Case Title: Moosmeier v. Johnson

Citation: 412 N.W.2d 887

Docket Number: 15486

State: south-dakota

Court: South Dakota Supreme Court

Date: 1987-09-23T00:00:00Z

Document:
412 N.W.2d 887 (1987) Don MOOSMEIER, individually and as Executor of the Estate of Nora Moosmeier, Deceased, Plaintiff and Appellant, v. Helene JOHNSON, Defendant and Appellee. No. 15486. Supreme Court of South Dakota. Considered on Briefs May 22, 1987. Decided September 23, 1987. Wally Eklund of Johnson, Eklund & Davis, Gregory, for plaintiff and appellant. Michael D. Stevens of Blackburn & Stevens, Yankton, for defendant and appellee; James A. Johnson Vermillion, on brief. *888 MILLER, Justice. Appellant seeks reversal of a $10,000 jury verdict which he argues is insufficient. We affirm. Since this case is principally decided on procedural and legal grounds, a detailed recitation of the facts is not necessary. Briefly stated, appellant Donald Moosmeier (Donald), is the executor of the estate of his maiden aunt Nora Moosmeier (Nora) who died at age ninety-three. As executor, Donald discovered that Nora had made lifetime transfers of assets comprising nearly one-third of her $300,000 estate to appellee Helene Johnson (Helene). Donald commenced suit against Helene in a five-count complaint generally alleging that Helene was guilty of undue influence and conversion, seeking money damages, return of the property, and punitive damages. Helene denied any wrongdoing and alleged that Nora made the gifts because Donald and his family had ignored her in her elderly years and as a result she decided to distribute more of her estate to others and less to Donald. Helene testified that she had tried to discourage the gifts but Nora refused. It seems clear from the evidence that Helene was a close friend of Nora, visited her daily, and to a certain degree was involved in her business affairs. The case was submitted to the jury by special interrogatory. The verdict form individually itemized the assets transferred and required the jury to find whether Helene had exerted undue influence over Nora in relation to each specific asset transferred. The jury returned a verdict for $10,000 damages only relating to certain municipal bonds. The trial court denied Donald's motion for judgment n.o.v. and alternative motion for new trial and entered judgment for the $10,000 returned by the jury. The first issue as generally propounded by Donald is: During the course of trial, the trial court was never asked to rule as a matter of law that undue influence was present. Although Donald did make the post-trial motions for judgment n.o.v. and alternatively for a new trial, he never moved for directed verdict at any stage of the trial. The denial of the motion for judgment n.o.v. is not properly before us since such motions "can be considered only when the moving party at trial requested a directed verdict and thus the motion in effect brings before the trial court for review a second time the grounds urged in support of the motion for directed verdict." Kohlman v. Veit, 409 N.W.2d 125 (S.D.1987), citing Parham v. Dell Rapids Township in Minnehaha County, 80 S.D. 281, 284, 122 N.W.2d 548, 550-51 (1963); Oliveras v. American Export Isbrandtsen Lines, Inc., 431 F.2d 814 (2d Cir.1970); Hubbard v. White, 755 F.2d 692 (8th Cir.1985), cert. denied, 474 U.S. 834, 106 S. Ct. 107, 88 L. Ed. 2d 87 (1985). See also Sabag v. Continental South Dakota, 374 N.W.2d 349 (S.D.1985). Error in denying the motion for new trial was not argued before us, and therefore is deemed waived. SDCL 15-26A-60(6); Arens v. Arens, 400 N.W.2d 900 (S.D.1987); Shaffer v. Honeywell, Inc., 249 N.W.2d 251 (S.D.1976); Schumacher v. R-B Freight Lines, 73 S.D. 535, 45 N.W.2d 458 (1950). The second issue presented by Donald is: *889 It is the settled law that a jury should be given only those issues which find support in the record. Kase v. French, 325 N.W.2d 678 (S.D.1982); Black v. Gardner, 320 N.W.2d 153 (S.D.1982); State v. DuBray, 298 N.W.2d 811 (S.D. 1980); Egan v. Scheffer, 86 S.D. 684, 201 N.W.2d 174 (1972); Davies v. Toms, 75 S.D. 273, 63 N.W.2d 406 (1954). Here, there is ample evidence in the record