                               IN THE COURT OF APPEALS
                                        OF THE
                                 STATE OF MISSISSIPPI
                                      NO. 1998-CA-01217-COA
MIC LIFE INSURANCE COMPANY AND GENERAL MOTORS
ACCEPTANCE CORPORATION                                                                  APPELLANTS
v.
BETTYE HICKS, INDIVIDUALLY AND AS ADMINISTRATRIX OF THE
ESTATE OF DAVID E. HICKS, DECEASED                                                          APPELLEE

DATE OF TRIAL COURT                      06/19/1998
JUDGMENT:
TRIAL JUDGE:                BILLY JOE LANDRUM
COURT FROM WHICH APPEALED:  JONES COUNTY CIRCUIT COURT
ATTORNEYS FOR APPELLANTS:   R. WEB HEIDELBERG, JESS H. DICKINSON,
                            KATHARINE MALLEY SAMSON, JAMES G.
                            THORNTON
                            ANDREW L. FREY
ATTORNEYS FOR APPELLEE:     JOHN M. DEAKLE, JOHN M. SIMS,
                            WILLIAM R. COUCH, PAUL B. CASTON
NATURE OF THE CASE:         CIVIL - CONTRACT
TRIAL COURT DISPOSITION:    DIRECTED VERDICT FOR ACTUAL DAMAGES OF
                            $637.99. JURY VERDICT OF $6 MILLION IN PUNITIVE
                            DAMAGES AGAINST MIC LIFE AND $30 MILLION IN
                            PUNITIVE DAMAGES AGAINST GMAC; REMITTED TO
                            $1 MILLION AND $5 MILLION RESPECTIVELY
DISPOSITION:                REVERSED AND REMANDED-06/23/2000
MOTION FOR REHEARING FILED: 7/7/2000; denied 8/22/2000
CERTIORARI FILED:           9/19/2000; granted 12/21/2000
MANDATE ISSUED:

     BEFORE SOUTHWICK, P.J., LEE, AND MOORE, JJ.

     SOUTHWICK, P.J., FOR THE COURT:

¶1. The plaintiff's husband, David Hicks, financed the purchase of a pickup truck with General Motors
Acceptance Corporation (GMAC). At that time, Mr. Hicks also purchased a credit life policy from MIC
Life Insurance Co. The insurance agreement informed him that any unearned premium would be refunded.
The loan was satisfied a year later when the truck was traded for a new one, but no request was ever made
for a refund. When GMAC sent Mr. Hicks the canceled note, it gave him a form notice that, if there was
credit life insurance, he should contact the insurance company to determine if he was owed a refund.
¶2. After Mr. Hicks's death three years later, his widow discovered the insurance policy. When MIC Life
refused to pay the death benefit but stated that it would refund the $638 premium, she brought suit against
both MIC Life and GMAC. A jury awarded a total of $36 million in punitive damages against both
companies, after the trial judge directed a verdict against both of them for the unrefunded premium. We find
that a jury issue existed regarding the obligation of the finance company (GMAC) for the unrefunded
insurance premium; we reverse and remand both the actual and punitive damages against GMAC. We also
find that trial errors require that the judgment for punitive damages against the insurance company be
reversed. The cause is remanded for further proceedings.

                                                   FACTS

¶3. Bettye Hicks's late husband, David Hicks, bought a 1991 Chevrolet pickup truck from Hankins
Chevrolet in Taylorsville on April 2, 1991. He financed the purchase through the dealer, Hankins, who
immediately after the transaction sold the installment contract to GMAC. Mr. Hicks chose to obtain credit
life insurance at the time of the sale, but the purchase was not a requirement to make the loan. The entire
amount of the premium, $1,044.48, was transferred by the dealership to GMAC, which then paid a
commission to the dealership. The remaining premium was transferred to MIC Life. MIC Life placed the
funds in a premium reserve, paying itself from the reserve over the term of the loan as each premium was
earned. GMAC does not require that the insurance be purchased from MIC Life or any other affiliated
company. An official for the dealer is the agent for issuing the insurance and determines which one of
several credit life companies to suggest to a buyer. The borrower is entitled to choose a different insurance
company though the practicalities are that it is almost always a company suggested by the dealer.

¶4. GMAC is the sole owner of Motor Insurance Corporation, which in turn owns all of MIC Life
Insurance Co. Only the first and last named companies are defendants in this suit.

¶5. A little more than a year after purchasing the 1991 truck, Hicks traded it in on a 1992 truck at another
dealership named Chris Posey Chevrolet. The 1991 installment loan was satisfied at that time. Under the
insurance contract, when the loan is paid the credit life insurance is no longer effective since it is securing
that loan. MIC Life was holding unearned premiums from Hicks's insurance contract of $637.99 to which
Mr. Hicks was entitled because of the cancellation of the loan. Under GMAC's standard procedure in
Mississippi, in mid-July 1992 GMAC returned the canceled note to Mr. Hicks and also notified the first
dealership (Hankins) that the note had been satisfied. A GMAC form notice was sent to Mr. Hicks and
stated that "we suggest that you contact the dealer or the insurance company regarding a possible rebate of
the creditor life and/or disability insurance premium." The testimony was that neither Hicks nor his wife read
this notice, which is called an "OLA notice" in the industry. Instead they placed the unread document in a
file.

¶6. After David Hicks's death on February 24, 1995, Mrs. Hicks read the notice as she was examining
various papers. She contacted the Hankins dealership at which the policy was obtained, hoping to file a
claim. The dealership sent Mrs. Hicks a form for requesting a refund of unearned premiums from MIC Life.
Mrs. Hicks informed the dealership that she did not want a refund, but was demanding a death benefit. The
dealership sent her a claim form, which she filled out and submitted to MIC Life on March 23, 1995. MIC
Life wrote her back on April 10, 1995 and explained that no death benefit was due, but that it would refund
the unearned premiums of $637.99. Because of what it termed a "clerical error," MIC Life did not send the
refund before suit was filed.
¶7. No inquiry was made with MIC Life when the refund did not arrive. Mrs. Hicks filed this suit on July 5,
1995, against both GMAC and MIC Life. She alleged unjust enrichment, negligence and breach of
fiduciary duty against GMAC. Against MIC Life, she claimed breach of contract, breach of fiduciary duty,
unjust enrichment, breach of the duty of good faith and fair dealing and negligence.

