S & R, INC. v. Nails

584 A.2d 722, 85 Md. App. 570, 1991 Md. App. LEXIS 22
CourtCourt of Special Appeals of Maryland
DecidedJanuary 22, 1991
Docket323, September Term, 1990
StatusPublished
Cited by15 cases

This text of 584 A.2d 722 (S & R, INC. v. Nails) is published on Counsel Stack Legal Research, covering Court of Special Appeals of Maryland primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
S & R, INC. v. Nails, 584 A.2d 722, 85 Md. App. 570, 1991 Md. App. LEXIS 22 (Md. Ct. App. 1991).

Opinion

*572 ROBERT M. BELL, Judge.

Following a trial in the Circuit Court for Montgomery County, a jury returned special verdicts in favor of Allison Nails (“Nails”) and Robert Bolton (“Bolton”), appellees, and against S&R, Inc. t/a YOB Auto Sales, appellant, as to appellees’ claims for breach of contract and fraud. 1 The jury awarded each appellee compensatory and punitive damages. Appellant’s motion for judgment notwithstanding the verdict and/or new trial, directed at the fraud and punitive damage verdicts, was denied in all respects except as to the punitive damage award to Bolton, which was granted. The court entered judgment in accordance with that ruling. Appellant’s appeal from that judgment presents three issues:

1. Did the trial court err in submitting the fraud claims to the jury when plaintiffs’ own testimony conclusively established the absence of any reliance, and when the evidence was insufficient to support other essential elements of the fraud claims?
2. Did the trial court err in submitting the issue of punitive damages to the jury when there was no evidence of any conduct over and above the alleged fraud itself to support a finding of malice?
3. Did the trial court err in submitting a further special interrogatory to the jury after the jury returned its verdict, and in denying defendant’s motion for new trial when the answer to the further special question created an irreconcilable verdict?

Being aggrieved by the grant of appellant’s motion for judgment notwithstanding the verdict as to his punitive damage award, Bolton has cross-appealed, presenting a single issue:

*573 Did the trial court erroneously invade the province of the jury in granting a judgment notwithstanding the verdict as to the punitive damages awarded to cross-appellant, Bolton, when there was sufficient evidence from which the jury could find that the fraud perpetrated upon him at the time of his hire induced him to enter into his employment contract?

We answer appellant’s third question in the affirmative and, hence, we will reverse. For the guidance of the trial court on remand, we will briefly address the other issues raised by appellant. We need not, and, therefore, do not, address Bolton’s cross-appeal.

THE FINALITY OF THE JURY VERDICT

After instructing the jury, the court provided it with a special verdict form for each plaintiff, Nails and Bolton, to assist it in recording the verdicts. Included on that form were questions pertaining to the fraud count and the breach of contract count as well as compensatory and punitive damages. As relates to punitive damages, each contained the following:

PUNITIVE DAMAGES
10. Did the fraud arise out of a contractual relationship?
YES _
NO _
11. If YES, do you find that defendant acted with actual malice?
YES _
NO _
12. Do you find that defendant acted with implied malice?
YES _
NO _
13. State the amount of punitive damages, if any, you determine appropriate.
$-

*574 Before the jury began its deliberations, appellee asked the court to include in the verdict form the question, whether the fraud induced the contract; a question asking whether the fraud arose out of the contract was already included. 2 The court denied the request, ruling “It doesn’t, to me, make a bit of difference. If they come up with an award of punitive damages and answer no implied malice and no actual malice, you’re not going to get punitive damages, even if they award them.” 3 Utilizing the verdict forms, the *575 jury returned, as we have seen, verdicts in favor of both appellees. It found that appellant both defrauded appellees and breached its contract with them, for which it assessed compensatory damages. With regard to punitive damages, the jury determined that the fraud arose out of the contractual relationship and that appellant acted with implied, rather than actual, malice. Nevertheless, it assessed punitive damages against appellant, and in favor of both appellees. The court having read into the record, the jury’s responses to the questions in the special verdict forms, the following then occurred:

[THE COURT:] Ladies and gentlemen, your verdict as it will be recorded, is that the verdict of all 12 of you ladies and gentlemen?
THE JURY: (A chorus of ayes)
THE COURT: Madame Clerk, will you please file the verdict sheets.
Counsel and the parties, I will excuse you.
MR. STEINBERG [Plaintiffs’ counsel]: May we approach the bench?
THE COURT: Yes.

*576 At the bench conference, 4 appellees brought to the court’s attention what they considered to be an inconsistency in the verdict: despite finding that the fraud arose out of the contract and that appellant did not act with actual malice, the jury awarded punitive damages. They proposed to correct the inconsistency by submitting “an additional, supplement verdict sheet”, asking the single question: “Do you find that the fraud induced the Plaintiff to enter into the contract?” After extended discussion, and over appellant’s objection, the proposed additional issue was submitted to the jury, which, after further deliberations, found that fraud induced each contract.

Appellant filed a motion for judgment notwithstanding the verdict and for a new trial. Among the bases for the new trial request was the alleged impropriety of submitting an additional issue to the jury after the jury’s verdicts had been announced, the jury had been polled, the clerk had been ordered to file the verdict sheets, and counsel and the parties had been excused. In addition, appellant alleged that the submission of the additional issue to the jury exacerbated the situation; the jury’s response made the existing ambiguity or inconsistency even more irreconcilable, requiring a new trial.

Maryland Rule 2-522 provides in pertinent part:
(b) Verdict — Verdict of a jury shall be unanimous unless the parties stipulate at any time that a verdict or a finding of a stated majority of the jurors shall be taken as the verdict or finding of the jury. The verdict shall be returned in open court.

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Bluebook (online)
584 A.2d 722, 85 Md. App. 570, 1991 Md. App. LEXIS 22, Counsel Stack Legal Research, https://law.counselstack.com/opinion/s-r-inc-v-nails-mdctspecapp-1991.