to warrant the giving of instruction 15. Attorney John DeVany was closely involved with Nora's financial arrangements and was aware of most of the transactions as they occurred, with the possible exception of the municipal bond transfer upon which the verdict was rendered. He generally testified that his duties to Nora included being The fact that Nora did not consult with Mr. DeVany on each specific transfer or did not agree with or follow all of his advice is not dispositive. Kase, supra. That was something for the jury to consider in light of all of the other evidence in the case in arriving at its ultimate verdict on the specific transfers. The fact remains that she often received independent advice that was neither incompetent nor perfunctory. The last issue framed by Donald was: At the close of the evidence, the trial court granted Helene's motion to strike Donald's request for punitive damages. Two salient statutes allow punitive damages. SDCL 30-17-8 provides: SDCL 21-3-2 also provides for punitive damages as follows: In light of the foregoing statutes standing alone, and Black v. Gardner, supra, the issue of punitive damages could have been submitted to the jury. Since the jury found that undue influence had been exerted over Nora involving the transfer of the municipal bonds, the jury could also have had the opportunity to consider an award of punitive damages on that claim. A finding of undue influence indicates that fraud may have occurred. In re Snowball's Estate, 157 Cal. 301, 107 P. 598 (1910); In re Shell's Estate, 28 Colo. 167, 63 P. 413 (1900); Van Ginkle v. Mooy, 104 Ind.App. 282, 10 N.E.2d 759 (1937).[*] That portion of Donald's complaint, seeking exemplary damages, alleges undue influence, oppression, and malice. Nowhere in that cause of action, nor for that matter nowhere in the complaint, is there an allegation that Helene committed a fraud. Fraud must be stated with particularity under SDCL 15-6-9(b). The terms "fraud" and "undue influence" are not specifically synonymous. Link v. Link, 278 N.C. 181, 179 S.E.2d 697 (1971); Daniel v. Etheredge, 191 Ga. 793, 13 S.E.2d 763 (1941); Cooper v. Agee, 222 Ala. 334, 132 So. 173 (1931); In re Shell's Estate, 28 Colo. 167, 63 P. 413 (1900). In *890 order to recover on a civil claim, a party must make the appropriate allegations upon which relief can be based. Schwartz v. First Nat. Bank in Sioux Falls, 390 N.W.2d 568 (S.D.1986); Baker v. Jewell, 77 S.D. 573, 96 N.W.2d 299 (1959); Kindley v. Williams, 76 S.D. 225, 76 N.W.2d 227 (1956); Linder v. Combustion Engineering, Inc., 342 So. 2d 474 (Fla.1977); 61A Am.Jur.2d Pleading § 384 (1981); 4 Am. Jur.2d Appeal & Error § 546 (1962). In our view, because there was no allegation of fraud and because the record is devoid of any showing that Helene was guilty of oppression or malice, the trial court properly struck the claim for exemplary damages. Affirmed. WUEST, C.J., and MORGAN, J., concur. HENDERSON, J., concurs in part and dissents in part. SABERS, J., concurs in part and in result in part, and dissents in part. HENDERSON, Justice (concurring in part and dissenting in part). I concur on Issues I and II, but dissent as to Issue III. On the punitive damage issue, the majority opinion vaults technicality (form) over substance. It is implicit, within the finding by this jury of undue influence, that fraud might well have been perpetrated upon the aggrieved. Further, the language contained in Hannahs v. Noah, 83 S.D. 296, 303, 158 N.W.2d 678, 682 (1968), provides precedent in this Court for the submission of punitive damages to the jury. It states: "`[E]xemplary damages are recoverable in all actions for damages based upon tortious acts which involve circumstances or ingredients, of malice, fraud, or insult, or a wanton and reckless disregard of the rights of the plaintiff.'" Id. (quoting 22 Am. Jur.2d Damages § 243, at 334 (1965) (emphasis added)).