Naughton v. Bankier

THIEME, Judge. This case involves an appeal and cross-appeal from the Circuit Court for Montgomery County wherein the trial judge refused to submit the issue of punitive damages to the jury under prevailing Delaware law, refused to strike the expert testimony of appellee’s expert witness and compelled appellant to submit to a physical examination, deemed the contents of a manufacturer’s warning labels to be inadmissible, and further refused to allow appellant to conduct a demonstration of the device which allegedly caused his injury. We shall vacate and remand. Facts Appellant Major Richard Naughton, United States Air Force, a New York resident, and appellee Jacques Bankier, a Montgomery County resident, were social acquaintances who occupied neighboring beach houses in Dewey Beach, Delaware, during the summer of 1990.

Both parties, as part of childish antics, engaged in water balloon battles and, specifically, in so doing, Bankier utilized a “toy” 1 called a “Winger.” 2 The “toy” is similar to an 8-foot slingshot. It is designed to catapult water balloons over long distances at high rates of speed, and its operation requires three adults (or, conceivably, three children with the strength of adults): two to hold the ⁶⁴⁷ ends of the elastic while the third participant stretches the center, which cradles the projectile. This “toy” is capable of hurling projectiles over 70 yards at initial speeds approaching 240 miles per hour. Bankier testified that on 25 August 1990, while under the influence of a disputed amount of alcohol, he, along with two cohorts, choosing to practice childish ways, used this toy to propel a water balloon through an open window into the residence of Naughton, thereby striking him and injuring his eye.

After it was determined that Bankier was a resident of Montgomery County, a complaint was filed in that jurisdiction, 3 and service of process was effectuated. A scheduling order was generated, wherein 1 July 1994 was the cut-off date for Bankier’s expert witnesses to be named. The close of all discovery was originally mandated as 29 July 1994; this was extended by subsequent court order to 20 October 1994. No extensions of time for the parties to name experts were requested or granted.

Bankier filed a motion to dismiss Naughton’s claim for punitive damages. Said motion was reviewed by a special master, and ultimately granted by Judge William Cave, sitting as a motions judge. Prior to trial, Naughton moved the court to reconsider the motion under Delaware law. The trial judge held the motion sub cuña until the close of all evidence, whereupon he ruled that the issue of punitive damages would not be submitted to the jury.

At a settlement conference, attorney’s fees were imposed against Bankier in the amount of $350.00, due to Bankier’s insurance carrier’s absence, in violation of the court’s scheduling order, 4 and the fact that Bankier had no authority to enter into settlement negotiations or make a settlement offer. ⁶⁴⁸ During the month of August 1995, Bankier filed a motion to compel the physical examination of Naughton. On 31 August 1995, a motions judge granted the motion. On 22 September 1995, one business day before trial, Bankier named Dr. Brian Haas as an expert witness. At trial, Naughton sought to have his expert, Dr. Michael Lemp, read manufacturer’s warning labels and testify to the potential harm to an eye that a water balloon launched by the Winger could cause. 5 Naughton further requested to demonstrate to the jury the operation of the Winger.

The trial judge denied both requests. The jury returned an award of compensatory damages in the amount of $16,109.00, $4,750.00 of which represented future medical expenses. Additional facts will be supplemented as necessary. Naughton presents the following issues for this Court’s review: 1.

Based upon prevailing Delaware law, did the trial court err in refusing to submit the issue of punitive damages to the jury? 2. Did the trial court err in failing to strike the testimony of appellee’s expert witness, Dr. Brian Haas? 3. Did the trial court err in determining that the contents of manufacturer’s warning labels were inadmissible? 4. Did the trial court err in refusing to allow appellant to demonstrate the use of the Winger to the jury?

In his cross-appeal, appellee presents the following issues: 5. Did the trial court err in submitting the issue of future medical expenses to the jury in the absence of sponsorship testimony? ⁶⁴⁹ 6. Did the settlement judge abuse his discretion in ordering attorney’s fees against appellee for failure to enter into settlement negotiations? We shall answer “Yes” to questions 1, 2, and 6, reverse and remand issues 1 and 2, and reverse issue 6 without further disposition; we answer “No” to, and affirm, issues 3, 4, and 5.