¶8. At the close of a two day trial, the court entered judgment finding both defendants "jointly and severally
liable to the plaintiff for compensatory damages as to all counts" in the complaint. Actual damages in the
amount of the unrefunded premium of $637.99 were entered against GMAC and MIC Life, though the
premium had been retained by MIC Life. Then the court submitted the issue of punitive damages to the jury.
The court allowed the plaintiff's attorney to state in closing argument over defense objection that another
jury had awarded punitive damages of $38 million "not long ago" in an unidentified case against an unstated
defendant for unknown claims. The jury imposed $30 million in punitive damages against GMAC and $6
million against MIC Life. The court remitted the awards to $5 million and $1 million respectively. GMAC
and MIC Life appeal.

                                                DISCUSSION

I. Prejudicial Trial Errors

¶9. MIC Life and GMAC cite various trial errors that they argue necessitate at least a remand.

      A. Evidence concerning GMAC's procedures in other states.

¶10. There was testimony that eight states have adopted statutes that require lenders such as GMAC
automatically to refund unearned premiums when an installment loan is prematurely paid off. Over repeated
objections, Mrs. Hicks's counsel referred to these eight statutes at trial as the standard by which MIC Life's
conduct in Mississippi should be judged. In closing, Mrs. Hicks's counsel argued: "There's no reason they
couldn't do that in Mississippi. The only reason they wouldn't do that in Mississippi is because they want to
keep the money. They want to keep the people's money. They don't ever intend to pay it back."

¶11. We have attempted to review the statutes in question. They were not introduced into evidence and
only one is cited in the briefs. The principal trial evidence was a reference to a GMAC manual that informed
its dealers that in eight states it was necessary for the creditor (i.e., GMAC) to refund unearned premiums
on credit life policies. It would then be up to the creditor to receive a credit or refund from the insurance
company. In those eight states, GMAC imposed that obligation on the dealers from whom it purchased
installment contracts. The one statute cited in Mrs. Hicks's brief makes that requirement. Kan. Stat. Ann. §
16a-4-108. This Kansas statutory provision is derived from the Uniform Consumer Credit Code. No state
has adopted the UCCC in over twenty-five years. 7A Unif. Laws. Ann., Consumer Credit Code (1997).
We have not researched whether each of the nine adopted UCCC section 4-108 as did Kansas. The eight
states mentioned by Mrs. Hicks's counsel were Alabama, Colorado, Idaho, Kansas, Massachusetts, New
York, Oklahoma and Wyoming. Perhaps some of the states adopted a similar provision without accepting
the Code.

¶12. As will be discussed more fully below, the alleged relevance for this evidence was to show that the
defendants were aware that requiring the borrower/insured to request a refund was not as effective as the
system in these other states. If so, it was quite indirect evidence. The statutes in other states create the duty
that plaintiff wishes to impose on MIC Life and GMAC in Mississippi, but here there is no statute. A
foreign state's statutory duty does not create a duty in a state without the statute. It may have some other
relevance, but the jury must not be misled as to its importance.

¶13. There was also an effort to use the statutes to indicate that a useful alternative approach existed. A
possible relevance for the statutes could arise from this reasoning: some states have passed statutes
requiring lenders or dealers to reimburse unearned premiums on credit life policies; the refund of premiums
in those states is more effective than the OLA notice system; GMAC and MIC Life knew of that disparity;
there were methods by which the companies voluntarily could have applied the direct reimbursement
approach in Mississippi. There may be other theories that indicate the potential relevance of what a statute
requires in a different state.

¶14. The problem for Mrs. Hicks is that the existence of the statutes is itself of little probative value on the
claims that she is making. The existence of the statutes sheds no relevant light on the reason that another
state adopted it since it does not reveal the degree, or even existence, of problems that the remedy was
intended to address. It does not prove that the OLA notice system is meaningfully less effective or that the
parties were aware of that. Moreover, the plaintiff's use of the evidence went well beyond proof of notice.

¶15. We hold that this evidence should not have been admitted at the original trial because it was far more
likely to mislead than to assist. We are reversing and remanding. If at a new trial Mrs. Hicks again wants to
use evidence of these statutes, and in light of other evidence that may support the claim, the court can
decide whether the probative value of the evidence outweighs its prejudicial effect. M.R.E. 403.

      B. Improper lay testimony drawing legal conclusions

¶16. Over GMAC's objections, the trial court allowed GMAC employee Mildred Wilbanks to be
questioned concerning interpretation of the contract between Mr. Hicks and MIC Life, a separate
company. She also was required to state whether she believed the OLA notice procedure violated a
specific Mississippi statute, Miss. Code Ann. § 83-53-17. She thus drew legal conclusions in front of the
jury. Because Wilbanks is not a lawyer and was not qualified to make legal conclusions, this line of
questioning was improper.

¶17. The statute requires a credit life insurer to "pay or cause to be paid to the debtor any refund due
pursuant to this subsection within thirty (30) days of the accrual of such refund." Miss. Code Ann. § 83-53-
17(2) (Rev. 1999). "Accrual" is undefined in the statute, but fulfillment of the obligation requires as a matter
of common sense that the credit life company know of the right to the refund. Otherwise the company has
no reason to refund. How the credit life company is to learn is a central issue.

¶18. We start with noting that the payoff of the loan was to GMAC, who was the lender. The credit life
insurance was issued by MIC Life. In some fashion notice had to be received by the insurance company of
the fact of the cancellation of the loan. In this case there was a corporate relationship between lender and
insurer, but that is not a legal necessity. Nothing within the refund statute requires that the lender be the one
that notifies the insurance company. The statutes in the eight other states avoid the notice issue by requiring
a direct refund by the lender. This state has not done that. It was Mr. Hicks's insurance. GMAC reminded
him with the form notice that, if credit life insurance had been purchased, a refund needed to be requested
from the insurance company.

