Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca10-90-03170/USCOURTS-ca10-90-03170-0/pdf.json

Parties Involved:
Eldon L. Bergeson
Appellee
Edward K. Dilworth
Appellant
Nathan O. Dilworth
Appellant

Document Text:

FI L~ D 

United States Court of Appeals Tenth Circuit 

UNITED STATES COURT OF APPEALS 

TENTH CIRCUIT 

MAR 3 0 1992 

ROBERT L. HOECKEe 

Cler!.: ELDON L. BERGESON, individually 

and as administrator of the 

estate of Sheryl L. Bergeson, 

deceased, 

Plaintiff-Appellee, 

vs. 

) 

) 

) 

) 

) 

) 

) 

) 

EDWARD K. DILWORTH and NATHAN O. ) 

DILWORTH, ) 

Defendants-Appellants. 

) 

) 

No. 90-3170 

(D.C. No. 87-1579-T) 

( D. Kan.) 

738 F. Supp. 1361 

ORDER AND JUDGMENT* 

Before HOLLOWAY, BALDOCK and SETH, Circuit Judges. 

Defendants-appellants, Edward K. Dilworth ("Edward") and 

Nathan O. Dilworth ("Nathan"), appeal from a judgment entered 

against them in a diversity action for the wrongful death of 

Sheryl L. Bergeson ("Sheryl") resulting from an automobile 

collision. We have jurisdiction under 28 U.S.C. § 1291. We 

affirm. 

Defendants worked together as general contractors under the 

name Ed Dilworth Construction ("EDC"). In September 1986, EDC had 

two contracts with the Army Corps of Engineers for construction 

work near Marion Lake and Cherryvale, Kansas. Both contracts 

* This order and judgment has no precedential value and shall 

not be cited, or used by any court within the Tenth Circuit, 

except for purposes of establishing the doctrines of the law of 

the case, res judicata, or collateral estoppel. 10th Cir. R. 

36.3. 

Appellate Case: 90-3170 Document: 010110239092 Date Filed: 03/30/1992 Page: 1 
listed Edward and Nathan as co-owners of EDC. 

On the evening of September 4, 1986, Defendants jointly 

decided to move their construction equipment from the Marion Lake 

job to the Cherryvale job . Defendants loaded a backhoe weighing 

over five tons on a homemade, twenty-foot trailer attached to 

three-quarter ton Ford pickup. 1 The hitch ball on the pickup was 

loose due to earlier wear. Additionally, the brake shoes on the 

wheels attached to two of the three trailer axles had been removed 

rendering the trailer brakes inoperative. Both Defendants were 

aware of the condition of the hitch and trailer brakes yet 

proceeded to use the trailer and pickup to haul the backhoe. 

At approximately 9:30 p.m., Defendants left Marion and 

proceeded on U.S. Highway 77. 2 Edward drove a Freightliner 

tractor pulling a 28-30 foot end-dump rock trailer. Nathan 

followed, approximately fifty feet behind, in the pickup pulling 

the trailer and backhoe. Edward maintained visual contact in his 

rear-view mirror with the pickup truck. A driver who passed the 

caravan prior to the collision testified that the trailer attached 

to the pickup driven by Nathan was weaving over the center line. 

As the pickup came over a hill, the ball on the trailer hitch 

broke leaving the trailer attached solely by the safety chains and 

causing the trailer to swerve across the center line. 

Unfortunately, Sheryl was driving in opposite direction, and she 

1 Defendants had never hauled the backhoe on this trailer nor 

had they ever attempted to pull the trailer with the pickup. 

2 Highway 77 is a two-lane road with no emergency shoulders on 

either side. 

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collided with the trailer as she came over the top of the hill. 

She died shortly thereafter as a result of injuries sustained in 

the collision. 

Plaintiff-appellee, Eldon L. Bergeson, brought this action 

seeking compensatory and punitive damages. Shortly before trial, 

Nathan admitted liability but disputed the a.mount of compensatory 

damages and the appropriateness of punitive damages. Edward 

denied liability as well as disputing the damages. 

