KEMNER v. MONSANTO CO. No. 5-88-0420.
576 N.E.2d 1146 (1991)
217 Ill. App.3d 188
160 Ill.Dec. 192
Frances E. KEMNER et al., and all other cases consolidated with Cause No. 80-L-970, Plaintiffs-Appellees, v. MONSANTO COMPANY, Defendant-Appellant (Bruce D. Ryder, Appellant, and St. Clair County, Illinois, Appellee).
Appellate Court of Illinois, Fifth District.
July 22, 1991.
Coburn, Croft & Putzell, Kenneth R. Heineman, Bruce D. Ryder, Dudley W. Von Holt, St. Louis, Mo., James C. Craven, P.C., Springfield, Coffield, Ungaretti, Harris & Slavin, J. Timothy Eaton, Chicago, for Monsanto Co. and Bruce D. Ryder.
John Baricevic, State's Atty., St. Clair Co., Belleville, for St. Clair Co.
Rex Carr, Carr, Korein, Tillery, Kunin, Montroy, Glass & Bogard, East St. Louis, Jerome W. Seigfried, Seigfreid, Runge, Leonatti & Pohlmeyer, Mexico, Mo., for plaintiffs-appellees, Frances E. Kemner, et al., and all other cases consolidated with Cause No. 80-L-970.
Justice LEWIS delivered the opinion of the court:
This case involves an appeal by Monsanto Company from an adverse verdict in favor of 65 plaintiffs in the circuit court of St. Clair County.
An action was brought in the circuit court of St. Clair County, Illinois, by 65 plaintiffs against five defendants: Monsanto Company ("Monsanto"), Norfolk & Western Railway Company ("Norfolk"), G.A.T.X. Corporation ("GATX"), General American Transportation Corporation ("General American"), and Dresser Industries, Inc. ("Dresser"). Plaintiffs' 20 original complaints were consolidated for trial. Prior to trial, certain third-party claims against third-party defendant Willamette-Western Corporation were severed from the case. Certain counterclaims against Monsanto and Norfolk were also severed. These third-party claims and counterclaims remain pending in the circuit court. Prior to verdict, all defendants other than Monsanto settled with the plaintiffs.
Plaintiffs' consolidated cases were tried against defendant Monsanto only. Plaintiffs' second amended complaints, which were filed after the close of evidence, were in two counts, alleging in count I a strict liability theory and in count II a wilful and wanton conduct theory. The jury returned a verdict in favor of Monsanto on count I, pertaining to the claim that the product was unreasonably dangerous, and in favor of plaintiffs on count II, awarding no damages for any noneconomic losses, $1 to each of 63 plaintiffs for economic losses, $14,500 each to the other two plaintiffs for property damages losses, and $16,250,000 in a joint punitive damage verdict.
A judgment was entered on the verdicts on October 22, 1987. On November 10, 1987, the court entered a judgment against Monsanto in favor of St. Clair County for extraordinary costs in the amount of $84,294.26. Also at the close of the evidence, but before the jury was instructed, the court fined Monsanto and its counsel Bruce D. Ryder $10,000 and $1,000 respectively, pursuant to section 2-611 of the Code of Civil Procedure. Ill.Rev.Stat.1987, ch. 110, par. 2-611.
Monsanto filed a post-trial motion raising issues pertaining to the October 22, 1987, verdicts on count II, the November 10, 1987, judgment on extraordinary costs and the court's August 27, 1987, order on sanctions. Plaintiffs filed a post-trial motion requesting relief only as to the October 22, 1987, nonpunitive damage verdicts on count II. Both post-trial motions were denied. A finding that there was no just reason for delaying enforcement or appeal was made pursuant to Supreme Court Rule 304(a) (134 Ill.2d R. 304(a)), in view of the remaining severed counterclaims and third-party claims. Monsanto appeals from the judgment on the verdicts on count II, the judgment on extraordinary costs, and the order on sanctions.
The plaintiffs in this case are 65 individuals who were residents of Sturgeon at the time of the spill or who spent time in Sturgeon for various reasons after the spill. Plaintiffs alleged that they suffered personal injuries as a result of exposure to the dioxins contained in the spilled chemicals and that Monsanto was liable for such injuries under theories of strict products liability and wilful and wanton conduct. The jury returned its verdict after hearing evidence for 3½ years and deliberating for eight weeks. It found for Monsanto on the strict products liability count but for plaintiffs on the wilful and wanton conduct count as heretofore set forth.
It would be counterproductive to discuss the evidence in this case with the exception of that relevant to the specific issues addressed in this opinion. The plaintiffs' case-in-chief lasted some 17 months and the defendant took 24 months to present its defense. The trial began with jury selection on February 6, 1984, and lasted until the jury returned its verdict on October 22, 1987. The transcript of the proceedings totals 91,555 pages along with some 6,333 exhibits. We will not address any evidence relating to the issues of causation and personal injury damages. The majority of the evidence at trial related to those issues, but since the jury determined that no personal injury occurred, and no appeal was taken thereon, there is no need to address those subjects.
The defendant, Monsanto, filed a 2,700-page post-trial motion but was required by the court to file an abbreviated motion not to exceed 200 pages. This was not error as all issues have been fully covered and addressed on appeal. Although the defendant-appellant's brief contains many issues and subissues listed in its points and authorities, the brief does set forth the issues on appeal in broader fashion. We will address only those issues that this court feels are necessary to dispose of this appeal. The issues presented by the defendant are:
The common-law record, the trial transcripts, exhibits, trial briefs, post-trial motions, and trial rulings are monumental in size and length. However, the succinct way the attorneys for both appellant and appellees handled the appeal in their briefs and arguments have been of great assistance to this court, and all attorneys involved are to be complimented on their presentation. Dealing with the great volume of the record by counsel has been, to say the least, an overwhelming task.
