Trimble v. City and County of Denver

KIMBLE, Keary Petitioner, TRIMBLE, Petitioner, Jack F. Cleveland DENVER, The CITY AND COUNTY OF PEOPLE State of municipal corporation, Colorado, Respondent. Kauvar, Respondents. Abraham J. No. 84SC370. No. 81SC398. Supreme Court Colorado. Supreme Colorado, Court of 4, 1985. En Banc.

Feb.

March 1985. Rehearings April 15, Denied Massaro, Sp. Deputy Nicholas R. Public

Defender, Junction, petitioner. Grand Hutchins,

John Milton Atty. 1st Asst.

Gen., Denver, respondent.

ORDER OF COURT

Upon consideration of the Petition for cause, of Certiorari filed

Writ above being sufficiently and now premises,

advised

IT IS DAY ORDERED THIS that said be, is,

Petition hereby shall same

Granted, and that shall briefs be filed as

follows:

(a) Opening Petitioner’s Brief shall be date; days

filed forty within from this

(b) Respondent’s Answer Brief shall be thirty days

filed within receipt from Brief; Opening

(c) Reply Petitioner’s Brief be filed days receipt

within fourteen

the Answer Brief. COURT, BANC,

BY THE EN FEBRU-

ARY 1985. issue(s) summary of as an- day

nounced Court is as follows:

Whether the erred in

refusing to order trial court to dismiss charges

all due of petitioner's to a violation

right to a speedy trial under the detainer

statute, 16-14-101, -108, section 8 C.R.S. Owen,

Holme Roberts & Daniel S. Hoff- man, McDermott, Hansen, Anderson & Denver, Reilly, Reilly, Daniel M. peti- tioner. Zall, City Atty.,

Max P. Kelly, Robert M. Stoffel, Jr., Goral, L. John Brian H. Asst. Denver, City Attys., respondents County of Denver and Abraham J. Kauvar, capacity Manager Hospitals. Health and Hart, McClearn, Holland & William C. Sattler, Tredennick, Jr., Bruce W. John C. Denver, respondent Abraham J. Kau- var.

LOHR, Justice.

Dr. F. Cleveland di- former Department Emergency rector of the (Emergency Medical Services Medical Ser- vices) Hospital brought at Denver General against County suit of Denver (City) supervisor, and Trimble’s immediate Kauvar, manager Dr. Abraham J. of Den- Department Hospitals ver’s of Health and (Health Hospitals). Trimble’s com- plaint stated a breach of contract claim against and claims for tortious Kauvar, arising conduct all employment the termination of Trimble’s Hospital. Denver General After jury, trial without a the Denver District compensatory Court awarded Trimble Kauvar, punitive damages against compensatory damages against City. Appeals The Colorado Court of affirmed City, the award judgment. reversed remainder Denver, 645 City County Trimble v. & (Colo.App.1981). granted We cer- tiorari to review this decision. appeals We conclude that the court of correctly the extent of the determined City’s liability. Parts of the trial court’s Kauvar, however, judgment against proper and should have been sustained. Therefore, judgment we affirm the part, part, reverse it in proceed- the case for further remand ings.

