Kelly
Kelly v. Haag
Opinion
lead Opinion
McConnell, J.
In this fraud case, the issue on appeal is whether substantial evidence supports the trial court’s assessment of $75,000 in punitive damages against defendant Jeffrey L. Haag. We conclude the evidence does not support the award, and thus we reverse the judgment in part. We reject plaintiff Michael R. Kelly’s assertion he is entitled to a retrial on punitive damages.
*914 BACKGROUND
The underlying facts are undisputed. Haag and Kelly were formerly good friends. Haag is a licensed contractor, and he represented to Kelly that his company, JLH Ventures, Inc. (JLH), carried liability insurance. Based on the representation, Kelly agreed to pay Haag $50,000 to perform construction management services at his condominium in downtown San Diego. In turn, Haag hired JLH to perform demolition work for $9,500.
During demolition, one of JLH’s workers broke a fire sprinkler head. It leaked for 15 to 20 minutes because the worker did not know where the water shutoff valve was. Kelly’s condominium was flooded, and there was also damage to the units of owners who lived below Kelly. After the incident Haag confessed that JLH was actually uninsured.