# Reply Brief — Bankers Life & Casualty Co. v. Crenshaw

> Briefs, arguments, decisions, and more.

URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385012_0117%3A09

## Record

- **Collection:** Supreme Court brief
- **Document type:** Reply Brief
- **Published:** January 1, 1988
- **Citation:** 486 U.S. 71

## Text

EDITOR'S NOTE

THE FOLLOWING PAGES WERE POOR HARD COPY
AT THE TIME OF FILMING, IF AND WHEN A
BETTER COPY CAN BRE OBTAINED, A NEW FICHE
WILT BE ISSUED,

Supreme Court, U.S,
| FILED
NOV 20 BéT
a ES LSE, SPANO, i
IN THE

Supreme Court of the Gnited States
OCTOBER TERM, 1987

BANKERS LIFE AND CASUALTY COMPANY,
Appellant,

LLOYD M. CRENSHAW,
Appellee.

On Appeal from the Supreme Court of Mississippi

REPLY BRIEF OF APPELLANT

*THEODORE B. OLSON
LARRY L. SIMMS
TERENCE P. Ross

Of Counsel: GIBSON, DUNN & CRUTCHER
1050 Connecticut Ave., N.W.
Washington, D.C. 20036
(202) 955-8500
COPELAND, COOK, TAYLOR Attorneys for Appellant

& BUSH
Post Office Box 2132
Jackson, Mississippi 39225
(601) 354-0123

CHARLES G. COPELAND
J. TUCKER MITCHELL

*Counsel of Record

TT A LTRS er
PRESS OF BYRON S. ADAMS, WASHINGTON, D.C. (202) 347-8263

I.

Il.

Il.

IV.

TABLE OF CONTENTS

I iii ideniisciiiisndiigictiisimianzsnnencecees
A. The Excessive Fines Clause Question ...

1. The Presentation of the Excessive Fines
ID ~iicaicinsicatidsdinetideemnepese

2. The Excessive Fines Clause Question Is
Worthy of Plenary Consideration ......

B. The Due Process Clause and Contract
SE ID ceniinititetnsseninteneininenescesecccce

THE $1,600,000 PUNITIVE AWARD IM-
POSED BY THE MISSISSIPPI COURTS
VIOLATES THE EXCESSIVE FINES
CAEN ccctnncncicksicssbsbecssnsncseosuveoeseppeonssosseccs

A. Appellee’s Arguments Against the Appl-
icability of the Excessive Fines Clause
NE. teiitinitntiniatinainhitnianiiisndivateenees

B. The Historical Relevance of the Amerce-
STE teen e ee

C. The Appropriate Measure of Constitu-
tional EXCeSSIVENESS ............cccssessssssereeees

1. The Substantive Inquiry Into Exces-
EE setitiiaiitniietencntinieneniemttentineseses

2. The Procedure Utilized to Inquire into
Excessiveness and the “Workability”’ of
Appellant’s Test for Excessiveness .....

THE COURT BELOW CHANGED THE
RULES IN VIOLATION OF THE CON-
TRACT AND DUE PROCESS CLAUSES .

MISSISSIPPI’S APPEAL PENALTY
STATUTE ARBITRARILY BURDENS THE
gn

IIE idciicicccininnciinnincncbesoceses

B. The Arbitrary Classifications Drawn by §
EE» ctaieeashdattatensiatedediediceteamacianiensininnese

C. Lindsey v. Normet Is Indistinguishable .

V. CONCLUSION

iil

TABLE OF AUTHORITIES
CASES: Page

Aetna Life Insurance Co. v. Lavoie, 470 So.2d 1060
(Ala. 1984), vacated, No. 84-1601 (Apr. 22,

1986), 106 S. Ct. 1580 (1986) «0... eee 4, 16
Ash v. Security National Insurance Co., 574 S.W.2d
A Te 19
Benson v. Bart, 3 Burr. 1846, 97 Eng. Rep. 1130
EEE EET 10
Blue Cross and Blue Shield of Mississippi, Inc. v.
Campbell, 466 So.2d 833 (Miss. 1984) _.......... 17
Bonsignore v. City of New York, 521 F. Supp. 394
SDNY. SII ilies did endhicesndcentecensessesscces 8

Braniff Airways, Inc. v. Nebraska State Board of
qualization and Assessment, 347 U.S. 590

EG A DLE, I Se 4
Central Union Telephone Co. v. City of Edwards-

I, BP CIID cccecccccccccesccssccccsecces 2
Earl of Devon’s Case, 11 State Tr. 1354 (1689) . 14
Eddings v. Oklahoma, 455 U.S. 104 (1982) _........ 2
Educational Placement Services v. Wilson, 487

CC TD sc nccsccscessssssescnesovecses 2

Giaccio v. Pennsylvania, 382 U.S. 399 (1966) _.... 17
Grey v. Grant, 2 Wils. K.B. 252, 95 Eng. Rep. 794

EN EES TTT TUTTO C ETE 10
Griffin v. Mississippi, 504 So.2d 186
i scccssnonsosecs 2
Hathorn v. Lovorn, 457 U.S. 255 (1982). ............ 2
Huckle v. Money, 2 Wils. K. B. 205, 95 Eng. Rep.
as ccccssesctnsndonncncscoose 10
Ingraham v. Wright, 430 U.S. 651 (1977) ........... 6,11,12
Lindsey v. Normet, 405 U.S. 56 (1972) .............. 17,18,19
a and St. Louis Ry. Co. v. Beckwith, 129
i cssmemmnonooee 13

Mishxin v. New York, 383 U.S. 502 (1966) _........ 5

iv

Table of Authorities Continued

Page

Nationwide Mutual Insurance Co. v. Tuttle, 155

DG SG yyy 19
Pitts v. Mississippi State Bar Association, 462 So.2d

340 (Miss. 1985) (en banc) ..........cccceeeeeeeeeeeees 2
Pruneyard Shopping Center v. Robins, 447 U.S. 74

EIU ccacncasncentocesesstnsnintnincninaiensiamainiattienonmniness 5
Robinson v. California, 370 U.S. 660 (1962) _...... 12
Rowlett v. Anheuser-Busch, Inc., No. 87-1021 (ist

Cir. Sept. 90, 197) nccccccccrcccoccscccccssesccoseeseees 15,16
Town of Madison v. Bear Creek Water Ass’n, Inc.,

510 So.2d 800 (Miss. 1987) — .......cccccssceseseeeeees 2
United States ex rel. Siegal v. Follette, 290 F. Supp.

fii es ie
Webb v. Webb, 451 U.S. 493 (1981) — ..........cceeeeeeee 4
Webb’s Fabulous Pharmacies, Inc. v. Beckwith,

ye 2,3,4
Williams v. Illinois, 399 U.S. 235 (1970) _ ........... 8
FEDERAL CONSTITUTION:
Art. I, § 10, cl. 1 (Contract Clause) —..............000+ 5
Re DI rescnccccsessncsestntnescnseiassncesssnenesscows 7
Potrthn AmRGGG occccccccecccccccscccccccsscscssescsccccsesece 5
Eighth Amendment (Excessive Bail Clause) ........ 12
Eighth Amendment (Excessive Fines Clause) ....... passim
Eighth Amendment (Cruel and Unusual Punish-