I. Trimble threatened on several occasions to resign given unless he were more re- The trial court findings made extensive improve emergency patient sources to care. detailing the relevant facts. It summa- These threats irritated Kauvar. In order rized the case as follows: provide patient faster service and reduce We are Court on matter this because Services, at Emergency loads Medical Trim- very respected physicians two clashed began ble to divert ambulances to other philosophical over differences as to how hospitals. opposed diversion of emergency ambulatory services and care practice ambulances because this entailed should be administered at Denver Gener- loss of revenue. The differences between Hospital_ philo- al of their [BJecause the two men April intensified. In sophical differences Dr. Kauvar decided resignation, Kauvar demanded Trimble’s who, “get rid” of Dr. Trimble he be- May, pro- but Trimble refused. In lieved, cooperating poli- was not with his posed splitting Emergency case, Medical Servic- process cies. this and meth- unit, es into a critical care which getting od would rid of Dr. Trimble was patients care for requiring unscheduled power. abuse administrative He had treatment, emergency unit, receiving and a other authorized alternatives to correct which problem patients would serve unscheduled he believed Dr. Trimble seriously less injured was mutinous or ill. or obstructive but he Trimble was to chose an remain overall chief improper unauthorized and as well as head of opposed method which resulted in the critical care. reorga- medical and academic community believing that, Dr. nization. The Trim- trial court found as a “fired”, ble damaging repu- was thus the of disputes, result these developed Kauvar Also, tation of Dr. exchange personal Trimble. in hostility toward Trimble and agreement that Dr. began explore Trimble would ways removing to him. resign, give up right the to a career Late in June Kauvar announced the hearing, City service and not sue the split of the receiving unit and the critical employees, its Dr. Kauvar and the July care unit. On Kauvar ordered entered into a settlement contract with stop all Trimble ambulance diversions to Dr. Trimble which the defendants did not hospitals. July On the Denver honor, thereafter further damaging Dr. published Post an article reporting Trim- Trimble. disagreement reorganization ble’s with the appointed Trimble was director of Emer- Emergency Medical Services. Kauvar gency Medical Services at Denver General very upset was newspaper report. the Hospital classified, in 1972. This was a 8, 1974, July On Kauvar Trim- removed permanent position. career service Kauvar position ble from his as director of Emer- appointed manager of Health and Hos- gency reassigned Medical Services and him pitals by mayor February the 1974. He Department to the Surgery as a staff supervisor. was Trimble’s surgeon. Kauvar testified that he had de- post, When Kauvar assumed his Emer- permissible termined that the transfer was gency Medical experiencing Services was upon based the advice of the Career Ser- delays service, shortages ambulance Authority. vice The trial court found that personnel equipment, patient and and con- advice, he had received no such and that tacts at four designed capacity times the the reassignment was made with intention- emergency the facilities. The trial court al disregard and reckless for career service found responsible that Kauvar was not Although rules. Kauvar described the re- problems resource that existed in assignment temporary, immediately as he .Emergency Medical Services authorized formation of a search committee opinion Differences permanent between to look Kauvar for a Trim- successor to concerning hospital Trimble Emergency adminis- ble as director of Medical Ser- policy trative immediately. surfaced almost vices. The trial court found that Kauvar cine, including emergen- reassignment permanent instruction of be intended provision medical staff and regard cy “were services1 his actions and that care, patient for not attended less than fifteen good faith not over the year. Dr. Trim- hours week course of one of malice toward circumstances return, ble, Trimble, however, grievance, him.” In Trimble withdrew the ‘get rid’ of resigned employee, Denver Hos- as a career service did not elect to leave General covenanted not to sue or its em- pital. “relatpng] previous ployees em- [his] officially August, In Kauvar abolished Department ployment City’s separate Emergency Medical Services as a Hospitals Health and or the business and department, eliminating thus the director’s operation Department....” the said The critical care unit was trans- position. However, had determined before Department Surgery, ferred to the was executed Trimble receiving unit of the De- became provide to teach or was not to be allowed Medicine. The trial court partment of patient under the care contract to work primary purpose of this found that emergency in the medical services area of reorganization per- to effect Trimble’s hospital, and Kauvar adhered to that emergency ser- manent removal from decision. specifically The court deter- vices area. gave assign- attended mal- Trimble no work mined that action was and was not taken in ments until March when Trimble com- ice toward Trimble pur- plained good organizational for bona fide to Kauvar about the lack of work. faith poses. assigned Kauvar then Trimble to write re- ports require pres- that did Trimble’s response position to elimination premises. hospital ence on the After mak- director, pursuant to career service during payments to Trimble rules, chose demotion rather than period, the initial months of the contract position layoff. He was demoted city auditor refused to authorize such Department of associate director of the payments April May. On June However, Surgery. the former associate 1975, Trimble elected to treat the contract perform director continued to the duties of “discharged.” office, while, found, that as the trial court given “Trimble was an office a mainte- resignation, After worked as his Trimble building, house’ nance known as ‘boiler private hospital in Den- a consultant for a perform the and was not allowed to duties pro- accepted position and then as a ver Further, he was of the Associate Director. University Florida in 1978. fessor at the assigned proctology, specialty by not his to employment by The discontinuation of his choice.” to Kauvar Unbeknownst City had led to the termination agreed Depart- had with the director professorship University of assistant at the Surgery never ment of that Trimble would candidacy and of his for an associ- Colorado director of perform the duties of associate professorship The trial court ate there. department. significant very there was a found negative among his reaction to Trimble grievance challenge to Trimble filed a peers following separation from Denver validity of Kauvar’s actions under career Hospital. profes- His extensive General rules, pursuing service but in lieu of opportunities affiliations and his to sional relief conclusion he entered into a settle- to reports speeches publish and make agreement City in December ment with found that: severely reduced. The court found, 1974, intended, court to as the trial reputation. Dr. Trimble has suffered a serious and restore his Trimble was to oppor- emergency permanent reputation loss of serve as a consultant medi- though parties Emergency continued to refer to critical care as 1. Even Medical Services had abolished, technically leaving emergency a critical been medical services. unit, separate receiving care unit and a employment tunity gain prestigious to for breach of contract. It held that Trim- The medical agreement academic environments. ble had affirmed the settlement community Dr. believes academic by and was bound its covenant not to sue Kauvar_ ‘fired’ Dr. Trimble was wrongs, suffering for earlier mental result of

as a breach of settlement agreement compensable, was not that “for ... Dr. has suf- As a result Trimble purposes of the tort intentional interfer- permanent fered a and substantial loss [of party ence was a enjoy with ability life. contract] the settlement contract and therefore could 2, 1975, September brought On Trimble it, said not to have interfered with be action, present seeking damages from that Kauvar was jointly liable for from Kauvar for tortious conduct and breach that contract.”2 City for of contract. case was breach jury. tried to the court without a Four issues are on certiorari raised re- (1) Does view: Trimble’s covenant not to The trial court ruled that ac- Kauvar’s sue all actions other bar him than those tions constituted malicious interference agreement? (2) based on the settlement rights Trimble’s contractual as a ca- Kauvar, employee City, Could as an employee reer service and under settle- be liable for intentional interference with agreement. The court concluded also fraud, relationship the contract between that Kauvar had Trimble committed based City? (3) upon enjoy and the his intentions not to allow Trimble to Does offi- perform (4) immunity as associate director of the De- cial for his actions? Can partment Surgery provide or to the in- against recover either Trimble defendant agree- tended under the services settlement suffering? for mental We consider these ment, upon his conduct in furtherance questions in turn. addition, of those intentions. court ruled that Kauvar had the tort committed II. pow- intentional abuse of administrative signed agreement a settlement City er. The was held to have breached pro- effective December which agreement materially settlement vided that: preventing performance Trimble’s and fail- required payments. make The trial Dr. Trimble shall refrain hereafter from $14,062.50 any assessed filing any civil action court or damages monetary losses filing any grievance or similar ac- from breach of the settlement any professional organization tion before $35,000 additional contractual society filing legal or from life, ability enjoy Trimble’s loss or administrative action suffering. form of mental also held It County Denver, Department its Kauvar for liable these same amounts Hospitals, and or employees Health its upon