At trial, the district court permitted two letters written by 

Edward to be read into the record over Defendants' objection. The 

first, dated September 25, 1987, from Edward to Plaintiff's 

counsel, indicated that Sheryl was at fault in the collision. 

Specifically, Edward stated in the letter that Sheryl ca.me at 

Edward (who was driving the Freightliner), that he witnessed the 

collision in the rear view mirror, and that "Sheryl ... was 

either asleep or putting cassette tapes in to play, or was trying 

to commit suicide." Edward also admitted ownership of the pickup 

truck, and stated that he would hold Sheryl and Plaintiff's 

counsel liable for the damage to the pickup. The second letter, 

dated April 22, 1988, was from Edward to Robert Laughridge, a 

motorist who collided with the pickup truck driven by Nathan 

shortly after the collision with Sheryl's car. This letter stated 

that the first group of police officers who investigated the 

collision were intoxicated, apparently attempting to discredit the 

police report prepared by these officers which exonerated 

Laughridge of fault for the subsequent collision. The letter also 

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indicated that Edward and Nathan believed that Laughridge was 

drunk. The letter requested payment for damages to the pickup. 

The district court instructed the jury that the letters could be 

considered on the issue of Edward's credibility, and could be 

considered in determining the state of mind or knowledge of 

Defendants at the time of and prior to the collision. IR. doc. 

66 (instruction no. 19). 

The jury was instructed on seven theories of negligence based 

on Defendants' conduct. 3 IR. doc. 66 (instruction no. 2). The 

district court also instructed the jury that Plaintiff had claimed 

punitive damages against Defendants because of gross and wanton 

negligence in doing at least one of the seven acts. Id. Two 

theories of vicarious liability were also submitted to the jury. 

First, the court instructed on a "business enterprise joint 

venture" theory which provides that the actions of one party in 

3 The seven theories of negligence were as follows: (1) 

driving a motor vehicle pulling a homemade trailer left of center, 

contrary to K.S.A. 8-1515, 1519, 1522 and 1907; (2) causing or 

permitting a homemade trailer to whip or travel into the wrong 

traffic lane and collide with Sheryl Bergeson's vehicle; (3) 

driving a motor vehicle pulling a homemade trailer in a careless 

and reckless manner; (4) driving at a speed higher than was 

reasonable and prudent under the conditions existing (K.S.A. 

8-1557); (5) failing to keep their vehicles under proper control; 

(6) failing to keep a proper lookout; and, (7) towing a homemade 

trailer using a hitch insufficient to pull, stop, and hold all 

weight pulled, and not designed to insure that the towed vehicle 

would follow in the path of the towing vehicle in a straight line, 

contrary to K.S.A. 8-1907. IR. doc. 66 (instruction no. 2). 

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the enterprise are considered the actions of the other.

4 Id. 

(instruction no. 16). Second, the court instructed on a 

partnership theory which provides that each partner is liable for 

4 This instruction stated: 

There are several principles or theories of Kansas law 

by which two or more persons may have liability for the 

action of the other person or persons. One such 

principle of law is known as the "business enterprise 

joint venture," where the actions of one party in the 

enterprise are considered the actions of the other party 

in the business enterprise. Under this principle of law 

each party is the agent of the other if the action taken 

was in furtherance of their mutual agreement to engage 

in the business enterprise or enterprises. Such an 

agreement may be found in the mutual acts of the parti es 

before, during and after an event upon which liability 

is claimed. 

Although no single act or conduct is determinative, 

among those acts or conduct that may indicate a business 

enterprise joint ventur e a r e: 

1. The joint ownership and/or control of property used 

in the enterprise; 

2. The sharing of expenses, profits and loss, and 

having and exercising some voice in determining the 

division of the net earnings; 

3. A community of control over and active participation 

in the management and direction of the business 

enterprise; 

4. The intention of the parties, express or implied; 

and 

5. The fixing of salaries or withdrawals of money from 

the enterprise by joint agreement. 