¶19. We hold, and it appears that the dissent agrees, that a lender such as GMAC simply could not be
liable for an unrefunded premium under a Mississippi statute requiring that an insurance company make the
refund unless there was sufficient evidence to make a jury question of the existence of some conspiracy
involving both companies. The witness should not have been required to give her own legal analysis.

¶20. Though a somewhat different matter, we address here the dissent's view that the statutory obligation
that is on credit life companies to refund within thirty days required that MIC Life have in place better
procedures to cause that to happen. The majority and dissent disagree on whether the procedures as a
matter of law had to be something other than what occurred here. Since MIC Life has not appealed the
order that it repay the unearned premium, this difference of legal opinion affects MIC Life's liability for
punitive damages and not for actual damages, and does not affect GMAC.

¶21. The punitive damage issue we are returning for further proceedings. What could be made a separate
issue on remand is an obligation on MIC Life that does not depend on proof of a conspiracy with GMAC.
It would be a free-standing failure by MIC Life to comply with the statute regardless of GMAC's
complicity. Of course, GMAC factually could have been involved as well. If all Mrs. Hicks wishes to prove
is that GMAC should have notified MIC Life of the payoff of the loan, that is swept into the conspiracy
theory. If there is some alternative theory of how MIC Life failed to have adequate procedures in a manner
sufficient for punitive damages, that would be something for the trial court to address if raised.

     C. Judge's comments on the credibility of a witness

¶22. The defendant companies argue that the trial judge improperly communicated his disdain for their case
and his disbelief of MIC Life employee Michael Bush's testimony by his comments in front of the jury. The
supreme court has stated that a trial judge "should not in any way inadvertently communicate to the jury his
opinion regarding the value or credibility of the testimony being offered." Wirtz v. Switzer, 586 So. 2d 775,
783 (Miss. 1991).

¶23. At one stage Bush was asked about MIC Life's data systems in eight other states whose refund
procedures were set by those state's statutes. Bush stated that he was not qualified to describe those
systems in other states. Plaintiff's counsel expressed incredulity that the witness would not know the refund
systems there, which was a quasi-question that elicited an objection. MIC Life's attorney stated that the
witness was not a Rule 30(b)(6) company representative for deposition purposes, but just a witness with
limits on his knowledge. The trial judge responded that Bush "can answer the questions for the corporation,
he is required to do so without equivocation."

¶24. Later plaintiff's counsel asked Bush what in essence was a rhetorical question or more to the point,
was preliminary jury argument. Yet the court treated it as a basis for another discussion of equivocation.
The MIC Life witness was asked whether GMAC loaned money "as a favor."

     A. I can't speak for GMAC.

     Q. GMAC --

     THE COURT: Now just a minute. This is the same situation I got into a while ago. Now, Mr. Bush, I
     don't want to do this in front of the jury. But if you keep equivocating in front of this jury -- I can't
     keep sending the jury out. I am going to make the statement to you at this time, just answer out what
     you know. And I don't think that the jury or anybody else is going to believe that you don't know
     what you just said. Please be candid about it.
      MIC LIFE COUNSEL: Your Honor, for the record, may I say that --

      THE COURT: Say anything you want to say, but I want to get on with this trial. You people need to
      tell your witness how to testify.

      ANOTHER MIC COUNSEL: I understand, your Honor, but he is an employee of MIC and his
      questions about GMAC --

      THE COURT: You don't think that this man here is an employee of a major corporation in this
      country and these people loaning them money, and he says he doesn't know whether they get anything
      as a result of it? What do you call interest? Now answer up and let's go on.

¶25. MIC Life and GMAC were separate companies. Though they certainly were related, they had
different employees with different functions. There was no evidence that the separate corporate structure
was a sham. MIC Life employee Bush's right to limit his responses to questions regarding his company and
not about GMAC should have been protected.

¶26. The characterization of Bush's responses as "equivocation" was incorrect and prejudicial. Nichols v.
Munn, 565 So. 2d 1132, 1133-34 (Miss. 1990).

      D. Prejudicial statements by Mrs. Hicks's counsel

¶27. During closing arguments and rebuttal, there are several instances of excessive jury argument. To have
upheld objections to these arguments as not being based on evidence, as instead trying to prejudice the jury
against the defendants based on speculation and stereotypes about big out-of-state corporations, would
likely have been proper rulings. Such rulings are for the trial court's reasonable discretion, conscious of the
inferences that can be drawn from the evidence that is introduced.

¶28. There are frequent legal descriptions about the wide latitude for jury argument. Ball v. Sloan, 569 So.
2d 1177, 1179 (Miss. 1990). Such generalities cannot override fundamental fairness of trials, the need for
evidence to support argument, and the need to exclude unfairly prejudicial comments. We do not find it
necessary to sift the evidence on the specific point of the acceptable inferences of heartlessness and
arrogance that the plaintiffs sought to create in the jurors' minds. If there is a new trial, the trial court must
balance the competing interests in both a full and a fair closing argument.

¶29. In this closing argument, however, is another example of the effect of the trial court's admitting
evidence about what other states require. Mrs. Hicks's counsel stated that GMAC had been "called on the
carpet" by the eight states in which they are required by statute automatically to refund unearned premiums
upon payoff of the loan. This statement construed evidence of what GMAC was required to do in a few
other states as indicators of fault in Mississippi. By itself it was not. Absent evidence of the effect of such a
system versus the effect of the approach used as to the Hicks loan, or the reasons why the other states
adopted the statutes, the existence of the statutes cannot support the argument that was made.