based his tortious As fur- conduct. filing insofar as such or action re- torts, ther for the remedies Kauvar’s to Dr. previous employ- lates Trimble’s $15,000 assessed Kauvar alone City’s Department ment at the of Health damages compensatory for Trimble’s loss Hospitals opera- and or the business and $20,000 reputation punitive and dam- of the Department tion said and shall ages. processing pend- refrain from further his Appeals ing Authority appeal Colorado Court of affirmed Service Career only $14,062.50 City the award the grievance stipula- into shall enter a suffering 2. The court of the trial misconstrued mental against same amounts awarded —the judgment including court’s damages against as the assessment for breach of the settlement judgment against Kauvar for the settle- breach of contract —the Kauvar in those agreement. Although ap- the trial court deter- amounts based on tort. The court of $14,- peals incorrectly mined that Kauvar liable for Trimble’s also noted that Trimble assert- $35,000 monetary City. 062.50 loss as well for as ed tortious conduct on the Co., v. H.A. 579, Aaberg Harman dismissing appeal grievance 144 Colo. said tion (1960); Ferry, Holscher v. request at the of the Man- prejudice 358 P.2d 601 with Department (1955). of Health ager of the 280 P.2d 655 The choice Colo. City. Hospitals of belongs of remedies to the one defrauded. Yeager, Altergott v. Colo.App. not to asserts this covenant Kauvar necessary Election is except on breach of the sue all actions bars recovery are in- whenever- theories of agreement. settlement Ferry. Holscher consistent. policy favors settlements Public disputes, fair provided settlements are It pleadings, is clear from the Davis v. Flatiron Materials ly reached. course of the trial trial court judg and the Co., (1973). The 511 P.2d 28 182 Colo. ment that Trimble has elected to affirm the ruled, however, that Kauvar trial court agreement recovery seek settlement and to as employ the covenant not to sue could not agreement by City. for breach intent a defense because fraudulent addition, In he seeks in tort for respect agreement. with settlement causing fraud in him to enter into Kauvar’s He intended allow Trimble never Both the contract. of these claims are patient emergen provide teach or to care theory, on a consistent affirmance of based cy medical services. Donohoe, Carpenter the contract. effect, rescinded trial court (1964); Altergott 388 P.2d Colo. respect not to covenant sue with Yeager. Having affirmed the settlement remedy fraud. Kauvar as Kauvar’s contract, Trimble avoid the not also with contracted Trimble contract, including burdens of that his part-time career pecuniary and benefits of promise regarding not to sue Trim- Kauvar practice year teaching and one emer pre-settlement employment. A reme ble’s services in for his gency medical return dy based on affirmance of the contract is and his not to sue. resignation covenant arising a remedy, inconsistent with out of promised not to Kauvar and Trimble sue facts, same based on disaffirmance city employees concerning previ his Ferry, rescission. Holscher v. operation ous or the of Health employment Trimble When Thus, Hospitals. is a third- contract, to affirm he aban elected beneficiary of the not to party covenant right to rescind it in whole doned sue, raise as de and could that covenant Id. part. Hence the not to sue covenant Hyzak Greybar, action. fense in this remains enforceable. (1975). Deny partial this defense effected that, argues election agreement. of the settlement rescission required, incurs no a tortfeasor remedies fraudulently attempting to induce a risk Although, later discussed agreement That settlement with a victim. opinion, Kauvar’s intention not to hon- is, will affirmance leave the tortfeasor agreement constituted the settlement sought, agreement and disaffirmance fraud, partial rescission of the wrongdoer posi place that in no worse will remedy proper not a for that misconduct. committed. tion than before fraud was Brink, See Colorado Co. v. Gibraltar Life however, fails, argument because Trimble’s One rem party has an additional the defrauded remedy inducement seeking to fraudulent who elects edy in such a case. The victim must elect rescind of a contract either to the the contract is not limited to to affirm the entire contract restore the conditions seeking made, remedy damages subse agreement existing the before addition, fully con quent breach. or entire recover to affirm the contract and agreement, the sistent with affirmation of the difference between the actual value party may bring a tort ac the of those the defrauded benefits received the value they represented. guilty the of fraud benefits if had been as tion one 724 damages resulting fully from the is consistent with

obtain fraudu affirmance the misrepresentations. Therefore, Carpenter lent Do contract. that extent nohoe, 82, 401; 154 Colo. 388 at P.2d at McKay Fleming holds that an action for 28, at Altergott, Colo.App. 37 543 P.2d at fraudulent inducement is necessarily incon- party may 1297-98. The defrauded recov sistent action for with an breach of con- damages prox er such as are a natural and tract we it. overrule consequence the imate fraud. Russell v. argues recovery even Co., Mortgage First American 39 Colo. pre-settlement the torts is barred the 360, course, App. Of sue, there covenant not to remain two torts the victim elect to instead rescind the scope that fall outside the of that covenant. remedy contract and be limited to resto They are Kauvar’s fraudulent inducement existing ration conditions before the of the settlement contract and his malicious agreement was made. Neiheisel v. Ma City’s performance interference with the lone, 586, (1962); 150 Colo. agreement. under that We discuss these 190, Ferry, Holscher v. 131 Colo. 280 P.2d sequence. (1955). If the victim chooses to affirm fraud elements of are: contract, necessary it is not to release (I) A representation false of a material obligations him from his contractual —at fact, representation existing a to a or they least as matters of relate to which he existing fact material made with a reck- knowledge had when contract was disregard less of its truth or a falsity; or compensate made—in fully order to him fact, existing concealment of material Thus, deter the tortfeasor. because good equity that in conscience should sue, covenant not to Trimble cannot (2) Knowledge part be disclosed. on the pre-settlement recover for the so-called making representation of the one arising allegedly torts —those from Trim- false; that it is or utter indifference to reassignment “temporary” ble’s to the De falsity; knowledge its truth or he partment Surgery, abolition of his concealing equi- is material fact that in post Emergency as director of Medical Ser ty good he conscience should dis- vices, subsequent and his demotion. (3) Ignorance close. on the recognize We in McKay representations one to whom are made Fleming, (1919), 66 Colo. 180 P. 747 concealed, from whom such fact is [of] held that an action fraudulent in falsity representation or of ducement to enter a inconsistent (4) existence of fact concealed. with an action for breach contract. Cer representation or concealment made or tainly, permissible it would not be to allow practiced shall intention that it recovery double same elements of (5) upon. repre- be acted Action on the damage through independent such actions. sentation or concealment appeals’ The court of in Altergott, decision damage. however, P.2d Associates, Brown, Bemel Inc. v. illustrates recovery that double in 414, 418, (1967), quoting P.2d in an herent action for fraudulent induce Goodspeed, Morrison v. 100 Colo. coupled theory with a of contract 477-78, Carpenter affirmance. Accord Dono hoe, P.2d To court The trial found that even recovery allow fraud the extent that the time the settlement value of the contractual abiding benefits con made Kauvar no intention had fell fraudulently ferred short of the value it. The found this false was a represented, plus any representation natu fact constituting fraud. rally proximately fraud, dispute caused appeal does not doubly compensate does not the victim and this was a misrepresentation3 of an exist- It is not misrepresen- clear from trial court’s order whetlier this fact was found to be sue, Booras, scope agree of the covenant not to Stalos ing material fact. See tort, proven by P.2d 254 It that this would findings previous employment trial court’s not relate to his from the apparent falsity operation of Health and knew the business that Kauvar not, and Hospitals Trimble did terms are representation, as those used Therefore, was intended representation the covenant not to covenant. agree- the settlement preclude induce execution of from sue does not Trimble assert- agreed not to sue was ment. The covenant ing that tort claim. in reliance on the fraudulent Trimble damage representation, III. fraud the elements of

