Opinion ID: 1875795
Heading Depth: 3
Heading Rank: 2

Heading: the amount of punitive damages was excessive in relation to the appellant's net worth.

Text: Initially we turn to the posture of this suit inasmuch as it consists of three separable, though related, causes. The first is a tort suit based on negligence; the second, a contractual suit for compensatory damages; and the third, a suit based upon an independent tort arising from the denial of the contractual claim. The damages for the tort, assuming negligence and proximate cause, rest in the loss of property, physical injury, or death as revealed by the evidence. The contractual award, if any, is directly dependent upon the terms of the contract. The third is conditioned upon a sum sufficient as punishment for the wrongdoer, and as a deterrence to others from the commission of similar offenses. The damages originate from different theories of law and necessarily rest upon different principles, the only common nexus being the occurrence bringing them on stage. Heretofore in appraising punitive damages we have sometimes expressed our reasoning through the use of mathematical formulas, such as contrasting the sum of the actual damages to the punitive damages and, comparing the punitive damage award to the net worth of the defendant. At times we have also indulged verbal equations by referring to a sum so great that at first blush it shocks the judicial conscience when compared with other awards in different cases. These formulas are attempts to illustrate the court's thoughts in either accepting or rejecting the sum of the award. They do not, and probably cannot, express an exact rule for the determination. Although inexact, we think the better formula for review is to give due consideration to the degree and nature of transgression from reasonable and lawful practices and the likely harmful effect upon the individual litigant and the public. More to the point, however, we are now importuned to hold Employers Mutual's financial statement of 1982 exhibiting net assets of $112,332,110.00 does not conform to award and financial worth as expressed in State Farm Mutual Automobile Ins. Co. v. Roberts, 379 So.2d 321 (Miss. 1980); Aetna Cas. & Sur. Co. v. Steele, 373 So.2d 797 (Miss. 1979); Travelers Indemnity Co. v. Wetherbee, 368 So.2d 829 (Miss. 1979); and Allen v. Ritter, 235 So.2d 253 (Miss. 1970). We are asked to evaluate the present punitive damage award by taking notice of both the size of other punitive damage awards and the relative net worth of the defendants. Employers Mutual argues the award of $400,000.00 is incompatible with our other cases and is obviously the result of bias or prejudice. We have made such comparison, including in the more recent case of Bankers Life & Casualty Co. v. Crenshaw, 483 So.2d 254 (Miss. 1985), in which a majority of the court through Justice Sullivan stated in appropriate part, Bankers Life argues that the amount of damages awarded  $1,600,000  is grossly excessive and should be substantially reduced. The point is brought before us by Bankers Life's assignment that the trial judge erred when he denied Bankers Life's post-trial motion for a remittitur of punitive damages or, alternatively, a new trial on the amount of punitive damages. This issue must be adjudged under the same process of adjudication as is applicable on any other assignment of error. This involves the familiar three-step process of identifying and articulating the applicable rules of law, resolution of all questions of evidentiary fact, and application of the law to the facts. See Boardman v. United Services Automobile Association, 470 So.2d 1024, 1029 (Miss. 1985). With regard to punitive damages, our rules are necessarily general. Once it is established that punitive damages in some amount should be allowed, the quantum thereof is determined by reference to certain general factors which include: (1) Such amount as is necessary for the punishment of the wrongdoing of the defendant and deterring defendant from similar conduct in the future, Standard Life Co. of Indiana v. Veal, 354 So.2d 239, 249 (Miss. 1977); (2) Such amount as is reasonably necessary to make an example of the defendant so that others may be deterred from the commission