BOD CRIED. ceccsccccceccocsscccccesunsessonsonesesetcosees 12
Fourteenth Amendment (Due Process Clause) ...... passim
Fourteenth Amendment (Equal Protection

IED cnccsccscsencescrenscccnsescsssnsnpsosssnasenmsanessosooecs 3,18

ENGLISH STATUTES:

—s Bill of Rights of 1689, 1 Wm. & M., Sess.
Ce, B CIID cccccccscccccesccccsccesscccccesescescscoeseees passim

Table of Authorities Continued

Page
Magna Carta, 25 Edw. I, Ch. I, 1 Stat. at Large
SUITE TIEN -sitiiiciintcndsatiedineneiateaseneepusienainiiltd passim
Statute of Westminster, 3 Edw. I, Ch. 6, 1 Stat.
£m 13
STATE CONSTITUTION, STATUTES AND RULES:
se Be I III, ~ ccnceceidsantntvtcuscenscnnsinnon 3
I a sae 19
Miss. Code Ann. § 11-3-23 (Supp. 1986) ......... 17,18,19
Rule 38, Rules of the Sup. Ct. of Miss. _......... 19
TREATISES:
E. Coke, The Second Part of the Institutes of the
Laws of England (6th ed. 1681) .............20000 10,13
Granucci, “Nor Cruel and Unusual Punishments
Inflicted”: The Original Meaning, 57 Calif. L.
+ ( £2 SEE raS 8
W. Hale, Handbook on the Law of Damages (2d
ea ice ict caniivnominn 10
J. Holt, Magna Carta (1965) .............ccceeseeseeeees 14
Long, Punitive Damages: An Unsettled Doctrine,
25 Drake L. Rev. 870 (1976) .........ccccseeseeeees 8

Massey, The Excessive Fines Clause and Punitive
Damages: Some Lessons History, 40 Vand.
L. Rev. 1233 (Nov. 1987) (to be published) . 11,12

W. McKechnie, Magna Carta (2d ed. 1958) .... 9, 14

Montesquieu, Tie Spirit of Laws (1751) _.......... 8

L. Schwoerer, The Declaration of Rights, 1689
GEITUEY sieacindinedasiapchictintinibitsidtipaaniieitiigittapetateniteionss 9-10

F. Thompson, Magna Carta: Its Role in the Mak-
ing of The English Constitution 1800-1629
Ep Re ree ae eee CE ee 14

I
JURISDICTION

Appellee’s arguments concerning the Court’s jurisdiction
over Question 1, Br. of Appellee, at 20-27, revisit the same
issues which were fully aired in his Motion to Dismiss, at
10-17, and presumably rejected when probable jurisdiction
was noted. Appellant will respond only to the extent ap-
pellee’s previous arguments have been re-packaged or
where additional authorities have been presented.’

A. The Excessive Fines Clause Question

1. The Presentation of the Excessive Fines Clause Ques-
tion

Appellee’s arguments regarding the presentation of the
Excessive Fines Clause question to the court below, Br.

' Appellant will not respond to appellee’s attempt to re-characterize
the record below. Br. of Appellee, at 1-6. The relevant core of the
proceedings below is that a Mississippi jury determined that appellant’s
handling of appellee’s insurance claim was unfair or improper and mer-
ited a $1,600,000 penalty. Although the amount of the fine did not
“shock .. . the judicial conscience’’ of five justices of the Supreme Court
of Mississippi, four justices of that court found the magnitude of the
fine either ‘‘grossiy excessive’ or completely unwarranted because of
appellee’s reliance on its highly qualified Medical Director. The simple
fact that punishment of this magnitude may be exacted for conduct
which so divides medical experts and the highest court of a state con-

veys telling messages concerning punitive damages.

Appellee’s discussion of the trial court’s instructions to the jury, Br.
of Appellee, at 2 n.2 and 46 n.69, regarding punitive damages is in-
complete and misleading. Appellee makes reference to only three of
the instructions given to the jury regarding the standards pursuant to
which punitive damages could be awarded and the amount of any pu-
nitive award. In the interest of completeness, all six of the pertinent
instructions have been reproduced in the appendix to this brief. The
confused, unintelligible standards pursuant to which the jury returned
its verdict for punitive damages are relevant to, and mirrored by, the
vague, shifting standards pursuant to which this verdict was affirmed
by a narrow majority of the court below as discused in part III, infra.

of Appellee, at 22-26,? are primarily directed to the inartful
manner in which this federal question was raised. Such
lack of sophistication, however, has been held by the Court
not to deprive it of the power to decide important con-
stitutional questions, Eddings vy. Oklahoma, 455 U.S. 104,
114 n.9 (1982). A unanimous Court applied this principle
in Webb’s Fabulous Pharmacies, Inc. v. Beckwith, 449 U.S.
155 (1980), on which appellant relied at the jurisdictional
stage, see Reply Mem., at 7-8 & nn.5 & 6.8

* Appellee reiterates arguments made in his Motion to Dismiss, at
13-17, that appellant was required to present its federal challenge to
the magnitude of the punitive fine in the trial court both pre- and post-
trial. Br. of Appellee, at 25. In renewing these arguments, appellee
does not address the holding of the trial court that it had no power
to consider appellant’s challenge to the size of the punitive award, see
J. S., at 10-12, a holding which deprived appellant of any “reasonable
opportunity” to have its federal and state law challenges to the punitive
damage award determined by that court. Central Union Telephone Co.
v. City of Edwardsville, 269 U.S. 190, 194-95 (1925). Although Central
Union was relied upon by appellant, Reply Mem., at 9, and is con-
trolling, appellee does not even cite that case.

Appellee’s argument is deficient in other crucial respects. Appellee
cites Educational Placement Services v. Wilson, 487 So.2d 1316 (Miss.
1986), as establishing what he characterizes as a “‘consistently-applied”’
practice of the court below in refusing to consider questions not pre-
sented to the trial court, but neglects to bring to the Court’s attention
subsequently decided cases in which the court below decided issues
raised for the first time on direct appeal. See Town of Madison v. Bear
Creek Water Ass’n, Inc., 510 So.2d 800 (Miss. 1987); Griffin v. Mis-
sissippi, 504 So.2d 186 (Miss. 1987). More importantly, neither appellee
nor the cases he cites address the practice of the court below as regards
the presentation of issues on rehearing. This Court recognized in Hath-
orn v. Lovorn, 457 U.S. 255 (1982), that the court below regularly
entertains questions raised for the first time on rehearing. Pitts v.
Mississippi State Bar Association, 462 So.2d 340, 342 (Miss. 1985) (en
banc), cited in appellant’s Reply Mem., at 1, but not mentioned by
appellee, confirms that practice.

