Opinion
No. 2-064 / 01-0287.
Filed April 24, 2002.
Appeal from the Iowa District Court for Clayton County, MARGARET L. LINGREEN, Judge.
David Marx appeals the district court's denial of his motion for new trial on damages in this negligence action. Elkader Cooperative Company cross-appeals on the issue of punitive damages. AFFIRMED.
Jeffrey Tronvold of White Johnson, P.C., Cedar Rapids, for appellant.
John McCoy of Yagla, McCoy Riley, Waterloo, for appellee.
Considered by MAHAN, P.J., and MILLER and HECHT, JJ.
David Marx appeals the district court's denial of his motion for a new trial on the issue of damages. He claims the district court improperly instructed the jury on damages. Elkader Cooperative Company (Coop.) cross-appeals, claiming the court should have granted its motion for a directed verdict on the issue of punitive damages. We affirm.
Marx purchased a greenhouse in Elkader, Iowa, in March 1996 and began doing business as Emerald City Greenhouse. In April 1998 Marx's daughter, Jennifer, and her husband, Michael Zawislak, started managing the greenhouse. They had no formal training or previous experience in operating a greenhouse. Marx's wife, Wanda Osolowski, worked in the greenhouse until early 1999, when she began preparations to sell plants from the couple's home in Marquette, Iowa.
On April 28, 1999, Greg Bahls, a herbicide applicator for the Coop. sprayed two herbicides, Class 40A and Roundup Ultra, on a farm field across the street from the greenhouse. There were wind gusts up to twenty-three miles per hour that day, but it is unknown what the wind velocity was at the time the herbicide was applied. Bahls added an anti-drift agent to the herbicide to reduce drift. It is clear, however, the wind blew some herbicide over to the greenhouse where it negatively affected some plants.
On May 3, 1999, Steve Van Helten from the Iowa Department of Agriculture inspected the greenhouse. He took three samples to test for the presence of herbicides. One sample from a tomato plant, which had been outside the greenhouse, showed a small amount of Class 40A. The department issued the Coop. a written warning, stating it had violated Iowa Code section 206.11(3)(b) (1999) by using a registered pesticide in a manner inconsistent with its labeling.
On May 4, 1999, Patrick O'Malley, an employee of the Iowa State University Extension Office, inspected the plants. He stated about half of the plants showed signs of herbicide exposure, but thought most would recover. At that time Marx told the Coop. he was claiming damages of over $800,000. Allan Beck, an agricultural consultant, inspected the greenhouse on May 27, 1999. He determined only a small portion of the plants in the greenhouse showed symptoms that would be consistent with herbicide exposure.
Marx continued to sell plants from the greenhouse. He also moved a substantial portion of the plants that he stated were dead or damaged to his home in Marquette. There was no inventory of the number of plants in the greenhouse on April 28, 1999. Marx prepared a list, however, of the plants he claimed to have transported to Marquette. Marx terminated operations at the greenhouse in October 1999 and later sold the property. The greenhouse never earned a profit while owned by Marx.
Marx filed suit against the Coop., claiming it was negligent in applying herbicide and thus damaged his business. Marx sought the wholesale value of the damaged plants, plus the loss of his business. He claimed damages between $843,000 and $1.5 million. The Coop. presented expert testimony that most of Marx's plants did not appear to be damaged. The Coop.'s experts testified only some tomatoes, lilies, and geraniums that were outside suffered any herbicide damage. They testified any damage to other plants most likely was caused by poor greenhouse management rather than herbicide exposure.
A jury found the Coop. was at fault and awarded Marx $6890 for destroyed or damaged plants and $7848.30 for lost profits. The jury also awarded Marx $50,000 in punitive damages. The district court denied Marx's motion for new trial on damages and denied the Coop.'s motion for judgment notwithstanding the verdict on the punitive damages award. Marx appeals, and the Coop. cross-appeals.
I. Jury Instructions
Marx contends the district court should have granted his motion for new trial on the issue of damages. He claims the jury instruction on damages was an improper statement of the law. He asserts all of his plants were destroyed and the correct measure of damages was the reasonable market value of the plants prior to their destruction.
Our scope of review of a district court's ruling on a motion for new trial depends on the grounds raised in the motion. Roling v. Daily, 596 N.W.2d 72, 76 (Iowa 1999). To the extent the motion is based on discretionary grounds, we review it for an abuse of discretion. Channon v. United Parcel Serv., 629 N.W.2d 835, 859 (Iowa 2001). But if the motion is based on legal grounds, our review is on error. Id.
Our standard of review concerning alleged error with regard to jury instructions is for correction of errors at law. Iowa R. App. P. 6.4; Duncan v. City of Cedar Rapids, 560 N.W.2d 320, 325 (Iowa 1997). We review jury instructions to decide if they are a correct statement of the law and are substantially supported by the evidence. Bride v. Heckart, 556 N.W.2d 449, 452 (Iowa 1996). Error in giving or refusing to give a particular instruction does not warrant reversal unless the error is prejudicial to the party. Sonnek v. Warren, 522 N.W.2d 45, 47 (Iowa 1994).