¶30. Finally, Mrs. Hicks's counsel told the jury about a $38 million verdict "up here not long ago," but gave
no details. Details would not have made the statement relevant. There was no evidence offered prior to
closing argument about punitive damages in other suits, and even if there had been it should have been
excluded. The only possible use for such information was to suggest a standard against which the jury could
measure its own zeal. The jury returned a verdict of $36 million, which all but proves the prejudice. That the
trial court later granted a remittitur does not fully correct the distorting of the entire deliberative process by
the judge's error.

¶31. Mrs. Hicks states that MIC Life's counsel did not object to any of these comments by her counsel,
although she admits that GMAC did object and was overruled. Therefore, she asserts, MIC Life cannot
argue this issue on appeal. The trial court expressly ruled at the beginning of trial that each defendant would
be deemed to have joined in any objection raised by the other. Therefore, the assignment of error is
preserved.

¶32. Mrs. Hicks asserts that any harmful effect of the remarks was cured by this jury instruction:
"Arguments, statements and remarks of counsel are intended to help you to understand the evidence and
apply the law, but are not evidence. Any argument, statement or remark having no basis in the evidence
should be disregarded by you." Such an instruction smooths the rough edges of a few overzealous
comments, but it does not substitute for the trial judge's role in excluding significant improper comments
such as those in this case.

¶33. We find reversal is required for these errors. The dissent argues that the worst of the errors affects
GMAC and not MIC Life. We cannot draw the lines quite so finely. This was a trial sufficiently flawed as to
draw into question the verdict against both defendants, not only but perhaps most clearly because the
central allegation below was that these two companies were in a conspiracy with each other. What damned
one alleged conspirator reasonably damned the other in the minds of the jurors.

II. Directed verdict on compensatory damages

¶34. The trial judge directed a verdict against the defendants, finding each liable for the unpaid insurance
premium. Whether that was correct is addressed next since it forms the basis for actual damages that must
be found before punitive damages can be awarded.

      A. MIC Life's Liability for premium.

¶35. The insurance company does not seek a new trial regarding the judgment against it for the unpaid
premium. Thus we do not discuss the issue.

      B. GMAC's liability for premium

¶36. Analyzing GMAC's possible liability for the unrefunded premium starts with understanding its role in
the insurance purchase. GMAC buys the installment loan agreements from the automobile dealers. If the car
buyer wanted credit life insurance, the premium is paid at closing. The premium in this case was received by
MIC Life, though other insurance companies are used as well. The dealer as agent for the insurance and not
GMAC keeps a commission for selling the insurance. When loans are prepaid, GMAC sends notices (the
OLA notices) to the prepaying customers, informing them that they may be entitled to a refund of unearned
credit life premiums.

¶37. Mrs. Hicks argues that GMAC involved itself in the refund process, thus becoming liable when
unearned premiums were not refunded. The notice allegedly created GMAC's liability.

¶38. A debtor-creditor relationship is not a fiduciary one. Peoples Bank & Trust Co. v. Cermack, 658
So. 2d 1352, 1358 (Miss. 1995). Upon collecting the money for the premium by financing it with the loan,
GMAC paid a commission to the dealership and forwarded the net premium to MIC Life. A fiduciary
obligation regarding what occurred thereafter would not normally arise.

¶39. Two cases are cited by Mrs. Hicks to prove that this situation was exceptional. In one, the finance
company collected the credit life premium and was to tender the premium to the insurance company but
failed to do so. Parnell v. First Savings & Loan, 336 So. 2d at 766. In this case, there is no question that
the credit life premium was promptly forwarded to MIC Life. In the other precedent, the bank and life
insurance company failed to inform the borrower that the credit life insurance on two notes would expire
with the maturity of the notes. Lowery v. Guaranty Bank & Trust Co., 592 So. 2d 79, 80 (Miss. 1991)
When her husband died, the borrower was told that no insurance benefits were available. Id. The supreme
court found that, although no formal fiduciary relationship existed between the Lowerys and the bank, their
long and personal history of dealings caused the Lowerys to place trust and confidence in the bank "to the
point of being less vigilant about the coverage of the credit life insurance than they had been in the past . . .
." This made an issue of material fact as to whether a fiduciary relationship had been fostered by the bank.
Id. at 85. A jury question also existed of whether "the lender had a duty to define any ambiguous terms or
specialized terms which might mislead unknowledgeable customers who rely on the lender for advice." Id. at
84. Here the point is the unambiguous OLA notice that the borrower needed to contact the credit life
company to get any refund on the credit life insurance. Certainly no advice not to contact the insurance
company was ever given.

¶40. Despite Mrs. Hicks's testimony that she and her husband "trusted everybody" and "thought everything
was taken care of," there was no history of dealing between the parties that could have led Mrs. Hicks to
place this level of reliance and confidence in GMAC without its consent. Further, the trust here was not on
whether there would be insurance at all, the subject of both Lowery and Parnell, but on the refund of a
premium when the agreement and a follow-up notice by the lender informed the borrower-insured of the
need to send the insurance company a request.

¶41. Mrs. Hicks argues that GMAC was unjustly enriched. Both the injustice and the enrichment must be
shown. A corporation and its subsidiaries are separate legal entities and are not liable for each other's
actions unless the plaintiff establishes circumstances that justify piercing the corporate veil. Rauch Indus.,
Inc. v. Poloron Prods. of Mississippi, 362 So. 2d 605, 607 (Miss. 1978). The Fifth Circuit applied the
same rule of law in a case in which the court reversed a holding that a parent corporation was liable for the
wrongs of its subsidiary on a theory of unjust enrichment. United States v. Dean Van Lines, Inc., 531
F.2d 289, 290 (5th Cir. 1976). In Dean, the separate corporate identities were upheld absent "such a unity
of interest and ownership that the individuality of the subsidiary as a distinct entity has ceased." Id. at 291.
No such unity of interest between GMAC and MIC Life has been demonstrated here.

