the
defendant has been guilty of oppression, fraud or
malice, actual or presumed, the jury, in addition
to the actual damages, may give damages for the
sake of example and by way of punishing the
defendant.
The issue of punitive damages went to the jury over
appellant's objection that there was no evidence sufficient
to raise an issue under the statute. The trial judge gave
the following instructions defining oppression, fraud and
malice:
INSTRUCTION NO. 23
You are instructed that oppression is
defined as an act of cruelty, severity,
unlawful exaction or excessive use of
authority. An act is oppressively done
if done in a wa.y or manner which violates
the right of another person with unneces-
sary harshness or severity as by misuse
or abuse of authority or power.
INSTRUCTION NO. 24
You are instructed that the abuse of
authority or power is the essence of
cohstructive fraud.
INSTRUCTION NO. 25
You are instructed that the standard for
presumed malice sufficient to support an
award for punitive damages under the laws
of the State of Montana is as follows:
When a person knows or has reason to know
of facts which create a high degree of
risk or harm to the substantial interests
of another, and either deliberately
proceeds to act in conscious disregard of
or indifference to that risk, or reck-
lessly proceeds in unreasonable disregard
of or indifference to that risk, his
conduct meets the standard of willful,
wanton and/or reckless to which the law
of this State will allow imposition of
punitive damages on the basis of presumed
malice.
Instruction no. 23 is an accurate statement of the law
as contained in Purcell v. Automatic Gas Dist., Inc. (Mont.

Instruction no. 25 is a correct statement of the law taken
from Owens v. Parker Drilling Co. (Mont. 1984), 673 P.2d at
1251, 41 St.Rep. at 69. Instruction no. 24 is not the
statutory definition of constructive fraud as found in
5 28-2-406. However, the language was taken from our opinion
in Purcell v. Automatic Gas Dist., Inc., supra. ~lthough
instruction no. 24 could have been more complete, the conduct
described is embraced within the definition of oppression as
the following instructions defining oppression, fraud and
malice :
INSTRUCTION NO. 23
You are instructed that oppression is
defined as an act of cruelty, severity,
unlawful exaction or excessive use of
authority. An act is oppressively done
if done in a way or manner which violates
the right of another person with unneces-
sary harshness or severity as by misuse
or abuse of authority or power.
INSTRUCTION NO. 24
You are instructed that the abuse of
authority or power is the essence of
constructive fraud.
INSTRUCTION NO. 25
You are instructed that the standard for
presumed malice sufficient to support an
award for punitive damages under the laws
of the State of Montana is as follows:
When a person knows or has reason to know
of facts which create a high degree of
risk or harm to the substantial interests
of another, and either deliberately
proceeds to act in conscious disregard of
or indifference to that risk, or reck-
lessly proceeds in unreasonable disregard
of or indifference to that risk, his
conduct meets the standard of willful,
wanton and/or reckless to which the law
of this State will allow imposition of
punitive damages on the basis of presumed
malice.
Instruction no. 23 is an accurate statement of the law
as contained in Purcell v. Automatic Gas Dist., Inc. (Mont.

In the present case, viewing the evidence in a light
most favorable to the Dunfees, a jury question was raised as
to fraud, oppression and malice on the part of
Baskin-Robbins. According to the respondents' testimony,
appellant failed to properly review their relocation request
and did not attempt to renegotiate the Mini-Mall lease.
Furthermore, Sharon McCarthy, if Patricia Dunfee is believed,
misrepresented material facts with respect to the underlying
lease between Baskin-Robbins and the Raymond Mini-Mall. In
furtherance of her vindictive attitude she refused to deliver
any of the facts to the vice president, the only one who
could make a decision favorable to the Dunfees' relocation
request.
The evidence on punitive damages presents this Court
with a close question. When the question for jury submission
is a close one, doubt should be resolved in favor of the jury
deciding a fact issue. In Jacques v. Montana National Guard
(1982), 199 Mont. 493, 649 P.2d 1319, we quoted from Mr.
Justice Black's dissenting opinion filed in Galloway v.
United States (1943), 319 U.S. 372, 63 S.Ct. 1077, 87 L.Ed.
1458 wherein he said:
As for myself, I believe that a verdict should be
directed, if at all, only when, without weighing
the credibility of the witnesses, there is in the
evidence no room whatever for honest difference of
opinion over the factual issue and controversy. I
shall continue to believe that in all other cases a
judge should, in obedience to the command of the
seventh amendment, not interfere with the jury's
function. Since this is matter of high
constitutional importance, appellate courts should
be alert to insure the preservation of this
constitutional right even though each case
necessarily turns on its peculiar circumstances.
In Jacques we adopted the standard articulated by
Justice Black for the purpose of measuring directed verdict
questions. When the standard is here applied, we find the
respondents' evidence sufficient to take the case to the jury
on the question of punitive damages.

