Contracts II, Pages 1176–1182

Romero v. Mervyn's

Supreme Court of New Mexico, 1989

Facts:

Plaintiff was shopping in defendant's store when fellow Christmas shopper pushed her on an escalator and she hit her jaw. Plaintiff claims Wolf, the store manager, told plaintiff that defendant would pay any medical expenses, while Wolf claimed that he only told her that defendant would submit the claim to its insurer.

Three days later, plaintiff was still in pain, and so her daughter called Wolf to confirm that defendant would pay the expenses. He told her to come pick up some forms, but when she came in, he said he was out and to just take plaintiff to the hospital.

Plaintiff went to a doctor and underwent physical therapy for a cost of $2,041. Defendant refused to pay the bills. Plaintiff sued under negligence and contract.

Procedural History:

After a first trial and appeal, on remand, the jury found for plaintiff on the contract claim and awarded her $2,041 in compensatory damages and $25,000 in punitive damages.

Issue:

Was the award of punitive damages proper?

Defendant's Argument:

Punitive damages should not be submitted to the jury when there was no evidence of malice. Punitive damages was based on sympathy, passion, and prejudice.

Rules:

  • LexisNexis IconWestLaw LogoGoogle Scholar LogoPage 1178, Paragraph 4

    [P]unitive damages may be recovered for breach of contract when the defendant's conduct was malicious, fraudulent, oppressive, or committed recklessly with a wanton disregard for the plaintiff's rights.

    Explanation:

    LexisNexis IconWestLaw LogoGoogle Scholar LogoPage 1179

    [M]alice . . . means

    the intentional doing of a wrongful act without just cause or excuse. This means that the defendant not only intended to do the act which is ascertained to be wrongful, but that he knew it was wrong when he did it.

Reasoning:

  • While contract law generally allows parties to allocate their own risk by awarding damages based on the expected damages of the contract, in some cases punitive damages serve important social ends. Here, defendant's promise could be viewed as merely trying to get plaintiff out of the store on the busiest shopping day of the year without intending to follow through. Thus the jury could have inferred that defendant acted with malice and recklessness.

  • The punitive damages are related enough so as to not raise a question of sympathy, passion, and prejudice.

Holding:

The award of punitive damages was valid. Trial court affirmed.

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