Lawrence v. INTERMOUNTAIN, INC.
243 P.3d 508
Utah Ct. App.2010Background
- In 1999, A. Paul Schwenke formed cSave.net, LLC, a business with which Victor Lawrence and family had ties.
- Schwenke arranged leases for three Isuzu Rodeos; Wong signed the leases using his credit despite no intent to pay.
- The Lawrences provided a $3,000 down payment by personal checks; one Rodeo was taken by the Lawrences at lease inception.
- Intermountain arranged the leases with a different dealership, ultimately selling the leases to Bank of America and Isuzu; the Leases were not paid for several months.
- Plaintiffs later sued Intermountain and others, alleging various contract and related claims; Intermountain repurchased the vehicles and later attempted repossession.
- Intermountain sued for fraud-related claims; the trial court found Wong liable for fraud and the Lawrences liable for conspiracy to defraud and conversion, plus punitive damages.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Conspiracy to defraud elements | Lawrences deny meeting all conspiracy elements | Intermountain asserts conspiratorial intent and overt acts | Conspiracy to defraud established against Lawrences |
| Conversion liability | Intermountain possessed rights prior to 1/31/2001 | Lawrences contended no right to possess after notice | Liability for conversion affirmed; post-incident interference also actionable |
| State-law punitive damages review | Punitive awards excessive under Crookston factors | Awards supported by conduct and wealth of defendants | Punitive damages not excessive under Crookston factors; affirmed awards |
| Federal due process punitive-damages standard | Due process violated by punitive awards | Arguments insufficiently briefed; not addressed further | Court declines to address due process challenge due to inadequate briefing |
Key Cases Cited
- Crookston v. Fire Insurance Exchange, 817 P.2d 789 (Utah 1991) ( seven factors for evaluating punitive damages; de novo review)
- State Farm Mut. Auto. Ins. Co. v. Campbell, 538 U.S. 408 (U.S. 2003) ( guidances for punitive-damages due process review: reprehensibility, ratio, and penalties vs. penalties in comparable cases)
- BMW of N. Am. v. Gore, 517 U.S. 559 (U.S. 1996) ( due process guideposts for punitive damages)
- Diversified Holdings, LC v. Turner, 2002 UT 129, 63 P.3d 686 (Utah 2002) ( Crookston factors; punitive damages considerations)
- Smith v. Fairfax Realty, Inc., 2003 UT 41, 82 P.3d 1064 (Utah 2003) ( de novo review; factors overlap with federal guideposts)