IR. doc. 66 (instruction no. 16). 

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the acts of another partner. 5 Id. (instruction no . 17). The 

court instructed the jury that it had to find either a partnership 

or a business enterprise in order to "find[] liability for actual 

and/or punitive damages as to the named defendants in this case 

5 

Id. (instruction no. 18). The jury was also given a 

This instruction stated: 

Plaintiff also contends that the two named defendants, 

along with others, were partners engaged in the 

construction business, and hence under law each partner 

is liable for the acts of every other partner. Each 

partner is the agent of the other partner engaged in 

activity of the partnership . Kansas statutory law 

(K.S.A. 56-306) defines a partnership as: 

"A partnership is an association of two (2) or more 

persons to carry on as co-owners a business for profit." 

K.S.A. 56- 307(d) further provides: 

"An agreement to be partners need not be in writing and 

may be proven by the conduct of the parties. The 

receipt by a person of a share of the profits of 

business in prima facie evidence that he or she is a 

partner in the business." 

In essence, a partnership, like a joint venture, is a 

form of business enterprise. Usually a partnership is a 

continuing business relationship, whereas a joint 

venture often relates to a relationship for a particular 

business enterprise. 

IR. doc. 66 (instruction no. 17). 

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specific instruction on punitive damages. 6 See id. (instruction 

no. 25). Additionally, the jury was instructed that it was not 

6 This instruction stated: 

In any action like the one before you, the jury may give 

damages for the sake of example and by way of 

punishment, if the jury finds the defendant or 

defendants have been guilty of oppression, fraud, or 

malice, actual or presumed. These damages are called in 

legal parlance exemplary or punitive damages. 

The basis for allowance of punitive damages rests upon 

the principle of punishment to the offender for the 

general benefit of society, both as a restraint upon the 

transgressor and as a warning and example to deter the 

commission of like acts in the future. 

Punitive damages are not limited to cases where there is 

direct evidence of fraud, malice or gross negligence. 

They may be allowed when there is evidence of such 

recklessness and wanton disregard of another's rights 

that malice and evil intent will be inferred. If a 

defendant is grossly and wantonly reckless in exposing 

others to danger, the law holds him to have intended the 

natural consequences of his acts, and treats him as 

guilty of willful wrong. 

To constitute willful or wanton negligence sufficient to 

justify an award of punitive damages, it is not 

necessary that there exist ill will toward the persons 

injured, or specific intent to inflict the injury. If 

an act that caused harm to the plaintiff was the result 

of, or accompanied with, such gross negligence or 

reckless disregard of another's rights, manifesting an 

indifference to the consequences of the act or acts, so 

that malice may be inferred, then an award of punitive 

damages is appropriate. 

If you find that the conduct of a defendant caused or 

contributed to cause plaintiff's injuries in this 

matter, fits within this definition, you may award 

punitive damages in this case. Any punitive damages 

that you award must bear some relationship to the amount 

of actual damages awarded. 

IR. doc. 66 (instruction no. 25). 

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required "to assess damages against each defendant individually. 117 

Id. (instruction no. 26). 

The jury returned a special verdict holding both Defendants 

liable for compensatory and punitive damages. The special verdict 

specifically found that Edward and Nathan "were members of a 

business enterprise on the date of the accident," and that 

Nathan's acts "were in furtherance of the business enterprise. " I 

R. doc. 68. The special verdict also specifically found that "the 

defendants acted in a wanton manner on the date of the accident," 

and that "punitive damages should be assessed against the 

defendants." Id. Plaintiff was awarded $256,795 in compensatory 

damages8 and $500,000 in punitive damages . In a published 

opinion, the district court denied Defendants' motion for a 

7 This instruction stated: 

The defendant, Nathan 0. Dilworth, has admitted 

liability for any injury and all compensatory damages 

which may have resulted to the estate of Sheryl L. 

Bergeson and to her heirs from the occurrence in 

question. He has denied liability for any punitive 

damages. 

