Graham v. Zurich American Insurance Co.

2012 COA 188, 296 P.3d 347, 2012 WL 5360913, 2012 Colo. App. LEXIS 1792
CourtColorado Court of Appeals
DecidedNovember 1, 2012
DocketNo. 10CA2265
StatusPublished
Cited by5 cases

This text of 2012 COA 188 (Graham v. Zurich American Insurance Co.) is published on Counsel Stack Legal Research, covering Colorado Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Graham v. Zurich American Insurance Co., 2012 COA 188, 296 P.3d 347, 2012 WL 5360913, 2012 Colo. App. LEXIS 1792 (Colo. Ct. App. 2012).

Opinion

Opinion by

Judge RUSSELL.

T1 Zurich American Insurance Company appeals from the trial court's final judgment in favor of Michael Graham. We affirm and remand for a decision about attorney fees.

[349]*349I. Background

12 Graham worked as a regional sales manager for Zurich. After being terminated from his job, he brought an action to recover certain bonuses that, in his view, constituted unpaid wages under the Colorado Wage Claim Act. See §§ 8-4-101 to -128, C.R.S. 2012.

13 The jury found in Graham's favor and awarded $28,326.98 in damages. But it failed to add certain penalties that are mandatory under the Wage Claim Act. See § 8-4-109(8)(b), C.R.S.2012. In pertinent part, the verdict form read as follows:

We, the jury, find for the Plaintiff, Michael Graham, and award the following damages:
1) $ 28,826.98 Unpaid Wage and Compensation
2) $ 0 125% of that amount of unpaid wages or compensation, section 1 of this verdict form, up to and including seven thousand five hundred ($7, 500) dollars[.]
3) $ 0 50% of that amount of unpaid wages or compensation, section 1 of this verdict form, that exceed seven thousand five hundred ($7,500) dollars.

T 4 The parties agreed that judgment could not be entered on this verdict. But they disagreed about the appropriate remedy. Graham argued that the verdict reflected a technical error-the calculation of statutorily-mandated penalties-that could be corrected by the court. Zurich argued that the verdict reflected a substantive error that required further deliberation.

T5 The court did not enter judgment on the verdict. Instead, it returned the case to the jury with this oral instruction:

Based on the stipulations of the parties and the law, if you find unanimously that wages or compensation were unpaid to Mr. Graham, then you must award the damages set forth in paragraph 2 and 3 of ... verdiet form A. With that information, you may reconsider your entire verdict at this time.

[ 6 The next day, the jury returned another verdict, this time in favor of Zurich. The court discharged the jury, but it did not enter judgment on the second verdict. Instead, the court announced that it would await post-trial motions.

T7 Graham filed a motion for post-trial relief under C.R.C.P. 59, arguing that he was entitled to judgment notwithstanding the verdict (JNOV). Zurich opposed Graham's request and asked the court to enter judgment on the second verdict.

18 The court granted Graham's motion. After declaring that it "did err" in requiring further deliberations, the court entered judgment on the first verdict in the amount of $28,326.98, plus penalties and interest.

II. Discussion

I 9 Zurich contends that the court erred in granting judgment for Graham. We reject its arguments and affirm the court's rulings. In our view, the court (A) correctly recognized that it had erred, (B) appropriately reconsidered its order requiring further deliberations, and (C) properly entered judgment on the first verdict after adding the mandatory penalties,

1 10 We explain our conclusions here.

A. The court correctly recognized that it had erred.

T 11 The trial court ruled that it had committed an error. We agree. We also note that the underlying problem could have been avoided.

1. The jury should not have been asked to determine penalties.

112 The court's initial instructions required the jury to determine statutory penalties. This was a mistake. Instead of involving the jury, the court should have determined the penalties as a matter of law after receiving the jury's factual findings:

® Under section 8-4-109(8)(b), penalties are mandatory if (1) the employee makes a written demand for payment and (2) the defendant does not pay within fourteen days. Because those facts were undisputed here, there was no need to involve the jury. The imposition of penalties-both as to liability and amount-was simply a mechanical [350]*350calculation that flowed automatically from the jury's verdict on damages.
Under section 8-4-109@8)(c), CRS. 2012, an additional penalty is mandatory if the "employer's failure to pay is willful." Here, the court properly required the jury to determine whether Zurich's failure was willful.1 But the court should not have required the jury to make any consequent determination about the penalty. That determination should have been made by the court.

113 As a rule, juries should not be required to determine or impose statutory penalties. As long as the jury makes the necessary factual findings (which can be accomplished by interrogatories), the matter of penalties should be left to the court. If the jury is involved in determining penalties, it may be moved to reduce its award of damages, which would frustrate the legislative goal of deterring improper conduct. See Heritage Vill. Owners Ass'n v. Golden Heritage Investors, Ltd., 89 P.3d 513, 518 (Colo.App.2004) (identifying reasons to refrain from instructing the jury on the availability of treble damages under the Colorado Consumer Protection Act); see also HBE Leasing Corp. v. Frank, 22 F.3d 41, 45 (2d Cir.1994) ("Every authority brought to this court's attention upholds excluding references to trebling and attorneys fees in the RICO context.").2

Courts may avoid unnecessary confusion if they first require the jury to make the pertinent factual findings, and then determine and impose mandatory penalties as a matter of law. See, e.g., Lloyd A. Fry Roofing Co. v. State Dep't of Health Air Pollution Variance Bd., 191 Colo. 463, 470, 553 P.2d 800, 806 (1976) (after the jury resolved the disputed issues of fact, the court determined the amount of the civil penalty required by the Air Pollution Control Act); Olsen v. Bondurant & Co., 759 P.2d 861, 863 (Colo.App.1988) (after receiving the jury's finding of fact, the court assessed the penalty under the wage statute); see also Campos-Orrego v. Rivera, 175 F.3d 89, 96 (1st Cir.1999) (after the jury determined the amount of compensatory damages, the court properly doubled the award as required by statute; the court was not required to inform the jury about the effect of the statutory multiplier before submitting the issue of damages).

2. The court erred in requiring further deliberations.

1115 The court erred in requiring further deliberations after it received the first verdict. The court should have recognized that the first verdict contained all the necessary factual findings, and it should have corrected the jury's determination of penalties as a matter of law. Cf. Cole v. Angerman, 31 Colo.App. 279, 282, 501 P.2d 136

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Cite This Page — Counsel Stack

Bluebook (online)
2012 COA 188, 296 P.3d 347, 2012 WL 5360913, 2012 Colo. App. LEXIS 1792, Counsel Stack Legal Research, https://law.counselstack.com/opinion/graham-v-zurich-american-insurance-co-coloctapp-2012.