* Appellee’s failure to respond to Beckwith in his merits brief is un-
derstandable, because Beckwith is dispositive on this point. In that case,
the appellant’s memorandum of law filed in the state trial court—

Moreover, and contrary to appellee’s assertion, appellant
expressly challenged on federal grounds in the court below
the excessiveness of the $1,600,000 award, asserting that
the award “is excessive, constitutes an excessive fine, and
violates due process, equal protection and other constitu-
tional stanoards.” J. S. App., 15la (emphasis added).‘ Ap-
pellant twice challenged the size of the award as
“constitut[ing] [an] excessive fine.” J. S. App., 139a, 15la.

Appellee, Br. of Appellee, at 22, objects that appeliant
did not cite expressly to the Excessive Fines Clause of
the Eighth Amendment in its briefs in the court below
But appellant’s challenge to the punitive damage award
as being an “excessive fine’’ is surely sufficient. In any
event, the Court has made clear that a state court liti-

apparently the only document in the record relied upon by this Court
to sustain its jurisdiction—contained a series of state law challenges to
the Florida statute at issue and apparently a single reference to the
“pertinent provisions of the Florida Constitution and its Federal coun-
terpart.” 449 U.S., at 159 n.5 (emphasis in original). In the instant
case, appellant’s briefs in the court below, J. S. App., 124a-152a, much
more clearly relied on the Federal Constitution.

In Beckwith, the Court observed that the federal question “‘appears
to have been raised in the Supreme Court of Florida.’’ 449 U.S., at
159 n.5. This observation of the Court was apparently based on an
assertion to that effect by the appellant’s counse] at oral argument in
an exchange with Justice Blackmun. Although the Court did not appear
to rely on that exchange in taking jurisdiction over that case, that
exchange is in any event less substantial than the briefs of appellant
filed in the court below in this case.

‘ Appellee’s suggestion, Br. of Appellee, at 25 n.36, that appellant’s
reference to “‘due process, equal protection” in the court below may
have constituted a reference to the guarantee of due process in Art.
8, § 14 of the Mississippi Constitution overlooks the fact that Missis-
sippi’s constitution contains no equivalent of the Equal Protection Clause
of the Fourteenth Amendment. Thus, appellee’s speculation requires
concluding that appellant shifted from state to federal grounds within
a single phrase of a sentence. Furthermore, when appellant relied on
provisions of the Mississippi Constitution, it expressly cited those pro-
visions by article and section. See J. S. App., 135a.

gant’s failure to rely on the “correct” provision of the
Federal Constitution is irrelevant to this Court’s power to
decide a federal question so long as the question brought
here is “within the clear intendment”’ of the contention
made below. Braniff Airways, Inc. v. Nebraska State Board
of Equalization and Assessment, 347 U.S. 590, 599 (1954).
Appellant relied on Braniff at the jurisdictional stage after
appellee first raised this objection, Reply Mem., at 7-8 n.5.
As with Beckwith, supra, appellee inexplicably does not
even cite Braniff, which is indistinguishable and control-
ling. See Webb v. Webb, 451 U.S. 493, 501 (1981) (“we
have not insisted” that “litigants identif[y] in the state
courts precisely the provisions of the Federal Constitution
. on which they rely ....’’).

Thus, the rule announced by this Court is: Webb v. Webb,
451 U.S., at 501, requiring “that a claim under ... the
Federal Constitution was presented in the state courts and
that those courts were apprised of the nature and sub-
stance of the federal claim at the time and in the manner
required by state law,” is fully satisfied in this case.

2. The Excessive Fines Clause Question Is Worthy Of Plen-
ary Consideration

Appellee’s contention that the Excessive Fines Clause
question does not meet this Court’s standards for the ex-
ercise of its certiorari jurisdiction is authoritatively refuted
by the Court’s direct statement just eighteen months ago
in Aetna Life Insurance Co. v. Lavoie, No. 84-1601 (Apr.
22, 1986) slip op., at 13, 106 S Ct. 1580, 1589 11986)
(emphasis added), characterizing the Excessive Fines
Clause question as raising an “important” issue ‘which
... must be resolved,’”’ and the Court’s unrestricted no-
tation of probable jurisdiction in this case.*

* Appellee’s argument, Br. of Appellee, at 26-27, that the Excessive
Fines Clause question need not be reached because Congress and some
state legislatures may be “‘actively considering a broad range of re-

B. The Due Process Clause and Contract Clause Ques-
tion

Appellant expressly asserted below that the court had,
in affirming the punitive damage award, “change[d] the
law” regarding punitive damages in violation of “‘consti-
tutional requirements of equal protection.” J. S. App.,
138a. Appellee contends, Br. of Appellee, at 44-45, that
appellant cannot rely on the Contract Clause or the Due
Process Clause in support of this federal challenge in this
Court because those clauses were not cited to the court
below and because this challenge was not raised until the
rehearing stage.

Appellee’s initial contention is overcome by the same
authorities discussed above regarding appellant’s entitle-
ment to invoke the Excessive Fines Clause in this Court.
Appellee’s contention regarding the timeliness of this chal-
lenge ignores the fact that this federal question did not
arise until the court below had formulated new substantive
standards of conduct in 1985 and had imposed on appellant
a $1,600,000 penalty for not having complied with those
standards in 1979 and 1980. Thus, cases such as Prune-
yard Shopping Center v. Robins, 447 U.S. 74, 85-87 n.9
(1980) and cases cited (litigants entitled to raise in this

strictions on punitive damage awards” is singularly devoid of any spe-
cifics as to the nature of the legislation pending or the likelihood of
its enactment. S. 544, cited by appellee in his brief at 26 n.39, would
place no limit on the size of punitive damage awards.

Appellee’s reliance, Br. of Appellee, at 27, on Mishkin v. New York,
883 U.S. 502, 512-13 (1966), to suggest that the record in this case
does not present the Excessive Fines Clause question with “sufficient
clarity,”” is misplaced. The Court’s concern in Mishkin centered ezclu-
sively on the absence in the record of an evidentiary basis for deciding
the fact-bound Fourth Amendment question presented. Whether the
Excessive Fines Clause applies to punitive damages, in sharp contrast,
is not dependent for its resolution on any facts; it is a pure question
of federal constitutional law which can only be resolved definitively by
this Court.

Court a federal question raised at first opportunity to do
so in the state court system), require rejection of appellee’s
contention.

II

THE $1,600,000 PUNITIVE AWARD
IMPOSED BY THE MISSISSIPPI COURTS
VIOLATES THE EXCESSIVE FINES CLAUSE

A. Appellee’s Arguments Against the Applicability of
the Excessive Fines Clause Are Specious

The origin and development of the Eighth Amendment’s
antecedents must be examined and applied in this case in
the context of a governmentally imposed, court approved,
$1,600,000 fine levied in order to punish and deter per-
ceived antisocial conduct—precisely the purposes served by
the criminal law. The incontrovertible history of the Eng-
lish antecedents of the Excessive Fines Clause, viewed in
light of this purpose, requires the result urged by appellant.
Appellee avoids any discussion of the purpose of the pu-
nitive fine in this case and the purpose of English and
American constitutional restrictions on excessive, govern-
mentally imposed punitive fines. Instead, appellee advances
two simple and closely related propositions which are crit-
ical to his position but which fall of their own weight when
scrutinized.