Discussion I. Before addressing the merits of Naughton’s contention that the trial court erroneously refused to submit the issue of punitive damages to the jury, it is incumbent upon this Court to acknowledge the issue of which state’s substantive law on punitive damages, Maryland or Delaware, should be applied to the instant action. See Maryland Rule 8-131(a). In situations when a cause of action accrues in one state and the adjudicatory forum of the action lies in another state, Maryland follows the conflict of laws principle of lex loci delicti. Hauch v. Connor, 295 Md. 120, 125 , 453 A.2d 1207 (1983). 6 This results in the application of the procedural law of the forum state, and the application of the substantive law of the place (state) of the wrong.

Black v. Leatherwood Motor Coach Corp., 92 Md.App. 27, 37 , 606 A.2d 295 , cert. denied, Leatherwood Motor Coach v. Martinez, 327 Md. 626 , 612 A.2d 257 (1992). In Black , residents of Virginia brought an action in Maryland against a common carrier, for injuries sustained in a bus accident in New Jersey. This Court refused to apply Maryland’s cap on non-economic damages, inasmuch as the cap is ⁶⁵⁰ substantive in nature, and therefore should be governed by prevailing New Jersey law. No matter the basis for utilizing the substantive law of a foreign jurisdiction, and although not yet decided by the Court of Appeals, we believe punitive damages, in and of themselves, to be of a substantive nature.

Under lex loci delicti, they, like the statutory cap that establishes their maximum awardability, should also be governed by the law of the state in which the wrong occurred. Restatement of Conflict of Laws (First) § 412 harmonizes our position and states: “The measure of damages for a tort is determined by the place of wrong.” In Steger v. Egyud, 219 Md. 331, 337 , 149 A.2d 762 (1959), the Court of Appeals favorably referenced § 412 in the context of liability and contribution, and opined that, under this section, substantive matters concerning damages are governed by the place of the wrong in conflict of laws situations. In factual postures similar to the case now before us, other jurisdictions have come to synonymous conclusions concerning the nature of punitive damages. In Aerovias Nacionales De Colombia, S.A. v. Tellez, 596 So.2d 1193 (Fla.App. 3 Dist.1992), the Florida intermediate appellate court determined that representatives of victims of an airline crash that occurred in New York were bound to the appropriate New York substantive law concerning punitive damages when suing in a Florida court.

The Court of Appeals of Kansas, in a fashion akin to their Floridian brethren of the bench, determined that when legally pursuing an action for conversion in Kansas, the conduct forming the basis thereof occurring in Nebraska, Nebraska substantive law applies, thereby precluding the recovery of punitive damages. North Central Kansas Production Credit Assoc. v. Odell Farmers Co-op Elevator Co., 722 P.2d 592 (Kan.App.1986) (per curiam). Jury instructions are procedural in nature, no matter the substantive content contained therein. In a conflict of laws situation, the law of the forum state prevails as to their ⁶⁵¹ administration.

Maryland law shall accordingly be used in their assessment. In determining the propriety of a trial court’s determination to give a particular jury instruction, we must evaluate whether the law conveyed in the instruction is applicable in light of the evidence before the jury. Wegad v. Howard Street Jewelers, Inc., 326 Md. 409, 414 , 605 A.2d 123 (1992). Whether a particular instruction is warranted based on the evidence produced at trial is vested within the sound discretion of the trial judge.

Blaw-Knox Constr. Equip. Co. v. Morris, 88 Md.App. 655 , 596 A.2d 679 (1991). Underlying Delaware’s substantive law on punitive damages is the notion that: It is a well-established principle of the common law, that ... a jury may inflict what are called exemplary, punitive or vindictive damages upon a defendant, having in view the enormity of his offense rather than the measure of compensation to the plaintiff____ By the common as well as by the statute law, men are often punished for aggravated misconduct or lawless acts, by means of civil action, and the damages, inflicted by way of penalty or punishment, given to the party injured.

