Opinion ID: 1195187
Heading Depth: 2
Heading Rank: 3

Heading: The Jury Instructions on Fraud

Text: In light of our holding, we must address the trial court's unwarranted instructions to the jury on fraud and the effect, if any, such instructions may have had on the punitive damages and negligence verdicts. The trial court instructed the jury on the fraud claim as follows: [Instruction No. 42:] Plaintiff Janie Ditto seeks to recover damages claimed to be sustained as a result of the alleged fraud of the defendant, Dr. McCurdy, in failing to disclose the full extent of his qualifications or lack thereof. The essential elements of the fraud claimed in this action, each of which must be proved to recover damages are: 1, Dr. McCurdy must have concealed or suppressed a material fact; 2, Dr. McCurdy must have been under a duty to disclose the fact to Janie Ditto; 3, Dr. McCurdy must have intentionally concealed or suppressed the fact with the intention to defraud Janie Ditto; 4, Janie Ditto must have been unaware of the fact and not have acted as she did if she had known of the concealed or suppressed fact; 5, and finally, as a result of the concealment or suppression of the fact Janie Ditto must have sustained damages. [Instruction No. 43:] A fiduciary relationship arises when one person puts their trust and confidence in another who possesses superior skill, knowledge, training and expertisefiduciary in nature. Fiduciary imposes on the doctor an affirmative duty to exercise the utmost good faith, integrity, fairness, and fidelity, and to disclose material facts to the patient regarding the doctor's qualifications to perform the procedures contemplated by the patient. (Emphasis added.) Because the instructions informed the jury that Dr. McCurdy had a legal duty to disclose his qualifications or lack thereof, we hold that they were erroneous. [E]rroneous instructions are presumptively harmful and are a ground for reversal unless it affirmatively appears from the record as a whole that error was not prejudicial. Calleon v. Miyagi, 76 Hawai`i 310, 315, 876 P.2d 1278, 1283 (quoting Quedding v. Arisumi Bros., Inc., 66 Haw. 335, 340, 661 P.2d 706, 710 (1983)), reconsideration granted, 76 Hawai`i 453, 879 P.2d 558 (1994).
Where clear and convincing evidence exists, one circumstance in Hawai`i that warrants an award of punitive damages is when there has been some wilful misconduct or that entire want of care which would raise presumption of a conscious indifference to consequences. Masaki v. General Motors Corp., 71 Haw. 1, 11, 780 P.2d 566, 572, reconsideration denied, 71 Haw. 664, 833 P.2d 899 (1989) (citation omitted). Award or denial of punitive damages is within the sound discretion of the trier of fact. Amfac, Inc. v. Waikiki Beachcomber Inv. Co., 74 Haw. 85, 138, 839 P.2d 10, 36, reconsideration denied, 74 Haw. 650, 843 P.2d 144 (1992). Absent a clear abuse of discretion, we will not reverse a trier of fact's decision to grant or deny punitive damages. Id. at 138, 839 P.2d at 37. The trial court's instruction to the jury on punitive damages read in relevant part: In order to establish punitive damages should be awarded against Dr. McCurdy[,] plaintiff must have proven by clear and convincing evidence that Dr. McCurdy acted with willful misconduct and entire want of care which would raise presumption of consideration of indifference to the consequences of his act or omission. We note that the trial court misstated the standard for awarding punitive damages when it used the conjunctive rather than the disjunctive in its instruction; such error, however, was harmless beyond a reasonable doubt. As stated previously, the jury needed only find either willful misconduct or entire want of care, to wit, gross negligence, in order to properly award punitive damages. See Masaki, 71 Haw. at 11, 780 P.2d at 572. The error merely operated to elevate the standard for awarding punitive damages, leaving Dr. McCurdy's substantive rights unaltered. In fact, the instruction erroneously afforded Dr. McCurdy more protection than required under prevailing law. Turning next to the jury's assessment of punitive damages, we agree with the ICA's holding insofar as we determine that there was, indeed, an abundance of clear and convincing evidence upon which the jury could rely to find that Dr. McCurdy's care of Ditto, from the outset, was grossly negligent and therefore reckless and consciously indifferent to the consequences that could arise. See Ditto, at 97-98, 947 P.2d at 972-973. For example, there was substantial evidence produced at trial, which, if believed, revealed that: the medical history portion of Dr. McCurdy's consultation was woefully inadequate; Dr. McCurdy did not properly inform Ditto of the risks or complications involved in the initial surgical procedure