[1] Within the following holdings of this Court, plus one federal decision, I would take comfort that a jury question existed in this case on exemplary damages. Smith v. Montana-Dakota Utils., 575 F. Supp. 265 (D.S.D.1983); Gross v. Kouf, 349 N.W.2d 652 (S.D.1984); K & E Land & Cattle, Inc. v. Mayer, 330 N.W.2d 529 (S.D.1983); Black v. Gardner, 320 N.W.2d 153 (S.D. 1982); Hulstein v. Meilman Food Indus., 293 N.W.2d 889 (S.D.1980); Till v. Bennett, 281 N.W.2d 276 (S.D.1979). Chief Judge Bogue, in Smith, 575 F. Supp. at 266-67, wrote: SDCL 53-4-7 deals specifically with "undue influence." It provides: Undue influence consists: This statute was quoted in Black v. Gardner, 320 N.W.2d 153, 156 n. 1 (S.D.1982). According to D. Dobbs, Handbook on the Law of Remedies § 3.9, at 204-05, 208 (1973), punitive damages may be awarded if the plaintiff has established, on the part of the defendant "a sufficiently aggravated piece of misconduct ... plus a culpable state of mind...." Id. at 208. Dobbs notes that Id. at 205. Can "undue influence" involve, be, coexist with, touch upon, or partake of "fraud"? Defendant, while acting in a confidential relationship, took from the safety deposit box of the elderly plaintiff, $10,000 in City of Watertown Industrial Development Revenue Bonds. She then put them in her own safety deposit box. Later, she said they were "gifts"; the jury said otherwise.[2]*892 "Circumstances of fraud"? Yes. "Ingredients of fraud"? Yes. "Wanton or reckless disregard of the rights of plaintiff"? Yes. "The purpose of awarding punitive damages is to punish the wrongdoer." Hulstein, 293 N.W.2d at 892. This jury found the defendant to be a wrongdoer. A reading of SDCL 21-3-2, set forth, in extenso, in the majority opinion, reflects, inter alia, "oppression, fraud, or malice, actual or presumed...." (Emphasis added.) Said statute further provides for giving additional damages "for the sake of example, and by way of punishing the defendant." Under these circumstances, the trial court should have submitted the issue of punitive damages to the jury. SABERS, Justice (concurring in part and in result in part, and dissenting in part). I concur in result only on the first issue because I would affirm on the merits. I concur on the second issue. I would reverse and remand on the third and last issue because the issue of punitive damages should have been submitted to the jury. Black v. Gardner, 320 N.W.2d 153 (S.D.1982); SDCL 30-17-8; SDCL 21-3-2. Since the jury found that Helene exerted undue influence over Nora resulting in liability of $10,000 involving the transfer of the municipal bonds, the jury should have had the opportunity to consider punitive damages at least on that claim. For the trial court to strike plaintiff's demand for punitive damages as a matter of law was error. Black, supra. The majority opinion states: "Fraud must be stated with particularity under SDCL 15-6-9(b). The terms `fraud' and `undue influence' are not specifically synonymous." They do not have to be "specifically synonymous." Both rise to a sufficient level to support liability for wrongdoing and a jury instruction on punitive damages. The complaint alleged undue influence, oppression, and malice. If this pleading was insufficient or uncertain, a motion for a more definite statement could have been demanded by Johnson, but was not. Therefore, the pleading was apparently sufficient for Johnson. The pleading was also sufficient to support the jury's determination of liability. Therefore, it was also sufficient for punitive damages. Undue influence necessarily involved fraud and oppression here because it constituted taking advantage of a superior position. Even if it is not automatically fraudulent or oppressive, it certainly is a jury question. Black, supra. [*] Helene's position that in addition to fraud there must be a showing of willful and wanton misconduct, in disregard of humanity, is untenable. Helene simply misreads the statute. [1] A pleader is required, under SDCL 15-6-9(b) to plead the "circumstances constituting fraud or mistake ... with particularity." (Emphasis added.) [2] Attorney John DeVany represented the elderly plaintiff. Defendant's testimony at trial claimed that the attorney had knowledge of his client giving permission to remove the bonds from the safety deposit box and having them transferred unto defendant. Attorney DeVany vehemently contradicted this testimony.