The first proposition, Br. of Appellee, at 28, is that
punitive damages must be distinguished from other gov-
ernmentally imposed financial penalties because they are
not extracted by the government “‘to fine or punish for
its own benefit,” id. (emphasis added), but rather are
merely made available by the government “but ‘designed
for the benefit of other parties.’” Id., quoting Ingraham v.
Wright, 430 U.S. 651, 668 (1977) (emphasis added). Ap-
pellee’s unstated premise is that punitive fines in civil cases
are not intended primarily to serve the government’s ob-
jectives. But that premise is plainly false, and the history

of punitive damages is to the contrary. Punitive damages
are invariably justified as serving society’s goals.*

Even assuming the validity of appellee’s major premise,
the logical fallacy in appellee’s reasoning is his assumption
that the government’s involvement becomes immaterial
merely because there may be some ancillary benefit to a
private litigant. Such logic would, for example, authorize
privately obtained injunctions against the printing of news-
papers despite the First Amendment’s prohibition against
the government’s obtaining such an order for its own “‘ben-
efit.”” That is not the law.

Appellee’s second, closely related proposition, Br. of Ap-
pellee, at 30-35, is that these punitive fines are ‘‘different”’
for constitutional purposes because they are “awarded to
private plaintiffs” rather than paid to the government. Id.,
at 30. Appellee seems to argue, Br., at 30-38, that the
principal concern over amercements and fines reflected in
Magna Carta and the English Bill of Rights is that they
were set by and payable to the King and therefore subject
to abuse whenever the Crown needed to generate addi-
tional revenue. This premise is, however, grounded in a
myopic view of history.

Concern over excessive and disproportionate punishment
has ancient roots that go far beyond the potential ‘‘conflict
of interest” identified by appellee. From Genesis, Leviticus
and the lex talionis, the concept of proportionality—equal-
ity between the crime and the punishment—has been abid-

* Appellee’s counsel advised the jury during his opening statement:
“we are asking you to return to us a sizable verdict ... not to com-
pensate Lloyd Crenshaw, but to penalize this company and let them
know that the people of Jackson County don’t like their insurance
claims handled in that manner.” R. 174. The jury was subsequently
instructed that punitive damages “are never awarded to benefit the
injured party, but rather to punish and compel the wrongdoer to have
due and proper regard for the rights of the public.” R. 1130, App. 5a,
infra.

ing and fundamental. See Granucci, “Nor Cruel and
Unusual Punishments Inflicted”: The Original Meaning, 57
Calif. L. Rev. 839, 844 (1969); Montesquieu, The Spirit of
Laws *111 (bk. VI, ch. XVI) (“It is an essential point that
there should be a certain proportion in punishments, be-
cause it is essential that a great crime should be avoided
rather than a lesser ....”’). And even if history were to
the contrary—which it is not—‘“‘neither the antiquity of a
practice nor the fact of steadfast ... judicial adherence
to it through the centuries insulates it from constitutional
attack ....”’ Williams v. Illinois, 399 U.S. 235, 239 (1970).

Underlying appellee’s argument is the proposition that
American governments may achieve the retributive and
deterrent purposes of punitive fines without regard to cen-
turies-old restrictions on excessive monetary punishments
by the simple expedient of turning those fines over to
private persons. Appellee has, however, advanced no sup-
port in law, logic or history for his gossamer theory.’

’ Appellee also argues, Br. of Appellee, at 31, that amercements are
“different” from punitive damages because the former were imposed
not only upon “great or serious” offenses, but also for “minor and
trivial’’ offenses, whereas punitive damages are awarded “‘only’’ where
“particularly culpable and reprehensible behavior” is involved. Like ap-
pellee’s other arguments, this one starts with a false premise and then
stretches to reach conclusions which are untenable even if the premise
were valid. The suggestion that punitive damages are available only
for egregious, highly culpable conduct is simply wrong. They may be
awarded for conduct which a jury finds to be “wanton” or in “reckless
disregard for the rights of others” (Iowa), for “gross negligence” (Ar-
izona) or even “‘rudeness’’ or “mere caprice” (North Carolina). See
Long, Punitive Damages: An Unsettled Doctrine, 25 Drake L. Rev. 870,
880-81 (1976). See, e.g., Bonsignore v. City of New York, 521 F. Supp.
394 (S.D.N.Y. 1981) (New York City held liable for $125,000 punitive
damage award to wife of police officer shot by her husband on basis
of city’s policy of requiring police officials to carry firearms while off
duty). Even if this dichotomy actually existed, appellee does not suggest
how this asserted “difference” would give rise to a distinction of con-
stitutional dimension.

B. The Historical Relevance of the Amercements
Clauses

Appellee acknowledges that a substantial consideration
in determining whether the Excessive Fines Clause limits
the magnitude of punitive damage awards is the historical
derivation of that Clause. Br. of Appellee, at 27-28 n.40.
Moreover, appellee does not dispute that the principal pur-
pose served by amercements, fines, and punitive damages
is to inflict punishment on the perpetrator of antisocial
conduct in order to deter the wrongdoer and others from
engaging in similar conduct. Br. of Appellant, at 25-26;
Br. of Aetna Life Insurance Co., et al., as Amici Curiae,
at 10-11 (“Br. of Aetna”). However, appellee asserts that
Chapter 20 of Magna Carta was concerned only with lim-
iting the ability of the Crown to determine the size of
poten al amercements which would be paid into its coffers.
But neither the text nor historical application of Chapter
20 provides any support whatsoever for that argument.

On its face, see Br. of Appellant, at 23, Chapter 20
adopts substantive limications on the size of amercements
without regard to the identity of the beneficiary of the
extraction. In addition, amercements were, as an historical
fact, paid to officials other than the Crown. See Br. of
Aetna, at 16 n.26 & 17 n.27. Furthermore, the central
point of Chapter 20 was to remove the arbitrary element
in the exaction of amercements by requiring the Crown
to “conform to its own customary rules.”” W. McKechnie,
Magna Carta 287 (2d ed. 1958). See generally Br. of Aetna,
at 15. This objective was, in practice, achieved through
the articulation of substantive standards and the imposition
of procedural regularity on the amercements system. This
objective was also pursued by those who drafted the pro-
hibition on excessive fines as it appeared in the Declaration
of Rights of 1689, subsequently enacted later that year by
Parliament as the English Bill of Rights. Those drafters
“wanted to prohibit punishments that were unauthorized
by statute ....” L. Schwoerer, The Declaration of Rights,

10

1689, 93-94 (1981). Appellee cites no evidence to the con-
trary.

