Montague v. Heater

836 F.2d 422
CourtCourt of Appeals for the Eighth Circuit
DecidedJanuary 4, 1988
DocketNos. 86-2585, 86-2602
StatusPublished
Cited by4 cases

This text of 836 F.2d 422 (Montague v. Heater) is published on Counsel Stack Legal Research, covering Court of Appeals for the Eighth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Montague v. Heater, 836 F.2d 422 (8th Cir. 1988).

Opinion

BRIGHT, Senior Circuit Judge.

This case arises from defendants’ Joy Heater, Ted Heater and Oren Henry sale to plaintiff Sandra Montague of a 1973 Oldsmobile Cutlass. The car had been driven 168.188 miles, but its odometer read only 68.188 miles. Mrs. Montague filed a three-count complaint alleging common law fraud and misrepresentation, violations of the federal odometer statute, 15 U.S.C. § 1988 (1982 & Supp. IV 1986), and the Missouri state odometer statute, Mo.Ann. Stat. § 407.536 (Vernon Supp.1987). A jury found against all three defendants on all three counts, and awarded Mrs. Montague $1,400 in actual damages and $55,000 in punitive damages.1 The defendants appeal. We affirm.

For reversal, Joy and Ted Heater, the operators of the Specialized Auto Sales dealership, argue: (1) the court erred in refusing to submit their converse jury instructions; and (2) the court erred in submitting to the jury the state odometer law claim. Oren Henry, their business associate, appeals separately and argues (1) it was error to permit Montague to amend her complaint the morning of trial; (2) there was not sufficient evidence to establish a principal/agent relationship between Oren Henry and Ted Heater; (3) the court erred in failing to give a limiting instruction concerning evidence of a lawsuit by the State of Iowa against Ted Heater for odometer fraud; and (4) the damage award is excessive.

L BACKGROUND

In June of 1985, defendant Oren Henry purchased, on behalf of Specialized Auto Sales, a 1973 Oldsmobile Cutlass. Oren received an odometer statement and a title assignment which stated the vehicle’s odometer had “rolled over” and had over 100,000 miles on it. On June 27, 1985, the Montague family negotiated with Ted Heater and tentatively agreed upon a sale price for the Oldsmobile, and left a deposit of $25. After the meeting with the Mon-tagues, Ted Heater contacted Oren Henry to get his approval to see the car.2

[424]*424Having obtained Henry’s approval, Ted Heater took the title certificate, along with its assignment endorsed by former car owner Jack Miller Chrysler Plymouth, and by Joy Heater, to the bank which provided the funds for the sale. The bank then sent these documents, in addition to its lien perfection copy of the title application, to the Department of Revenue. While the assignment of title reflected the car’s true mileage, the title application showed incorrectly that the car had been driven only 68,188 miles. Ted Heater delivered to the Mon-tagues a copy of the title application, and no other document. The Montagues never saw the title assignment, nor any other document which would have notified them that the car had been driven 168,188, not 68,188 miles.

The Montagues testified that they received no information the vehicle had been driven 100,000 miles, and that they did not discover the true mileage until a month or two after the purchase. Heater testified that he discussed with Mrs. Montague the fact that he did not know the mileage and could not guarantee it.

Sandra Montague filed her initial complaint against Ted Heater and Joy Heater, d/b/a Specialized Auto Sales, on November 6, 1985. After deposition testimony revealed Oren Henry’s participation in Specialized Auto Sales’ business, Mrs. Montague joined Oren Henry as a defendant under a joint venture theory. The Friday before trial, Mrs. Montague advised Oren Henry that an amended complaint would be filed that day alleging a principal/agent theory instead of a joint venture theory. On the morning of trial, the court granted Mrs. Montague’s leave to amend.

The jury returned verdicts against all defendants on all counts. The jury awarded actual damages of $1,400 and punitive damages as follows: Joy Heater—$10,000; Ted Heater—$25,000; Oren Henry—$20,-000. This appeal followed.

II. DISCUSSION

A. Oren Henry

1. The Grant of Plaintiffs Leave to Amend

Oren Henry argues that the district court erred in granting plaintiff’s leave to amend on the morning of trial. Oren contends that he prepared his defense based on Mrs. Montague’s joint venture theory, and was prejudiced when Mrs. Montague changed her theory of liability at the last minute.

We fail to see how Henry was prejudiced by the court’s granting Mrs. Montague’s leave to amend in any way. The proofs required to establish a principal/agent relationship are similar to those necessary to establish a joint venture.3 Under either theory, the pivotal issue related to Henry’s right to control the conduct of Heater. Thus, a shift in theories did not affect Henry’s defense preparation. Indeed, as the Montagues point out, Henry engaged in no discovery after being made a party to the lawsuit, and his strategy was apparently to expend minimal time and effort in defense of this case and simply file bankruptcy if he lost, as he has now done. No evidence exists supporting Henry’s contention that the court’s grant of Mrs. Montague’s leave to amend constitutes prejudicial error. Consequently, we reject Henry’s claim.

2. Sufficiency of the Evidence

Henry further contends that Mrs. Montague presented insufficient evidence to support the finding that Heater acted as Henry’s agent in the car transaction.

To establish the existence of an “agency” relationship, one must prove “the manifestation of consent by one person to another that the other shall act on his behalf and subject to his control, and consent by [425]*425the others so to act.” Southern Pac. Transp. v. Continental Shippers Ass’n, Inc., 642 F.2d 236, 238 (8th Cir.1981) (emphasis added). According to Henry, Heater undertook the car sale solely on his own behalf and acted independently throughout.

The evidence presented at trial justified a submission of the agency issue to the jury. Ted Heater testified at trial that Henry bought and sold cars with him for some ten years, splitting any profits 60/50. Heater further testified that when the Montagues offered him $2,100 for the car, he agreed with the understanding that he would have to confer with Henry. Later, when discussing car financing with the Montagues, Heater told Sandra Montague he would have to obtain Henry’s permission with regard to the terms proposed.

Henry’s control over the vehicle’s sale is evidenced by the fact that Henry signed, as agent for Specialized Auto Sales, the odometer statement received from the car’s previous owner. Henry could just as easily have signed over the car’s title. Moreover, had title been transferred without his approval, he would have had a claim for relief against Heater. Because the evidence indicates that Heater acted in Henry’s behalf, and Henry controlled crucial aspects of the car sale, we conclude that the jury might find that Mrs. Montague had established a principal/agent relationship. We thus reject Henry’s assignment of error.

Henry additionally argues the court erred in refusing to instruct the jury that court records reflecting that Ted Heater was previously convicted of odometer fraud should only be considered in connection with Ted Heater and not as to Oren Henry.

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