stating that, even though “North Carolina follows the general rule that punitive or exemplary damages are not allowed for breach of contract, with the exception of a contract to marry,” “where there is an identifiable tort even though the tort also constitutes, or accompanies, a breach of contract, the tort itself may give rise to a claim for punitive damages”
How later courts described this case
- stating that, even though “North Carolina follows the general rule that punitive or exemplary damages are not allowed for breach of contract, with the exception of a contract to marry,” “where there is an identifiable tort even though the tort also constitutes, or accompanies, a breach of contract, the tort itself may give rise to a claim for punitive damages”
- stating that North Carolina follows the general rule that punitive damages are not available even for a wilful or malicious breach of contract, but where the breach also constitutes an independent tort, punitive damages may be available
- noting that the tort exists to "deter refusals on the part of insurers to pay valid claims when the refusals are both unjustified and in bad faith"
- providing that “where there is an identifiable tort even though the tort also constitutes, or accompanies, a breach of contract, the tort itself may give rise to a claim for punitive damages”
Written by the judges who cited it.
The opinion
Chief Jusice Sharp
concurring in result.
For the reasons stated in my dissent in Oestreicher v. Stores, 290 N.C. 118, 144 , 225 S.E. 2d 797, 813 (1976), I concur in the result reached in the majority opinion with reference to punitive damages. In my view, in neither this case nor in Oestreicher are punitive damages appropriate. Further, I do not think we will clarify the law by overruling Swinton v. Realty Co., 236 N.C. 723 , 73 S.E. 2d 785 (1953). On the contrary, this action can only further confuse an area of the law which is rapidly becoming confusion worse confounded.
*117 On its facts, the decision in Swinton was clearly correct. It has been cited by each of the five members of the present Court who became members prior to 1 January 1975 as authoritative and as supporting the propositions variously stated as follows:
(1) Punitive damages can be recovered only in tort actions and upon allegations and proof of facts showing actual malice, oppression, gross and willful wrong, insult, indignity or a reckless disregard of plaintiff’s rights. Van Leuven v. Motor Lines, 261 N.C. 539, 546 , 135 S.E. 2d 640, 645 (1964). See also Hinson v. Dawson, 244 N.C. 23, 27 , 92 S.E. 2d 393, 396 (1956); Lutz Industries, Inc. v. Dixie Home Stores, 242 N.C. 332, 344 , 88 S.E. 2d 333, 342 (1955).
(2) Without such a showing, punitive damages cannot be recovered for false representations. Nunn v. Smith, 270 N.C. 374, 377 , 154 S.E. 2d 497, 499 (1967); Horne v. Cloninger, 256 N.C. 102, 103 , 123 S.E. 2d 112, 113 (1961).
(3) A plaintiff is not entitled to punitive damages in an action for fraud merely upon a showing of misrepresentations which constituted the cause of action (the situation in Swinton). Hardy v. Toler, 288 N.C. 303, 306, 311 , 218 S.E. 2d 342, 344, 348 (1975).
(4) It is the general rule that ordinarily exemplary, punitive or vindictive damages are not recoverable in an action for fraud. Davis v. Highway Commission, 271 N.C. 405, 409 , 156 S.E. 2d 685, 688 (1967).
(5) With the exception of a breach of promise to marry, punitive damages are not given for breach of contract. King v. Insurance Co., 273 N.C. 396, 398 , 159 S.E. 2d 891, 893 (1968).
In my view the foregoing propositions are sound law, and I would not cast doubt upon them by overruling Swinton . An appropriate disposition of this case makes is unnecessary to overrule Swinton or to consider the implications inherent in such a course.
Justices Branch and Moore join in this concurring opinion.