Opinion ID: 1598162
Heading Depth: 1
Heading Rank: 5

Heading: The Punitive Damage Issue.

Text: The jury awarded McGough punitive damages against Charles Gabus for $135,000 and Gene Gabus for $25,000. The court, however, granted Gabus's motion for judgment notwithstanding the verdict as to the punitive damage awards and set them aside. When reviewing a motion for a judgment notwithstanding the verdict, we consider whether the evidence, taken in the light most favorable to the nonmoving party, regardless of whether the evidence was contradicted, and every legitimate inference that may be fairly or reasonably deduced therefrom, shows that the movant was entitled to a directed verdict at the close of all the evidence. Hillrichs v. Avco Corp., 514 N.W.2d 94, 100 (Iowa 1994) (citing Beeman v. Manville Corp. Asbestos Disease Compensation Fund, 496 N.W.2d 247, 255 (Iowa 1993)). In reviewing such a ruling, we look to see whether the evidence on an issue was sufficient to generate a jury question. See Nesler v. Fisher & Co., 452 N.W.2d 191, 193 (Iowa 1990). The trial court set aside the punitive damage awards because it determined that Gabus's fraud was simple, not aggravated, and therefore, the defendants' level of culpability fell short of that which is necessary to sustain an award of punitive damages. It cited Holcomb v. Hoffschneider, 297 N.W.2d 210, 214 (Iowa 1980) (exemplary damages appropriate if plaintiff demonstrates malice or outrageous conduct). In Beeman, we affirmed a judgment notwithstanding a verdict for punitive damages. We stated that [f]or punitive damages, a defendant's conduct must be more egregious than mere negligence; it must amount to a willful and wanton disregard for the public's rights or safety established by a preponderance of clear, convincing, and satisfactory evidence. 496 N.W.2d at 256 (citing Iowa Code § 668A.1). We concluded that there was insufficient evidence of the necessary elements for punitive damages. In the present case, the jury was instructed in language identical to Uniform Jury Instruction 210.1: The Plaintiff asks that you award punitive damages. Such damages may be awarded if the Plaintiff has proven by a preponderance of clear, convincing and satisfactory evidence the Defendants' conduct constituted a willful and wanton disregard for the rights or safety of another and caused actual damage to the Plaintiff. The court did not define willful and wanton conduct (nor, apparently, was it requested to do so). In Fell v. Kewanee Farm Equipment Co., we approved this definition of willful and wanton conduct: [T]he actor has intentionally done an act of an unreasonable character in disregard of a known or obvious risk that was so great as to make it highly probable that harm would follow, and which thus is usually accompanied by a conscious indifference to the consequences. 457 N.W.2d 911, 919 (Iowa 1990) (quoting Prosser and Keeton § 34, at 213). In this case, when the evidence is viewed in the light most favorable to the plaintiff, the following facts (among others) could cause a reasonable fact finder to conclude that Gabus was guilty of willful and wanton conduct: Gabus misled McGough about Duggie's potential and misstated the appraisal value and the staffing requirements for the business. Taken as a whole, this conduct establishes evidence of legal malice. We believe that there was adequate evidence from which a jury could find willful and wanton disregard for the rights of this plaintiff and that the court erred in setting aside the verdict for punitive damages.