Although there are a great number of issues that could be addressed, the case at bar deals basically with the propriety of the punitive or exemplary damage award in the sum of $16,250,000 assessed in a general verdict. It would seem that a paramount and overriding issue is whether a series of verdicts finding "0" noneconomic loss and "$1.00" economic loss for each of 63 plaintiffs is sufficient to allow the exemplary verdict to stand. An adverse ruling on this issue and the issue of damages to Kemner would require a reversal without remandment, while other issues go to the question of a possible new trial.
The jury returned individual verdicts in favor of each of 63 plaintiffs and assessed damages as follows:
The jury also returned a general verdict which read:
As to Frances E. and William F. Kemner, the jury assessed damages as follows:
Separate verdicts were returned for each of the Kemners.
Noneconomic damages, in a tort case such as this, are compensation for the actual
Here, the jury awarded no damages in dollars for injury and nominal damages of one dollar for economic loss. Therefore, the question becomes whether a verdict for $16.5 million in punitive damages can stand when there is no damage found for injury and nominal damages for economic loss.
In each of the amended complaints consolidated here the plaintiffs alleged that the defendant committed certain acts and omissions recklessly, wilfully, and wantonly. In the proper case, there is no question that punitive damages can and will be awarded. Our supreme court, on several occasions recently, has considered punitive damages.
In Loitz v. Remington Arms Co., Inc. (1990),
Hazelwood v. Illinois Central Gulf R.R. (1983),
However, at this point this court is not bringing into issue whether or not a punitive damages verdict will stand based on the conduct of a defendant, but, rather, we are faced with the preliminary problem of jury verdicts which allowed no damage for injury and $1.00 for economic loss. The trial judge was faced with this problem when dealing with the post-trial motion for judgment n.o.v.
Illinois does not recognize a cause of action for punitive damages alone. (Florsheim v. Travelers Indemnity Co. of Illinois (1979),
In Florsheim the court held that since the plaintiff there could not recover actual damages on the policy or for any other injury, the claim for punitive damages must also fail, citing Tonchen v. All-Steel Equipment Co. (1973),
Plaintiffs apparently concede in their brief that a punitive damage award must be supported by an actual damage award but argue that nominal damages satisfy that requirement. Defendant argues that it is only when there is an invasion of a legal right, such as an intentional tort, or when it is not possible for plaintiffs to prove the amounts of their loss or damages, that nominal damages can support a punitive award. They further argue that, in the instant case, the plaintiffs alleged that they were physically injured by defendant's conduct and devoted a great portion of the 3½-year trial to prove the extent of their injuries. If plaintiffs had proved their case, they would have been entitled to actual damages. Here, the jury returned "0" for actual injury damage and $1.00 for economic loss. Their injuries were capable of being calculated, and they, in fact, asked for $34 million in compensatory damages. The plaintiffs attempted to liken wilful and wanton conduct to intentional conduct and cited cases that involved general trespass. However, in the instant case there were neither allegations nor findings of intentional tort. The jury instruction submitted by the plaintiff and given by the court defining wilful and wanton conduct omitted any reference to intentional conduct. This was not a case of intentional tort or a case where it was impossible to prove damages. The plain fact is that the jury, after 3½ years of trial, found no actual damage but decided to punish the defendant for wrongful acts occurring from 1949 through several years after the incident in Sturgeon, Missouri.
Based upon the foregoing, we hold that the punitive damage award must be reversed. The jury found that the plaintiffs suffered no noneconomic damage, and, since there are no underlying compensatory damages, no punitive damage award can stand. Nor will the verdict stand on $1.00 verdicts for economic loss. As we have indicated, this is not a case where there
The court in Embassy/Main Auto Leasing Co. v. C.A.R Leasing, Inc. (1987), 155 Ill.App.3d 427, 432, 108 Ill.Dec. 170, 174, 508 N.E.2d 331, 335, expressed familiar concerns and cautions of courts with respect to the imposition of punitive damages:
Whether to assess punitive damages in a particular case is a question of law. (Knierim v. Izzo (1961),
We hold that the trial court erred and abused its discretion in not granting a judgment n.o.v. after the verdicts were returned assessing "0" noneconomic loss and $1.00 economic loss as compensatory damages for each plaintiff.
Although we did not have to address the evidence on the jury verdict question heretofore discussed, we do have to consider the evidence on the issue of the Kemners' land damage (economic loss verdict).
In addition to the $1.00 verdict for each of 63 plaintiffs for economic loss, the jury returned separate verdicts of $14,500 for economic loss in favor of both Frances E. Kemner and William F. Kemner. These verdicts were for property damage losses. These verdicts also cannot stand and must be reversed. Mr. Kemner testified that, at the time of the spill, he was discussing the possibility of selling land, including both the land for which he was seeking damages and other lands, but after the spill, the purported buyer did not want the land. However, there was no evidence of any kind presented that dioxins came onto the property. There was some spill on the 39 acres in question, but no evidence of dioxin there. The evidence disclosed that, from certain tests made, 2, 3, 7, 8, TCDD, i.e., dioxin, was not specifically identified in the soil. In fact, plaintiffs' expert was specifically told not to test for dioxin.
The Kemners maintained in their second amended complaint that Monsanto wilfully and wantonly failed to remove "toxic substances" (dioxin) from Boone County. Their complaint was with reference to dioxin and not to OCP-crude. Kemners admitted in their brief that Mr. Kemner did not testify precisely that dioxin caused the diminution in the value of their property, nor did anyone else so testify. The claim was based on dioxin contamination, but no evidence of such contamination came in. The alleged wrongful act of Monsanto was allowing dioxin on the land. The plaintiffs must prove that they were damaged by the wrongful act alleged. In plaintiffs'
From our careful examination of the record, there is no evidence, direct or indirect, that places dioxin on the land in question. There was some OCP-crude but no dioxin. Further, the circumstantial evidence produced indicated that TCDD binds to the soil and would remain closer to the spill than would phenols. Although phenols did reach the farm in the spring after the spill, even the plaintiffs' evidence tended to prove that dioxin did not accompany the phenols away from the spill site.
