Appellant bank sought review of a judgment of the Superior Court of San Diego County (California), which awarded respondent employee damages for intentional infliction of emotional distress in an action for negligent misrepresentation.
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Overview
Respondent employee accepted employment with appellant bank based on certain oral financial incentives which appellant never honored. Respondent resigned and filed complaint for damages against appellant. A jury found for respondent on his cause of action for negligent misrepresentation, and awarded respondent compensatory damages and additional damages for intentional infliction of emotional distress. Appellant sought review on the grounds that the award of damages for emotional distress was error. The court reversed, holding that under Cal. Civ. Proc. Code § 3333, damages for emotional distress were not recoverable in an action for negligent misrepresentation when the injury other than the emotional distress was only economic. The court found that where the misrepresentation was merely negligent rather than intentional, that the recovery was analogous to that available in negligence actions generally. Respondent, having incurred neither physical impact nor physical damage, was only damaged economically, and would thus not be entitled to either punitive or emotional distress damages, these being noncompensable consequential damages.
Outcome
The court reversed the trial court’s award to respondent employee for damages for intentional infliction of emotional distress on the grounds that appellant bank’s misrepresentation was negligent, not intentional, and resulted in economic damages only to respondent, not physical damages, which were not recoverable.