Court Opinion

ID: 9533812
Source: CourtListenerOpinion
Date Created: 2023-08-07 04:34:44.236309+00
Date Added: 2024-06-11T13:29:10.976232
License: Public Domain

NEIGHBORS, Justice,
dissenting in part:
Because I disagree with the court’s analysis and resolution of Trimble’s claim against the City for mental suffering, I respectfully dissent to section V.B. of the majority opinion. I agree with the court’s formulation of the general rule: Damages for mental suffering are not recoverable in a breach of contract action unless (1) the breach was willful or wanton or (2) the contract is of such a personal and special nature that serious emotional disturbance was a particularly likely result of a material breach. I conclude that the majority’s application of the rule to the facts in this case produces a result inconsistent with the present state of the law.
A.
The court’s opinion strongly suggests that an employee’s willful and wanton tor-tious conduct which constitutes the breach of the contract between the employer and a third person cannot be imputed to the employer.1 If, indeed, this is the rule adopted here, it is at odds with our holding in McDonald v. Lakewood Country Club, 170 Colo. 355, 461 P.2d 437 (1969), where, in the context of a tort claim, we stated: “[T]he acts of a corporate employee, if within the scope of his employment, make the doctrine of respondeat superior applicable.” 170 Colo. at 362, 461 P.2d at 440. (citations omitted). I fail to see why the same rule should not be applicable to contract claims.2 In McDonald, the plaintiff *733alleged that the defendants “perpetrating the said false arrest and imprisonment of [plaintiff], were intentional or in willful and wanton disregard of the rights and feelings of the plaintiff.” Id. at 361, 461 P.2d at 440.
Moreover, there is considerable tension between the court’s determination that Kauvar was acting “within the outer boundaries” of his discretionary authority for purposes of resolving the immunity issue Trimble v. City and County of Denver, 697 P.2d 716, 729 (Colo.1985), and the majority’s summary conclusion that Kauvar’s “improper intentions cannot rightly be attributed to the City.” At 731.
B.
I think it unwise to address the issue of whether Kauvar’s willful and wanton conduct should be imputed to the City when the special contract analysis yields a satisfactory solution to the question of whether the City is liable for mental suffering damages. The trial court made the following pertinent factual finding:
It reasonably appears that Dr. Trimble entered into the settlement so that he could have the opportunity to teach and render patient care in the emergency medical services area of the Hospital as a means of attempting to restore his loss of reputation as a result of the preceding events.
In Westesen v. Olathe State Bank, 78 Colo. 217, 240 P. 689 (1925), we allowed the plaintiff to recover damages for mental suffering against a bank that breached its contract to furnish him credit for a trip to another state when it refused to honor the plaintiff’s checks during his vacation in California. The court stated:
Defendant in error further contends that plaintiff cannot recover for mental suffering and humiliation unless there was a wilful wrong on the part of defendant. That might be true in cases where mental pain and suffering alone is the ground of recovery. (Citations omitted.) But where, as here, other grounds of recovery are laid, “the grounds for an allowance of exemplary damages need not be present.” 17 C.J. 830. No wilful wrong need be present.
78 Colo. at 220, 240 P. at 691. Admittedly, the court’s analysis in Westesen is less than complete and in need of explication. Therefore, I would adopt the test enunciated by the North Carolina Supreme Court in Stanback v. Stanback, 297 N.C. 181, 254 S.E.2d 611, 620 (1979):
[W]e hold that a claim for mental anguish damages resulting from breach of contract is stated only when the plaintiff’s complaint reveals the following. First, that the contract was not one concerned with trade and commerce with *734concomitant elements of profit involved. Second, that the contract was one in which the benefits contracted for were other than pecuniary, i.e., one in which pecuniary interests were not the dominant motivating factor in the decision to contract. And third, the contract must be one in which the benefits contracted for related directly to matters of dignity, mental concern or solicitude, or the sensibilities of the party to whom the duty is owed, and which directly involves interests and emotions recognized by all as involving great probability of resulting mental anguish if not respected.
(Emphasis in original.) The Stanback test is consistent with section 353 of the Restatement (Second) of Contracts, which provides: “Recovery for emotional disturbance will be excluded unless the breach also caused bodily harm or the contract or the breach is of such a kind that serious emotional disturbance was a particularly likely result.”
In addition to the provisions of the contract enumerated in the court’s opinion, Trimble, 697 P.2d at 721, the contract also limited the City’s financial obligation to Trimble at $19,500 per year. Trimble had the right to terminate the contract upon thirty days written notice to the City. On the other hand, the City was required to give notice of its desire to terminate the contract at least ninety days prior to the expiration of the contract term in any given contract year. The contract also provided for the disclosure of confidential information to third persons at such time as Trimble applied for an academic appointment or professional employment. Given the trial court’s factual determination that the purpose of the contract was to rehabilitate Trimble’s reputation and from my examination of the contract,3 I am persuaded that the Stanback standard is met here. The contract was not concerned with trade and commerce, nor was any significant profit involved. Second, the pecuniary interests were not the dominant motivating factor in the decision of the parties to contract. Finally, one’s reputation as a physician is directly related to matters of dignity, mental concern, and solicitude. An objective review of the contract demonstrates that the trial court’s factual determination is correct. The obvious purpose of the contract was to provide Trimble with an employment base and minimal income so that he could pursue other professional opportunities.
I would hold that the City is liable to Trimble for the mental damages he sustained as a result of the City’s breach of contract.

. The trial court found that "[t]he defendant, City and County of Denver, acting through Dr. Kauvar and the Auditor, materially breached the settlement contract of December, 1974 by prohibiting Dr. Trimble from performing the services allowed or required by the contract and by failing to pay him in a timely manner.”

. The general rule is summarized as follows:
*733A municipality as a legal entity cannot commit a willful or negligent act, but can only do so through its agents or servants. And a municipality is liable for the willful or malicious acts of its agents, where done within the scope of their duties, although there is no ratification of the act by the municipality. Likewise, in a proper case a municipality may be held liable for fraud and deceit practiced by its officers.
18 E. McQuillan & S. Flanagan, Municipal Corporations § 53.62 (1984) (footnotes omitted). However, in McIntosh v. City and County of Denver, 98 Colo. 403, 55 P.2d 1337 (1936), we held that the city could not be held vicariously liable to the plaintiff based on his allegations that the city police officers had wantonly and maliciously arrested, imprisoned, and prosecuted him without probable cause. The doctrines of respondeat superior, vicarious liability, and the like have neither been briefed nor argued in this case. Those issues may be resolved in connection with the indemnification claim filed by Kauvar against the City of Denver. The indemnification claim was severed pursuant to the agreement of the parties and the final judgment concerning Trimble’s claims against the City and Kauvar was certified pursuant to C.R. C.P. 54(b). In addition, the pleadings filed in connection with the indemnification claim reflect that the City of Denver had adopted a charter amendment, since repealed, in which it elected to treat itself as a private employer and was required to pay judgments entered against its employees up to $100,000, but was not liable for punitive damages awarded against its employees. See Charter of the City and County of Denver Art. VI, § C6.8-1. In light of the pending issues remaining in the trial court and the impact of any decision we might make concerning imputing willful and wanton conduct to the City, I believe this provides one more reason why we should avoid addressing that issue in connection with this case.

. Interpretations of contracts are questions of law. E.g., People v. Johnson, 618 P.2d 262 (Colo.1980); Radiology Professional Corp. v. Trinidad Area Health Ass'n., Inc., 195 Colo. 253, 577 P.2d 748 (1978).