Defendant Edward K. Dilworth denies liability for both 

compensatory and punitive damages. 

As stated elsewhere in these instructions, any liability 

on the part of Edward K. Dilworth is dependent upon your 

findings as to the existence of a business enterprise. 

It is therefore unnecessary for you to assess damages 

against each defendant individually. 

IR. doc. 66 (instruction no. 26). 

8 The special verdict returned by the jury awarded Plaintiff 

$406,795.33 in compensatory damages, of which $250,000 represented 

nonpecuniary damages on the wrongful death action. The district 

court reduced the nonpecuniary damages to the $100,000 statutory 

maximum. See Kan. Stat. Ann.§ 60-1903(a) (Supp. 1990) . 

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remittitur of the punitive damages. See Bergeson v. Dilworth, 738 

F. Supp. 1361 (D. Kan. 1990). 

On appeal, Defendants contend that the district court erred 

in admitting the letters written by Edward which Defendants claim 

were irrelevant and so prejudicial that a new trial on 

compensatory and punitive damages is required. Additionally, 

Edward contends that the district court erred by instructing the 

jury on a theory of vicarious liability for punitive damages, and 

that he was entitled to a directed verdict on the issue of 

punitive damages. 

I. 

We review the district court's ruling on the admissibility of 

the evidence for an abuse of discretion. K-B Trucking Co. v. Riss 

Int'l Corp., 763 F.2d 1148, 1155 (10th Cir. 1985); Rasmussen 

Drilling, Inc. v. Kerr-McGee Nuclear Corp., 571 F.2d 1144, 1149 

(10th Cir.), cert. denied, 439 U.S. 862 (1978). 9 "The 

admissibility of evidence in diversity cases in federal court is 

generally governed by federal law." Romine v. Parman, 831 F.2d 

944, 944 (10th Cir. 1987) (citations omitted). " [ T] he Federal 

Rules of Evidence should be applied in a diversity case in federal 

9 

Even if the district court abuses its discretion by 

erroneously admitting particular evidence, we will not reverse a 

judgment when the error is harmless -- i.e. when the error does 

not affect a substantial right of the party asserting error. K-B 

Trucking, 763 F.2d at 1156. See also Fed. R. Civ. P. 61; Fed. R. 

Evid. 103(a). "[T]he burden of demonstrating that substantial 

rights were affected rests with the party asserting error." K-B 

Trucking, 763 F.2d at 1156. 

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court to determine whether evidence is relevant or prejudicial." 

Id. at 945. Under the Federal Rules of Evidence, all evidence 

which has any tendency to make a material fact more or less 

probable is considered relevant and is admissible "except as 

otherwise provided by the Constitution of the United States, by 

Act of Congress, by the[] [Federal] [R]ules [of Evidence], or by 

other rules prescribed by the Supreme Court pursuant to statutory 

authority." Fed. R. Evid. 401, 402. Relevant evidence "may be 

excluded if its probative value is substantially outweighed by the 

danger of unfair prejudice, confusion of the issues, or misleading 

the jury . . . . " Id. 403. 

Defendants contend that the letters were not relevant to 

their state of mind at the time of and prior to the collision 

because Edward wrote them over a year later. Defendants rely on 

O'Gilvie v. International Playtex, Inc., 821 F.2d 1438 (10th Cir. 

1987), cert. denied, 486 U.S. 1032 (1988), for the proposition 

that a defendant's subsequent conduct is irrelevant to the issue 

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f o puni ·t· d 10 ive amages. O'Gilvie is distinguishable on several 

grounds. First, at issue in O'Gilvie was the propriety of a 

remittitur, not the admissibility of evidence. Second, the 

subsequent conduct there occurred post-trial whereas the 

subsequent conduct here occurred after the incident giving rise to 

liability but before trial. Moreover, the specific language in 

O'Gilvie on which Defendants rely expressly states that our 

determination as to lack of relevance was particular to that case. 