Appellee also argues that English constitutional limits
on excessive penalties would have been regarded as in-
applicable to 20th-Century punitive damage awards be-
cause in some cases English courts in the 18th Century
perceived themselves to be without authority to set aside
disproportionate “exemplary damage” awards. Br. of Ap-
pellee, at 33-35. Appellee’s argument, however, totally fails
to address the fact that the three cases upon which he
relies* either involved misconduct by government officials,
who did not enjoy the protection of the Amercements
Clauses, see E. Coke, The Second Part of the Institutes of
the Laws of England 27 (6th ed. 1681); Br. of Appellant,
at 29, or involved “‘exemplary damage” awards which were
perceived to be compensatory as well as punitive. Jd., at
28-30.

As appellant has demonstrated, id., the blending of the
reparative and retributive rationales by English courts in
the 18th Century to justify the affirmance of the earliest
“exemplary damage” awards explains in part why the
defendants in those cases may not have invoked the prin-
ciple of proportionality in Magna Carta and the Excessive
Fines Clause of the English Bill of Rights. It was not until
the middle of the 19th Century that punitive damages in
their more purely punitive form—imposed, like amerce-
ments and fines, for the purposes of punishment and de-
terrence—began to emerge “as ‘a sort of hybrid between
a display of ethical indignation, and the imposition of a
criminal fine.’’’ W. Hale, Handbook on the Law of Dam-
ages 303 (2d ed. 1912). At that point, the reparative and
retributive purposes of the law continued to be joined in

* Huckle v. Money, 2 Wils. K.B. 205, 95 Eng. Rep. 768 (C.P. 1763);
Grey v. Grant, 2 Wils. K.B. 252, 95 Eng. Rep. 794 (C.P. 1764); Benson
v. Bart, 3 Burr. 1846, 97 Eng. Rep. 1130 (1766).

a

. 1]

civil actions, but the function of punitive or exemplary
damages was finally recognized as purely punitive.

The best indication of the meaning and intended reach
of the Excessive Fines Clause is not, as appellee would
have it, a few English cases from the mid-18th Century
before “exemplary damages’’ had taken on the exclusively
punitive and deterrent role they now perform. Rather, the
understanding of the Colonists and Framers of the Eighth
Amendment who, as history shows, fully intended to pro-
tect themselves from disproportionate, excessive punish-
ment, is the better source from which to derive the
meaning of the Excessive Fines Clause.

The distinctions between ‘“‘amercement”’ and “‘fine”’ had
become blurred as early as the 15th Century. Br. of Aetna,
at 18 n.29. As documented by amici curiae, the Colonists
also used the terms amercement and fine interchangeably
in the fundamental Colonial documents, some of which
expressly incorporated Chapter 20 of Magna Carta. Br. of
Aetna, at 20-25. Those materials demonstrate the under-
standing of the Colonists that Chapter 20 was applicable
to fines imposed in civil as well as criminal cases, id., at
23,° and was applicable to fines payable directly to a pri-

*The understanding of the Colonists regarding the applicability of
Chapter 20 and the prohibition on excessive fines in the English Bill
of Rights of 1689 to civil cases mirrors the understanding of the com-
mittees of the Convention which drafted Article 10 of the Declaration
of Rights in early 1689 and the Members of Parliament who enacted
the Declaration as the Bill of Rights later that year. Professor Massey,
after a thorough exposition of the relevant historical materials, con-
cludes that the prohibition on excessive fines in Article 10 of the Dec-
laration ‘‘should be read as prohibiting excessive fines and amercements,
whether imposed by judge or jury, in both civil and criminal proceed-
ings.” Massey, The Excessive Fines Clause and Punitive Damages: Some
Lessons from History, 40 Vand. L. Rev. 1233, 1256 (Nov. 1987) (to be
published).

An examination of the briefs before the Court in Ingraham v. Wright,
430 U.S. 651 (1977), demonstrates that the primary historical materials

12

vate litigant, id., at 21. Like the drafters of the English
Bill of Rights, the Colonists, including the Framers of the
Eighth Amendment, were concerned about excessive gov-
ernmentally imposed punishments, not the particular form
in which such punishments were administered. The sug-
gestion that the Colonists would have been indifferent to
excessive governmentally imposed financial sanctions
merely because they were paid to randomly selected citi-
zens rather than to the government’s treasury defies com-
mon sense and is not supported by any historical evidence.’

relied on by appellant, amici curiae Aetna, et al., and Professor Massey
were not placed before this Court by the litigants in Ingraham. This
lack of full development of the historical background of the framing
of the English Bill of Rights may well have been responsible for the
Court’s suggestion in Ingraham that the Eighth Amendment applies
only to punishment imposed after a criminal trial. As noted at the time,
the Ingraham Court proffered this suggestion based upon a “vague
and inconclusive recitation of the history of the [Eighth] Amendment.”’
430 U.S., at 685 (White, J., dissenting).

Moreover, in Ingraham the Court’s opinion observed that, as an
historical fact, the use of moderate corporal punishment by a teacher
to correct a student in his care was viewed as “lawful,” 430 U.S., at
661, by Blackstone. In sharp contrast, the exaction of excessive amerce-
ments (and, later, fines) has been violative of English law since at least
1215. Thus, while English history arguably supported the result reached
in Ingraham, it did not support the breadth of some of the Court’s
language. As Professor Massey’s research establishes, the elimination
of the reference to “criminal cases” from an early draft of Article 10
of the Declaration should, in light of the contemporary events, be re-
garded as reflecting the understanding of the drafters that the pro-
hibitions on excessive fines, bail and punishments were not limited to
criminal cases. 40 Vand. L. Rev., at 1254-56.

” Appellee suggests, without elaboration, that the Court should hold
the Excessive Fines Clause inapplicable to the States, Br. of Appellee,
at 29 & n.43, and that corporations are not entitled to its protection,
id. & n.44. Neither suggestion has merit. In Robinson v. California,
370 U.S. 660 (1962), the Court first held the Cruel and Unusual Pun-
ishments Clause applicable to the States through the Due Process Clause
of the Fourteenth Amendment. The Excessive Bail Clause has also been
held applicable to the States through the Due Process Clause. See, e.g.,

13

C. The Appropriate Measure of Constitutional Exces-
siveness

Appellee appears to agree that Chapter 20 of Magna
Carta required amercements to be proportional to the se-
riousness of the conduct for which the amercement was
imposed. Br. of Appellee, at 32. Appellee nevertheless ar-
gues that there is no historical support for appellant's
position that the constitutional excessiveness ot punitive
damage awards should be measured, at least in part, by
comparing the magnitude of such awards to civil and crim-
inal penalties established prospectively by legislatures and
made generally applicable to all citizens as the appropriate
financial sanctions for comparable conduct. Br. of Appel-
lee, at 37-41.

Appellee’s explanation of his position confuses, perhaps
unintentionally, two separate questions. As noted in the
foregoing paragraph, the initial question regards the sub-
stantive standards imposed on the excessiveness of puni-
tive awards by Chapter 20; on this question the parties
generally agree. The second, and more important, question
revolves around how English courts avoided the imposition
of amercements which were disproportionate to the offense

United States ex rel. Siegal v. Follette, 290 F. Supp. 632, 634-35 &
nn.11-13 (S.D.N.Y. 1968).