We do not believe that the evidence of a small amount of dioxin found in Saling Creek, downstream from the site of the spill, could give rise to an inference that the dioxin would have flowed from the site of the spill onto the Kemner property. The evidence was that the flow was eventually diverted so that the dioxin in all likelihood did not go through or onto the Kemners' property.
The plaintiffs allege and the jury was instructed that the condition of the orthochlorophenol-crude (presence of dioxin) caused damage, but since there was no proof of dioxin present on the Kemners' property, the damage claim must fail. Indeed, there was precious little evidence on land damage. It was limited to the testimony of Kemner and some circumstantial evidence by experts.
The landmark case of Pedrick v. Peoria and Eastern R.R. Co. (1967),
Having decided this, we will also consider other issues that would require reversal and remandment for new trial.
"The Defendant as a corporation can act only through its officers and employees. For purposes of awarding compensatory damages, any act or omission of an officer or employee within the scope of his employment is the action or omission of the Defendant corporation. However, in order to provide a basis for an award of punitive damages against the Defendant, the act or omission which proximately caused this Plaintiffs' [sic] injuries must have been authorized, participated in, or ratified by a superior officer of the Defendant corporation."
Monsanto vigorously lobbied for the giving of this instruction in the instructions conference, citing among other cases, Tolle v. Interstate Systems Truck Lines, Inc. (1976),
The court gave plaintiffs' Instruction No. 10, which is Illinois Pattern Jury Instructions, Civil, No. 50.11 (2d ed. 1971) (hereinafter IPI Civil 2d No. 50.11):
This instruction is commonly referred to as the respondeat superior instruction and was given without modification.
The corporate complicity rule stems from this court's decision in Tolle v. Interstate Systems Truck Lines, Inc. (1976),
Mattyasovszky noted that the punitive and admonitory justifications for the award of punitive damages were sharply diminished in cases where vicarious liability is imposed. The court supported this statement with reference to section 217C of the Restatement (Second) of Agency (Restatement (Second) of Agency section 217C (1958)), which states:
Drawing on this language in Mattyasovszky, this court stated in Tolle v. Interstate Systems Truck Lines, Inc. (1976),
We went on to find that there was a paucity of evidence to support the award of punitive damages under the corporate complicity rule where a driver for the truck-line company ignored the rules of the road by switching lanes without a signal and without checking for passing traffic. We found these acts could not be construed as authorized by the defendant, given the fact that there was no evidence introduced to show that the employee was unfit and that the company was liable for employing him, that the employee was acting in a managerial capacity, or that the company ratified the complained-of acts. Where the company
The corporate complicity rule set out in Tolle has been adopted in cases from other districts: Sherman v. Field Clinic (1979),
In Pendowski v. Patent Scaffolding Co., the defendant contended that the trial court erred in submitting IPI Civil 2d No. 50.11, the same instruction which was given in the case at bar. The court held that where a plaintiff seeks to hold a corporate master vicariously liable for its employee's actions, the award of punitive damages for willful and wanton conduct would be available only if the superior officer of the corporation ordered, participated in, or ratified the "outrageous conduct" of the employee. The court found that while the instruction given was valid under other circumstances, it was erroneously given in a situation where a corporation was sought to be held liable for punitive damages vicariously because the instruction would impute liability for any act done by an employee, rather than only those specifically ordered, participated in, or ratified by a superior officer. The court found that it would be necessary to reverse the award of punitive damages even if the plaintiff had presented adequate evidence of the defendant's alleged willful and wanton conduct sufficient to warrant submission of the case to the jury.
The corporate complicity rule is, therefore, the current state of the law in Illinois. This was recognized in McCarthy v. PaineWebber, Inc. (N.D.Ill.1985),
As noted above, Monsanto objected strenuously to the giving of the respondeat superior instruction during the instructions conference.
In their brief plaintiffs admit that Mattyasovszky and its progeny hold that punitive damages cannot be awarded against a principal on a respondeat superior theory and adopt the corporate complicity rule. The plaintiffs argue, however, that the language of Monsanto's instruction, wherein it states that a plaintiff's injuries must have been authorized, participated in, or ratified by a "superior officer" of the defendant corporation, was erroneous. Plaintiffs draw on several cases, Lee v. Heights Bank (1983),
"Managerial employee" is defined in Illinois State Journal-Register, Inc. v. National Labor Relations Board (7th Cir. 1969),
Pendowski uses the term "superior officer", as does Tolle, in discussing the basis for corporate complicity liability for punitive damages assessed vicariously without discussion of what constitutes a superior officer. However, Tolle cites Roginsky v. Richardson-Merrell, Inc. (2nd Cir.1967),
A footnote to this discussion indicates that in that case the defendant asserted, and the plaintiff did not dispute, that for the purposes of applying the complicity rule to that case, "management" included only the presidents and vice-presidents of the corporation, and that the court did not have to decide whether, under New York law, the acts of inferior supervisory employees would otherwise be deemed the acts of the corporation for purposes of assessing punitive damages. Roginsky, 378 F.2d at 842 n. 18.
It would appear, therefore, that Tolle and its progeny would require deliberate corporate participation by and through its officers or directors in order to fulfill the requirements of the complicity rule for purposes of imposing punitive damages on the corporation vicariously.
The plaintiffs cite Deal v. Byford (1989),
Monsanto tendered its instruction based on this court's language in regard to the corporate complicity rule in Tolle. It supported the submission of its instruction with reference to both Tolle and Pendowski
It would appear that, given the state of the law at the time the case went to the jury, it was inappropriate to give IPI Civil 2d No. 50.11. As noted in Pendowski, this instruction, while valid under other circumstances, was ill-suited to convey the correct principles of law to the jury, since it could impute liability for any act done by an employee, rather than only those specifically ordered, participated in, or ratified by a superior officer. (Pendowski v. Patent Scaffolding Co. (1980),
The appellant raises many other major issues including excessiveness of verdict, irrelevant and improper trial tactics, failure to conduct voir dire concerning extensive publicity, court's conduct, exclusion of certain testimony, cumulative effect of erroneous court rulings, and several others. In light of our determination expressed above to reverse the judgment of the trial court with respect to those questions already discussed, resolution of these issues is not crucial to our decision.
