Opinion
April 5, 1971
In an action to recover damages for conspiracy to defraud plaintiff's intestate and strip him of his property, (1) defendant Weinberg appeals (a) as limited by his brief, from so much of a judgment of the Supreme Court, Nassau County, entered January 13, 1970, as is against him and in favor of plaintiff on a jury verdict of $125,000 for compensatory damages and $125,000 for punitive damages, and (b) from an order of the same court, entered February 25, 1970, which denied his motion to set aside the verdict, to vacate the judgment and for judgment in his favor or, in the alternative, for a new trial; and (2) plaintiff cross-appeals from so much of the judgment as is against her and in favor of defendants Royal National Bank and William Goldfine, upon the trial court's dismissal of the complaint as against said defendants. Order affirmed, without costs. Judgment affirmed insofar as appealed from by plaintiff, with costs to defendants Goldfine and Royal National Bank. Judgment reversed insofar as appealed from by defendant Weinberg, on the law, and, as between plaintiff and said defendant, action severed and new trial granted, with costs to abide the event, unless, within 30 days after entry of the order hereon, plaintiff shall serve and file in the office of the clerk of the trial court a stipulation consenting to reduce the verdict in her favor to $85,000 for compensatory damages and to $50,000 for punitive damages and to the entry of an amended judgment, in which event the judgment, insofar as appealed from by defendant Weinberg, as so reduced and amended, is affirmed, with costs to plaintiff. In our opinion the award for compensatory damages is excessive to the extent indicated herein for these reasons: (1) Among the items of damage claimed, and apparently allowed in full by the jury, was about $35,000 paid to the Royal National Bank by plaintiff's decedent (through the sale of his pledged collateral and his satisfaction of a judgment) to liquidate the joint and several obligations of himself and one Feldman on loans to them from the Bank. However, as plaintiff's decedent was himself liable for one half of that debt ($17,500) and was entitled to a contribution of only the other one half ($17,500) from Feldman (see Lynch v. Jones, 179 App. Div. 613, 614, app. dsmd. 228 N.Y. 514; Miller v. Miller, 62 Misc.2d 755), the wrongful acts of defendant Weinberg, which frustrated the decedent's attempts to collect from Feldman the contributive share due from him, actually damaged the decedent only to the extent of the $17,500 due him from Feldman, not the full extent of the $35,000 paid by him to the Bank. (2) Another item of damage claimed, and also apparently allowed in full by the jury, was $75,000 for the interest of plaintiff's decedent in Hollywood Shopping Mart, whose sole asset was a lease producing a net income ranging upward from $1,000 per month, at first, to some unspecified figure over $1,400 per month in the later years of its remaining 12-year life. The decedent owned 25% of Hollywood; and, in addition, he had a claim against it for about $43,000 which he, personally, had paid out on account of Hollywood's debts. The record also discloses that at the time the Hollywood lease was sold (wrongfully, according to plaintiff) Hollywood had other debts totaling about $56,000. Considering the fact that the actual worth of the lease, at the time it was sold, was not the total of the income receivable from it over the next 12 years, but only the "present value" of those future annual payments (i.e., about $140,000, when computed on the basis of a 6% interest factor), and considering the fact that this $140,000 must be reduced by Hollywood's debts of $99,000 ($43,000 to plaintiff's decedent and $56,000 to others) in order to determine Hollywood's net worth, it appears that the interest of plaintiff's decedent in Hollywood's true net worth was 25% of $41,000, or about $10,000. As plaintiff's decedent was entitled to repayment from Hollywood for the $43,000 he had advanced for it, in addition to his $10,000 interest in its net worth, the actual damages he suffered from the alleged wrongful sale of Hollywood's sole asset (its lease) was the sum of these two items, i.e., $53,000. Consequently, the claimed damages of $75,000, from the sale of the Hollywood lease, are about $22,000 too high. With respect to the award of punitive damages, we believe the record supports a finding that the misconduct of defendant Weinberg was so gross and wanton, and this case so more flagrant than an "ordinary" fraud action, that an award of such damages is justified ( Walker v. Sheldon, 10 N.Y.2d 401, 405). However, we believe the award was excessive and that a $50,000 award would be proper. Hopkins, Acting P.J., Latham, Christ, Brennan and Benjamin, JJ., concur.