Defendant company sought review of the decision of the Superior Court of Stanislaus County (California), which denied its motion for a new trial in favor of plaintiff trucker in plaintiff’s suit alleging breach of contract and breach of implied duty of good faith and fair dealing, and awarded plaintiff compensatory and punitive damages.
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Plaintiff trucker sued defendant company for breach of contract and breach of implied duty of good faith. Plaintiff sued defendant employees for tortious interference with business relations and intentional infliction of distress. The jury returned a verdict that defendant employees were not liable, defendant company was the responsible party, and that awarded plaintiff compensatory and punitive damages on his contract claim. On appeal defendant company argued that punitive damages were barred in contract actions. The court affirmed the decision as to defendant employees. As to defendant company the court affirmed the award of compensatory damages but reversed the award of punitive damages. The court held that there was no special relationship that would provide an exception to the general rule that restricted relief in contract to contract damages. The court also held that a jury instruction concerning good faith and fair dealing was unqualified, overly broad, and prejudicially erroneous. It was reasonably probable that a more favorable result to defendant company would have been reached if the instructions had been within guidelines set by existing caselaw.
The court affirmed the finding that defendant employees were not liable and compensatory damages for plaintiff trucker in his breach of contract suit against defendant company, but reversed the award of punitive damages against defendant company. There was no special relationship to create an exception to the rule restricting relief in contract to contract damages, and a jury instruction on breach of good faith and fair dealing was overly broad.