We Concur:

Chief Justice
n

Justices
Mr. Justice Fred J. Weber dissents as follows:

I would reverse the District Court because I conclude
there was not sufficient evidence to support a punitive
damage award of $300,000.
As stated in the majority opinion, the question is
whether there was sufficient evidence to submit the issue of
punitive damages to the jury. The majority concluded that a
review of the evidence in a light most favorable to the
Dunfees resulted in a conclusion that a jury question had
been raised as to fraud, oppression and malice on the part of
Baskin-Robbins. The majority opinion then refers to three
factual bases for this conclusion:

(1) According to the Dunfees' testimony,
Baskin-Robbins failed to properly review the Dunfee
relocation request and did not attempt to renegoti-
ate the lease;
(2) The Dunfees testified that District Manager
Sharon McCarthy of Baskin-Robbins misrepresented
material facts with respect to the underlying
lease;
(3) In furtherance of District Manager McCarthy ' s
"vindictive attitude" she refused to deliver any of
the facts to the Vice President of Baskin-Robbins,
the only one who could make a favorable decision
for relocation.
I will discuss these in more detail.
With regard to ( I ) , I conclude that the Dunfees did not
prove a failure by Baskin-Robbins to review the relocation
request. The evidence submitted without contradiction by
Baskin-Robbins shows that the relocation request was consid-
ered by Sharon McCarthy, the District Manager for
Baskin-Robbins, and that she forwarded the information to
Division Manager Miller. In turn, Division Manager Miller
discussed the move with Mr. Bovshow, Baskin-Robbins' Real
Estate Manager, and they both concluded that the relocation
was not a good idea and disapproved it. Mr. Bovshow was the
Baskin-Robbins representative originally involved in the
location of the store in Butte. Even if we accept the testi-
mony of Mrs. Dunfee that she was not told of the possibility
of a sublease and of the 5 year termination possibility, the
Dunfees have still failed to prove that Baskin-Robbins did
not properly consider and reject their request for reloca-
tion. I conclude that there is a complete absence of evi-
dence suggesting that Baskin-Robbins failed to properly
review the relocation request.
With regard to ( 2 ) , we have a difficult question because
Mrs. Dunfee did testify that District Manager McCarthy mis-
represented the underlying lease and its terms. However, if
we start with the premise that Baskin-Robbins has a right to
decide whether or not to authorize the change of ,location,
the issue takes on a different light. Unless the majority is
concluding that Baskin-Robbins had an obligation to renegoti-
ate the lease, the misrepresentation of facts is not materi-
al. I have concluded that Baskin-Robbins was involved in an
arms length transaction under which it properly could refuse
to enter into a change of location, and I believe the majori-
ty essentially agrees with that conclusion. At that point, I
must also conclude that there was no misrepresentation of a
fact material to the rights of the Dunfees. Clearly the
facts are not of the type sufficient to raise a jury question
on fraud, oppression or malice.
With regard to (3), the majority emphasizes that "in
furtherance of her vindictive attitude" District Manager
McCarthy refused to deliver any of the facts to the Vice
President of Baskin-Robbins, the only one who could make a
favorable relocation decision. I conclude that is not a
correct factual analysis. The record does not in any way
indicate that District Manager McCarthy refused to deliver
any facts to the vice president of Baskin-Robbins. As dis-
trict manager she passed this information on to her division
manager, Mr. Miller. Mr. Miller in turn discussed the same
with the Baskin-Robbins real estate manager, and they disap-
proved relocation. That determination was within the discre-
tion granted to the division manager and the district manager
by Baskin-Robbins. In view of their decision against reloca-
tion, there was no reason to pass the information on up the
corporate ladder to the vice president. Presentation to the
vice president of Baskin-Robbins was required only in the
event that the lower level managers concluded that relocation
was advisable. I therefore conclude there is a total absence
of any proof of a vindictive attitude on the part of the
officers or representatives of Baskin-Robbins involved in the
failure to pass the information up to the vice president, he
being the only one who could make a favorable decision for
relocation.
I conclude there is an absence of evidence showing
fraud, oppression or malice on the part of Baskin-Robbins. I
then conclude the Dunfees failed to meet the minimum standard
for proof of punitive damages, and that submission of the
punitive damages issue to the jury constitutes reversible
error.
I further disagree with the majority opinion in regard
to Issue I, which pertains to the instruction on fiduciary
duty. Instruction No. 15, which is quoted at length in the
majority opinion, is extremely confusing. In this case it is
an invitation to error so far as the jury is concerned.
There are no facts in the record which warrant an instruction
on fiduciary relationship. The majority concludes that even
though it may be true that there was no fiduciary relation-
ship, the instructions are not reversible error because they
require only an acting in good faith and fair dealing which
is appropriate. I do not agree with that conclusion.
Under Instruction No. 15, it is possible that the jury
could have concluded that a fiduciary relationship existed
between Baskin-Robbins and the Dunfees because of a special
confidence imposed in Baskin-Robbins, binding it in equity
and good conscience to act in good faith and with due regard
to the interests of the Dunfees. That relationship could be
found to imply a condition of superiority by Baskin-Robbins
over the Dunfees. The second paragraph of the instruction
could be interpreted to mean that the fiduciary relationship
of Baskin-Robbins exists because there was a reposing of
faith, confidence and trust by the Dunfees. The last sen-
tence could allow the jury to conclude that there was a
requirement that Baskin-Robbins should act not in its own
behalf but in the interest of the Dunfees. That idea is
totally inappropriate to an arms length transaction with
which we are here involved. I would therefore reverse be-
cause of this incomplete and misleading instruction.
I would reverse and remand for new trial.

- & ~ /
< Z A
Justi
We concur in the foregoing dissent of ~ustice/%eber,

,
ef Justice
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