Trimble. Hence In further defense the ma proven. tort, Kauvar contends licious interference asser disputes Trimble’s alleged that even if his interference with inducement of the fraud in the tion that relations Trimble and contractual between falls outside the agreement settlement agreement under the settlement He rea scope covenant not to sue. scope of the cove does not fall within misrepresentations any sons that because sue, nant not to his actions were neverthe inducing the or concealment privileged par was a less because exe agreement was place took before the claims, and, ty to the contract he cuted, the ambit of the they must be within acting scope employ within the represents This an to sue. covenant not words, City. pos In other he the covenant. unduly construction of broad agent organization an is not its that an file action promised not to contractual liable for interference with the employment or the relating previous to his organization and relations between operation of Health and Hos business parties. that the fact that third We'hold action for fraudulent pitals, whereas the employee alleged tortfeasor was was, what at the inducement relates to simply contracting parties is one one of the time, employment provided as his future factor, one, important in determin albeit an agreement. To the terms of the settlement person “improper acted whether focus, proof view the matter another required to establish an essential ly,” as fraud, Trim- damages is an element interfer of the tort of intentional element damaged by misrep Kauvar’s ble was not relations. ence with contract until he present intent resentation providing part-time prevented of a contract The existence by the contemplated settlement services nonparties not to inter impose duty for fraud did not agreement. His action contract. performance of that fere with the execution, so his cove until after accrue Gardens, Olympian Inc. Memorial to ex reasonably be construed nant cannot Consultants, Inc., Management & Sales action, especially it is as tend to such an (Colo.1984); Sett Watson v. part on Kauvar’s inten based in essential 150 Colo. lemeyer, conduct. Rosen post-execution tional Cf. Co., Baking Nonpareil Weber Inc., 569 Development, LTV Recreational 274 P. 932 Violation Cir.1978) (contracts (10th waiv F.2d inten injury, is the tort of duty, causing negligent conduct ing liability for future rela with contractual tional interference scrutinized). carefully will be cited with Gardens we tions. Memorial the tort following definition of approval the malicious interfer regard to With (Second) of relations, in Restatement set forth the second ence with contractual § (1979): Torts be outside the alleged by Trimble to tort analysis. does not affect the that this It will be assumed ted or concealed. misrepresented, but the distinction fact was 726 (e) intentionally improperly protecting

One who the social interests in the freedom of action of the actor and performance interferes with the of a con- other, the contractual interests of the (except marry) to tract contract be- person by (f) proximity tween another and a third or remoteness of the inducing causing actor’s conduct to the interference and or otherwise the third contract, person perform not to (g) parties. the relations between the subject liability to to the other for the § (Second) (1979). Restatement of Torts 767 pecuniary loss to the other Gardens, Memorial 690 P.2d See person from the failure of the third n. 7. perform the contract. Although important it (emphasis 690 P.2d at 210 added in Memo- corporate “freedom action [of officers] Gardens). Comtrol, rial See Inc. v. corporate purposes directed toward should Telephone Telegraph Mountain States & personal not be curtailed fear of liabili Co., 513 P.2d 1082 Inc., ty,” Inforex, Mass.App. v. Steranko 253, 273, (1977), 362 N.E.2d even City Kauvar asserts that agent can improper be liable for inter person” respect was not a “third with principal’s ference with the contractual re City obviously him. and the lations, see Credit Investment & Loan Co. egos, relationship not alter which would Co., Bank Guarantee & Trust preclude characterizing City as a third If the actor is person. Lakewood, City See Gude solely by motivated a desire to harm one of (Colo.1981). Kauvar’s rela contracting parties or to interfere in tionship employee was that of the contractual relations between those employer agent principal. See Shri parties, certainly interference is im Carter, (Colo.App. 651 P.2d ver (Second) proper. Restatement of Torts 1982); Corp. Lawson, Electrolux § 767, (1977); Prosser, comment d W. (Colo.App.1982). employer An Torts, (4th 1971). Law 943-44 ed. Cf. employee sue an for tortious interfer Steranko, (analyz N.E.2d 235-36 ence with contractual relations between the corporate the matter in terms of offi employer persons. and other Electrolux qualified privilege, cers’ lost when conduct therefore, Corp. City, v. Lawson. The malice). is motivated person respect indeed a third with to Kau- trial court var. found that when the set- agreement tlement was executed Kauvar Nevertheless, Kauvar is not liable already had determined that Trimble would per tort for his interference with the not be allowed to render services in the formance of the settlement be emergency medical services area at Denver tween Trimble and the unless Kauvar Hospital General permit- would not be “improperly.” Gardens, acted Memorial provide patient ted to teach or to care. The 207, 210; (Second) Restatement specifically trial court concluded that Kau- § Torts var’s actions and intentions constituted ma- determining whether an actor’s con- licious interference with the contractual re- intentionally interfering duct with a lationship between City, Trimble and the improper ... of another is authority. and an abuse of administrative not, given consideration is to the follow- authority The abuse of administrative ing factors: ruling implies acting that Kauvar was not (a) conduct, the nature of the actor’s organizational purposes for bona fide (b) motive, the actor’s interfering with the Trim- contract between (c) the interests of the other with This, City. conjunction and the ble interferes, which the actor’s conduct finding malice, leads to the conclu- (d) sought the interests to be advanced unjustified sion that Kauvar’s actions were actor, by the improper. With the other elements of case, answer often the found tort intentional interference with must be established, relations we hold a balance between evils inevitable contractual correctly judg- the trial based that in either alternative. claim. Kauvar on this 1960, century From turn of the the to the in Colorado courts balanced evils the IV. did, way Judge by same Hand confer- however, asserts, enjoys that he ring upon immunity officials. In absolute all of immunity against official Trimble’s Light Electric Ouray Miller & Power by manager virtue role as of claims Co., 131, (1902), 18 70 P. 447 a Proper Hospitals. Health and evaluation county mother the commissioners of sued requires some of this contention discussion Ouray personally County for her son’s principles of the evolution the official

