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Swinton v. Savoy Realty Co.
73 S.E.2d 785
N.C.
1953
Check Treatment
DeviN, C. J.

The defendants noted numerous exceptions during the trial, but base their appeal chiefly on three grounds: (1) the denial of their motion for judgment of nonsuit, (2) submission of issue of punitive damages, and (3) errors in the court’s instructions to the jury.

1. It is apparent from an examination of the record that the plaintiffs’ evidence considered in the light most favorable for them was sufficient to make out a easе for the jury. The plaintiffs are aged Negroes without education, and their testimony, if believed, was adequate to establish actiоnable fraud. Garland v. Penegar, 235 N.C. 517, 70 S.E. 2d 486; Gray v. Edmonds, 232 N.C. 681, 62 S.E. 2d 77; Kennedy v. Trust Co., 213 N.C. 620, 197 S.E. 130.

The plaintiffs’ evidence was sufficient to show that the action was begun within three years of the time when the facts constituting the alleged fraud were discovered, or should have been discovered in the exercise of reasonable diligencе. G.S. 1-52 (9); Lee v. Rhodes, 231 N.C. 602, 58 S.E. 2d 363; Wimberly v. Furniture Stores, 216 N.C. 732, 6 S.E. 2d 512; Hargett v. Lee, 206 N.C. 536, 174 S.E. 498. The facts stated in Harding v. Ins. Co., 218 N.C. 129, 10 S.E. 2d 599, and Hargett v. Lee, 206 N.C. 536, 174 S.E. 498, cited by defendants, are materially different ‍​​​‌‌​‌‌‌‌​​​​​‌​​​‌‌​‌‌​​​​‌​‌‌‌‌‌​​‌​​‌​​‌​‌‌‌‍from those in the case at bar.

2. Defendants assign error in the action of the cоurt in submitting an issue as to punitive damages.

The power of the court to assess punitive or exemplary damages, and thereby authоrize the taking of money from the defendant and awarding it to the plaintiff in addition to that sufficient to compensate him for the injury donе him, is questioned in some jurisdictions (25 C.J.S. 708), but it has been uniformly held with us that punitive damages may be awarded in the sound discretion of the jury and within reasonable limits, though the right to such an award does not follow as a conclusion of law because the jury has found an issue of fraud against the defendant. There must be an element of aggravation accompanying the tortious conduct which causes the injury. Smart money may not be included in the assessment of damages as a matter of course simply because of an actionable wrong, but only when there are some features of aggravation, as when the wrong is done willfully or under circumstances of rudeness, oppression, or in a manner which evinces a reckless and wanton disregard of the plaintiff’s rights. Baker v. Winslow, 184 N.C. 1, 113 S.E. 570. “But these damages *726 are awarded oil the ground of public pоlicy, for example’s sake, and not because tbe plaintiff bas a right to the money, but it goes to him merely because it is assessed in his suit.” Cotton v. Fisheries Products Co., 181 N.C. 151, 106 S.E. 487.

In the American Law Institute Restatement Law of Torts, sec. 908, it is said: “ ‘Punitive damages’ are damages, other than compensatory or nominal damages, awarded against a person to punish him for his outrageous conduct.” In actions to recover damages for a tort which involves the ingredient of fraud, malice, insult ‍​​​‌‌​‌‌‌‌​​​​​‌​​​‌‌​‌‌​​​​‌​‌‌‌‌‌​​‌​​‌​​‌​‌‌‌‍or is characterized by reckless and wanton disregard of the rights of the plаintiff exemplary or punitive damages may be awarded for the purpose of punishing or making an example of the defendаnt. 15 A.J. 713. As a general rule exemplary damages áre not recoverable in actions for breach of contract. 25 C. J.S. 716; Saberton v. Greenwald, 146 Ohio St. 414; 165 A.L.R. 599.

In Saberton v. Greenwald, supra, the action was to recover damages for fraudulent representation in the sale of a watch. It was held by a divided court that punitivе damages might be recovered under the facts of that case. Three Justices dissented, arguendo, on the ground that the tort sued on was not оf such a character as to warrant the assessment of punitive damages, questioning also the power of the court to make the defendant pay twice for the same wrong.

In some cases, in actions to recover damages for fraud, where punitive damages are asked, it is suggested that a line of demarcation be drawn between aggravated fraud and simple fraud, with punitive damages allowable in the one case and refused in the other. In a note in 165 A.L.R. 616, it is said: “All that can be said is that to constitute aggravated fraud there must be some additional ‍​​​‌‌​‌‌‌‌​​​​​‌​​​‌‌​‌‌​​​​‌​‌‌‌‌‌​​‌​​‌​​‌​‌‌‌‍element of asocial behavior which goes beyond the facts necessary tо create a case of simple fraud.”

Without undertaking to pursue this further, we think the rule is that the facts in each case must determine whether the fraudulent representations alleged were accompanied by such acts and conduct as to subject thе wrongdoer to an assessment of additional damages, for the purpose of punishing him for what has been called his “outrageоus conduct.”

In the case at bar the plaintiffs’ original complaint alleged that defendants entered into a written contraсt to convey lot No. 310, and pointed out certain lines as the boundaries of this lot, and plaintiffs in their complaint demanded spеcific performance of the contract according to the boundaries thus indicated. Subsequently in an amended and substituted сomplaint, plaintiffs having accepted the deed to lot 310, sued to recover damages for the loss occasioned by defendants’ fraud in the sum of $1,500. This the jury awarded them. Thus the plaintiffs seem to have been made whole for the $2,000 paid out, as they have received a lot worth $500 and *727 $1,500 as damages oil tbe ground of fraud. This is all tbe plaintiffs asked for, except an additional amount as рunitive damages.

We are inclined to tbe view tbat tbe facts in evidence bere are not sufficient to warrant tbe allowance of punitive damages. There was no evidence of insult, indignity, malice, oppression or bad motive ‍​​​‌‌​‌‌‌‌​​​​​‌​​​‌‌​‌‌​​​​‌​‌‌‌‌‌​​‌​​‌​​‌​‌‌‌‍other than tbe same false representations for which they have received tbe amount demanded. Here fraud is not an accompanying elеment of an independent tort but tbe particular tort alleged.

Though tbe conduct of tbe defendants was reprehensible, they have now been required to compensate tbe plaintiffs fully for tbe loss and injury caused by their false representations. We do not think tbe law requires tbat an additional amount for punishment should be meted out in this action.

3. Tbe defendants have noted exceptiоn to several portions of tbe court’s charge to tbe jury, and to tbe failure of tbe court to explain tbe law relating to certain phases of tbe testimony.

We have examined these in connection with tbe charge as a whole in tbe light of tbe evidеnce offered, and do not perceive any substantial ground upon which to predicate harmful error.

Other exceptiоns to which no reason or argument ‍​​​‌‌​‌‌‌‌​​​​​‌​​​‌‌​‌‌​​​​‌​‌‌‌‌‌​​‌​​‌​​‌​‌‌‌‍is submitted are deemed abandoned. Rule 28; Bank v. Snow, 221 N.C. 14, 18 S.E. 2d 711.

For tbe reasons herein set forth tbe allowancе of punitive damages should be eliminated from tbe judgment, and except as modified in this respect tbe judgment is affirmed.

Modified and affirmed.

PaRKeb, J., took no part in tbe consideration or decision of this ease.

Case Details

Case Name: Swinton v. Savoy Realty Co.
Court Name: Supreme Court of North Carolina
Date Published: Jan 6, 1953
Citation: 73 S.E.2d 785
Docket Number: 676
Court Abbreviation: N.C.
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