¶42. Mrs. Hicks also argues that GMAC was negligent. For that, there must have been a duty and a breach
of that duty by GMAC. Mississippi law imposes no duty on a lender to refund unearned credit life
premiums upon early termination of an installment contract. A Mississippi statute requires the insurer to
make a prompt refund, but not the creditor. Miss. Code Ann. § 83-53-17 (Rev. 1995). Mrs. Hicks argues
that GMAC assumed a duty to see that the premiums were refunded when it "stuck [its] nose in the refund
business" by sending out OLA notices and by requiring dealers to promise that they would facilitate refunds
upon customer request. The principle that Mrs. Hicks cites for her contention that GMAC assumed
responsibility for refund is the duty incurred by one who goes to the rescue of a person in difficulty or peril,
taking "charge or control of the situation." Prosser and Keeton on Torts, 5th Edition § 56 (5th ed. 1984).
This rescue rule does not apply.

¶43. GMAC sent a notice to Mr. Hicks to remind him that he would need to seek a refund. Whatever duty
GMAC might be said to have assumed, it is limited by the extent of the undertaking. Stacy v. Aetna Cas.
& Sur. Co., 484 F.2d 289, 295 (5th Cir. 1973) (finding that an insurance company performing limited
safety inspection did not assume employer's duty of inspection and was not liable under Mississippi law to
an employee injured in an accident). The practice of reminding customers of their rights cannot be
converted into a responsibility to make certain that the rights were exercised.

¶44. Therefore it was reversible error to direct a verdict finding GMAC liable for the unpaid premium.
Unless it was liable for actual damages, it could not be liable for punitive damages. Hopewell v. Trustmark
Nat'l Bank, 680 So. 2d 812, 820 (Miss. 1996). GMAC's liability for actual damages did not arise by
contract and is not imposed by the statute which requires insurance companies to refund. If such liability is
to be found it is a matter for the jury to resolve based on what is at best circumstantial evidence of a
conspiracy. We reverse and remand for consideration of this question at any new trial that is held. In all
events GMAC's liability was not a proper subject for a directed verdict.

III. Liability for Notification System

¶45. We have found that errors in the presenting of argument and evidence require the reversal of the
judgment as to both defendants. As a separate matter, we now look at the cause of action itself. Was
enough shown to constitute questions for the jury other than for actual damages?

¶46. We note what the evidence supports. GMAC and MIC Life were related companies with separate
corporate missions. One was to provide financing for purchase of General Motors automobiles while the
other was to provide credit life insurance. Lenders do not issue insurance, though they may act as agents for
borrowers for the purchase of insurance. Thus MIC Life needed to be a separate corporate entity from
GMAC. The original credit life insurance documents provided that if the loan were paid off early, a refund
of the unearned premium would be made. When this loan was paid off early, GMAC sent the OLA notice
to Mr. Hicks that reminded him of the need to make the request to the insurance company for a refund. Mr.
Hicks never did so.

¶47. A reasonable person could conclude that whatever reasons might exist for the requirement that the
insured send notice, one effect is that the number of refunds is less than one hundred percent. However,
unless the lender itself makes the refund, someone has to notify the insurance company. Among the
understandable reasons for the system is to place the obligation on the insured to protect himself, such that a
negligent failure by the lender to get the notice to the insurer does not itself create liability. There was no
statutory nor contractual obligation for the lender to refund. There was not even an obligation that we have
discovered to send the OLA notice. The money was MIC Life's. GMAC's notice was a reminder of the
possibility of a refund. Notice from the insured both prompts the insurance company and gives current
information on the address to send the payment.

¶48. Mrs. Hicks's contention is that GMAC and MIC Life conspired together to permit MIC Life to retain
a percentage of the unearned insurance premiums through their notification system, creating a windfall to
MIC Life which also benefitted GMAC as its "grandparent" company. The evidence of a conspiracy to
defraud was circumstantial. The "fraud" in essence is that these two companies did not use the system that
most effectively would cause unearned premiums held by MIC Life to be refunded. A majority of this Court
finds that suspicions surrounding the employment of the OLA notice system were adequate to make a jury
issue of whether this approach was adopted in order to reduce the number of refunds. The majority of the
Court also finds that a jury question existed of whether that purpose was a breach of various obligations
that the companies had towards Mr. Hicks, including the contractual obligation of good faith and fair
dealing.

¶49. Even though a majority concludes that evidence was sufficient to justify submission to the jury of the
claim for punitive damages, the consideration of that evidence was warped by the evidentiary and other trial
errors. A remand is necessary.

      A. MIC Life's liability for punitive damages

¶50. MIC Life concedes that it erred in failing to send Mrs. Hicks her refund after learning of her entitlement
in a letter dated March 23, 1995. Suit was filed July 5, 1995, so the delay was about three months. MIC
Life early in the litigation paid the unearned premiums to the clerk of court. Different theories for making
MIC Life liable for punitive damages are discussed next.

                                    1. Breach of fiduciary relationship

¶51. The starting point is that the relationship between an insurance company and an insured is in most
respects only contractual, not a fiduciary one. The principal fiduciary duty involves the insurer's resolution of
claims made on the policy and to defend and compromise claims against the insured made by third parties.
Hartford Accident & Indemnity Co. v. Foster, 528 So.2d 255, 263-66 (Miss.1988). Mrs. Hicks
testified that she and her husband trusted these companies. However, she had no contacts with MIC Life
prior to the inquiries after her husband's death. The truck loan for which that policy had been obtained had
long previously been satisfied, so no detrimental reliance occurred from the trust. She offered no evidence
of a course of dealing between herself and MIC Life that would give rise to a trust relationship. The party
seeking to prove the existence of a fiduciary duty must do so by clear and convincing evidence. People's
Bank v. Cermack, 658 So. 2d at 1358. Mrs. Hicks did not do so.

