Title: INTERNATIONAL REHAB. ASSOCIATES v. Adams
Citation: 613 So. 2d 1207
Docket Number: 1901798
State: Alabama
Issuer: Alabama Supreme Court
Date: August 7, 1992

613 So. 2d 1207 (1992)
INTERNATIONAL REHABILITATION ASSOCIATES, INC., d/b/a Intracorp; and Tammy L. Bradly
v.
Aubrey ADAMS.
1901798.

Supreme Court of Alabama.
August 7, 1992.
Rehearing Denied February 19, 1993.
*1208 Denise A. Ferguson of Bell Richardson, P.A., Huntsville, for appellants.
Jimmy Alexander and Linda B. Lloyd of Alexander, Corder &amp; Plunk, P.C., Athens, for appellee.
MADDOX, Justice.
This case presents two issues for our review: whether the trial court erred in (1) instructing the jury on the burden of proof necessary for an award of punitive damages, and (2) denying the defendants' motions for JNOV and for new trial. We affirm.
In November 1988, the plaintiff, Aubrey Adams, was employed by Marcrum Management ("Marcrum") as a maintenance man for an apartment complex in Athens, Alabama. While moving a refrigerator from a storage shed, Adams slipped and the refrigerator fell on him, injuring two vertebrae in his back. Adams was hospitalized immediately. Initially, Adams experienced paralysis in both legs; however, while in the hospital, he regained use of his right leg and partial use of his left leg.
Approximately six weeks after his injury, and after he had been released from the hospital, Adams contacted CIGNA Insurance Company ("CIGNA"), Marcrum's worker's compensation carrier, about receiving worker's compensation benefits. CIGNA began paying Adams temporary benefits and then hired International Rehabilitation Associates, Inc., doing business as Intracorp ("Intracorp"), to evaluate Adams's rehabilitation potential. Gerald Childrey, CIGNA's claims adjuster assigned to Adams's case, testified in deposition, which was read at trial, that he retained Intracorp's services to help him decide how to handle Adams's claim. The employment relationship between CIGNA and Intracorp was evidenced in a written "Request for Service," which specifically requested that Intracorp perform "aggressive medical management" and a full initial evaluation, including contacts with Adams, his employer, and his physician.[1]
*1209 Tammy Bradly was the rehabilitation specialist initially assigned to Adams's case. On January 27, 1989, Bradly wrote to Jimmy Alexander, Adams's attorney, asking permission to visit Adams to begin evaluating his rehabilitation potential and asking for a signed consent form. Alexander responded on February 2, 1989, by a letter requesting a complete description of Intracorp's services that Intracorp planned on performing for Adams, a description of Bradly's credentials, a listing of the governmental agency that licensed Bradly, an explanation and full disclosure of any relationship between Intracorp and CIGNA, and a copy of the consent form with an explanation of why it was necessary. Bradly forwarded a copy of Alexander's letter to Childrey. On February 9, 1989, CIGNA suspended Adams's temporary disability benefits for "refusal to accept rehabilitation." On February 10, 1989, Bradly responded to Alexander's February 2 letter. She stated:
(Emphasis added.)
The Intracorp brochure that Bradly enclosed with her reply letter read:
*1210 "What we do
"Some of the things that we can do to help an injured person to recover are:
In March 1989, Adams sued Marcrum for worker's compensation benefits, because CIGNA had suspended his benefits. Adams's attorney, Alexander, hired Patsy Bramlett to assess Adams's vocational disability rating for the worker's compensation lawsuit. During the vocational disability testing, Adams told Bramlett that he expected to be put in a rehabilitation program through Intracorp in the near future. Adams also told his personal physician that he expected to be put into a rehabilitation program through Intracorp in the near future.
In July 1989, Bradly met with Adams to perform an initial evaluation. Adams specifically asked Bradly whose interest she was there to serve, and she replied that she served the insurance company's interest at that point, but that after their initial meeting she would represent his interest. Bradly performed no further services for Adams.