Monsanto maintains that the circuit court erred in denying its motion for dismissal on the issue of forum non conveniens. Monsanto further asserts that the clear precedent set in this court in Lowe v. Norfolk & Western Ry. Co. (1984),
Although this court could reverse, even after trial, as in Lowe, it is interesting to note that the arguments made now are basically the same ones made earlier in this cause. This court previously denied defendant's petition for leave to appeal on the forum non conveniens issue, and that order was upheld by the supreme court on December 4, 1986. 113 Ill.2d 560.
Recently, the Illinois Supreme Court has had the opportunity to discuss thoroughly the problems and issues arising in forum cases. (See Boner v. Peabody Coal Co. (1991),
We have reviewed and considered all of the factors, both private and public and find that the circuit court did not abuse its
Monsanto maintained and argued on appeal that plaintiffs' case included claims that were preempted by Federal law, based upon preemption due to Federal statute as well as preclusion due to impact upon commerce. We disagree. Plaintiffs argue correctly that there was no allegation concerning the shipment of OCP-Crude or dioxins. Count II alleged that Monsanto recklessly wilfully and wantonly failed to test in its plant for dioxin; failed to remove dioxins; failed to warn inhabitants of Boone County promptly; and failed to warn those persons engaged in removal to adequately protect plaintiffs. There appears to be no claim that the product was improperly shipped. It is clear that since the Hazardous Materials Transportation Act ("Transportation Act") (49 U.S.C. app. sec. 1801 et seq. (1988)) governs the transportation of hazardous materials and, since the plaintiffs basically allege no negligence in the shipment, as set forth above, there is no preemption.
Even if there was a sufficient connection with shipment the claims would not be preempted. Section 1811 (49 U.S.C. app. sec. 1811(a), (b) (1988)) of the Transportation Act states in pertinent part as follows:
This section applies to regulations but would also apply to the common law. We believe that it is quite clear that the preemption doctrine does not prevent States from imposing common law tort standards stricter than those imposed by prevailing Federal law. See Rucker v. Norfolk & Western Ry. Co. (1979),
Since we are reversing this cause, we feel that it is unnecessary to go into an in-depth analysis of this issue other than to hold that under all the circumstances in this case there is no Federal preemption.
Monsanto also argued that large awards of punitive damages between private parties may be an excessive fine in violation of the eighth amendment of the Federal constitution. This contention has been rejected by the United States Supreme Court. (See Browning-Ferris Industries of Vermont, Inc. v. Kelco Disposal, Inc. (1989),
We find particularly troublesome one other major issue. That issue involves the admission of a great deal of evidence concerning incidents occurring both before and after the spill precipitating this lawsuit. We do not intend to go into detail concerning this issue because of our prior determination, but we are of the opinion that allowing evidence of dissimilar incidents that occurred prior to the spill and evidence concerning 2, 3, 7, 8-TCDD in Lysol and Weed-B-Gone, because it involved "post-spill conduct," was improper.
Monsanto sought to preclude admission of the evidence of prior dissimilar incidents, but its efforts were in vain. Plaintiffs maintained that Monsanto spread dioxin-contaminated chlorophenols throughout the world for 20 years and knew about it. They also used this evidence to bolster the credibility of their expert, Dr. Carnow. However, the law is that evidence of prior incidents is admissible when those incidents are similar in nature to the conduct giving rise to the litigation. The plaintiffs argued that the purpose of the testimony was not to show that the incidents were similar but to demonstrate Dr. Carnow's knowledge concerning dioxins and its effect on human beings. Given the massive amount of evidence on this subject, we reject that contention.
Loitz v. Remington Arms Co., Inc. (1988),
Bass v. Cincinnati, Inc. (1989),
We are of the opinion that the admission into evidence of testimony concerning a great deal of the prior incidents and all of the subsequent incidents was error, and, if we were not inclined to reverse as set forth earlier in this opinion, we would reverse and remand on this issue.
There remain two issues on appeal that must be addressed. Those issues are: (1) the imposition of sanctions upon Monsanto and Bruce D. Ryder, an attorney for Monsanto; and (2) the entry of an order directing Monsanto to reimburse St. Clair County, Illinois, for certain expenses.
Appellant, Monsanto, asserts on appeal that the trial court erred when it imposed sanctions, pursuant to section 2-611 of the Code of Civil Procedure (Ill.Rev.Stat.1987, ch. 110, par. 2-611), upon both Monsanto and attorney Bruce D. Ryder sua sponte.
The plaintiffs fail to address this argument directly in their brief. Although they do discuss the imposition of sanctions under section 2-611 by the court, they do so only in support of their position that the trial court did not demonstrate prejudice against Monsanto through the imposition of sanctions under section 2-611. Even though we feel that the Kemners do not address the issue raised by Monsanto with sufficient clarity or citation of authorities, a brief discussion of the issue is warranted.
Following the court's dismissal of juror McCann and the replacement of this juror by an alternate juror, Monsanto argued vehemently against the dismissal and replacement during an in camera discussion. At that time, Monsanto suggested that the court should consider recusing itself, alleging that the dismissal of McCann demonstrated bias on the part of the court. The court characterized the remarks of the Monsanto attorney as uncalled for and the request for recusal as being made without basis.