¶52. In support of her argument that the relationship between MIC Life and the Hickses amounted to a
constructive trust, Mrs. Hicks cites Planter's Bank & Trust Co. v. Sklar, 555 So. 2d 1024, 1034 (Miss.
1990), a case in which a landlord sought to enforce a landlord's lien on crops. That case in turn relies on
several other cases that we will discuss. One of the precedents stated this:

      A constructive trust is one that arises by operation of law against one who, by fraud, actual or
      constructive, by duress or abuse of confidence, by commission of wrong, or by any form of
      unconscionable conduct, artifice, concealment or questionable means, or who in any way
      against equity and good conscience, either has obtained or holds the legal right to property which
      he ought not, in equity and good conscience, hold and enjoy.

Sojourner v. Sojourner, 247 Miss. 342, 353, 153 So. 2d 803, 807 (1963)(emphasis added).

¶53. In another precedent, the court defined a constructive trust in the following manner:

      A constructive trust is a means recognized in our law whereunder one who unfairly holds a property
      interest may be compelled to convey that interest to another to whom it justly belongs.
Allgood v. Allgood, 473 So. 2d 416, 421 (Miss. 1985).

¶54. Finally, the court said:

      A constructive trust is a fiction of equity. It is the formula through which the conscience of equity finds
      expression. When property has been acquired in such circumstances that the holder of the legal title
      may not in good conscience retain the beneficial interest, equity converts him into a trustee.

Russell v. Douglas, 243 Miss. 497, 505-506, 138 So. 2d 734 (Miss. 1962).

¶55. The common theme running through these definitions of a constructive trust is that the trustee is holding
another's money and cannot properly retain it. That argument is what supports the majority's view that each
company is potentially liable if the jury finds that they conspired to implement a refund system for the
purpose of reducing the number of refunds.

¶56. A different basis for damages is MIC Life's delay in refunding the premium after receiving notice from
Mrs. Hicks in 1995, a delay that MIC attributes to "clerical error." If MIC Life through good faith
inadvertence delayed refunding the premium after Mrs. Hicks contacted them in 1995, there would be no
liability for exemplary damages due to the 1995 delay. That is a jury question.

¶57. Absent proof of bad faith and a conspiracy, MIC Life's obligation was to refund the unearned
premium once it had a reason to know that Mr. Hicks was entitled to those funds. If eight states require that
the process operate differently, that is not itself a basis for a punitive damages claim in Mississippi. If on the
other hand MIC Life in bad faith by itself, or in conspiracy with GMAC, created a system in which the
number of reimbursements would be unconscionably reduced, then that is a matter for a jury to consider
after a proper trial.

                                2. Breach of duty of good faith and fair dealing

¶58. Inherent in every contract relationship is a duty of good faith and fair dealing. Merchants & Planters
Bank v. Williamson, 691 So. 2d 398, 404-05 (Miss. 1997). This is a significantly lesser obligation than
that owed by a fiduciary. Id. at 405. It merely "requires abstinence by all parties from commission of
wrongful conduct which injures the 'right of [another] to receive the benefits of the agreement.'" Andrew
Jackson Life Ins. Co. v. Williams, 566 So. 2d 1172, 1188 (Miss. 1990).

¶59. In order for MIC Life to have breached its duty of good faith and fair dealing, there would have to be
evidence that it interfered in some way with the insured's ability to receive their refund. There is
circumstantial evidence that the plaintiff alleges proves a bad faith conspiracy. The evidence of course is that
if GMAC had paid the refund, at least on insurance issued by one of its affiliated companies, the insured's
receipt would have been definite. No Uniform Consumer Credit Code nor similar provision requires that in
Mississippi. Providing instead that the insured must contact the insurance company when the lender is paid
early is not onerous, impractical, nor barred by statute. Certainly the Mississippi Legislature could consider
whether such a prohibition should be created.

¶60. To prohibit this arrangement generally, we would have to find that this refund system violates public
policy. We do not find here, especially in light of the statute placing the premium refund obligation for credit
life insurance on the insurer, that informing the borrower in writing that it should request a refund is on its
face unconscionable, unfair, or otherwise to be prohibited. If the specific evidence in this case would permit
a finding that GMAC and MIC Life had a bad faith purpose in employing the refund system, then that
should be resolved by a new trial. We remand for a new trial so that the jury can decide if the facts support
the conclusion of bad faith here.

                                            3. Unjust enrichment

¶61. Unjust enrichment is a cause of action only in quasi or implied-in-law contracts, not when there is an
express contract between the parties. Ellis v. Anderson Tully Co., 727 So. 2d 716, 719 (Miss. 1998).
Because there was an express contract for insurance between MIC Life and the Hickses, no recovery for
any unjust enrichment claim was proper.

                                            4. Breach of contract

¶62. We have already discussed the basis of the contract claim. There was a fact question as to whether
MIC Life breached this contract by its failure to refund the premium either in 1992 or when Mrs. Hicks
notified the company in 1995 of her claim. MIC Life cites authority that mere "clerical error or honest
mistake" will not support a punitive award. Consolidated Amer. Life Ins. Co. v. Toche, 410 So. 2d 1303,
1306 (Miss. 1982). The factual basis for this separate potential liability for MIC Life can again be
considered at a new trial.

                                                5. Negligence

¶63. Whether or not MIC Life was guilty of negligence is a question of fact. Absent proof of misconduct
sufficient to justify punitive damages, all that Mrs. Hicks would receive if negligence were proven is actual
damages.

IV. Judgment for Defendants As a Matter of Law

¶64. One issue remains, namely, whether the suit was timely brought.

¶65. Before trial, MIC Life and GMAC moved for summary judgment, stating that the cause of action was
barred by the statute of limitations. The court denied the motions, stating that the question of when the
statute began to run on these claims was "more of a jury issue than it is a legal issue." However, this issue
never made it to the jury because the court later directed a verdict against both defendants on all counts.

¶66. The following dates are relevant to the statute of limitations:

      April 2, 1991 -- Mr. Hicks signed the retail installment contract to purchase the 1991 truck, opting to
      purchase credit life insurance. The contract contained notice that a refund might be available if the
      loan was prepaid.