The applicability of the Excessive Fines Clause to corporate entities
is controlled by the opinion of Justice Field, writing for a unanimous
Court in Minneapolis and St. Lowis Ry. Co. v. Beckwith, 129 U.S. 26,
28 (1889), in which the Court reasoned “that corporations can invoke
the benefits of provisions of the Constitution ... which guarantee to
persons the enjoyment of property ....” Moreover, at least since the
enactment of the Statute of Westminster, 3 Edw.I, Ch. 6, in 1275, the
protections of Magna Carta were extended to corporate and political
entities. E. Coke, The Second Part of the Institutes of the Laws of
England 27, 169-70 (6th ed. 1681). Thus, the Framers of the Eighth
Amendment would have understood the Excessive Fines Clause to be
applicable to corporate entities.

14

involved in a particular case. That latter question involves
an inquiry into both substance and process.

1. The Substantive Inquiry Into Excessiveness

Contrary to appellee’s submission, there is no doubt that
limits on amercements and fines, both before and after
Magna Carta, were frequently established by local customs,
rules and the equivalent of statues." See J. Holt, Magna
Carta 50, 230-32 (1965) (cited for this specific point in Br.
of Appellant, at 37). There was in fact a recognized scale
of maximum amercements established in the first year of
Henry VI, W. McKechnie, supra, at 298, and statutes also
established specific limits. F. Thompson, Magna Carta: Its
Role in the Making of the English Constitution 1800-1629,
361 (1948). This history demonstrates that in implementing
Chapter 20, the English rejected the proposition that juries
were competent to make the threshold determination re-
garding the maximum punishment which was “‘propor-
tional’”” to the particular offense involved. In fact, the
English settled on a degree of certainty that parallels the
process suggested by appellant’s submission to this Court
on this point.

'' Appellee asserts, Br. of Appellee, at 37-38, that amercements were
not required to be proportional to punishments imposed by “‘Parlia-
ment.” That assertion is contrary to Earl of Devon’s Case, 11 State
Tr. 1354 (1689), as discussed in appellant’s opening brief, at 38-39.

* Appellant’s proposed test of constitutional excessiveness implies
none of the inflexibility that appellee suggests. See Br. of Appellee, at
28-29 (treble damages would per se violate Excessive Fines Clause).
Appellant has not argued that a punitive award is invariably excessive
in the constitutional sense merely because it may be greater than any
particular legislatively imposed analog. Such enactments are, however,
valuable benchmarks which permit an objective inquiry into excessive-
ness and which will produce consistent, easily administered application
of the Excessive Fines Clause. Furthermore, if Mississippi had legislated
a treble damage standard for insurance bad faith cases, that standard
would, standing alone, reduce the punitive award in this case by
$1,560,000.

15

2. The Procedure Utilized to Inquire Into Excessiveness
and the “Workability’”’ of Appellant’s Tesi for Exces-
siveness

Appellee attempts to convince the Court that English
juries “had unlimited discretion to determine the appro-
priate amount” a person should be amerced, Br. of Ap-
pellee, at 38, while simultaneously arguing that appellant's
submission would require judges “‘to make substantive and
policy judgments they are ill-equipped to make.” Jd., at
41. The extreme tension between these two positions is
self-evident. Appellee would leave within the unfettered
discretion of juries the administration of an ad hoc system
of punishment which cannot, for reasons appellee fails to
articulate, be entrusted to judges guided by legislative en-
actments which presumptively reflect the values of society
as a whole, expressed prospectively, regarding standards
of conduct and penalties for deviation therefrom. Appel-
lee’s system, however, is not the system developed in Eng-
land and transplanted here.

The function of English juries within the amercements
system was to reduce an amercement which a court, often
guided by rule, custom or statute, had already determined
to be proportional to the particular offense involved. Br.
of Aetna, at 11-14 and authorities cited; Br. of Appellant,
36-39. Appellee eschews responding to this well-docu-
mented argument, apparently content to stand on the
proposition that reliance on judges and legislative stand-
ards in determining the maximum punitive damage award
permissible in a particular case is “doomed to failure.”
Br. of Appellee, at 43.

The First Circuit, however, has recently recognized the
arbitrariness of committing to juries the power to award
unlimited punitive damages. Rowlett v. Anheuser-Busch,
Inc. No. 87-1021 (1st Cir. Sept. 30, 1987). In the course
of reducing a $3,000,000 punitive damage award to
$300,000, that court imposed a prophylactic rule under

16

which trial courts were directed henceforth to establish a
limit on the amount of punitive damages which could be
awarded and so to instruct the jury, which would be per-
mitted to award less, but not more, than that judicially
ascertained limit. Slip op., at 33. Fashioned as a matter
of statutory interpretation rather than constitutional im-
perative, the First Circuit’s approach is both ‘workable’
and implicitly adopts one of the key principles recognized
and implemented in the antecedents of the Excessive Fines
Clause: punishment administered in arbitrary, purely vis-
ceral zmounts by juries is fundamentally inconsistent with
our constitutional system.

Ill

THE COURT BELOW CHANGED THE RULES
IN VIOLATION OF THE CONTRACT AND DUE
PROCESS CLAUSES

Appellee argues that the Court below did not ‘change
[the] law in any respect.” Br. of Appellee, at 47. However,
prior to the decision in this case the court below had never,
in a bad faith case, determined that insurers would be
liable for punitive damages when they had an arguable
basis for denying a claim but communicated an improper
basis to their insureds. As stated unequivocally by the
court below:

The issue is not the defense which Bankers Life

at trial finally settled upon to defend the suit,

but the reason it gave Crenshaw for denying the

claim.
J. S. App., 40a, 483 So.2d, at 283. To support this prop-
osition, the court below relied not on its prior cases but,
rather, the then-recent decision of the Supreme Court of
Alabama in Aetna Life Insurance Co. v. Lavoie, 470 So.2d
1060 (Ala. 1984), vacated, No. 84-1601 (Apr. 22, 1986), 106
S. Ct. 1580 (1986).

Having framed the “issue” in this manner, the majority

of the court below affirmed a punitive damage award for

ee eee ee

ill Rall 6 tlh ha ott ay

17

conduct held to be inconsistent with vague and uncertain
standards which have not even been susceptible to clear
articulation in general terms by the court below. Compare
the majority opinion below, J. S. App., 40a-47a, 483 So.2d,
at 173-76 (appellant not entitled to rely on expert opinion
of Medical Director), with dissenting opinion, J. S. App.
64a-68a, 78a-80a, 483 So.2d, at 284-85, 290-91 (appellant
justified in relying on expert opinion of Medical Director)
and Blue Cross and Blue Shield of Mississippi, Inc. v.
Campbell, 466 So.2d 833 (Miss. 1984) (insurer entitled to
rely on expert opinion of registered nurse).

Furthermore, if the imposition of a $230.95 fine for
conduct found to be “reprehensible in some respect’’ is
violative of the Due Process Clause, Giaccio v. Pennsyl-
vania, 382 U.S. 399, 403-04 (1966), then due process must
surely be violated by the imposition of a $1,600,000 fine
based on the elusive definitions of misconduct in this case
presented to the jury” and articulated by the court below.