of of by during death suffocation a fire in the immunity in law. Colorado county liability jail. Alleged was based immunity doctrine official The of upon breach of the commissioners’ statuto- in grounded common law. Kristensen v. duty county ry jail personal- to examine the Jones, 122, 195 Colo. irregularities ly and to all correct found. cogently The rationale for the doctrine original Appeals of Court of Colorado Judge in by Hand Gregoire stated Learned of charges against affirmed dismissal the Biddle, (2d Cir.1949), 581 R2d commissioners, county stating: the denied, S.Ct. cert. U.S. law, plaintiff If the the contention be (1950): L.Ed. then each individual commissioner would saying go It does indeed without that an this, to be liable in like actions because official, guilty using who in fact his by suffered an individual others, upon powers spleen to vent his in alleged public high- reason of defects a any personal motive con- for not way county bridge, in or in a good, public nected with the should not public public building, grounds or in the liability injuries he escape may for so might in which it be situate. To so hold cause; and, possible practice in it were large would tend counties of complaints to the guilty, to confine such state, least, bring about, as was deny recovery. be it would monstrous Idaho, supreme said court of “the doing justification for so is that it is county abrogation literal of the office of impossible to the claim is know whether commissioner, for no sane man would the case well founded until has been liability position assume with such a tried, officials, all and that to submit omitted). (Citation attached.” guilty, innocent as as the to the well 138-39, Subsequent at 449. Id. at 70 P. of a burden trial inevitable period prin- cases this first reiterated outcome, danger dampen its would personal- were ciple public officials not resolute, of all but the most or the ardor duty public, ly liable for breaches irresponsible, unflinching most in the dis- bolstering immunity the idea official Again again charge of their duties. public officials owed a notion that for public calls action which interest whole, only duty public a mistake, on a may turn out to be founded indi- held therefore could be liable an official later in the face which Belknap, injury. vidual Richardson put satisfy himself to it to a find hard (1923) (no personal 213 P. 335 Colo. good There in- faith. must jury of liability failure county commissioners’ public punishing offi- deed be means bridge); railings People ex to maintain truant to their cers who have been Publishing Hoag, Co. duties; rel. Lamar quite another matter but that is (1913) (no personal P. 400 exposing such as have been honest- from publish anyone liability county clerk’s failure to ly who has mistaken to suit list). errors. As is so nominations suffered their immunity immunity. The doctrine of absolute of official That court has distin- abrogated guished discretionary when court held between acts and county Ouray acts, commissioners of recognized larg- ministerial and has County personally for torts liable degree immunity per- er for officials Flor, they committed. Liber v. forming discretionary acts. We reversed law, public Under the common officials dismissal of the action the commis degrees enjoyed varying as a class have brought sioners by plaintiff who suffered immunity from lawsuits order to injury as a negligence result of the stor encourage explosives them in the administration of highway. near a This stated, appears protect their duties and to all that them from “[f]rom the face complaint harassing embarrassing the individual and litigation tort-feasors, defendants were the actual performing for decisions made while and if the this poli- evidence establishes fact as those duties. Balanced them, they one or more of should be cy is the concern for citizens who are respects held liable all as other tort-fea- public injured the acts of officials. Be- 208, Id. sors.” 143 Colo. at 353 P.2d at 592 conflicting cause of these concerns the (1960). Upon the commissioners’ subse scope scope of immunity is linked with the quent appeal judgment after was entered authority public of held official. them, we held that officials could functioning governmental Smooth of negligently selecting super be liable processes greatly impaired would be subordinates, vising directing or author making officials were deterred their Flor, v. izing Liber wrong. 160 Colo. policy decisions threats of lawsuits. 7, 415 P.2d 332 Later cases have importance This consideration lesser principle public employ reaffirmed the that public merely where the official carries personally ees are liable for torts commit policy out the decisions others. Thus an scope employment. ted within the of their enforcing policy official decisions of Jones, 122, Kristensen v. 195 Colo. 575 another is not afforded the same immuni- (1978) (RTD P.2d 854 driver can be held ty making policy as one decision. negligent driving); Antonopou liable for of Telluride, los v. Town 187 Colo. 532 Hollis, Cooper 505, 507, Colo.App. (1975) (police P.2d 346 officers can be held (1979) (citations omitted). negligent release of drunk liable driv police The court of concluded that McComas, Flournoy v. er); 175 Colo. impoundment act, of a car awas ministerial (1971) (superintendent 488 P.2d 1104 and police personally and that officers could be principal may negligent super be liable wrongful impoundment subject liable for accident); vision of student killed in auto good the defense of faith and reasonable County Moffat, Valdez 161 Colo. Accord Winters v. ness. Com (1967) (county 423 P.2d 7 commissioners City, merce (Colo.App.1982) 648 P.2d 175 hospital neg and trustees liable for be (building inspector personally may be liable child); but see ligent care of newborn Pe permit); for ministerial failure to issue Quintano Commission, v. Industrial Texas, terson v. State (1972) (individual (Colo.App.1981) (juvenile supervisor may be members of industrial commission not lia personally negligent supervision); liable for inspect factory). ble for failure Colo, McComas, Flournoy see also generally While it was held from 1960 530-31, today, at 488 P.2d at 1106. Until through personally 1979 that officials were opportunity this court has not had under for torts liable Colorado law commit- analysis adopted by review alternative scope employment, ted within the of their Appeals. the Colorado Court of Appeals decisions Colorado Court since analysis posits that, official, have followed different as an he was gives strength that to the doctrine personally renewed discretionary liable for acts scope assume within authori- that those actions performed were within the discretionary offi- ty. manager Trimble states outer boundaries of what the immunity, enjoy only qualified and Hospitals may do, cials Health normally immunity does not shield them that such acting were taken while under color of that liability action or for malicious action authority. See Corder v. People ex rel. illegal will cause that such officials know Smiley, 87 Colo. 287 P. 85 injury. questions Trimble also whether If the actions were within Kau- discretionary acts Kauvar’s were indeed authority, var’s have no they doubt scope employment. within the discretionary, not ministerial. The not asked we abolish the com- He has they trial upon court found that immunity, mon law doctrine of official followed disagreements sovereign organization we did the related doctrine over the County Board Evans v. immunity Health Hospitals. Such in decisions Commissioners, 97, 482 judgment, volved the planning policies § -118, (1971); but see 24-10-101 to They embody per director. did not (1982 Supp.), but rather C.R.S. mandatory formance duty oper of a scope we rule that of official im- Hence, they ational level. were discretion munity as to is not extensive shield so Hollis, Cooper ary. See liability in this case. from P.2d 600 109 Telluride, Antonopoulos v. Town of 187 question The that is what 392, remains 532 P.2d 346 Kauvar, type immunity an official like note the outset that there is We discretionary performing acts within question serious whether Kauvar was act office, scope enjoys under Colorado scope even within that broad authori A law. review of case law in this area recognized in ty purpose officials for the majority reveals a have that states immunity official An doctrine. official adopted general holding rule that an offi immunity has no for actions outside his performing discretionary cial acts within Towers, 727, authority. White v. 37 Cal.2d scope enjoys only qualified office his Miller, Kern v. (1951); 216 immunity. liability for He is shielded from (1975); Oyler Kan. 533 1244 P.2d damages only civil insofar as his conduct State, (Wyo.1980). trial 1042 The willful, not to cause malicious intended in court’s conclusions that Kauvar’s actions George’s Bradshaw Prince harm. fraudulently inducing the settlement and County, (1979); 284 Md. A.2d 255 interfering performance with Hefner, Smith 235 N.C. 68 S.E.2d settlement contract were malicious and Regents, Board (1952); Lister v. compellingly faith bad indicate action see (1976); N.W.2d Wis.2d However, authority. excess of since there Commonwealth, also DuBree v. Pa. specific finding by was no the trial court on (1978); Madsen v. Borth 393 A.2d 293 point, and concluded it this the court that ick, (Utah 1983); contra, Tan was Kauvar’s bad faith malice that Tulevech, 34, 471 go by Tango v. 61 N.Y.2d deprived immunity him protec of official tions, N.Y.S.2d 459 N.E.2d 182 we shall for the sake of this assume keeping developments recent in Colo actions to with discussion Kauvar’s which view, liability majority rado law we now assign Trimble would were within and the is, scope adopt his That this office. we will rule.4 immunity immunity. 4. Federal law is somewhat similar to lute Other exercise officers who Cautioning specific that of Colorado. discretionary have immu- functions absolute intricacies, applications many the law involves nity qualified torts and nonconstitutional immunity Davis federal Professor summarizes illegal immunity [e.g., for constitutional torts way: law in this employees searches and Officers or seizures]. The framework law of officers’ immu- perform discretionary who do functions not legislators, nity Judges, simply can be stated: immunity. have no prosecutors, and similar officers have abso- long applied suffering need not The