      June 29, 1992 -- Mr. Hicks terminated the installment contract by trading in the 1991 truck and
      purchasing a 1992 truck, paying off the loan.

      July 14 or 15, 1992 -- GMAC sent the Hickses and the original dealer an OLA notice, together with
      a notice of payoff of the 1991 truck.

      February 24, 1995 -- Mr. Hicks died.
      March 23, 1995 -- Mrs. Hicks sent MIC Life notice of life insurance claim.

      April 10, 1995 -- MIC Life notified Mrs. Hicks by letter that she was not entitled to a death benefit
      because the contract terminated on June 29, 1992, but that she was due a refund of the unearned
      premiums. MIC Life then failed to refund the premiums.

      July 5, 1995 -- Mrs. Hicks filed suit against MIC Life and GMAC.

¶67. The appropriate period of limitations arises from the general three year statute. Miss. Code Ann. § 15-
1-49 (Rev. 1995). The supreme court has held that a cause of action accrues "only when it comes into
existence as an enforceable claim; that is, when the right to sue becomes vested." Gentry v. Wallace, 606
So. 2d 1117, 1121 (Miss. 1992). A cause of action for breach of a life insurance contract accrues on the
date of the breach, for example, on the date that the insurance company refused to pay, and not on the date
of the decedent's death. Young v. Southern Farm Bureau Life Ins. Co., 592 So. 2d 103, 107 (Miss.
1991).

¶68. Mrs. Hicks argued that MIC Life was under an obligation to return the unearned portion of the
premium automatically, without any request from the customer. If this is true, the obligation arose on June
29, 1992, when the loan was satisfied. The suit was filed on July 5, 1995, three years and six days later.
However, regardless of when the duty came into existence, the breach of the duty would have occurred on
that same date only if MIC Life was required to refund immediately. Instead, a reasonable period of time to
comply with the duty would exist before a breach would have occurred.

¶69. More importantly, we have determined that absent proof of a conspiracy, MIC Life did not have a
duty to refund without notice being sent. Instead of a reasonable time period measured from the date that
the loan was satisfied with GMAC, MIC Life had an obligation to pay only from the date that it received
notice from the insured. In other words, Mr. Hicks would not have had a legitimate cause of action against
MIC Life on June 29, 1992, as MIC Life had not yet failed to uphold its obligations.

¶70. The legitimate period of time to send the refund is set by a previously discussed statute. A credit life
insurer is required to "pay or cause to be paid to the debtor any refund due pursuant to this subsection
within thirty (30) days of the accrual of such refund." Miss. Code Ann. § 83-53-17(2) (Rev. 1999). The
accrual of the right to a refund is judged by the parties' agreement as to when the entitlement commences.
Again, MIC Life's deadline for repaying arose thirty days after the notice was sent by Mrs. Hicks.

¶71. There is no statute of limitations problem in the claim. Even if there were, there is also a potentially
relevant statute extending the limitation period when a claimant dies before the statute of limitations has run.
Miss. Code Ann. § 15-1-55 (Rev. 1995).

¶72. THE JUDGMENT OF THE CIRCUIT COURT OF JONES COUNTY AS TO PUNITIVE
DAMAGES IS REVERSED AND THE CAUSE IS REMANDED. THE JUDGMENT
AWARDING COMPENSATORY DAMAGES IS AFFIRMED AS TO MIC LIFE AND IS
REVERSED AND REMANDED AS TO GMAC. COSTS ARE ASSESSED ONE-THIRD TO
EACH PARTY.

      McMILLIN, C.J., BRIDGES, MOORE, AND THOMAS, JJ., CONCUR.

      IRVING, J., CONCURRING IN PART AND DISSENTING PART BY SEPARATE
      WRITTEN OPINION, JOINED BY KING, P.J., LEE AND PAYNE, JJ.

      IRVING, J., CONCURRING IN PART, DISSENTING IN PART:

¶73. MIC Life Insurance Company (MIC Life) and General Motors Acceptance Corporation (GMAC)
appeal from a Jones County Circuit Court judgment against MIC Life in the amount of $1 million in punitive
damages, and against GMAC in the amount of $637.99 in actual damages and $6 million in punitive
damages. Judgment for $637.99 in actual damages also was rendered against MIC Life. However, MIC
Life does not appeal the judgment of actual damages. The judgment was entered against each defendant
after the trial judge had reduced the jury's verdict against MIC Life by $5 million and against GMAC by
$24 million. The majority reverses and remands the judgment against both MIC Life and GMAC. It
reverses the actual damage award against GMAC because it finds a jury issue exists as to GMAC's
obligation to refund the unearned premium. It reverses and remands the punitive damage award against
both MIC Life and GMAC because of what it finds to be prejudicial errors committed by the trial judge. I
agree with the majority that the judgment against GMAC must be reversed and remanded. However, I
believe the judgment against MIC Life should be affirmed. Accordingly, I respectfully dissent from that
portion of the majority opinion reversing the judgment against MIC Life.

¶74. Hicks's complaint against MIC Life alleged breach of fiduciary duty, breach of contract, unjust
enrichment, breach of duty of good faith and fair dealing, and negligence. She sought both compensatory
and punitive damages. She also alleged that because MIC Life required the entire premium to be paid in
advance before it was earned, MIC Life had a fiduciary duty to her. She alleged that MIC Life breached
that fiduciary duty by "failing to pay the claim for death benefits or, in the alternative, to refund the unearned
premium" and by "failing to investigate to inform itself that the underlying note to GMAC had been paid."
The complaint further alleged that MIC Life's actions were performed with the intent to retain the unearned
premiums or with gross disregard for the rights of [Hicks] . . . , thus warranting the imposition of punitive
damages."

