Present: All the Justices 

SIMBECK, INC. 

 OPINION BY JUSTICE A. CHRISTIAN COMPTON 

v. Record No. 980355 January 8, 1999 

DODD SISK WHITLOCK CORP., ET AL. 

FROM THE CIRCUIT COURT OF THE CITY OF WINCHESTER 

John E. Wetsel, Jr., Judge 

 This appeal involving the trucking insurance business is 

limited to consideration of the following issue: Did the trial 

court err in setting aside the jury's verdict for punitive 

damages? We conclude that the court was correct, and will 

affirm. 

 Appellant Simbeck, Inc., filed a motion for judgment, twice 

amended, against appellees Dodd Sisk Whitlock Corp. and James H. 

Dodd seeking compensatory and punitive damages for alleged 

wrongful business practices in connection with procuring 

insurance coverage for plaintiff's trucking business. Plaintiff 

operates trucks nationwide from its base in Winchester. The 

corporate defendant is an insurance agency in Louisa employing 

the individual defendant, an insurance agent. 

 The plaintiff sought recovery against defendants on 

numerous theories. Following many pretrial rulings, the case 

was tried to a jury in September 1997 on allegations that 

defendants were guilty of tortious interference with a business 

expectancy and breach of fiduciary duties. 
 During the three-day trial, the jury found in favor of the 

plaintiff and awarded compensatory damages of $30,000 against 

both defendants. The trial court reduced this amount to 

$12,328, the amount of the ad damnum. The jury also awarded 

punitive damages against the corporate defendant in the sum of 

$17,700 and against the individual defendant in the sum of 

$60,000. 

 The defendants filed motions to set aside the verdicts. 

Following argument of counsel, the trial court, in a detailed 

written opinion, denied the motion to set aside the compensatory 

damage verdict and granted the motion to set aside the punitive 

damage verdict. The court memorialized these rulings in a 

November 1997 judgment order, from which we awarded the 

plaintiff this appeal, limited to the foregoing issue. 

 When a plaintiff's verdict has been set aside by the trial 

court, the verdict is not entitled to the same weight upon 

appellate review as one that has received the trial court's 

approval. But in considering the facts under these 

circumstances, the appellate court will accord the plaintiff 

benefit of all substantial conflicts in the evidence and all 

reasonable inferences that may be drawn from it. Commercial 

Bus. Sys. v. Halifax Corp., 253 Va. 292, 296, 484 S.E.2d 892, 

894 (1997). 

2
 We shall summarize the pertinent evidence, much of which 

was conflicting, in accord with the foregoing principles. In 

July 1994, plaintiff entered into "an insurance relationship" 

with the defendants (collectively, the defendant) for defendant 

to "write" plaintiff's business insurance coverage. As the 

result of defendant's efforts, plaintiff entered into a series 

of insurance contracts with several insurers to provide 

liability insurance, physical damage insurance, and related 

coverages (hereinafter, the insurance policy) necessary to 

conduct plaintiff's business. The policy remained effective for 

a period of one year, commencing July 20, 1994. 

 Defendant was "the retail producer or the seller of 

insurance" to the plaintiff, the insured. Also involved in this 

type of transaction were "intermediaries or wholesalers which 

were in between the retail insurance producers and the insurance 

companies." The wholesaler in this transaction was W. E. Love & 

Associates, Inc., a North Carolina broker, with whom defendant 

had a written brokerage agreement. 

 In early July 1995, as the insurance policy was "coming due 

for renewal," plaintiff, through its president Ronald 

Simkhovitch, sought renewal coverage with a number of companies, 

including Service Insurance Agency, a Richmond "retail insurance 

agency" and competitor of defendant. Simkhovitch "indicated 

that he would like to do business with" Service. Greg Pohler, 

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the owner of Service, was aware that defendant had obtained "a 

quote" for a renewal premium from "Occidental Insurance 

Company." Service then proceeded to obtain a premium quotation 

from Occidental. 