The trial court the correct detain us. that, when it ruled that “Dr. Kauvar’s standard trial court found as a Kau- result of intentions, ... taken as a actions pre-settlement var’s torts as well as his whole, characterized adminis conduct, later tortious Trimble suffered a authority abuse trative bad faith and permanent ability and substantial loss of malice which with toward Dr. de life, enjoy equated which court prives availability Dr. Kauvar of suffering. Hildyard mental v. West Cf. public qualified immunity official’s Inc., Fasteners, ern legal system in tort.” is suffi suit The (1974)(loss enjoyment of life is ciently predictable anyone Kauvar or proper of tort damages). element determined, position in his have else would $35,000 dam court awarded to Trimble as given thought, if the matter had been ages injury. appeals for that The court of the actions taken Trimble would be reversed of its conclusion that because in a be malicious held court of law to action Trimble’s covenant to sue barred recov intended Such cause harm. reflection to. ery. We II have determined him, might have deterred and would not opinion that Trimble can fraud recover for dampened proper in the have his ardor in the inducement intentional interfer discharge Gregoire of his duties. See relations,5 ence with contractual but not Hence, Biddle, 177 F.2d at 581. trial pre-settlement Therefore, Trim- torts. properly rejected the defense of offi suffering damages ble is mental entitled to correctly immunity, cial considered in from the torts of fraudulent Trimble’s claims Kauvar on their ducement and intentional but interference merits. not for the others. The same is true of the $15,000 reputation loss of award for V. $20,000 punitive damages. re With held court of that “the trial spect damages to for intentional interfer awarding $35,000 court erred Trimble ence, Gardens, generally see Memorial suffering mental for caused defendants’ Olympian Management Inc. v. Sales & conduct tortious and breach contract.” (Colo. Consultants, Inc., 690 P.2d 207 Denver, City County & 1984); (Second) Restatement Torts P.2d at 282. that Kauvar is We hold liable § damages, 774A(1) (1977); Prosser, suffering mental but W. for The Law of damages 1971). remand, limited to (4th such must be those that Torts 948-49 ed. On in the resulted fraud inducement and damages the trial must limit court with intentional interference contractual re- those for resulted from the torts Although agree with the lations. we court which properly Kauvar was held liable appeals damages wrong- that these were judgment enter those for amounts. ly City, assessed we reach that reasoning. conclusion different B.