In short, O'Gilvie simply does not stand for the broad proposition 

10 O'Gilvie addressed the propriety of a district court's 

remittitur of a punitive damage award based on a subsequent 

remedial act by the defendant . Without the plaintiff's consent, 

the district court reduced a $10 million punitive damage award in 

a product liability action to $1.35 million due to the defendant's 

removal of the product from the market, despite the district 

court's finding that there was sufficient evidence to support the 

amount of punitive damages, that the award was intelligently drawn 

not out of passion or prejudice, and that the award was not so 

excessive as to shock the conscious. We recognized that a 

remittitur was "not proper unless the amount of damages awarded is 

so excessive that it shocks the judicial conscience," and held 

that "[t]he trial court's action .. . violated this standard both 

because it expressly found that the award did not shock the 

judicial conscience and because it based its decision to remit on 

events occuring after trial." Id. at 1448-49 (footnote omitted). 

We concluded that "because the post-trial conduct upon which the 

trial court relied in ordering remittitur in this case had no 

relevance to the injurious conduct underlying the claim for 

punitive damages, the court was without authority under either 

state or federal law to reduce the award on that basis." Id. at 

1450 (emphasis added). 

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that Defendants would like. 11 

The district court indicated that Edward's accusations in the 

April 22 letter that the investigating officers and Laughridge 

were intoxicated, and his attempt to place fault with Sheryl by 

stating that she was "asleep, or putting cassette tapes in to 

play, or was trying to commit suicide" in the September 25 letter 

could lead the jury to properly infer that he was attempting to 

conceal his knowledge of the danger existing at the time of the 

accident. Bergeson, 738 F. Supp. at 1364 (citations omitted). 

Evidence of other acts may be admissible to show knowledge. Fed. 

R. Evid. 404(b). The fact that the other conduct occurred 

subsequent to the event giving rise to liability does not make it 

any less admissible. See Eaves v. Penn, 587 F.2d 453, 464 (10th 

Cir. 1978) (evidence of defendant's subsequent conduct admissible 

under Rule 404(b) to show defendant's intent at time of alleged 

breach of fiduciary duty). Here, Edward's attempt to place fault 

11 Defendants also direct us to Ettus v. Orkin Exterminating 

Co., 665 P.2d 730 (Kan. 1983), to support their claim that 

subsequent conduct is not relevant to a person's state of mind at 

the time of the incident giving rise to liability. 

Notwithstanding that we look to federal rather than state law in 

determining relevancy questions, Romine, 831 F.2d at 945, we 

similarly do not read Ettus for the broad proposition argued by 

Defendants. Ettus held that "(a]bsent unusual circumstances ... 

settlement offers and negotiations are inadmissible in evidence 

even when offered for the limited purpose of defending against an 

award of punitive damages." 665 P.2d at 743. Critical to the 

court's holding was its recognition that "(m]any elements enter 

into settlement negotiations which have no bearing whatsoever on 

the culpability of the defendant for the alleged wrongful 

conduct." Id. The court recognized that subsequent conduct is 

admissible on the issue of punitive damages when it is probative 

of the defendant's state of mind at the time of the event giving 

rise to liability. Id. at 741, 744 (citing with approval Byers v. 

Santiam Ford. Inc., 574 P . 2d 1122 (Or. 1978)). 

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with Sheryl and his accusations that Laughridge and the 

investigating officers were intoxicated similarly shows an intent 

to conceal his knowledge of the circumstances giving rise to 

liability. See United States v . Cook, 745 F.2d 1311, 1317-18 

(10th Cir. 1984) (evidence that defendant misidentified himself to 

police officers admissible to prove defendant's earlier intent, 

plan or absence of mistake or accident in committing crime), cert. 

denied, 469 U.S. 1220 (1985). Furthermore, Edward's admission in 

the letter to witnessing the accident is clearly probative 

evidence of his knowledge. Thus, the district court did not abuse 

its discretion in determining that the letters were relevant to 

Edward's knowledge. 