The court heard argument in camera on August 27, 1987. At that time, the court discussed its decision to replace juror McCann. It characterized the Monsanto motion as one fraught with misrepresentation and, thus, a violation of section 2-611 of the Code of Civil Procedure. The court then assessed against Monsanto a sanction in the sum of $10,000 and assessed against the attorney who signed the original motion, Bruce D. Ryder, a sanction in the sum of $1,000. The court awarded attorney fees to plaintiffs' counsel in the amount of $500. It refused at that time to stay the order. The next day, August 28, 1987, the court issued a stay of execution of the previous day's order imposing sanctions and attorney fees and denied defendant's oral motion to vacate the sanctions previously imposed. On November 10, 1987, the court entered a written order denying the defendant's motion to vacate the 2-611 findings. However, that same order stated that the court would not impose any sanctions based on those findings.
At the time of the prehearing conference conducted for this appeal on August 17, 1988, in the appellate court, pursuant to Supreme Court Rule 310 (134 Ill.2d R. 310), the parties agreed that the plaintiffs-appellees would be estopped from contesting the issue of the appropriateness of the application of sanctions against appellant Bruce D. Ryder and stipulated that the plaintiffs-appellees conceded the issue. An order issued by this court on August 18, 1988, filed August 22, 1988, reflects this stipulation and concession.
The posture of this issue on appeal is, then, as follows: the violation of section 2-611 in regard to Monsanto remains a viable issue, but because of the trial court's order of November 10, 1987, the sanctions imposed pursuant to section 2-611 are not in issue. Neither the alleged violation of section 2-611 nor the sanctions imposed against Bruce D. Ryder are in issue as a result of both the November 11, 1987, order of the trial court and the order entered in this case on August 18, 1988.
Section 2-611 of the Code of Civil Procedure is, in its present form, which became law on November 25, 1986, drawn directly from Federal Rule of Civil Procedure 11 (Rule 11). (Western Auto Supply Co. v. Hornback (1989),
By its mere existence, Rule 11 serves to give attorneys notice and knowledge of the standards of conduct required by the rule. (Donaldson v. Clark (11th Cir.1987),
Offending parties, both clients and attorneys, should be given notice as early as possible in order to deter further violations of the rule and conserve judicial resources. (In re Yagman, Brown & Fleisher v. Baden & Weinberg (9th Cir.1986),
In the case at bar, substantial monetary sanctions were levied against both Monsanto and one of its attorneys without prior notice of the court's intention to impose a sanction pursuant to section 2-611, thus short-circuiting the due process rights of both Monsanto and its attorney. In view of the fact that Monsanto was a client, and the considerable size of the monetary sanction imposed against it, notice to Monsanto was inadequate, and the lack of opportunity for a meaningful hearing impermissibly abridged Monsanto's due process rights. The award of attorney fees is also improper. The trial court's finding of a violation of section 2-611 with regard to Monsanto is therefore reversed.
Monsanto asserts that the trial court erred in issuing an order directing it to reimburse St. Clair County for expenses incurred during the trial amounting to $84,284.96 for juror fees, juror mileage, juror meals during deliberation, juror parking fees, and the cost of constructing an annex for use as a storage room for evidence. We agree.
Juror fees and travel expenses are the responsibility of the county for which the jurors provide their services (Ill.Rev.Stat. 1987, ch. 53, par. 62, § 44). The juror per diem and mileage fees are to be taken from the county treasury and cannot be taxed as costs against the losing party. (Chicago, Peoria, & St. Louis Ry. Co. v. Eaton (1891), 136 Ill. 9, 26 N.E. 575.) Jury fees cannot be assessed as costs. (People v. Kluck (1979),
Likewise, the taxing of juror parking fees and meals for jurors during deliberations as costs against Monsanto was improper. No statutory authority mandates the payment of personal expenses incurred by jurors in the performance of their duties by the county for which they serve. (See Sexton v. Henderson (1891), 42 Ill.App. 234.) By extension, if the county does not have to pay jurors for monies expended on dining and parking while serving, the losing party does not have to do so,
The order of the trial court charging to Monsanto the cost of building an annex to store evidence connected with this cause of action similarly lacks a basis in law. While courts may make rules or orders under which costs can be taxed or imposed, the ultimate authority for the power to impose costs on a party must be found in the statutes, and any statute allowing the recovery of costs must be strictly construed. (Gruidl v. Schell (1988),
Thurston v. Illinois Department of Employment Security (1986),
The funding of capital improvements to the courthouse by unsuccessful litigants is not supported by either statutory authority or case law. It cannot be characterized as a "fee" for services performed by a public official that would be taxable to a losing party. The language in the order of November 10, 1987, which characterizes the expenses as being "above and beyond regular costs and upkeep of the court", cannot be utilized to make an award to the county for those expenses, in the absence of statutory authority. The award to St. Clair County of $4,994.00 for the cost of constructing a room in which to store evidence was improper. We reverse the order directing Monsanto to pay $4,994.00 for the cost of building a storage room to house exhibits.
The order assessing costs in favor of St. Clair County is reversed in its entirety.
In summary, our disposition of this appeal is as follows: (1) that part of the judgment of the trial court entered on the verdict awarding plaintiffs $16,250,000.00 in punitive damages is reversed; (2) that part of the judgment of the trial court entered on the verdict awarding the Kemners $14,500.00 each is reversed; (3) that part of the judgment of the trial court entered on the verdict awarding 63 plaintiffs other than the Kemners $1 each for economic loss is reversed; (4) the order of the trial court awarding costs to St. Clair County in the amount of $84,284.96 is reversed; and (5) the trial court's finding of a violation of section 2-611 as to Monsanto is reversed. Based on the above, the judgment is reversed. We further hold that based upon our discussion of the error, other than the reversible error, this cause would, in the alternative, have to be reversed and remanded for a new trial.
