BEFORE BROOM, HAWKINS AND DAN LEE
DAN LEE, JUSTICE, FOR THE COURT:
This is an appeal from the Circuit Court of Harrison County wherein David and Janet Lacoste, appellees, brought suit for breach of contract arising from the purchase of a marker for their child's grave and two cemetery plots located on each side of their child's grave in Resthaven Memorial Park. The contracts were executed by the Lacostes and Ray E. Fernandez, who was alleged to be an agent of T. C. L., Inc., a Louisiana corporation organized for the purpose of acquiring Resthaven Memorial Park in 1976.
The officers and stockholders of T. C. L. consisted of Rodney Conti, William J. Luscy, III, and Ted Tumminello. Conti denied Fernandez was authorized as an agent for T. C. L. to enter into contracts for the sale of burial plots. Therefore, T. C. L. refused to honor the Lacostes' contracts with Fernandez. At the conclusion of the trial, the jury was peremptorily instructed as to actual damages of the Lacostes and a verdict of $880 was returned in their favor. The jury also awarded the Lacostes $300,000 in punitive damages against T. C. L., Inc., Rodney Conti and William Luscy, appellants. Punitive damages were not, however, assessed against Fernandez. From the jury verdict and final judgment thereon, T. C. L., Inc., Rodney Conti and William Luscy have appealed. We reverse.
T. C. L., Inc., is a Louisiana corporation which was chartered in 1976 for the purpose of acquiring certain property known as the Resthaven Memorial Park Cemetery located in Harrison County. The corporation was licensed to do business in the state of Mississippi by the secretary of state in the same year. The principal stockholders in the corporation are Rodney Conti, William J. Luscy, III, and Ted Tumminello. The initial capital for operation of the corporation and acquisition of Resthaven Memorial Park was supplied by Tumminello. Tuminello apparently supplied $50,000 of which $42,500 went for the purchase of Resthaven and another $5000 or $6000 being paid to Ray Fernandez for a finder's fee for information and work in acquiring Resthaven. Fernandez in turn endorsed this check and gave it back to Conti in payment of a previous personal loan.
After acquiring Resthaven, T. C. L. verbally contracted with Cemco, a Mississippi corporation owned by Ray Fernandez, whereby Cemco agreed to maintain the grounds at Resthaven and handle the interment of deceased persons who owned a right to be interred at Resthaven prior to T. C. L.'s
acquisition of the cemetery. In return, Cemco was to receive the opening and closing fees for interment and the option of purchasing plots for $50 per plot plus $30 per plot to be paid to T. C. L. in its perpetual care fund. Conti denied that Cemco or Fernandez was ever authorized by T. C. L. to sell any property owned by T. C. L. Although Fernandez at first asserted his duties, pursuant to the aforementioned agreement, involved all those necessary to the operation of a cemetery, including the sale of plots and vaults, he later retracted this statement, testifying he was never authorized to sign or issue any deeds to cemetery plots.
Following this agreement, Fernandez began occupying the office building located on the grounds of Resthaven and continued to do so until February or March of 1980.
In February of 1979, appellees' young son died at Tulane Medical Center in New Orleans. The child was transported to Riemann's Funeral Home. An employee of Riemann's contacted Fernandez for the appellee and arranged for interment of the child at Resthaven. Thereafter, appellees met with Fernandez in the office on the cemetery grounds where they purchased a plot for their son.
In September of 1979, appellees again contracted with Fernandez for the purchase of a marker to be placed on their son's grave, at which time they paid $210. They also contracted to purchase the plots on each side of their son's grave for a total of $450, paying $50 down and $20 per month thereafter until the purchase price was paid. Fernandez represented that their son's marker would be installed by Thanksgiving of 1979.
Appellees continued to pay on these two plots until their check was subsequently returned by T. C. L., Inc., at which time it expressed its view that their contract with Fernandez was illegal. T. C. L., however, offered to sell the plots to appellees under similar terms, but without giving credit for those sums which had already been paid to Fernandez. The marker for their son's grave was finally installed only a few months prior to trial. Appellees incurred approximately $70 in additional expenses for installation of the marker which included a base for the marker and an installation fee enacted by T. C. L. as of March 3, 1979.
It was approximately December of 1979 when Mr. Fernandez's questionable activities began to surface. At that time appellees' attention was called to an announcement in a local newspaper which stated:
TCL, Inc., owner of Resthaven Memorial Park, hereby advises all purchasers of cemetery plots, markers, bases or vaults, that TCL, Inc. is not responsible for any such purchases and purchasers must secure the items purchased from the selling agent. Only contracts executed with Rodney Conti or William J. Luscy, III, officers of TCL, Inc., are the responsibility of TCL, Inc.
It was also during the latter portion of 1979 that Fernandez was indicted on several counts for embezzlement of proceeds tendered to him in payment of several markers. ...