IV

MISSISSIPPI’S APPEAL PENALTY STATUTE
ARBITRARILY BURDENS THE RIGHT TO APPEAL

A. Standard of Review

Relying on a passage from this Court’s opinion in Lind-
sey v. Normet, 405 U.S. 56, 73 (1972), which is irrelevant
to the showing which must be made to justify a State’s
burdening of the right to appeal, appellee defends § 11-3-
23 without acknowledging the burden he carries under
Lindsey. Br. of Appellee, at 12. As Lindsey held, the ex-
ercise of the statutory right to appeal “cannot be granted

8 As noted above, note 1, supra, the six jury instructions on punitive
damages, reprinted in the Appendix, infra, la-7a, taken collectively,
provided the jury the opportunity to impose punitive damages on the
basis of virtually meaningless standards and in a virtually unlimited
sum.

BEST AVAILABLE COPY

18

to some litigants and capriciously or arbitrarily denied to
others without violating the Equal Protection Clause.” 405
U.S., at 77.

B. The Arbitrary Classifications Drawn by § 11-3-23

Based on his mischaracterization of the applicable stand-
ard of review dictated by Lindsey, appellee argues that
the arbitrary overinclusiveness and underinclusiveness of
§ 11-3-23 are essentially irrelevant to a determination of
the constitutional issue. Br. of Appellee, at 16-17. This
assertion is flatly inconsistent with Lindsey, in which the
Court held that the statute at issue was unconstitutional
because it at once barred nonfrivolous appeals and allowed
“meritless appeals” to go unpunished. 405 U.S., at 78.
Section 11-3-23 also fails to punish certain frivolous appeals
and cross-appeals, yet imposes a substantial penalty (here,
$240,000) on an appellant, as here, who brings an appeal!
which fails by a single vote in the highest court of a state
after three years of deliberation.

Appellee also theorizes that the windfall received by
successful appellees may bear some relationship to “intan-
gible costs that cannot be precisely measured, such as the
emotional toll of participating in litigation ....” Br. of
Appellee, at 15. But this suggestion merely obscures the
fundamental defect in § 11-3-23. If Mississippi desires to
reimburse litigants for such “intangible costs” in connec-
tion with appeals pursued within its appellate system, Mis-
sissippi is required to place all litigants who experience
such “intangible costs” on an equal footing. Section 11-3-
23 makes no pretense of doing so.

C. Lindsey v. Normet Is Indistinguishable

Although appellee generally ignores the pertinent as-
pects of Lindsey, his muted attempt, Br. of Appellee, at
19-20 n.26, to distinguish Lindsey is without merit. He
argues that Lindsey involved “poor tenants.” Yet, as the
Lindsey Court expressly held, the statute imposed on a
“nonindigent ... appellant ... a substantial barrier to

19

appeal faced by no other civil litigant ....” 405 U.S., at
79."

Appellee also argues that the burden on appellants un-
der that statute “doubled the stakes,” while § 11-3-23 only
raises the stakes by fifteen percent. The Court’s concern
in Lindsey, however, was not with the fact that the stakes
were doubled but, rather, was with the fact that the wind-
fall recovery by the landlord was ‘“‘unrelated to actual rent
accrued or to specific damage sustained by the landlord.”
Id., at 77. Section 11-3-23 results in an indistinguishable
“windfall” to successful appellees.

Finally, appellee contends that the double-bond require-
ment struck down in Lindsey ‘“‘applied only to a very small
class of litigants.’”’” But nothing in the Court’s opinion in
Lindsey suggests that the Court would have sustained the
statute if its arbitrary exactions had been extended to
other classes of litigants on the same unequal basis. Con-
trary to appellee’s suggestion, Mississippi now stands vir-
tually alone among the States in imposing arbitrary
penalties on unsuccessful appellants.'* Even Mississippi has
now adopted a rational substitute for § 11-3-23."

This observation by the Court disposes of appellee’s argument, Br.
of Appellee, at 11 n.9, that appellant has no “standing” to challenge
§ 11-3-23 by laying before the Court all of the arbitrary classifications
drawn by § 11-3-23.

'’ Appellee acknowledges that only the States of Alabama, Kentucky
and Virginia have enacted statutes under which mandatory penalties
are imposed on unsuccessful money-judgment appellants. Br. of Ap-
pellee, at 19 & n.24. Alabama repealed its statute on a prospective
basis effective June 11, 1987. 1987 Ala. Acts 188. The Kentucky statute
imposes a penalty only on the second appeal of a case, Ash v. Security
National Insurance Co., 574 S.W.2d 346, 350-51 (Ky. 1978), while Vir-
ginia’s statute is applied in very narrow circumstances. Nationwide
Mutual Ins. Co. v. Tuttle, 155 S.E.2d 358, 362 (Va. 1967).

1% On June 15, 1987, the court below promulgated new Rule 38 under
which, “if this Court shall determine that an appeal is frivolous, it
shall award just damages and single or double costs to the appellee.”

20

V
CONCLUSION

This case concerns the question whether excessive, dis-
proportionate punishment may be inflicted by the govern-
ment notwithstanding an ancient and clear constitutional
prohibition. Today’s punitive damage system is, if any-
thing, worse than the arbitrary fines which Magna Carta
and the English Bill of Rights were adopted to control,
because the present system is even more arbitrary, stand-
ardless, capricious and destructive. The $1,600,000 punitive
fine at issue must be vacated and the Mississippi courts
directed to reduce it according to the principles of Magne
Carta and the English Bill of Rights as carried over in
the Eighth Amendment.

November 20, 1987 Respectfully submitted,
*Theodore B. Olson
Larry L. Simms
Terence P. Ross
Of Counsel: GIBSON, DUNN & CRUTCHER
1050 Connecticut Avenue, N.W.
Charles G. Copeland Washington, D.C. 20036-5303
J. Tucker Mitchell (202) 955-8500

Attorneys for Appellant
COPELAND, COOK, TAYLOR ‘*Counsel of Record
& BusH
Post Office Box 2132
Jackson, Mississippi 39225-
2532
(601) 354-0123

This rule was made applicable, as of January 1, 1988, only to civil
cases in which § 11-3-23 “does not apply.”

APPENDIX

weet GN
Sh mh,

la

INSTRUCTION NO. P-6—GIVEN—Filed November 30, 1981

IN THE CIRCUIT COURT OF JACKSON COUNTY,
MISSISSIPPI

LLOYD M. CRENSHAW PLAINTIFF
VERSUS NO. 11,292
BANKERS LIFE AND CASUALTY COMPANY DEFENDANT

INSTRUCTION NO. P-6

The Court instructs the Jury that an insurance is ob-
ligated to deal fairly and in good faith with its insured in
handling and processing an insured’s claim and to refrain
from abuse, gross negligence, malice, fraudulent or out-
rageous conduct in the handling of its insured’s claim.

