In 1994, Charles Arrington and Benny McWhorter formed LaGrange Propane Services, Inc. “LPS” as a closely held corporation. Arrington and McWhorter operated LPS until 2004, when Arrington terminated McWhorter’s employment and foreclosed on all of LPS’s assets. Thereafter, McWhorter sued Arrington, Arrington’s three sons, and Southland Propane, Inc. the new company that Arrington and his sons had formed collectively “defendants”, alleging damages based on numerous claims, including defendants’ conversion of his corporate interests, defamation, breach of fiduciary duty, fraud, and intentional infliction of emotional distress. Following a trial, the jury rendered a verdict in favor of McWhorter on several of his claims, awarding him compensatory and punitive damages, and the trial court entered judgment accordingly. Defendants now appeal, arguing that the trial court erred in 1 allowing McWhorter to bring a direct action, instead of a derivative action on behalf of LPS, as to the claims pertaining to his corporate interests; 2 denying defendants’ motion for judgment notwithstanding the verdict j.n.o.v. as to McWhorter’s claims for conversion, fraud, breach of fiduciary duty, and intentional infliction of emotional distress; 3 denying a challenge to McWhorter’s expert witness; 4 admitting prejudicial evidence; and 5 allowing punitive damages. For the reasons set forth infra , we conclude that the trial court’s error in allowing McWhorter to bring a direct action on his corporate-interest claims and denying defendants’ motion for j.n.o.v. as to McWhorter’s intentional-infliction-of-emotional-distress claim requires reversal as to those claims and as to the award of punitive damages. Nevertheless, because the jury’s verdict in McWhorter’s favor on his defamation claim —which defendants do not appeal —can support an award of punitive damages, we remand the case for further proceedings consistent with this opinion. At the outset, we note that “on appeal from the denial of a motion for a directed verdict or for j.n.o.v., we construe the evidence in the light most favorable to the party opposing the motion, and the standard of review is whether there is any evidence to support the jury’s verdict.”1 However, “we review questions of law de novo, applying the plain legal error standard of review.”2
So viewed, the record shows that McWhorter, who was married to Charles Arrington’s sister, had worked in the propane business for over twenty years. In 1994, Arrington and McWhorter decided to start their own propane business, resulting in the incorporation of LPS. The company was created pursuant to a plan in which Arrington would provide the initial financing, own 51 percent of the stock, and act as the CEO and president. McWhorter, on the other hand, would own 49 percent of the stock, act as treasurer, and handle the day-to-day operations of the company.