Nor did the district court abuse its discretion in concluding 

the probative value of the letters was not "substantially 

outweigh[ed]" by their unfair prejudice . See Fed. R. Evid. 403. 

"The exclusion of relevant evidence under Rule 403 is an 

extraordinary remedy to be used sparingly." K-B Trucking, 763 

F.2d at 1155 (internal quotation omitted). "'[U]nfair prejudice' 

as used in Rule 403 is not to be equated with testimony simply 

adverse to the opposing party. Virtually all evidence is 

prejudicial or it isn't material. The prejudice must be 

'unfair.'" Dollar v. Long Mfg., 561 F.2d 613, 618 (5th Cir. 

1977), cert. denied, 435 U.S. 996 (1978). 

Defendants argue that the letters were unfairly prejudicial 

because Edward's statements which attempted to attribute fault to 

Sheryl were not only false, but they were cruel and thoughtless. 

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Defendants suggest that the jury likely awarded damages, at least 

in part, based on Edward's cruel and thoughtless conduct 

subsequent to the collision. Defendants' argument assumes that 

the jury could not follow the district court's limiting 

instruction that the evidence could be properly considered only on 

the issue of Defendants' state of mind at the time of or prior to 

the collision. We, however, assume the contrary. See United 

States v. Cardall, 885 F.2d 656, 667 (10th Cir. 1989) ("[t)he 

assumption that juries can and will follow the instructions they 

are given is fundamental to our system of justice") (citation 

omitted) . Moreover, we simply cannot accept Defendants' claim 

that the evidence was unfairly prejudicial when the prejudicial 

nature of the evidence was due entirely to Defendants' pretrial 

conduct specifically related to the dispute. This factor, makes 

the evidence all that more probative as to Edward's state of mind 

at the time of the collision. Accordingly, we do not find that 

the district court abused its discretion in admitting the letters. 

II. 

"[A)n error in the jury instructions will mandate reversal 

only if the error is determined to have been prejudicial, based on 

a review of the record as a whole." Durflinger v . Artiles, 727 

F.2d 888, 895 (10th Cir. 1989) (internal quotations omitted). The 

instructions must "state the law which governs and provide[) the 

jury with an ample understanding of the issues and the standards 

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applicable." Ramsey v. Culpepper, 738 F.2d 1092, 1098 (10th Cir. 

1984) . 

Edward contends that the district court erred by instructing 

the jury that it could award punitive damages against him based on 

a theory of vicarious liability. Edward's contention is addressed 

to language in instruction number 26 that "any" liability 

attributable to him was "dependent . . . [on) the existence of a 

business enterprise" and the jury was therefore "not required to 

assess damages against each defendant individually." See supra 

note 7. Edward contends that this instruction permitted the jury 

to assess punitive damages against him based on a theory of 

vicarious liability -- i.e., Edward could be liable for punitive 

damages based solely on Nathan's conduct. 

In reviewing jury instructions, we must "consider all that 

the jury heard and . decide not whether the charge was 

faultless in every particular but whether the jury was misled in 

any way and whether it had understanding of the issues and its 

duty to determine these issues. " Durflinger, 727 F.2d at 888. 

Contrary to Edward's contention, we do not believe that the 

particular language to which he points us misled the jury in such 

a manner as to require reversal. 

Initially, we note that Kansas law is unsettled on the issue 

of whether punitive damages may be imposed vicariously on partners 

or members of a business enterprise for the actions of their 

copartners. According to Edward, "the very theory of vicarious 

liability applied by the district court in this case" was rejected 

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by the Kansas Supreme Court in Kline v. Multi-Media Cablevision, 

666 P.2d 711 (Kan. 1983) . At issue in Kline was whether a 

corporation may be held liable for punitive damages arising from 

an act of an agent or employee. The court adopted the minority 

position on this issue known as the "complicity rule:" 

Punitive damages can properly be awarded against a 

master or other principal because of an act by an agent 

if, but only if, 

(a) the principal or the managerial agent 

authorized the doing and the manner of the act, or 

(b) the agent was unfit and the principal or 

managerial agent was reckless in employing or retaining 

him, or 

(c) the agent was employed in a managerial 

capacity and was acting in the scope of the employment, 

or 

(d) the principal or a managerial agent of the 

principal ratified or approved of the act. 