Justice GREEN, specially concurring:
The expressed policy of the Illinois Supreme Court in regard to awarding punitive damages is well set forth in the opinion of the court written by Justice Lewis. Frequently, as of late in Loitz, that court has warned that because of the penal nature of punitive damages, they "are not favored in the law." (Loitz, 138 Ill.2d at 414, 150 Ill.Dec. at 514, 563 N.E.2d at 401.) In
I concur in the decision to reverse without remandment and in the decision, in the alternative, merely to grant a new trial if our decision to reverse outright does not stand. I agree with the reasoning of the opinion of Justice Lewis. I write separately only to explain policies which I deem inherently involved in our decision and which I consider necessary to prevent punitive damages that do "run wild." These policies concern whether punitive damages can be based upon merely nominal damages and the consideration to be given to evidence that a tortfeasor against whom punitive damages are sought has committed other similar acts of misconduct.
Justice Lewis correctly points out that no decision of an Illinois court of review has passed directly upon the question of whether punitive tort damages may be predicated upon nominal damages, but that the language in various cases indicates that actual damages, which appear to be something more than nominal damages, are required. The opinion also carefully explains that (1) no conduct involving intent to harm is present here; and (2) had the jury found the plaintiffs, other than the Kemners, received actual injury, damages larger than nominal damages could have been calculated and awarded. Thus, two of the strongest reasons for award of punitive damages based only on nominal damages are not present. Accordingly, the case differs from Brown & Williamson Corp. v. Jacobson (7th Cir.1987),
In asking that we hold that punitive damages cannot be based upon the award of merely nominal economic damages to the non-Kemner plaintiffs, defendant is not requesting overruling of prior precedent. It is merely stating we should not extend the operation of punitive damage awards to those whose incidence to the allegedly wrongful conduct is so slight that they are not entitled to compensation of any substance. Under such circumstances, a decision based upon policy seems most appropriate.
A leading text on the law of torts points out that a majority of States do not permit recovery of punitive damages predicated upon only nominal damages but states that "[s]ince it is precisely in the cases of nominal damages that the policy of providing an incentive for plaintiffs to bring petty outrages into court comes into play", the better "view" is to allow punitive damages based on nominal damages. (Emphasis added.) (W. Keeton, Keeton & Prosser on Torts § 2, at 14 (5th ed. 1985).) However, that text also recognizes that, in recent years, the policy of permitting exemplary damages in tort litigation has come under special scrutiny as the Haslip and Loitz cases indicate.
The Loitz opinion cites a law review article by Professor David G. Owen, a scholar who is, in general, a proponent of the use of punitive damages. (Owen, Problems in Assessing Punitive Damages Against Manufacturers of Defective Products, 49 U.Chi.L.Rev. 1 (1982).) Professor Owen states the proliferation of large exemplary damage awards against large manufacturers in product liability cases has caused him to conclude that some modifications of the law applicable to those types of cases is desirable. He does not discuss the question of predicating punitive damages upon nominal damages but he does advocate taking steps to minimize the size of and proliferation
In cases such as that before us, permitting people who did not receive any measurable injury to recover punitive damages greatly increases the exposure of the alleged tortfeasor. One plaintiff here, permitted to share in the $16,250,000 punitive damage award, did not come to Sturgeon until the summer of 1979, well after the January 1979 spill. She stayed there for 27 days, spending the hours of 9 a.m. until 5 p.m. on all but two of those days visiting her mother in a hospital in Mexico, Missouri, less than 25 miles away. Another such plaintiff lived in Columbia, Missouri, a similar distance away, and had not been in Sturgeon during the time of the spill or cleanup. However, she had washed the clothes of her husband who spent three or four hours a day in Sturgeon during the time of the cleanup collecting trash. One of his customers had a place of business near the site of the spill, and another of his customers was involved in the cleanup. According to that plaintiff's husband, on one occasion a glass jar, containing mud and water and found in the rubbish of the latter customer, broke and spilled on that husband. He testified he felt a burning sensation from that spilled liquid and immediately washed himself. The plaintiff wife testified she smelled a strong odor upon washing her husband's clothing. She complained of a panoply of illness and physical repercussions extending from headache and depression to loss of libido and menstrual problems.
The jury could have properly concluded that the misconduct of defendant was of such a character as to justify very substantial punitive damage awards. If nobody was shown to receive any measurable personal injury from this conduct, permitting an award of punitive damages to someone would serve the purposes of punishing a tortfeasor who should be punished, discouraging others from similar conduct, and rewarding plaintiffs for and compensating them for their expenses in imposing sanctions for dangerous and highly improper conduct. However, when such a wide group of persons having little close connection with the occurrence involving the tort are permitted to recover punitive damages limited, at best, only by some otherwise undefined standard of reasonableness, a real danger of punitive damages that "run wild" exists. Here, we do not know how many other people could also sue claiming nominal damages. The tort alleged here does not appear to be subject to any statute of repose. Minors could sue many years into the future.
In view of the well-documented concern about the proliferation and size of punitive damage awards, I conclude that the better policy requires generally limiting punitive damage awards for unintentional torts to those who suffer more than nominal damage. As I have indicated, I agree with the conclusion of Justice Lewis that existing precedent does not appear to permit the award of punitive damages to those receiving only nominal economic damages here. I also consider public policy considerations support that holding.
Another need for limitation in regard to punitive damage awards arises here from plaintiff's attempts to use evidence of other occurrences to prove the wilful nature of defendant's improper conduct. I agree with Justice Lewis that, under the supreme court decision in Loitz and that of the first district appellate court in Bass, much of the evidence of those occurrences should not have been admitted. Prejudice to defendant was compounded when, in closing argument, plaintiffs' counsel indicated to the jury that the jury should not only consider this evidence as bearing upon the severity of defendant's misconduct for which damages were sought here, but that the jury should, by a punitive damage award here, punish defendant for its conduct on those other occasions. If evidence of other misconduct of a defendant is properly received to show the wilfulness of that defendant's misconduct in the occurrence giving rise to the case on trial, great care by the trial court is required in its rulings upon the receipt and use of such evidence. Any failure to do so is also likely to cause punitive damage awards to "run wild."