of similar offenses. Reserve Life Insurance Co. v. McGee, 444 So.2d 803, 808 (Miss. 1983); T.C.L., Inc. v. LaCoste, 431 So.2d 918, 923 (Miss. 1983); Tideway Oil Programs, Inc. v. Serio, 431 So.2d 454, 460 (Miss. 1983); Snowden v. Osborne, 269 So.2d 858, 860 (Miss. 1972); and (3) The pecuniary ability or financial worth of the defendant, Collins v. Black, 380 So.2d 241, 244 (Miss. 1980); Allen v. Ritter, 235 So.2d 253, 256 (Miss. 1970); Standard Life Insurance Co. of Indiana v. Veal, 354 So.2d 239, 249 (Miss. 1978); Jones v. Carter, 192 Miss. 603, 610, 7 So.2d 519 (1942). Punitive damages are an important component of the remedial side of our law whose purpose is the protection of the customer. On these facts our law would seem to authorize a quantum of punitive damages to be that amount reasonably necessary to punish defendant and to provide a substantial deterrent to it and others similarly situated from the commission of similar offenses, all consistent with the pecuniary aility and financial worth of the defendant. In this context, we note that Bankers Life reported to the Commission of Insurance in its 1980 report total assets in excess of $1,300,000,000, and net assets of approximately $294,000,000. Our case law is to the effect that the determination of the amount of punitive damages is a matter committed solely to the authority and discretion of the jury. See, e.g., Commodore Corp. v. Bailey, 393 So.2d 467, 471 (Miss. 1981); Collins v. Black, 380 So.2d 241, 244 (Miss. 1980); Sandifer Oil Co. v. Dew, 220 Miss. 609, 71 So.2d 752 (1954); Teche Lines, Inc. v. Pope, 175 Miss. 393, 166 So. 539 (1936). These same cases, frequently in the same sentence as has been used to commit sole discretion to determine the amount of punitive damages to the jury, use language expressing a view to the effect that the jury's verdict may be interfered with if it is found arbitrary or unreasonable or against the overwhelming weight of the evidence. Commodore Corp. v. Bailey, 393 So.2d at 472. Other cases recognize that a jury's finding on amount of punitive damages may be disturbed for exceptional causes. Collins v. Black, 380 So.2d at 244; Snowden v. Osborne, 269 So.2d 858, 861 (Miss. 1972); Woodall v. Ross, 317 So.2d 892, 896 (Miss. 1975). 483 So.2d at 277-278. From the record before us we are unable to discern any valid reason why the punitive damage award should be reduced and particularly so when consideration is given to the uncontradicted fact that Employers Mutual persisted over a period of years in the use of an exclusion in direct violation of the public policy of this State. We think their reasons for doing so are feeble. The first is that they purchased the standard automobile policy form prepared by the Insurance Services Office, Atlanta, Georgia, and second, the form was approved by the Mississippi Insurance Commission for use in Mississippi after March 1, 1981. Acknowledging the accuracy of these facts, neither indemnify the insurer from damages because the exclusion remains contrary to the state's public policy as expressed by this Court in Lowery, supra, until the Legislature in its wisdom effects a change. Here, as in Richards v. Allstate Ins. Co ., Tompkins suit has benefitted all of Employers Mutual's policyholders by directly causing deletion of the exclusion from the standard Mississippi policy. Additionally, by considering all aspects of the suit we are not convinced the award was too large as punishment for Employers Mutual's failure to timely pay the just claims of Tompkins. We therefore conclude the award as found by the jury was not excessive. We have reviewed in detail the entire record and are convinced Employers Mutual was afforded a fair trial in accord with our procedures and law. The judgment of $500.00 actual damages against Trina Smith is affirmed. The judgment of $50,000.00 contractual damages against Employers Mutual is reduced to $500.00 and judgment entered here for that amount. The judgment of $400,000.00 against Employers Mutual is affirmed. AFFIRMED AS TO ACTUAL AND PUNITIVE DAMAGES; CONTRACTUAL DAMAGES REDUCED TO $500.00. WALKER and ROY NOBLE LEE, P.JJ., and DAN M. LEE, PRATHER, ROBERTSON and SULLIVAN, JJ., concur. HAWKINS, J., dissents. ANDERSON, J., not participating.