Id. at 714, 716 (quoting Restatement (Second) of Torts§ 909 

(1977)). Despite the rule being "couched in terms of master's and 

principal's liability," the court recognized that "the rules are 

equally applicable to corporations." Id. at 716. 

Contrary to Edward's argument, the "complicity rule" is not 

an absolute bar to imposing punitive damages on one party based on 

the tortious conduct of another party. A principal will be liable 

for punitive damages for tortious acts of his agent which he 

authorized, ratified or approved. Moreover, a principal is liable 

for punitive damages for the tortious acts of managerial agents 

done in the course of their employment. See Gould v. Taco Bell, 

722 P.2d 511, 517-18 (Kan. 1986). Defendants' argument 

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conveniently overlooks these exceptions to the general policy 

against imposing vicarious liability for punitive damages and 

boldly asserts, citing no authority, that this general policy 

applies to a joint venturer's or partner's liability for punitive 

damages based on the tortious acts of a copartner. 

Edward completely ignores or overlooks that Kansas has 

adopted the provision of the Uniform Partnership Act ("UPA") which 

holds a partnership liable for the acts of one of the partners in 

the ordinary course of the partnership's business or with the 

authority of his copartners. 12 Kan. Stat. Ann. § 56-313 (1983). 

This section expressly provides that the partnership is liable for 

"any penalty" that may be incurred. Id. Under Kansas law, 

punitive damages are intended as a penalty as their purpose is "to 

punish the wrongdoer" and "to serve as an example to restrain and 

deter others" from committing willful, malicious or wanton 

invasions of another person's rights. Kline, 666 P.2d at 713. 

See also Wooderson v. Ortho Phamaceutical Corp., 681 P.2d 1038, 

1061 (Kan.), cert. denied, 469 U.S. 965 (1984). Given that "[a]ll 

partners are liable jointly and severally for everything 

chargeable to the partnership" Kan. Stat. Ann. § 56-315 (1983), 

12 Specifically, Kansas law provides: 

Where, by any wrongful act or omission of any partner 

acting in the ordinary course of the business of the 

partnership or with the authority of his or her 

copartners, loss or injury is caused to any person, not 

being a partner in the partnership, or any penalty is 

incurred, the partnership is liable therefor to the same 

extent as the partner so acting or omitting to act. 

Kan. Stat. Ann. § 56-313 (1983) (emphasis added). 

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and that the partnership is liable for penalties incurred by a 

partner for acts done in the course of the partnership's business, 

Kansas may impose different rules for vicarious liability for 

punitive damages based on the nature of the business relationship. 

Indeed, several other states that have adopted the vicarious 

liability provisions of the UPA recognize that partners may be 

vicariously liable for punitive damages based on acts of their 

copartners done in the course of the partnership ' s business. See, 

~, Shetka v. Kueppers, Kueppers, VonFeldt & Salmen, 454 N.W.2d 

916, 918-19 (Minn. 1990); Rogers v . Hickerson, 716 S.W.2d 439, 447 

(Mo . App. 1986); Meleski v. Pinero Int'l Restaurant, 424 A. 2d 784, 

790-92 (Md. App . 1981); Spencer v. Steinbrecher, 164 S.E.2d 710, 

716 (W. Va. 1968) . But see Husted v. Mccloud, 450 N.E.2d 491, 

494-95 (Ind . 1983) ( "rationale behind punitive damages ... 

prohibits awarding such damages against an individual who is 

personally innocent of any wrongdoing" ) . 