or any of the subsequent surgical procedures; he sent Ditto home after her second surgery, despite continued complications, to make room for other patients in his recovery room; he failed to properly suture her incisions, resulting in constant bloody discharges; he failed to document medications allegedly prescribed to Ditto; he failed to properly diagnose an obvious infection; and he allowed his medical assistant to suture Ditto's incision when he was not physically present.... It has long been the law in this jurisdiction that verdicts based on conflicting evidence will not be set aside where there is substantial evidence to support a jury's findings. State Sav. & Loan Assoc. v. Corey, 53 Haw. 132, 141, 488 P.2d 703, 709 (1971) (citations omitted), cert. denied, 406 U.S. 920, 92 S.Ct. 1774, 32 L.Ed.2d 119 (1972). Contrary to Dr. McCurdy's contention, there was substantial evidence on which the jury could have based its award of punitive damages.... We hold, therefore, that the trial court properly allowed the issue of punitive damages to be considered by the jury and that the jury did not abuse its discretion in making the award. Ditto, at 97-98, 947 P.2d at 972-973. Irrespective of the fraud count, the evidence introduced at trial relating thereto, and the instructions relating to fraud, the evidence of Dr. McCurdy's gross negligence was so overwhelming and of such an egregious nature that the jury certainly could have found that punitive damages were warranted. Furthermore, the trial court provided separate and clear instructions on negligence, punitive damages, and fraud, making any possible incidence of prejudice flowing from the fraud claim doubtful and, at most, harmless. The presumption of harm resulting from the erroneous jury instructions on fraud is therefore rebutted, and we affirm the ICA's decision upholding the jury's finding of liability for punitive damages.
The jury's special verdict makes it clear that the erroneous jury instructions on fraud did not prejudice Dr. McCurdy with respect to Ditto's negligence claim. In its special verdict, the jury found, inter alia, that (1) Dr. McCurdy was negligent in his care and treatment of Ditto, and (2) his negligence was a legal cause of injury or damage to Ditto. The jury also answered yes to the following interrogatory: Was the Defendants' fraudulent conduct a legal cause of injury or damage to Plaintiff Janie Ditto separate and apart from any damages caused by negligence? (emphasis in the original). The jury obviously believed the damages caused by Dr. McCurdy's negligence were wholly separate from Ditto's injuries resulting from Dr. McCurdy's fraudulent conduct. Moreover, as previously discussed, the evidence of Dr. McCurdy's gross negligence was so overwhelming that any additional discussion on plain negligence is unnecessary. We therefore affirm, without further comment, the jury's finding of negligence.
We are unable, however, to conclude from the record that the erroneous jury instructions did not prejudicially influence the jury in its calculation of punitive damages. The court gave the jury separate instructions on fraud and punitive damages, and the jury found Dr. McCurdy separately liable for each. Nevertheless, the jury gave only one award for punitive damages, and it is possible that the jury based part of its award on evidence of Dr. McCurdy's fraud. In fact, Ditto's counsel expressly told the jury that, in determining the amount to award for punitive damages, it should take into account, inter alia, a doctor's failure to discuss with a patient his or her qualifications. Specifically, Ditto's counsel argued in closing: And there is a fourth issue. The last little piece. Punitive damages. The judge is going to instruct you that you may award damages in this case that are intended to punish Dr. McCurdy for what he has done, and you may award them to deter others from engaging in similar conduct, if you choose. I don't know what the proper figure should be in the punitive damages box. But in deciding that, think about the other people in this community. Think about the unsuspecting women, girls, mature adults, who end up going to see doctors who don't tell them all they ought to have told them about hair [sic] credentials, about surgery, about what they are getting into. That should help you. (Emphasis added.) Because the special verdict form did not specifically delineate punitive damages for fraud, gross negligence, and willful misconduct, it is impossible to apportion the punitive damages award. Nor can we let the award stand for gross negligence or willful misconduct, given counsel's argument before the jury and the evidence of fraud presented at trial that may have inflated the punitive damages award. Accordingly, we vacate the jury's $600,000 award of punitive damages.