 Because defendant was first in obtaining a "quote" for 

plaintiff from Occidental, however, "professional courtesy" in 

the industry entitled defendant to a "10-day hold" on its 

Occidental quotation. This means that Service, the competing 

agency, could not write the renewal policy with Occidental until 

defendant released the "quote" that it previously had obtained 

for plaintiff from Occidental. Plaintiff's insurance policy was 

to expire July 20, 1995. This was two days before expiration of 

defendant's ten-day hold period on the Occidental quotation. 

 Defendant refused to release the "quote" to Service unless 

Service agreed to give defendant 50 per cent of its commission 

and unless plaintiff executed a promissory note payable to 

defendant, to be personally guaranteed by Simkhovitch, in the 

sum of $84,000 bearing 10 per cent interest payable over a 30-

day period. Plaintiff had been regularly late in submitting 

premium payments to defendant and owed defendant thousands of 

dollars, the exact sum being undetermined at that time. 

 Service agreed to share its commission with defendant but 

plaintiff refused to execute the note. Because plaintiff 

apparently would not be able to obtain insurance coverage, and 

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thus would lack "operating authority," it began "slowing down 

its operations" on July 19. But at 5:17 p.m. on the 19th, 

Liberty Mutual Insurance Company, one of the insurers plaintiff 

had contacted, notified plaintiff it was providing the necessary 

insurance coverage effective July 20. Thus, plaintiff did not 

suspend its operations. 

 Defendant James Dodd, called by plaintiff as an adverse 

witness, testified defendant's refusal to release the "quote" 

unless plaintiff executed the note was an effort to put "the 

squeeze" on plaintiff. Dodd explained that his use of the 

"squeeze" term as it applied to plaintiff meant he was trying 

"to get our money that was owed us." 

 Expert testimony offered by the plaintiff established that 

defendant's conduct was "totally improper," and a deviation of 

established custom and practice in the trucking insurance 

industry. The witness also indicated that defendant owed 

fiduciary duties as insurance broker to its insured, the 

plaintiff, which were breached. 

 On appeal, the plaintiff contends the trial court erred in 

setting aside the punitive damage award and in entering judgment 

for compensatory damages only. The plaintiff dwells on the 

elements of causes of action for tortious interference with a 

contract and breach of fiduciary duty. Then, plaintiff argues 

it "introduced testimony of the intentional and improper 

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interference" by defendant with plaintiff's "contractual 

relationships." It says the evidence supports the conclusion 

that the defendant's "interference" prevented Service Insurance 

Agency from entering into "the prospective contract" with the 

plaintiff and likewise prevented the plaintiff from obtaining 

insurance coverage through Service. Plaintiff notes that Dodd 

admitted his actions were meant to put the "squeeze" on 

plaintiff "despite the fiduciary duty" he owed plaintiff. 

 Finally, briefly addressing the law on punitive damages, 

the plaintiff contends defendant's conduct was "not only 

malicious but it borders on extortion." Plaintiff argues a jury 

question was presented whether defendant's conduct was "wilful 

or wanton as to show a conscious disregard for others." It 

contends the trial court, in deciding the issue as a matter of 

law, "deprived the jury of its responsibility to analyze the 

facts and its verdict should be reinstated." We do not agree. 

 The broad rule governing the award of punitive damages, the 

purpose of which is not so much to compensate the plaintiff but 

to punish the wrongdoer and to warn others, is that such damages 

may be recovered only when there is misconduct or actual malice, 

or such recklessness or negligence as to evince a conscious 

disregard of the rights of another. Hamilton Dev. Co. v. Broad 

Rock Club, Inc., 248 Va. 40, 45, 445 S.E.2d 140, 143 (1994). 

Accord Webb v. Rivers, 256 Va. ___, ___, ___ S.E.2d ___, ___ 

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(1998); Smith v. Litten, 256 Va. ___, ___, ___ S.E.2d ___, ___ 

(1998). Under the allegations in this case of interference with 

a business expectancy and breach of fiduciary duty, however, 

punitive damages may be awarded only if the acts are done with 

malice or wantonness. Smith v. Litten, 256 Va. at ___, ___ 

S.E.2d at ___. See Worrie v. Boze, 198 Va. 533, 543, 95 S.E.2d 

192, 200 (1956). 