A. court determined The question The Kauvar that the not be held whether could liable properly damages suffering held liable for for mental contract for Trimble’s mental Davis, Treatise, Although Law § K. Administrative 26.15 can be held these liable for (1982 Supp.). Fitzgerald, torts, See Harlow 457 U.S. City enjoys statutory sovereign immu- 2727, (1982); 102 S.Ct. L.Ed.2d 396 nity Butz sec- for all tort claims not enumerated in Economou, 438 U.S. 98 S.Ct. 24-10-106, (1982), tion C.R.S. can- thus (1978). L.Ed.2d 895 We have no occasion in respondeat superior not be held liable explore this case to the contours of the law of theory. required pay also not for immunity absolute in Colorado. judgments against employees its where the act policy implications For a discussion of the complained of was willful or wanton. 24-10- § limiting governmental immunity, and official 110(l)(b)(I), 10 C.R.S. Bermann, Integrating see Governmental and Of- Liability, Tort 77 Col.L.Rev. 1175

ficer (1970) (setting out in order to re- Colo. damages. It reasoned that tort.)6 the elements.. .of that party damages in contract cover such (1) either “that the aggrieved must show Thus, question upon which accompanied the conduct which defendant’s City’s liability for mental suffer turns the the basis of breach could have been damages ing as an element of in- negligent or independent tort claim whether its conduct was willful and wan distress,” infliction of emotional tentional findings, ton. Based on the trial court’s (2) that the contract P.2d at or quality. the conduct of Kauvar was of that special personal was “of such a breached Therefore, im if Kauvar’s actions can be knew, parties or should nature that puted City, for mental suf foreseen, by one of that a breach have fering properly assessed or emo- result in severe mental them would City.7 at 282-83. distress.” 645 P.2d tional however, findings, court’s es- trial satisfactorily that Kauvar’s willful tablish Putting for the moment aside imputed be and malicious actions cannot recovery, alternative basis for the second City. interfered When Kauvar has no foundation we believe that the first City’s contract with the trial law, approve it. It is and we do not our found, acting not he was cases, that, in contract well-established valid administrative reason and was suffering are recovera damages for mental acting principal. interests of his the best they or wanton breach when ble for willful Therefore, improper cannot his intentions proximate consequence are a natural and City. Al- logically be attributed to the McCreery the breach. v. Miller’s Gro contract, though City did breach Co., 99 Colo. ceteria anyone other than there is no evidence that (1937); Olinger Mortuary Fitzsimmons v. wantonly to willfully acted Association, we,recognize While cause this breach.8 original by the court of As stated acting with that Kauvar have been Colorado, “in cases where a appeals of discre- respect subject matter within his and the of contract has occurred breach authority is tionary authority, as such accompa attending such are acts breach im- broadly purposes of official defined willful, insulting conduct nied or wanton that, law, under the munity believe breach, guilty of the one substantial case, improper intentions facts of this damages may recovered for mental suf be City. rightly attributed to the cannot be Jackson, 24 fering only ...” Hall 225, 228, Lastly, must determine wheth we App. 134 P. Ac suffering Inc., damages can be 667 er for mental Comprecare, cord Rederscheid v. proof of willful or wan Group, recovered without (Colo.App.1983);Farmers P.2d 766 permit on the cases (Colo.App. ton conduct based 658 P.2d Inc. the contract is of such 1982). depart recovery such where perceive no reason We par special that the impose personal a a and nature authority settled and to from this known, knew, that a prin ties or should have recovery based on higher threshold of mental or result in severe relating law breach would ciples transplanted from the Fitzsimmons v. emotional distress. infliction of emotion See the tort of intentional Association, 91 Colo. Mortuary McCarty, Olinger Rugg v. al distress. Cf. (1962); unnecessary Greeley, 150 Colo. we find it to discuss wheth- 6. While -106, the level of outra- 10 C.R.S. er Kauvar’s actions rose to 24-10-102 and § conduct, geous not wish to be understood we do endorsing appeals’ conclusion the court of as that delay making the in 8.We do not believe that the they did not. May payments rises to the level contract or June McCreery v. under of willful or wanton breach sovereign immunity City protected The cases in that Co. and other Miller’s Groceteria actions, pro- enjoys no such in certain tort but line. City Spaur against contract claims. tection of 544, 17 (1932); torts. We remand this case to the court of Westesen Olathe Bank, State 78 Colo. 240 P. appeals it with directions to return to the category Cases in this been have limited to entry judgment trial court for of consistent presenting range special those a narrow opinion. with this Here, not circumstances. it was the mere passive perform City the failure NEIGHBORS, J., part. dissents in suffering caused foreseeable mental Rather, KIRSHBAUM, JJ., Trimble. it was Kauvar’s active QUINN do and and thwarting intentional Trimble’s con participate. goals tractual without valid administrative NEIGHBORS, Justice, dissenting part: in contrary

reason and best to the interests of City produced the damages. We disagree I court’s Because with the anal- agree appeals with the court of that this ysis and resolution of Trimble’s claim case not fall recogniz does within the cases against City suffering, I mental exception to the willful and wanton respectfully dissent to section V.B. of the requirement special conduct in circumstanc majority agree I opinion. court’s es. general Damages formulation of the rule: suffering for mental are not recoverable in VI. (1) a contract breach of action unless judgment of the court of (2) breach willful or wanton part. in affirmed and reversed personal special contract is of such a holding that the covenant not to sue barred nature that serious disturbance emotional against Trimble’s action is af- particularly likely was a of a result materi- pre-settlement torts, firmed as to and re- majority’s al breach. I conclude that the versed to the torts of fraudulent induce- application of the rule to facts in intentional interference with con- produces case a result inconsistent with the tractual relations. court correctly The trial present state the law. judgment $14,- entered amount jointly severally against 062.50 A. for breach of contract opinion strongly suggests The court’s Kauvar for intentional interference with employee’s that an willful and wanton tor- contractual relations. The trial court's tious conduct which constitutes the breach $35,000 against award of for men- employer the contract between suffering tal based on breach emp person imputed third cannot be properly ap- reversed court of If, indeed, loyer.1 adopted this is the rule peals. The trial court vacate must its earli- here, holding it is at odds with our damages er awards Club, Country McDonald v. Lakewood $15,000 reputa- loss amounts (1969),where, tion, $35,000 suffering, for mental claim, $20,000 the context of a tort punitive damages stated: and enter corporate employee, acts of new awards limited to the “[T]he scope within employment, flowed the torts make induce- fraudulent respondeat appli the doctrine superior ment and intentional interference with con- cable.” P.2d tractual relations. The trial court de- 170 Colo. at 461 at 440. (citations omitted). cide in discretion why its whether additional I fail to see the evi- applicable dence should be taken to determine the same rule to con should be damages extent McDonald, plaintiff of the attributable to these tract In the claims.2 defendant, required 1. by The trial court found "[t]he that services allowed or contract and the Denver, City County acting through by failing pay timely and Dr. to him in a manner.” Auditor, materially the and breached December, by the settlement contract of prohibiting 1974 general 2. The rule is summarized as follows: performing Dr. Trimble from the