The principle underlying the allowance of damages is compensation; the ultimate purpose being to place the injured party in as favorable a position as though no wrong had been committed. Hendricks v. Great Plains Supply Co., 609 N.W.2d 486, 494 (Iowa 2000). No injured party should receive more than has been lost as a result of another's wrongdoing. United States Borax Chem. Corp. v. Archer-Daniels-Midland Co., 506 N.W.2d 456, 460 (Iowa Ct.App. 1993).
Where tangible property has been damaged, the proper measure of damages is the reasonable market value of the property before the damage, plus lost profits due to business interruption. See Mills v. Guthrie County Rural Elec. Co-op Ass'n, 454 N.W.2d 846, 850 (Iowa 1990). However, replacement cost may also be used when an award of fair market value would result in an unjust windfall to the plaintiff. United States Borax, 506 N.W.2d at 460. When either of two measures of damages will fully compensate a plaintiff for his or her loss, the measure must be adopted which is less expensive to defendant. Id. (citing 25 C.J.S. Damages § 72, at 842 (1966)).
In part, the instruction provided:
If plaintiff has demonstrated that any plant was destroyed by the fault of the Defendant, Elkader Cooperative Company, Plaintiff is entitled to recover the reasonable market value (wholesale cost) of the plant at the time of the spraying incident at issue or the replacement value of the plant, whichever is less.
If plaintiff has proven that any plant was damaged by the fault of the Defendant, Plaintiff is entitled to recover the difference between the reasonable market value (wholesale cost) of the plant immediately before and after the damage or the replacement cost of the plant, whichever is less.
The jury was also instructed, "Plaintiff is entitled to recover lost profits from the inability to use such plant during the period of time reasonably necessary to replace such plant." We determine this instruction follows the principles of law stated above.
Marx also claims the instruction mislead and confused the jurors. An instruction is not confusing if a full and fair reading of all of the instructions leads to the inevitable conclusion that the jury could not have mistaken the issue. Welter v. Humboldt County, 461 N.W.2d 335, 339 (Iowa Ct.App. 1990). If the jury has not been misled, there is no reversible error. Id. We find the jury instruction in question is not confusing. Contrary to Marx's assertions that the jury did not understand the instruction, it is likely the jury simply found that not all of Marx's plants had been destroyed by improper exposure to herbicide. We conclude the district court properly denied Marx's request for a new trial on compensatory damages.
II. Punitive Damages
The Coop. has cross-appealed, claiming the district court should have granted its motion for directed verdict on the issue of punitive damages. It asserts there was insufficient evidence to show its conduct constituted willful and wanton disregard for the rights of another. The Coop. claims there was no evidence of actual or legal malice by it towards the greenhouse.
Our review of a district court's denial of a motion for directed verdict is for correction of errors of law. Pierce v. Staley, 587 N.W.2d 484, 485 (Iowa 1998). A directed verdict may be granted where a plaintiff's claim is not supported by substantial evidence. Stover v. Lakeland Square Owners Ass'n, 434 N.W.2d 866, 873 (Iowa 1989). Evidence is substantial when a reasonable mind would accept it as adequate to reach a conclusion. Johnson v. Dodgen, 451 N.W.2d 168, 171 (Iowa 1990). We review the evidence in the light most favorable to the nonmoving party. Pierce, 587 N.W.2d at 485.
Punitive damages serve "as a form of punishment and to deter others from conduct which is sufficiently egregious to call for the remedy." Coster v. Crookham, 468 N.W.2d 802, 810 (Iowa 1991). Mere negligent conduct is not sufficient to support a claim for punitive damages. Beeman v. Manville Corp. Asbestos Disease Compensation Fund, 496 N.W.2d 247, 256 (Iowa 1993). Punitive damages are appropriate only when actual or legal malice is shown. McClure v. Walgreen Co., 613 N.W.2d 225, 231 (Iowa 2000). Actual malice is characterized by such factors as personal spite, hatred, or ill will. Id. Legal malice is shown by wrongful conduct committed with a willful or reckless disregard for the rights of others. Id.
Examining the evidence in the light most favorable to Marx, we find a reasonable juror could find the Coop. acted with a willful or reckless disregard for the rights of others. The evidence showed Bahls did not use any means to attempt to determine wind velocity prior to spraying herbicide. Mike Hillesland, who was golfing nearby, testified it was very windy that day. Bruce Blair, an employee of the Iowa Department of Natural Resources, drove by while Bahls was spraying. Blair testified it was very windy and he felt Bahls should not have been spraying on such a windy day. In addition, the herbicides were applied at a pressure not recommended by the label. Based on these factors, we determine the issue of punitive damages was properly submitted to the jury.
We affirm on the appeal and the cross-appeal. Costs of this appeal are assessed one-half to each party.
AFFIRMED.