In August 1989, Adams and CIGNA settled the worker's compensation lawsuit. Part of that settlement called for CIGNA to pay for Adams's rehabilitation and medical expense. Later that same month, Bradly was promoted, and Norma Stricklin was assigned to Adams's case; however, before turning over Adams's case to Stricklin, Bradly requested and received a signed consent form from Adams. Stricklin wrote to Alexander in October 1989 and asked for another signed consent form, and another was sent to her.
In January 1990, Adams's case was again reassigned to another rehabilitation specialist. Adams sued Intracorp, Bradly, and Stricklin, alleging negligence in the performance (or nonperformance) of their professional duties, wantonness, fraud, and intentional interference with a business relationship. The defendants filed a motion to dismiss, which was denied by the trial court. Adams filed a motion to dismiss Stricklin as a party defendant; the trial court granted that motion. The case was then presented before a jury. At the close of Adams's case, Intracorp and Bradly moved for a directed verdict; the trial court directed a verdict as to Adams's interference with business relationship and wantonness claims, but denied the motion as to negligence and fraud. After the defendants presented their evidence, the trial court again denied their motion for directed verdict. The case was submitted to the jury on the negligence cause of action and on a fraud by suppression cause of action. The jury returned a verdict for Adams and against both Intracorp and Bradly, assessing $80,000 in compensatory damages and $75,000 in punitive damages. The trial court entered a judgment consistent with the jury's verdict. Intracorp and Bradly filed motions for a JNOV and for a new trial; the trial court denied these motions. Intracorp and Bradly appeal.
Intracorp and Bradly first argue that the trial court reversibly erred in its *1211 instruction to the jury on the burden of proof required for assessment of punitive damages. While we agree that the trial court erred in its charge, we conclude that Intracorp and Bradly failed to object to the court's curative instruction, and, thus, that they failed to preserve this issue for our review.
The record reveals that the trial court instructed the jury on the burden of proof required for assessment of punitive damages as follows: "Now, the plaintiff is entitled to recover punitive damages in a case where the jury is reasonably satisfied from the evidence that the fraud not only took place but that the fraud was conducted or happened with either malice or wantonness or some gross behavior." (R. at 348; emphasis supplied.) Defense counsel objected to this charge after the entire oral charge was completed, by stating, "We would also object to that portion of the charge which addressed the burden of proof, proving punitive damages as being only a burden of reasonable satisfaction and not clear and convincing evidence." (R. at 357.) The trial court overruled the defendants' objection.
However, after the jury had retired to the deliberation room, and had been reinstructed by the trial court on certain matters, the issue was raised again. The record reads:
(R. at 364-66.)
After this colloquy, the trial court gave a curative instruction that restated the burden of proof for assessing punitive damages as "clear and convincing evidence." Of great importance, however, is the absence of any objection to the trial court's curative instruction.
This Court acknowledges that, generally, a trial court must specifically withdraw an erroneous instruction, and then give the jury a correct instruction, to cure the giving of the erroneous instruction. Inter-Ocean Casualty Co. v. Holston, 271 Ala. 251, 122 So. 2d 774 (1960), Alabama Farm Bur. Mut. Cas. Ins. Co. v. Carswell, 374 So. 2d 250 (Ala.1979), and Stewart v. Clayton, 502 So. 2d 767 (Ala.Civ. *1212 App.1986). However, where no objection to the corrected instruction, or to the court's failure to specifically withdraw the erroneous instruction, is made, no error is preserved for our review. Bush v. Alabama Farm Bur. Mut. Cas. Ins. Co., 576 So. 2d 175 (Ala.1991); Rule 51, Ala.R.Civ.P. No error was preserved in this case because the defendants failed to object to the corrected instruction or to the trial court's failure to specifically withdraw the erroneous charge.
Intracorp and Bradly argue that the trial court erred in denying their motions for JNOV and for new trial because, they argue, Adams failed to properly plead or sufficiently prove his fraud cause of action. We address each contention in turn.
Intracorp and Bradly argue that they were not given adequate notice that fraud by suppression would be an issue in the case, and thus, that a JNOV or new trial should have been granted. We disagree, because we find that the issue of fraud by suppression was tried by the implied consent of the parties, and that the complaint was amended to conform to the evidence.
