Court Opinion

ID: 9633164
Source: CourtListenerOpinion
Date Created: 2023-08-22 11:36:07.323833+00
Date Added: 2024-06-11T13:09:33.572238
License: Public Domain

Thompson, C. J.,
dissenting in part:
I agree that an identical compensatory damage award of $5,000 to each of the 85 plaintiffs (total, $425,000) who are dissimilarly situated is erroneous on its face and cannot stand since, in the light of the evidence, their annoyance and discomfort could not have been the same. However, I depart from the majority view that punitive damages in some amount *454may be justified. There simply does not exist a suitable foundation upon which to find malice in fact [NRS 42.010; Nevada Credit Rating Bureau, Inc. v. Williams, 88 Nev. 601, 503 P.2d 9 (1972)] to justify an award of punitive damages in any amount, let alone the enormous sum of $1,400,000 levied against the defendants by the trial court.
Kiln No. 2 of the Nevada Cement Company near Fernley, Nevada, was in operation from September 5, 1969, to March 31, 1971, without adequate dust control equipment. In May 1970, Lyon County filed suit to abate the nuisance. In that case the court found that the emissions from Kiln No. 2 “while creating problems is not overwhelmingly serious, though aggravating, annoying, and to a degree damaging.” That court also found “that an abrupt cessation of operating Kiln No. 2 would result in the immediate termination of employment of approximately 37 men and would thereby create a severe economic hardship to those employees, their families, to Nevada Cement Company, the businessmen of Fernley, Nevada, and suppliers to Nevada Cement Company. For example, Southwest Gas Company would lose approximately $296,145 during a nine month shutdown of Kiln No. 2 with a resultant danger of employee termination by this company. Sierra Pacific Power Company would likewise be damaged with resultant employee termination.”
As noted by the majority opinion “the court in the Lyon County case exercised its discretion, balanced the equities, and concluded that the shutting down of Kiln No. 2 would impose hardships in excess of any benefit to be derived by the residents of Lyon County. Cf. Koseris v. J. R. Simplot Co., 352 P.2d 235 (Idaho 1960); Riter v. Keokuk Electro-Metals Co., 82 N.W.2d 151 (Iowa 1957); Smith v. City of Ann Arbor, 6 N.W.2d 752 (Mich. 1942); Smith v. Staso Milling Co., 18 F.2d 736 (2d Cir. 1927). That court, therefore, granted to Nevada Cement a period of six months from October 1, 1970, to April 1, 1971, within which to correct the emissions from Kiln No. 2, and granted a temporary injunction effective April 1, 1971, if the nuisance was not by then abated. Nevada Cement installed an electrostatic precipitator before April 1, 1971. The nuisance was abated within the time allowed by that court.”
The court order in the Lyon County case provides insulation against the claims for punitive damages in the instant action and precludes a finding of malice in fact on the part of Nevada Cement. Cases elsewhere appear to suggest that it is improper to apply the doctrine of balancing conveniences to a situation *455where the acts complained of are willfully tortious. Stuart v. Lake Washington Realty Corporation, 92 S.E.2d 891 (W.Va. 1956); Wright v. Best, 121 P.2d 702 (Cal. 1942); Bourne v. Wilson-Case Lumber Co., 113 P. 52 (Ore. 1911). The converse of that proposition must be that if a court does apply that doctrine and declines to abate the nuisance forthwith, the conduct of the defendant must be deemed without sufficient malice to justify punishment therefor. Compensation for actual damage sustained would be in order, but not punishment, since the court by its decree has authorized the continuation of the nuisance for a limited period of time.
Of course, the Lyon County decree is not res judicata of the issue of punitive damages. It does, however, bear directly and forcefully upon the motivation of the cement company. To hold otherwise would place Nevada Cement in an intolerable position. The law must not be allowed to rule in one case that “the community needs your business, we will not abate it forthwith, you may continue” — and, in the other case, “but you will be soundly punished if you do so.”
Quite aside from the Lyon County decree, the record may not reasonably be read to show malice on the part of Nevada Cement. The company started operating the second kiln in September 1969. It was equipped with a primary filtration system which removed approximately 85 percent of the dust. Plans had been made to add an electrostatic precipitator to remove a greater percentage of the dust. However, the company wished to conduct necessary tests under normal production conditions before designing and installing the precipitator, in order to determine essential requirements therefor. The tests were run and the results thereof were submitted to the company in December 1969. The company immediately drew up preliminary bid specifications and mailed them to prospective builders of the precipitator.
At that point in time, local and state emission standards were nonexistent. Meetings had been held by officials of Nevada Cement with the County Commissioners and state representatives to discuss emission standards, and final design of the precipitator was withheld pending adoption of appropriate regulations. Not until the end of May 1970 did it become clear that the state regulations to be promulgated would require the precipitator to be 99 percent effective.. Final specifications for the precipitator were then prepared and a contract let for its construction and installation in June 1970. The precipitator was installed and in operation in May 1971, ten months after *456final specifications were known. Installation within ten months was a rapid installation according to the record.
This course of conduct cannot reasonably be construed to denote malice in fact warranting punishment. The award of punitive damages should be stricken from the judgment.