No. 1257 October Term, 1978, Appeal from Order and Judgment entered in the Court of Common Pleas of the 26th,41dicial District of Pennsylvania, Columbia County Branch at No. 353 of 1976, Civil Action - Law - in Trespass
William J. Purcell, Scranton, for appellants.
John M. Kuchka, Berwick, for appellee.
Van der Voort, Watkins and Montgomery, JJ.
[ 261 Pa. Super. Page 346]
This appeal arises from an action in trespass for compensatory and punitive damages due to alleged defalcations in accounting for receipts of cash and inventory from the retail business of selling flowers and gifts owned by plaintiff, and the diversion of customers of that business to a new one opened and operated by the defendants-appellants at a different location. Defendants were employees of plaintiff. A jury returned one verdict in plaintiff's favor for $8000.00. Post-verdict motions having been overruled and judgment entered on the verdict, this appeal followed.
Two issues are before us involving the questions whether the verdict was excessive and whether there was any evidence to sustain an award of punitive damages.
At the outset it may be stated that the resolution of these issues is made more difficult, if not impossible, by the fact that only one verdict was rendered when both types of damages were demanded. Ordinarily it is the approved practice to instruct a jury to find the items of damages separately, particularly since punitive damages may not be disproportionate to the compensatory damages. Bergen v. Lit. Bros. et al., 158 Pa. Super. 469, 45 A.2d 373 (1946), Shurmaker v. Hankey, 158 Pa. Super. 602, 45 A.2d 910 (1946). Givens v. W. J. Gilmore Drug Co., 337 Pa. 278, 10 A.2d 12 (1940). Hughes v. Babcock, 349 Pa. 475, 37 A.2d 551 (1944), Mitchell v. Randal, 288 Pa. 518, 137 A. 171 (1927). See also 75 Dickinson L.R. 585 (1971).
[ 261 Pa. Super. Page 347]
However, we shall endeavor to resolve the matter, regardless, by first considering whether there is any merit to the claim for exemplary damages. Exemplary damages are allowed only when the act which creates actual damage also imports insult or outrage, and is committed with a view to oppress, or appears to have been committed in contempt of a plaintiff's rights. Although they have been allowed in certain cases for the tort of intentional interference with a prospective business advantage, there must be present malice or wanton conduct to justify the allowance. North Carolina Mut. Life Ins. Co. v. Plymouth Mutual Life Ins. Co., D.C., 266 F.Supp. 231 (1967). Malice is the important ingredient. Philadelphia Traction Co. v. Orbann, 119 Pa. 37, 12 A. 816 (1888).
The present case presents a situation where the defendants divorced themselves from the business enterprise they had engaged in with the plaintiff, and established a similar business of their own, allegedly attracting some customers of the old business to the new one. The complaint alleges this was wrongfully done "-- by advising them that the business was moving and was going to undergo a name change --". In addition, it alleged that they converted to their own use cash acquired through the operation of plaintiff's business, and also converted to their own use various items of inventory from his business. These allegations were all denied by the defendants.
It appears that the defendants were employed on a profit sharing basis of $1.60 per hour plus 1/3 of any profits. Plaintiff's principal business was wholesale. The flower and gift shop was retail and was opened at the request of the defendants. It constituted only five per cent of plaintiff's total operation. There was some dispute as to whether defendants were partners or employees. At first, defendants worked part time, but later devoted full time to the business. Their connection with the business began about May 1, 1974, and lasted until ...