If you find from a preponderance of the evidence in this
case that the Plaintiff filed a legitimate claim with the
Defendant for the loss of his foot and that the Defendant
subsequently denied and refused to pay said claim, and if
you further find that such refusal was attended by abuse,
gross negligence, malice, fraudulent, or outrageous con-
duct, then it is your sworn duty to return a verdict for
the Plaintiff and in doing so, you may award both com-
pensatory and punitive damages.

[1124]

2a

INSTRUCTION NO. P-9A—GIVEN—Filed December 3, 1981

IN THE CIRCUIT COURT OF JACKSON COUNTY,
MISSISSIPPI

LLOYD M. CRENSHAW PLAINTIFF
VERSUS NO. 11,292
BANKERS LIFE AND CASUALTY COMPANY DEFENDANT

INSTRUCTION NO. P-9A

The Court instructs the jury that an insurance company
and its employees, in doing the various acts required to
make effective an insurance policy, owes a duty to its
insureds to act in good faith in handling claims presented
by its insureds. Such a relationship is a position of trust
and confidence and it demands that the insurance company
through its employees deal fairly and exercise good faith
in administering the insurance coverage.

If you find from a preponderance of the evidence in this
case that the Defendant, Bankers Life and Casualty Com-
pany, through its employees delayed or denied the payment
of policy benefits, improperly handled the claim, and that
such conduct amounted to a breach of the duty to deal
fairly and in good faith with its insured, Lloyd M. Cren-
shaw, under the contract of insurance amounting to an
independent tort as more fully set out in Instruction P-
19A, then you may award punitive damages against the
Defendant, Bankers Life and Casualty Company.

[1125]

a ore Pee

3a

INSTRUCTION NO. P-12—GIVEN—Filed November 30, 1981

IN THE CIRCUIT COURT OF JACKSON COUNTY,
MISSISSIPPI

LLOYD M. CRENSHAW PLAINTIFF
VERSUS NO. 11,292
BANKERS LIFE AND CASUALTY COMPANY DEFENDANT

INSTRUCTION NO. P-12

The Court instructs the Jury that punitive damages may
also be awarded against an insurance company when an
insurance company refuses to pay a ligitimate claim, and
bases its refusal to honor the claim on a reason clearly
contrary to the espressed [sic] provisions of its own policy
as defined by law. Further, punitive damages may be
awarded against an insurance company when an insurance
company refuses to pay a legitimate claim and has no
legitimate reason or arguable reason for failing to pay such
a claim.

The purpose of punitive damages against an insurance
company where an insurance company refuses to pay a
legitimate claim, for the reasons stated above, is as fol-
lows: If an insurance company could not be subjected to
punitive damages it could intentionally and unreasonably
refuse payment of a legitimate claim with veritable im-
punity. To permit an insurer to deny a legitimate claim,
and thus force a claimant to litigate with no fear that
claimant’s maximum recovery could exceed the amount of
the claim plus interest, would enable the insurer to pres-
sure an insured to a point of desperation, enabling the
insurer to force an inadequate or avoid payment entirely.

If you believe from a preponderance of the evidence, if
any, that the insured, Lloyd M. Crenshaw, filed a legiti-
mate claim and that said legitimate claim was refused by
the Defendant and that the basis for the refusal to honor
the claim was for reasons clearly contrary to the provisions

[1126]

4a

[1127] of the policy, as defined by law or for no legitimate
or arguable reason, then it is your sworn duty to assess
punitive damages against the Defendant.

[1127]

5a

INSTRUCTION NO. P-6—GIVEN—Filed December 3, 1981

IN THE CIRCUIT COURT OF JACKSON COUNTY,
MISSISSIPPI

LLOYD M. CRENSHAW PLAINTIFF
VERSUS NO. 11,292
BANKERS LIFE AND CASUALTY COMPANY DEFENDANT

INSTRUCTION NO. P-19A

The Court instructs the Jury that an insurer is obligated
to deal in good faith and fairly with its insureds in han-
dling their claims, and to refrain from abuse, gross neg-
ligence, malice or fraudulent conduct.

If the handling of an insured’s claim is attended by
abuse, gross negligence, malice or fraudulent conduct, an
independent tort (wrong) may arise, separate from breach
of contract, for which punitive damages are recoverable.

Punitive damages are not awarded to compensate the
injured party but are allowed in addition to compensatory
damages. Punitive damages are granted, therefore, to pun-
ish the wrongdoer as an example, to deter the wrongdoer
and others from committing similar offenses in the future,
and to reward the injured party for his public service in
bringing the wrongdoer to account.

They are never awarded to benefit the injured party,
but rather to punish and to compel the wrongdoer to have
due and proper regard for the rights of the public.

If you find from a preponderance of the evidence if any
that punitive damages are warranted, you may take into
account the financial status of the defendant, Bankers Life
and Casualty Company.

[1130]

6a

IN THE CIRCUIT COURT OF JACKSON COUNTY,
MISSISSIPPI

LLOYD M. CRENSHAW PLAINTIFF
VERSUS NO. 11,292
BANKERS LIFE AND CASUALTY COMPANY DEFENDANT

JURY INSTRUCTION NO. D-1

The Court instructs the Jury that if you believe from
a preponderance of the believable evidence in this case
that Bankers Life and Casualty Company had a legitimate
or an arguable reason for refusing to pay the claim made
by Lloyd M. Crenshaw, then you may not return a verdict
for him which includes punitive damages.

The Court instructs you that any award of punitive dam-
ages to Lloyd M. Crenshaw must be based on a finding,
from a preponderance of the believable evidence in this
case, that at the time Bankers Life and Casualty Company
denied Lloyd M. Crenshaw’s claim, it did not have a le-
gitimate or arguable reason for doing so and that, in de-
nying the claim, Bankers Life and Casualty Company was
guilty of such gross and wanton misconduct as to amount
to an independent wrong against Lloyd M. Crenshaw.

INSTRUCTIONS
GIVEN
Filed 3rd day Dec 1981
JOE W. MARTIN JR., Clerk
By G. Jones, D.C.

[1138]

Ta

IN THE CIRCUIT COURT OF JACKSON COUNTY,
MISSISSIPPI

LLOYD M. CRENSHAW PLAINTIFF
VERSUS NO. 11,292
BANKERS LIFE AND CASUALTY COMPANY DEFENDANT

JURY INSTRUCTION NO. D-7

The Court instructs the Jury that if you believe from
a preponderance of the believable evidence presented in
this case that the basis of the Defendant’s denial of Lloyd
M. Crenshaw’s claim for benefits was based upon a rea-
sonable medical opinion, that Lloyd M. Crenshaw’s alleged
accident to his foot had no medical correlation to the sur-
gery performed, then you must find that the Defendant
had an arguable basis for the denial of benefits and you
further cannot hold the Defendant accountable for punitive
damage, even though you might ultimately find Lloyd M.
Crenshaw to be entitled to the full policy benefits.

INSTRUCTIONS
GIVEN
Filed 3rd day Dec 1981
JOE W. MARTIN JR., Clerk
By G. Jones, D.C.

[1141]

---

Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385012_0117%3A09. Public record. Not legal advice.