Jardel Co. v. Hughes, 523 A.2d 518, 528 (Del.1987), quoting Day v. Woodworth, 54 U.S. (13 How.) 363, 371 , 14 L.Ed. 181 (1851). In further delineating the standard under which the punitive damages are to be awarded, the Delaware Supreme Court, in Strauss v. Biggs, 525 A.2d 992, 999 (Del.1987), espoused: “Punitive damages are damages other than compensatory or nominal damages, awarded against a person to punish him for his outrageous conduct and to deter him and others like him from similar conduct in the future.” Jardel, 523 A.2d at 529 . (quoting Restatement (Second) of Torts, § 908 (1979)). “Conduct is ‘outrageous’ because of ‘evil motive or reckless indifference to the rights of others.’ ” Id. (quoting Restatement (Second) of Torts, § 908, comment b (1979)). “The wilful or wanton standard necessary to justify imposi ⁶⁵² tion of punitive damages refers to a ‘distinct state of mind, one a conscious awareness, the other a conscious indifference.’ ” Id.

Id. Further elaborating on what constitutes “reckless indifference” in the context of punitive damages, the court more recently in Tackett v. State Farm Fire and Cas. Ins. Co., 653 A.2d 254, 265 (Del.1995) (citations omitted), noted that “[i]t is not enough that a decision be wrong[,] [harm from a recklessly indifferent act] must result from a conscious indifference to the decision’s foreseeable effect.” It is required that the defendant foresee the potential harm to the plaintiff as a reasonable consequence of his unacceptable behavior.

Jardel, 523 A.2d at 529-530 . It is often difficult to demonstrate one’s mental state through direct evidence. “[W]e note that the problems involved in proving the existence of a person’s state of mind necessitate some reliance on circumstantial evidence.” Stanley v. State, 500 A.2d 581 (Del.1985). “As a matter of common sense, in judging the sufficiency of the evidence as to the state of mind, the jury must be able to weigh the conduct of the defendant. Otherwise, in most situations, the only evidence would be the defendant’s own self-interested testimony.” Plass v. State, 457 A.2d 362, 365 (Del.1983) (emphasis supplied). Reckless indifference, therefore, can readily be inferred from the defendant’s behavior towards individuals situated similarly to plaintiff.

See, Cloroben Chemical Corp. v. Comegys, 464 A.2d 887 (Del.1983). Under the circumstances here present, sufficient evidence was generated to present the jury with the factual question of whether Bankier acted with the reckless indifference required by Strauss, supra, to award punitive damages. Bankier admitted on cross-examination that he propelled the water balloon in question through an open window and into ⁶⁵³ Naughtcn’s beach house, thereby causing him injury. We think it clear that the hurling of a projectile, weighty or not, into a residential dwelling evidences a blatant and willful blindness for the readily foreseeable, substantial, and inherent risks associated with the projectile’s striking someone inside. 7 Under Delaware law, it was therefore erroneous for the trial judge to refuse to submit the issue of punitive damages to the jury.

II

Montgomery County has implemented the use of administrative scheduling orders pursuant to Maryland Rule 2-504. The purpose of the rule is two-fold: to maximize judicial efficiency and minimize judicial inefficiency. Though such orders are generally not unyieldingly rigid as extraordinary circumstances which warrant modification do occur, they serve to light the way down the corridors which pending cases will proceed. Indeed, while absolute compliance with scheduling orders is not always feasible from a practical standpoint, we think it quite reasonable for Maryland courts to demand at least substantial compliance, or, at the barest minimum, a good faith and earnest effort toward compliance.

See Betz v. State, 99 Md.App. 60 , 635 A.2d 77 (1994). The scheduling order in the instant case indicated that Bankier was to identify all its experts by 1 July 1994. It was, however, just one business day before trial, and more than one year past the expiration of the court-ordered disclosure period, that Bankier named Dr. Brian Haas as an expert