733 Bank, alleged v. Olathe State the In Westesen “perpetrating defendants 78 (1925), the 240 P. imprisonment said false arrest and of Colo. we the allowed [plaintiff], or plaintiff damages in willful and to for intentional recover mental disregard rights feelings against wanton the and suffering a bank that breached its Id. at of the P.2d plaintiff.” trip contract to furnish him credit for a to 440. another state when it refused to honor the plaintiff’s during checks his in vacation Moreover, there is considerable tension California. court stated: between the court’s determination that acting “within the was outer in error further contends Defendant authority discretionary boundaries” of his plaintiff cannot recover mental immunity purposes resolving the is suffering humiliation unless there and Denver, City County Trimble v. and sue wrong a wilful the of de- was 716, 729 (Colo.1985), major and the in might be true cases fendant. That ity’s summary conclusion Kauvar’s suffering pain where mental and alone rightly “improper intentions cannot be at recovery. (Citations ground the omit- City.” tributed the At 731. to where, here, ted.) grounds But as laid, recovery grounds are “the for an B. exemplary damages need allowance I to address the issue of think it unwise C.J. No present.” not be wilful wanton con- whether Kauvar’s willful and wrong present. need be City to when imputed duct be the should Admittedly, 78 Colo. at 240 P. at 691. analysis a special yields satis- the contract Westesen in analysis the less court’s factory question to of whether solution the complete explication. in than and need suffering for mental dam- City the is liable Therefore, adopt I would the test enunciat following made ages. The trial court the in Supreme ed the North Carolina Court finding: pertinent factual Stanback, Stanback v. 297 N.C. reasonably appears that Dr. Trimble It (1979): S.E.2d so that he into the settlement entered claim for mental an- teach hold that a opportunity to could have [W]e guish damages from breach of emergency patient care render only plain- Hospital a is stated when area of the as medical services following. complaint reveals the tiff’s attempting to restore loss means of First, not one con- preceding that the contract was as a result of the reputation and commerce with cerned with trade events. legal claim municipality entity with the indemnification cannot com- connection A act, City against negligent only of Denver. can do filed Kauvar mit but a willful pursuant agents claim severed through And a mu- indemnification so its servants. parties judg- the final of the nicipality or malicious is liable for the willful against concerning scope Trimble’s claims agents, where done within acts of its duties, pursuant C.R. City certified although and Kauvar was there is no ratifica- of their addition, Likewise, 54(b). pleadings filed by municipality. C.P. act tion of the claim re- municipality may with the indemnification be connection proper case a held City adopted a of Denver had practiced its flect that fraud and deceit liable for amendment, repealed, it in which since charter officers. employer private Flanagan, as a Municipal to treat itself McQuillan Cor- elected E. & S. (footnotes omitted). pay judgments (1984) required to entered porations 53.62 § $100,000, However, County up was not liable employees its but in McIntosh (1936), em- punitive awarded its Denver, P.2d County of vicariously ployees. city See Charter not be held held could VI, light pend- allegations C6.8-1. In plaintiff § Denver Art. ing based on his liable remaining court and the wantonly trial city police issues had officers that the might arrested, prose- we make concern- imprisoned, impact decision maliciously imputing and wanton conduct to willful probable The doc- cause. cuted him without provides more reason liability, City, one I believe this respondeat superior, vicarious trines of addressing why that issue should avoid nor ar- have been briefed like neither case. with this be resolved connection gued Those issues in this case. profit reputation physician concomitant as a nally, elements of involved. one’s Second, that the contract was one in directly dignity, related to matters of men- which the benefits contracted for were concern, objective An tal and solicitude. i.e., other pecuniary, than one which of the contract demonstrates that review pecuniary interests not the domi- factual determination is the trial court’s nant motivating factor in the decision to purpose con- correct. The obvious third, contract. And the contract must provide tract was to Trimble with an em- be one in which the benefits contracted ployment and minimal income so that base dignity, related directly to matters of pursue professional opportu- he could solicitude, mental concern or or the sensi- nities. party duty bilities of the to whom the I would hold that the is liable to owed, directly which involves inter- for the mental he sus- Trimble ests recognized by and emotions all as City’s tained as result of breach involving great probability contract. anguish mental respected. (Emphasis in original.) The test Stanback

is consistent with section 353 of the Restate- (Second) Contracts, provides: which

“Recovery for emotional disturbance will be

excluded unless the breach also caused bodi-

ly harm or the contract or the breach is

such a kind that serious emotional distur- particularly

bance was a likely result.” Colorado, The PEOPLE of the State of provisions In addition to the of the con- Plaintiff-Appellee, tract enumerated in the opinion, court’s P.2d at contract also City’s obligation limited the financial DeHERRERA, Richard $19,500 per year. at had Trimble Trimble Defendant-Appellant. upon right to terminate the contract No. 83SA309. days City. notice to the On thirty written hand, required the other Colorado, Supreme Court of give notice of its desire to terminate the En Banc. ninety days prior to the ex- contract at least March 1985. any given of the contract term in piration provided year. The contract also of confidential informa- for the disclosure persons such time as

tion to third appointment pro-

applied for an academic employment. the trial

fessional Given pur- determination that the

court’s factual contract was to rehabilitate

pose of the my from examina- reputation and

Trimble’s contract,3 persuaded I am

tion of the is met here. The standard

the Stanback not concerned with trade

contract was

commerce, profit any significant nor was Second, pecuniary interests

involved. motivating factor in

were not the dominant parties to contract. Fi-

the decision Ass'n., Inc., questions Health Interpretations are Area of contracts Johnson, (Colo. E.g., People law. 1980); Radiology Corp. v. Trinidad Professional

Case Details

Case Name: Trimble v. City and County of Denver

Court Name: Supreme Court of Colorado

Date Published: Mar 11, 1985

Citation: 697 P.2d 716

Docket Number: 81SC398

Court Abbreviation: Colo.