JENNY BARBEE SHORE
v.
RAY FARMER, t/d/b/a, RAY FARMER BONDING
Appeal pursuant to N.C.G.S. § 7A-30(2) from the
decision of a divided panel of the Court of Appeals, ___ N.C.
App. ___, 515 S.E.2d 495 (1999), finding no error in a judgment
entered 31 July 1997 by Seay, J., in Superior Court, Rowan
County. Heard in the Supreme Court 11 October 1999.
Thomas M. King and David Y. Bingham for plaintiff-
appellee.
The Holshouser Law Firm, by John L. Holshouser, Jr.,
for defendant-appellant.
LAKE, Justice.
The question presented for review is whether the
Court of Appeals erred in concluding that the trial court did not
abuse its discretion by allowing plaintiff to amend her complaint
to seek punitive damages in an action sounding in contract. In
the decision below, the Court of Appeals concluded that the trial
court did not err in allowing plaintiff's motion to amend her
pleadings to conform to the evidence because there was no showing
that the amendment in some way prejudiced defendant in
maintaining his defense. Since we conclude that the evidence in
this case does not support a claim for punitive damages and thatsuch claim is improper in a breach of contract action, we reverse
the decision of the Court of Appeals.
Plaintiff made the following basic allegations in the
complaint filed in this action. In June 1991, plaintiff and her
husband were arrested on North Carolina warrants while they were
on vacation in Myrtle Beach, South Carolina. Plaintiff and her
husband waived extradition and were transported to North
Carolina, and plaintiff was ultimately transported to the Watauga
County jail.
Defendant is a professional bail bondsman. Upon
contact, he informed plaintiff that a total of $75,000 in bond
premiums would procure the necessary bail bonds to secure her
release. Plaintiff and defendant subsequently entered into an
agreement whereby plaintiff would advance a portion of the
$75,000 to defendant and then tender the remaining balance to
defendant within ten days of her release. On 25 June 1991,
plaintiff paid the initial, agreed-upon portion of the fee and
was thereafter released from jail. Plaintiff then tendered the
rest of her outstanding balance to defendant on 29 June 1991.
That same day, plaintiff and defendant discussed and
negotiated an agreement to procure the release of plaintiff's
husband from jail by having him bonded on credit. During the
next two days, plaintiff procured a bail bond for her husband by
the following means: plaintiff's friend, Bob LaBianca, charged
$10,000 on his Gold Master Card. Once defendant received notice
of this $10,000 premium, defendant posted the bond for
plaintiff's husband, and he was subsequently released from jail. However, on 26 July 1991, defendant received a notice from Mr.
LaBianca's bank that LaBianca had signed a statement indicating
that he did not authorize the $10,000 credit.
On 12 August 1991, plaintiff and her husband traveled
to the Alleghany courthouse for a scheduled bond hearing. When
they arrived at the courthouse, defendant arrested and
surrendered both plaintiff and her husband into custody.
Defendant informed plaintiff that he was surrendering her because
her husband had not paid his bond due to Mr. LaBianca's
rescission of the $10,000 credit card charge.
On 16 October 1995, plaintiff instituted this action
against defendant by filing a complaint alleging breach of
contract, unfair and deceptive practices, and intentional
infliction of emotional distress. Defendant filed an answer on 9
January 1996 denying plaintiff's allegations. A jury trial
commenced on 21 July 1997. The record reflects that after all of
the evidence was presented to the jury, but prior to the jury
charge, the trial court conducted an in-chambers conference with
counsel for both parties. During this conference, the trial
court ruled that it would not submit plaintiff's claims of unfair
and deceptive practices and intentional infliction of emotional
distress to the jury, leaving only the breach of contract action.
Plaintiff then orally moved to amend her complaint to include an
issue of punitive damages. As reflected in the record, defendant
objected to plaintiff's motion, and the trial court ruled in
favor of plaintiff. Plaintiff subsequently filed a written
amendment to her complaint asserting a claim for punitivedamages in an amount in excess of Ten Thousand Dollars
($10,000.00).
On 25 July 1997, the jury found for plaintiff and
recommended an award of damages in the amount of $7,425 for
breach of contract and $150,000 in punitive damages. The trial
court entered judgment accordingly on 31 July 1997. Defendant
appealed; the Court of Appeals, with Judge Walker dissenting,
affirmed the order of the trial court.
Defendant contends that the Court of Appeals erred in
affirming the trial court's order on the ground that the trial
court abused its discretion in allowing plaintiff to amend her
complaint since plaintiff's evidence did not support a claim for
punitive damages in her breach of contract action. In its
decision, the Court of Appeals majority held that defendant
failed to preserve this issue for appellate review, and thus it
was not addressed because defendant lodged no objection on the
record to the submission of a punitive damages issue to the jury
either at the recorded charge conference or subsequent to the
trial court's jury charge. Shore v. Farmer, ___ N.C. App. ___,
___, 515 S.E.2d 495, 497 (1999). Therefore, the Court of Appeals
majority concluded that Rule 10(b)(2) of the Rules of Appellate
Procedure precluded defendant from asserting this unpreserved
argument regarding submission of punitive damages to the jury.