 Awards of punitive damages are not favored generally 

because they are in the nature of a penalty and should be 

assessed "only in cases involving the most egregious conduct." 

Bowers v. Westvaco Corp., 244 Va. 139, 150, 419 S.E.2d 661, 668 

(1992). This is not a case involving egregious conduct. 

 Of course, the jury's finding of compensatory damages, 

confirmed by the trial court, is a determination that defendant 

was guilty of both tortious interference with a prospective 

contract and a breach of fiduciary duty. The plaintiff 

established the elements of the former cause of action, i.e., 

that plaintiff had a contract expectancy of which defendant 

knew; that defendant intentionally interfered with the 

expectancy by using improper means or methods; and that 

plaintiff suffered loss. See Maximus, Inc. v. Lockheed Info. 

Management Sys. Co., 254 Va. 408, 414, 493 S.E.2d 375, 378 

(1997). 

7
 The plaintiff's losses resulting from its "slowing down of 

operations" on July 19 were reflected in the compensatory damage 

award. But awarding plaintiff damages for interference with a 

contract expectancy and for breach of fiduciary duty does not 

ipso facto support an award of punitive damages, as the 

plaintiff seems to argue. Rather, as we have said, under these 

circumstances there must be malicious or wanton conduct. 

 According the plaintiff benefit of all substantial 

conflicts in the evidence and all reasonable inferences that may 

be drawn from it, we conclude the trial court correctly ruled 

there was no evidence of acts done with malice or wantonness. 

As the trial court noted, the defendant violated unwritten trade 

customs or ethical practices in the trucking insurance business 

in an effort to make the plaintiff pay a debt owed to defendant. 

The defendant requested plaintiff to execute a note for an 

underlying debt and refused to release an insurance "quote," 

both of which were lawful acts, in an effort to make plaintiff 

pay defendant the sum it owed. If Simkhovitch had executed the 

note, plaintiff would have suffered no loss. 

 The plaintiff argues the amount of the note, $84,000, "bore 

no resemblance to the amount demanded by [defendant] for 

payment. In fact, it was admitted by the [defendant] at trial 

that the debt paid was approximately $25,000." This is not an 

accurate summary of the evidence. 

8
 Instead, the evidence shows that, based upon defendant's 

records, defendant reasonably believed plaintiff owed it more 

than $76,000 when the note was presented for Simkhovitch's 

signature. Because of the provisions of the brokerage agreement 

between defendant and W. E. Love, the North Carolina broker, 

defendant was liable to Love for plaintiff's insurance premiums, 

whether or not plaintiff paid defendant. At the time the note 

was presented for signature on July 18, 1995, the amount due 

defendant could only be estimated because no policy audits had 

been conducted, and because plaintiff, without defendant's 

knowledge, had made some premium payments directly to Love and 

Love had not credited defendant's account. Thus, defendant was 

confronted not only with large sums due it from plaintiff, but 

also with a possible debt due from defendant to Love on account 

of plaintiff's failures. In a letter attached to the note, 

however, defendant said the amount was only "an estimated 

figure" and that when "we get the exact amount and audits are 

completed, we can then give credits . . . ." 

 In August 1995, defendant sued plaintiff in the Circuit 

Court of Louisa County for approximately $76,000 for unpaid 

premiums due on the 1994-1995 insurance policy. Following 

completion of the audits and when the exact amount due was 

determined, the Louisa action eventually was settled for $25,000 

in July 1996. 

9
 In sum, an accurate and complete review of the evidence 

shows that defendant's attempt to collect a debt due it by 

plaintiff by putting "the squeeze" on plaintiff was not 

malicious or wanton, but merely an act of commercial "hard 

ball." Consequently, we hold the trial court did not err in 

concluding that, while defendant's violations of trade standards 

were the basis of both the tortious interference and breach of 

fiduciary duty rights of action, such violations were 

insufficient as a matter of law to justify imposition of 

punitive damages. 

 Thus, the trial court acted properly in setting aside the 

punitive damage verdict, and the judgment below will be 

Affirmed. 

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