It is undisputed that Adams did not plead fraud by suppression in his complaint. However, Adams did specifically plead fraud by misrepresentation. After the close of all the evidence the following discussion occurred:
(R. at 326-35; emphasis supplied.)
Rule 15(b), Ala.R.Civ.P., states, in pertinent part:
Also, this Court has said that implied consent of the parties can be inferred from an opposing party's failure to object to introduction of evidence raising the disputed issue initially. Bischoff v. Thomasson, 400 So. 2d 359 (Ala.1981), Hawk v. Bavarian *1214 Motor Works, 342 So. 2d 355 (Ala. 1977). Additionally, implied consent may be inferred when the opposing party himself offered evidence relative to the issue. Id. at 358. Further, assuming that the opposing party did object to the evidence on a non-pleaded issue, he must also show "that he would be actually prejudiced in maintaining his action or defense on the merits by the admission of the evidence." Hawk, 342 So. 2d  at 358.
We also note that a determination "as to whether [an] issue has been tried by express or implied consent under Rule 15(b) is a matter for the trial court's sound discretion, which will not be altered on appeal absent an abuse [of that discretion]." McCollum v. Reeves, 521 So. 2d 13 (Ala. 1987). Furthermore, "whether pleadings are deemed to be amended in order to conform to the evidence presented is also a matter within the discretion of the trial court," and a decision in that regard will not be disturbed on appeal absent an abuse of discretion. Id. at 16-17.
The above quoted portion of the record convinces us that the trial court deemed Adams's complaint to be amended to conform to the evidence. We have also examined the record to find the initial introduction of evidence supporting Adams's contention of suppression, and have found no objection by the defense to this evidence. Thus, the suppression issue was tried by the implied consent of the parties, and the trial court amended the pleadings to conform to the evidence presented. Therefore, the trial court did not err in refusing to grant a JNOV or a new trial on this basis.
Intracorp and Bradly also contend that the trial court reversibly erred in refusing to grant them a JNOV or a new trial, at least as to Adams's fraud cause of action, because, they argue, Adams failed to sufficiently prove the suppression of a material fact. This contention, of course, is merely an assault on the sufficiency of the evidence.
Initially, we note that a strong presumption of correctness attaches to a jury verdict in Alabama, if the verdict passes the "sufficiency test" presented by motions for directed verdict and JNOV. Christiansen v. Hall, 567 So. 2d 1338, 1341 (Ala.1990); Alpine Bay Resorts, Inc. v. Wyatt, 539 So. 2d 160 (Ala.1988). This presumption of correctness is further strengthened by a trial court's denial of a motion for new trial. Christiansen, 567 So. 2d  at 1341. Denying, and to a more limited extent granting, a motion for new trial is within the sound discretion of the trial court. See, Jawad v. Granade, 497 So. 2d 471, 477 (Ala.1986). This Court will not reverse a judgment based on a jury verdict on a sufficiency of the evidence basis unless the evidence, when viewed in a light most favorable to the nonmovant, shows that the verdict was "plainly and palpably wrong and unjust." Christiansen, 567 So. 2d  at 1341. Based on our review of the record, we cannot say that the verdict was plainly and palpably wrong or unjust.
This Court has stated that a cause of action for suppression of a material fact under § 6-5-102, Ala.Code 1975, has four elements: "(1) a duty to disclose facts; (2) concealment or nondisclosure of material facts by the defendant; (3) inducement of the plaintiff to act [or to refrain from acting]; and (4) action [or a refraining to act in a way that the plaintiff would otherwise act] by the plaintiff to his injury." Wilson v. Brown, 496 So. 2d 756, 759 (Ala.1986).
We conclude that Adams presented substantial evidence[2] of each of these elements. First, as to the duty to disclose, § 6-5-102, Ala.Code 1975, states, in pertinent part, "The obligation to communicate may arise from the confidential relations of the parties or from the particular circumstances of the case." (Emphasis added.) Adams does not argue that a confidential *1215 relationship existed, but rather that the particular circumstances of the case imposed an obligation to disclose.