Imposing liability for punitive damages on members of a 

partnership or business enterprise based on the tortious conduct 

of copartners acting in the course of the partnership's business 

is consistent with the complicity rule adopted in Kline . The 

complicity rule permits imposition of vicarious liability for 

punitive damages on the principal for tortious acts of its 

managerial agents. Gould, 722 P . 2d at 517-18. Kansas defines a 

partnership as "an association of two (2) or more persons to carry 

on as co-owners of a business for profit." Kan. Stat. Ann. 

§ 56- 306(a) (1983). "Every partner is an agent of the partnership 

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for the purpose of its business ... II Id. § 56-309(a). 

Because partners are by definition co-owners of a business for 

profit, each partner is essentially a managerial agent of the 

partnership. Thus, the complicity rule appears to support the 

proposition that a partner may be vicariously liable for punitive 

damages based on the acts of his copartner. 

Nevertheless, we need not decide how Kansas courts would 

determine this issue because we believe that the instructions, 

when considered in their entirety, required the jury to base 

Edward's liability for punitive damages on his individual conduct. 

Plaintiff alleged and the jury was instructed that Defendants' 

gross and wanton negligence was the basis for the punitive damage 

claim. The jury was instructed on seven theories of negligence 

and given specific instructions defining negligence and standards 

of care. These instructions, at least in part, pertained to 

Edward's liability for his own conduct and, given that Nathan 

admitted liability, would have been entirely superfluous if a 

vicarious liability theory was the sole basis of Edward's 

liability. 

Moreover, the specific instruction on punitive damages 

informed the jury that liability was dependent on individual 

conduct. See supra note 6. The district court told the jury that 

punitive damages may be awarded "if the jury finds the defendant 

or defendants have been guilty of oppression, fraud, or malice, 

actual or presumed." The jury was told that "the basis for 

allowance of punitive damages" is to "punish the offender." In 

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instructing the jury that malice and evil intent may be presumed 

from evidence of recklessness and wanton disregard of another's 

rights, the court specifically instructed the jury that "[i]f £ 

defendant is grossly and wantonly reckless in exposing others to 

danger, the law holds him to have intended the natural 

consequences of his acts, and treats him as guilty of a willful 

wrong. 1113 

The instructions, when considered together, adequately 

apprised the jury that Edward's liability for punitive damages 

must be based on his own conduct. Substantial evidence was 

presented at trial that Edward acted not only in concert with 

Nathan, but that his individual acts of loading a five ton backhoe 

on a trailer without brakes and a faulty hitch and permitting it 

to be hauled down a two-lane road at night were wanton. 

We recognize that the jury was instructed that "[f]or the 

purposes of finding liability for actual and/or punitive damages 

as to the named defendants in this case," it must find that a 

business enterprise or partnership existed at the time of the 

collision. However, we do not read this instruction, when 

considered in the context of all the instructions, as permitting 

the jury to find Edward vicariously liable for punitive damages. 

Rather, if anything, the instructions were more deferential to 

Defendants than was required, as the jury was instructed that it 

must find both wanton conduct by Edward and a business enterprise 

13 Defendants proposed an alternative instruction which sought 

to limit liability for punitive damages solely to Nathan. IR. 

doc. 64. 

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in order to find him liable for punitive damages. Moreover, we do 

not read the instruction that it was "unnecessary ... to assess 

damages against each defendant individually," as permitting the 

imposition of vicarious liability for punitive damages. Rather, 

we read this instruction as stating that, if the jury found 

Defendants liable, it need not apportion damages between them. 

This is a correct statement of Kansas law on joint and several 

liability for partners. See Kan. Stat. Ann.§ 56-315 (1983). 

Finally, while the jury's special verdict found that a 

business enterprise existed and Nathan's acts furthered the 

enterprise, it also found that "defendants acted in a wanton 

manner." Therefore, even if we read the instructions as 

permitting the imposition of punitive damages on Edward based on 

Nathan's acts, and even if this is an improper statement of Kansas 

law, the error did not prejudice Edward because the jury found 

that he acted in a wanton manner. 

AFFIRMED. 

Entered for the Court 

Bobby R. Baldock 

Circuit Judge 

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