Id. at ___, 515 S.E.2d at 497. We disagree.
N.C. R. App. P. 10(b)(1) provides in pertinent part:
General. In order to preserve a question for
appellate review, a party must have presented
to the trial court a timely request,
objection or motion, stating the specificgrounds for the ruling the party desired the
court to make if the specific grounds were
not apparent from the context. It is also
necessary for the complaining party to obtain
a ruling upon the party's request, objection,
or motion.
Furthermore, under subsection (b)(2) of Rule 10, [a] party may
not assign as error any portion of the jury charge or omission
therefrom unless he objects thereto before the jury retires to
consider its verdict. As above stated, the record in the case
at bar clearly shows that defendant's counsel orally objected to
plaintiff's motion to amend the complaint to include an issue of
punitive damages. As stipulated by counsel, the record on appeal
reflects that there is no dispute that defendant's counsel made
this objection during the in-chambers conference which occurred
after all of the evidence was presented to the jury and prior to
the jury charge. Therefore, although the better practice is to
make sure the objection is recorded in order to preserve it for
appeal, under these circumstances, defendant's position on the
motion to amend was clear to the trial court before the jury
began its deliberations, and it was not necessary for defendant
to further object to plaintiff's motion. Having concluded upon
the record before this Court that Rule 10(b) does not bar
defendant from challenging the trial court's instruction to the
jury and submission of the issue of plaintiff's claim for
punitive damages, we turn to the issue raised by defendant in
this appeal.
The appellate courts of this state have long and
consistently held that punitive damages should not be awarded in
a claim for breach of contract. Newton v. Standard Fire Ins.Co., 291 N.C. 105, 111, 229 S.E.2d 297, 301 (1976); Taha v.
Thompson, 120 N.C. App. 697, 704-05, 463 S.E.2d 553, 558 (1995),
disc. rev. denied, 344 N.C. 443, 476 S.E.2d 130, and disc. rev.
denied, 344 N.C. 443, 476 S.E.2d 131 (1996). The one exception
to this rule is in breach of contract to marry. Newton, 291 N.C.
at 111, 229 S.E.2d at 301. However, this Court has stated:
[W]hen the breach of contract also
constitutes or is accompanied by an
identifiable tortious act, the tort committed
may be grounds for recovery of punitive
damages. Our recent holdings in this area of
the law clearly reveal, moreover, that
allegations of an identifiable tort
accompanying the breach are insufficient
alone to support a claim for punitive
damages. In Newton[,] the further
qualification was stated thusly: Even where
sufficient facts are alleged to make out an
identifiable tort, however, the tortious
conduct must be accompanied by or partake of
some element of aggravation before punitive
damages will be allowed. Newton, [291 N.C.]
at 112, 229 S.E.2d at 301.
Stanback v. Stanback, 297 N.C. 181, 196, 254 S.E.2d 611, 621
(1979) (citation omitted).
In the instant case, defendant was acting as a licensed
bail bondsman when he contracted with plaintiff to procure the
release of plaintiff and plaintiff's husband from jail.
Accordingly, the agreement between plaintiff and defendant is
governed by N.C.G.S. § 58-71-20 which provides:
At any time before there has been a
breach of the undertaking in any type of bail
or fine and cash bond the surety may
surrender the defendant to the official to
whose custody the defendant was committed at
the time bail was taken, or to the official
into whose custody the defendant would have
been given had he been committed; in such
case the full premium shall be returned
within 72 hours after the surrender. Thedefendant may be surrendered without the
return of premium for the bond if the
defendant does any of the following:
(1) Willfully fails to pay the
premium to the surety or
willfully fails to make a
premium payment under the
agreement specified in G.S.
58-71-167.
(2) Changes his or her address
without notifying the surety
before the address change.
(3) Physically hides from the
surety.
(4) Leaves the State without the
permission of the surety.
(5) Violates any order of the
court.
N.C.G.S. § 58-71-20 (Supp. 1998). Pursuant to this statute, it
is clear a bail bondsman has the right to rescind the bail
contract and surrender a defendant into custody at any time
without cause or reason, provided he returns the full premium
paid. The bail bondsman would be liable in contract if he fails
to make such refund.
As the dissent to the decision below correctly noted,
plaintiff's cause of action ultimately consisted of a simple
claim for beach of contract because the trial court did not
submit to the jury the issues of unfair and deceptive practices
and intentional infliction of emotional distress. Significantly,
plaintiff does not now contend that the trial court erred in
refusing to submit these claims to the jury.
Because there was not a separate, identifiable tort to
support a punitive damages claim in this breach of contract
action, we must conclude the trial court erred in submitting the
punitive damages issue to the jury. Therefore, the decision of
the Court of Appeals is reversed, and this case is remanded tothe Court of Appeals for further remand to the Superior Court,
Rowan County, for proceedings not inconsistent with this opinion.
REVERSED AND REMANDED.
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