This Court has stated that "A duty to speak depends upon the relation of the parties, the value of the particular fact, the relative knowledge of the parties, and other circumstances." Deupree v. Ruffino, 505 So. 2d 1218, 1222 (Ala.1987), quoting American Bonding Co. v. Fourth National Bank of Montgomery, 206 Ala. 639, 641, 91 So. 480 (1921). Further, this Court has held that a case-by-case, flexible approach must be used in determining if a duty to disclose exists under the particular circumstances of the case. Jim Short Ford Sales, Inc. v. Washington, 384 So. 2d 83 (Ala.1980).
In this case, Adams presented evidence that Intracorp policy required a rehabilitation specialist to fully disclose to a client (injured party) the extent of Intracorp's relationship with that person. Specifically, Adams points to three portions of Intracorp's Rehabilitation Specialist Resource Guide (hereinafter, "Resource Guide"), Intracorp's written policy statement and manual for its rehabilitation specialists. One portion of the Resource Guide states, "[W]e are obligated to state clearly what our role will be in the assessment and rehabilitation process.... This is especially important when there is no intent to provide rehabilitation services beyond a file review, client interview, or assessment." Resource Guide at 9.2. Another portion of the Resource Guide states, "The client should always be aware of the limits of our relationship. We are obligated to provide full and complete disclosure of our involvement." Resource Guide at 9.2. Further, the Resource Guide states:
Resource Guide at 9.13.
Thus, it was Intracorp's stated policy to fully inform clients of its relationship with them and of any limitations in the services that Intracorp could render to them. Intracorp, then, by its own business policy, had an obligation to disclose to Adams the limited nature of its undertaking for CIGNA. That is, because of the particular circumstances of this case, especially the stated company policy, we conclude that Intracorp and Bradly had a duty to disclose to Adams that CIGNA had hired them to perform only an initial evaluation. Stated differently, we conclude that Intracorp and Bradly had a duty to disclose to Adams that they had not been hired by CIGNA to perform the full range of services discussed in the services brochure provided to Adams in response to his query about the kinds of services Intracorp planned to provide him.
Second, we find that Adams presented substantial evidence as to the nondisclosure or concealment element also. In answer to Alexander's written and specific inquiry about the types of services Intracorp would provide for Adams, Bradly referenced Intracorp's brochure (reprinted above) which outlined a plethora of rehabilitation services. If Adams was not to receive these services, it was incumbent on Intracorp and Bradly to specifically inform Adams to this effect. Furthermore, at the evaluation session, Adams specifically asked Bradly whose interest she served, and although she responded by saying that she served the insurance company's interest, she also stated that after this initial meeting she would serve his interest. When Adams asked her this question, Bradly had an opportunity to fully disclose to Adams the limited nature of Intracorp's undertaking. The evidence is clear that she did not do so.
Third, as to inducement of the plaintiff to act or refrain from acting, it is undisputed that Adams did not seek other rehabilitation services, even governmentally provided services. We conclude that Adams's inaction was reasonable under the circumstances and particular facts of this case.
*1216 Fourth, and finally, as to injury, there was evidence that Adams was delayed in returning to the workforce because he was not rehabilitated sooner. In short, Adams was not informed of Intracorp's limited undertaking, he specifically requested to know what type of services Intracorp proposed to provide, he was referred to Intracorp's brochure, and Intracorp and Bradly failed to inform him that those services would not be provided. We conclude that Adams was justified in relying on Bradly's answer to his inquiry, and that he was injured by failing to act as he would have acted absent Intracorp and Bradly's failure to disclose.
Based on the foregoing, we affirm the judgment entered on the jury's verdict.
AFFIRMED.
HORNSBY, C.J., and SHORES, HOUSTON and KENNEDY, JJ., concur.
[1]  There was testimony at trial to the effect that "medical management" and a "full initial evaluation" were synonymous terms.
[2]  "Substantial evidence" has been defined as "evidence of such weight and quality that fair-minded persons in the exercise of impartial judgment can reasonably infer the existence of the fact sought to be proved." West v. Founders Life Assurance Co. of Florida, 547 So. 2d 870, 871 (Ala.1989); see Ala.Code 1975, § 12-21-12.