I cannot subscribe to what I deem to be an illogical approach by my colleagues to reach a desired policy result. The main opinion, with only a belated allusion to Pedrick, reverses outright, delivering the crowning blow to 3½ years of tireless, dedicated work by the trial judge, court personnel, and the jurors who heard a truckload of evidence, deliberated for eight weeks, and then rendered verdicts which were confirmed in post-trial procedures.
The main opinion alludes to the quantity of evidence (some 91,555 pages of transcribed proceedings and 6333 exhibits) and then dismisses it all, ostensibly because "the jury determined that no personal injury occurred and no appeal was taken therefrom." I don't doubt but that the jurors on reading this opinion will be sorely surprised, perhaps even appalled, to learn what they "determined." It may well be true that the evidence presented in this trial, the longest running civil trial in the history of American jurisprudence, is unmanageable for purposes of our review, but a jury heard it all and so did a trial judge. I think we must consider that evidence and determine if in fact "all of the evidence, when viewed in its aspect most favorable to [the plaintiffs], so overwhelmingly favors [Monsanto] that no contrary verdict based on that evidence could ever stand." (Pedrick, 229 N.E.2d at 513-14.) This my colleagues have failed to do under the guise of unprecedented and, by my view, convoluted "legal" rationale—i.e., the jury found $0 non-economic damages, ergo the jury found no "actual damages," ergo the jury found "no injury," and that finding is invoidable (this being implicit in the main opinion); thus, judgment belongs to the defendant. It is axiomatic that the jury's verdict, even reduced to ink and paper, is not "evidence" as contemplated by Pedrick. Moreover, none of the precedent cited in the main opinion stands for disregarding the Pedrick standard when reviewing motions for judgment n.o.v. My colleagues have gathered their impressions of the jury's findings from entries on an itemized verdict form and then, drawing from inapposite case law, rationalize their rejection of the verdicts "as a matter of law."
The majority's approach violates a cardinal rule of appellate review that we "are not in the business of second-guessing a jury's `clear intent.'" (People v. Spears (1986),
I believe it significant that the same position being espoused by the main opinion here was summarily rejected by the court in Harriss v. Elliott (2nd Dist.1991),
In like manner, the court in Perry v. Storzbach (1st Dist.1990),
Cases cited by the Perry court as authority for approving personal injury awards for economic damages only were Griffin v. Rogers (4th Dist.1988),
In my opinion, the modern cases rejecting the defendant's position—i.e., equating $0 noneconomic damages with "no injury"—are the better reasoned. Just as the courts in the aforecited cases found evidentiary support for the jury awards, I find ample support here.
Also, I take issue with my colleagues' bald assertion that the damages of these plaintiffs "were capable of being calculated." In my opinion, the jury properly determined they were not. The plaintiffs established defendant's misconduct in continuing to manufacture and place into the stream of commerce a product containing the single most toxic chemical known to man—this despite general corporate knowledge of the state-of-the-art methods for eliminating the compound. Defendant's misconduct was proved to the jury's satisfaction. The jury was entitled, however, to reject plaintiffs' evidence of specific damages and award only nominal damages for the injuries suffered.
Under these circumstances, it is most important to be mindful of the fact that the jury was not considering merely negligence wherein the trial focuses on the harm resulting to the injured plaintiffs, and where credible evidence relating to the degree of plaintiffs' injury determines the appropriate measure of compensatory damages. This is a wilful/wanton misconduct case wherein the focus is on the defendant's misconduct. The reprehensibility of that misconduct and the need to deter it are primary factors in determining the appropriate level of punitive damages. By comparison, the nature and severity of plaintiffs' injuries may be difficult to prove, inexact, and only nominally compensable without being deemed on review insufficient to support a substantial award for punitive damages. In this case, plaintiffs' proof properly focused on defendant's misconduct. Obviously, greed was the overriding incentive—by shortcutting the production process, the profit margin was greater. By finding for plaintiffs, the jury found that the misconduct alleged had been proved, and such finding was eminently reasonable and based on the evidence.
While it would appear that the plaintiff in Lipke established his right to compensatory damages by proving lung cancer some 10 years after his last exposure to asbestos in defendant's employ, I find no less compelling factual grounds in the present case for affirming the jury's award of punitive damages against this defendant. Even lacking any evidence of Monsanto's ill will or intent, the facts in the record before us amply support the jury's conclusion of liability for wilful and wanton misconduct. Under the circumstances, I find no justification, legal, factual or based on public policy to reject the jury's perception that even slight injury entitling the plaintiffs to nominal compensatory damages could be the basis for punishing the wrongdoer.
Much of plaintiffs' evidence of damages related to their fear of future harm or consequences from exposure to dioxin in their environment. In my opinion, this is a legitimate basis for recovery. (See Petriello v. Kalman (1990),
My learned colleague, nonetheless, backs off from the enlightened view and goes on to portend of dangers of punitive damages "running wild." Again, as with the main opinion, he has chosen the easy way out, dumping the entire jury verdict, without regard to the substantial factual basis for an award of punitive damages.
As indicated above, it is my opinion that a reviewing court's outright reversal without factual analysis is always ill-advised and frustrates the jurisprudential system we have pledged to uphold. In a situation analogous to this case, the district court in the Jacobson case reduced the jury's assessment of compensatory damages for defendant's defamation of the plaintiff cigarette manufacturer from $3 million to $1. In reinstating $1 million of the jury's verdict for "presumed" damages, the circuit court of appeals looked to the factual scenario in which the defamatory statements were made and concluded that $1 million was "sizeable but on the facts of this case it is not `substantial' under Illinois law." (827 F.2d at 1142.) The court acknowledged that its process in reaching the $1 million figure was "a very inexact and somewhat arbitrary process" but that such process was inherent in Illinois law of presumed damages. Philosophically I find no greater need to "presume" compensatory damages in the defamation context than to permit a nominal compensatory award for wilful and wanton misconduct potentially causing insidious health consequences of dioxin poisoning. As the evidence in this case demonstrated, the dangers of dioxin are real. Dioxins are deadly and their long-term effects may be physically debilitating to an as-yet-unknown degree. Certainly the presumed loss to one's reputation is no more worthy of this State's protection than a community's fear of cancer from exposure to dioxin.
Defendant has invited our consideration of the Supreme Court's most recent pronouncement concerning the proper review of punitive damages (Pacific Mutual Life Insurance Co. v. Haslip (1991), ___ U.S. ___, 111 S.Ct. 1032, 113 L.Ed.2d 1), and I believe that the Court's opinion merits application here. In Haslip, plaintiff insureds brought an action in fraud against defendant life and health insurance company for its agent's misappropriation of premium payments made after plaintiffs' policy was cancelled without notice to the insureds. Mrs. Haslip incurred medical bills far beyond her ability to pay and learned she was uninsured. Her credit rating was ruined. After a trial by jury, a verdict for Mrs. Haslip was entered in the amount of $1,040,000, $840,000 of which represented punitive damages. The trial court, pursuant to Alabama law requiring post-verdict review of punitive damages awards, conducted a hearing "to reflect in the record the reasons for interfering with a jury verdict, or refusing to do so, on grounds of excessiveness of the damages." (Hammond v. City of Gadsden (Ala.1986),
Notwithstanding the jury's finding of plaintiffs' entitlement to only nominal compensatory damages in this case, the ineluctable result of applying the foregoing factors is an approval of the $16.25 million punitive damages award.
In sum, I find no abuse of the trial court's discretion in denying defendant's motion for judgment notwithstanding the verdict in this case. I am satisfied that the jury's award in plaintiffs' favor was based on the evidence presented at trial, and I would affirm the trial court's ruling on the motion.
I further find no reversible error in the trial court's decision to reject defendant's corporate complicity jury instruction. I do not deny that the law of Illinois at the time this case was tried was as stated by the majority. But I do not find that any instruction error here would in itself require a new trial. In my opinion, the IPI respondeat superior instruction given could not have affected the jury's verdict on the wilful/wanton misconduct count. The testimony relative to defendant's knowledge established that the corporation had knowledge of the dioxins it was producing at the Krummrich plant and their toxicity, and that defendant could have prevented their formation since at least the mid-1950's. This knowledge was imputed to the corporation via "superior officers," including defendant's production supervisor, its chemical engineers, its plant managers, its director of research and development, its house counsel, its biohazards committee, and its director of medical and environmental health. Evidence of defendant's engineers', managers', supervisors', directors' and counsels' deliberate corporate participation in the production of toxic products despite awareness of state-of-the-art methods to prevent the toxicity and defendant's ratification of the misconduct by continuous production for some 20 to 30 years until 1980 (several years after the accident underlying this case) permeated the trial and overwhelmingly satisfied the corporate complicity rule of this State. Again, the cases cited by the main opinion are inapposite.
In Pendowski v. Patent Scaffolding Company (1st Dist.1980),
Based on the vast amount of evidence of corporate knowledge and the corporation's unabated production of dioxins in its consumer products over an extended period of time, the jury in this case could not have reached a contrary verdict had defendant's corporate complicity instruction been substituted for the respondeat superior one given. Accordingly, I find no abuse of discretion in the trial court's decision to deny defendant's motion for a new trial on this basis.
Next, I must agree with my colleagues that the trial court's admission of evidence of prior dissimilar incidents at defendant's plants located throughout the world, etc., was prejudicial error. Prejudicial error occurred, for instance, when the trial court denied defendant's objections to statements made by the witnesses and counsel that defendant exposed babies and the elderly to dioxins in Lysol, that defendant had lied to the Canadian government in 1981 and to the E.P.A. in 1980 regarding the presence of dioxin in Santophen, that Agent Orange inflicted long-term illnesses on American soldiers in Viet Nam without warning, and that the Agent Orange case had been settled.
On the other hand, I find much of the testimony complained of relevant to plaintiffs' claim for punitive damages—e.g., that defendant misled its own employees about chloracne, a skin condition resulting from dioxin exposure; that defendant produced chemicals used in the manufacture of other consumer products, such as Lysol and Weed-B-Gone, that in fact contained dioxins; and that defendant for seven years daily dumped up to 40 pounds of dioxin from its Krummrich plant into the Mississippi River, thereby poisoning downstream food and water supplies. Even though these particular plaintiffs did not claim injury from these other chemicals, I believe that the testimony was relevant to the issue of defendant's knowledge on the wilful/wanton count that dioxin was a by-product of its chemical production, including OCP crude, and supportive of the claim for punitive damages.
For purposes of the product liability count, I find no error in the admission of evidence of post-incident misconduct to the extent that such testimony may have been relevant to the issue of unreasonable dangerousness of OCP crude. (Bass v. Cincinnati, Inc. (1st Dist.1989),
I agree with my colleagues' back-up position that this cause must be remanded for another trial. Although I do not find reversible error on any of the individual grounds treated in my colleagues' opinions, having thoroughly considered these and other arguments relative to issues that are not likely to arise on retrial, I am of the opinion that the cumulative effect, primarily of the evidentiary errors, entitles defendant to a new trial.
With respect to the Kemners' claim for damages to real estate, I cannot subscribe to the majority's reassessment of the evidence to arrive at the conclusion that the diminution of their property was not a result of dioxin contamination. In my opinion, from the fact that dioxin was in the OCP crude, the further fact that the OCP crude flowed across the Kemners' land and the further fact that the OCP crude was found downstream from the Kemners' property, the jury could infer that dioxin necessarily contaminated all of the land that the OCP crude touched. William Kemner's testimony of the devaluation of his property was unrebutted. Thus, rather than reversing outright the jury's verdict for the property owners, considering the cumulative effect of errors affecting claims for wilful and wanton misconduct, I would grant a new trial as to the Kemners' property damage claims as well.
I agree generally with the majority opinion's discussion of the trial court's ruling on plaintiffs' section 2-611 motions and its
I would remand the entire cause for a new trial.
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