¶75. Hicks's complaint against GMAC alleged that MIC Life was a wholly-owned subsidiary of GMAC
and received benefits from MIC Life by receiving a return on shareholder investments based on the earnings
generated by MIC Life. It alleged that GMAC was unjustly enriched by receiving dividends from its wholly-
owned subsidiary, MIC Life, which dividends were paid partly from premiums which were unearned. The
complaint further alleged that as the lender and parent corporation of MIC Life, GMAC owed a duty to
Hicks to exercise reasonable care to inform MIC Life when the loan was paid in full, so MIC Life could
refund the unearned premium. The complaint also alleged that GMAC's actions were performed with the
intent to allow MIC Life to retain unearned premiums, or with conscious indifference to Hicks's rights.

¶76. Hicks's complaint did not allege an outright conspiracy between MIC Life and GMAC to increase the
probability of MIC Life's retention of the unearned premium belonging to Hicks. However, it is clear from
the record that the conspiracy theory was the bedrock of Hicks's action against GMAC, that the parties so
understood it to be and that the case was tried accordingly. This is made clear by the following jury
instruction to which neither MIC Life nor GMAC interposed an objection:

      The Court instructs the jury that if you find from clear and convincing evidence that the defendants,
      GMAC and/or MIC Life, willfully and deliberately entered into a plan with reference to refunds of
      unearned premiums which was contrived to circumvent the laws of the State of Mississippi and the
      Certificate of Insurance by requiring an additional burden on the customer in order to receive a refund
      of unearned premium which burden was not required by state law or the insurance contract;

      And, if you further find that the motive of GMAC and/or MIC Life in designing and utilizing said plan
      was to increase the profits of either GMAC or its wholly-owned subsidiary, MIC Life, then you may,
      in your discretion, assess punitive damages as against both GMAC and MIC Life, or either of them.

¶77. I find it necessary to recite some facts which I believe are relevant to the undergirding of MIC Life's
liability, both as to actual damages and punitive damages.

      I. MIC Life's liability

¶78. On April 2, 1991, David E. Hicks entered into an installment sales contract to purchase a pickup from
Hankins Chevrolet Company. He also purchased credit life insurance from MIC Life to cover the truck
loan. The purchase price of the truck, as well as the total premium for the credit life insurance, was financed
through GMAC, the corporate grandparent of MIC Life. On June 29, 1992, David traded the truck for a
newer model, and the original loan from GMAC was paid off, thus effecting a premature termination of the
insurance coverage.

¶79. The certificate of credit life and disability insurance (insurance contract) provided, "In the event of
termination of this insurance prior to the maturity date, the unearned portion of the insurance
charge will be refunded to you or credited toward your indebtedness." (emphasis added). The
insurance contract contained no requirement that the insured notify MIC Life in case of termination of the
insurance prior to the maturity date in order to receive the refund although it did contain a provision that
MIC Life be notified in case of a loss. State law requires that the unearned portion of credit life insurance
premiums be refunded within thirty (30) days of the date of accrual of such refund. Miss. Code Ann. § 83-
53-17 (1972).

¶80. It is undisputed that MIC Life did not refund the unearned portion of the premium in a timely manner
nor in accordance with the requirement of Miss. Code Ann. § 83-53-17 (2) which provides in pertinent
part:

      Each individual policy or group certificate shall provide that in the event of termination of the insurance
      prior to the scheduled maturity date of the indebtedness, any refund of an amount paid by the debtor
      for insurance shall be paid or credited promptly by the insurer to the person entitled therefor; . . . The
      insurer shall pay or cause to be paid to the debtor any refund due pursuant to this subsection
      within thirty (30) days of the accrual of such refund. (emphasis added).

¶81. The quoted statute imposes a duty on the insurer to refund unearned premiums within thirty (30) days
of the accrual of such refund. The duty is not contingent upon the insurer being notified by the insured. The
majority interprets the statute to mean something other than the express terms of the statute. While the
statute requires the refund to be made within thirty (30) days of the accrual of such refund, the majority
construes that to mean within thirty (30) days of being notified by the insured or the insured's representative.
I find this an unwarranted intrusion into the legislative branch of government. It seems to me that if the
legislature intended the refund to be made within thirty (30) days of being notified by the insured instead of
thirty (30) days of the accrual of the refund it would have simply written the statute to say as much. Clearly,
the legislature knows the difference between "accrual" and "notification." There is perhaps a good reason
why the legislature would choose the date of accrual as the operative date instead of the date of notification.
With credit life insurance the insured pays the premium in advance; it seems entirely reasonable to me that
the legislature would not want the insurance company to retain citizens' premiums, and thereby make a
profit, for any unreasonable period of time beyond the expiration of the covered risk.

¶82. Faced with a statutory duty to refund unearned premiums within thirty (30) days, it was incumbent
upon MIC Life to have controls in place to guarantee compliance with its statutory duty. When the loan in
this case was paid off in June 1992, MIC Life had an obligation to refund the unearned premium thirty (30)
days later. MIC Life attempts to explain away any liability for its failure to comply with the statute by
asserting clerical error. In arguing clerical error, it addresses its failure to refund the premium in the context
of the period of time following Mrs. Hicks's notification to MIC Life of Mr. Hicks's death. I believe MIC
Life is being much too kind to itself in limiting the relevant period to that time between March and October,
the former date being the date of notice of Hicks's death and the latter being the date of the refund. As
discussed, MIC Life had a duty to make the refund within thirty (30) days after the payoff of the note.

¶83. Even if the relevant period was the more limited one, it is entirely reasonable for the jury to conclude
that MIC Life's failure to make the refund until October 1995, represented a gross indifference to Hicks's
rights. The loan was paid off April 29, 1992. The refund was made in October 1995. It is of no moment
that MIC Life did not learn about the payoff until March 1995. MIC Life's failure cannot be excused on the
basis of lack of knowledge. The failure to obtain timely notice only serves to highlight both MIC Life's
failure to comply with its statutory duty and the injustice which is bound to occur as a result of MIC Life not
having the proper notification controls in place. It cannot pass the buck.

¶84. The jury was entitled to consider the totality of MIC Life's actions and inactions and draw its own
conclusion. It seems reasonable that punitive damages were properly awarded against MIC Life for the
reasons discussed.

¶85. MIC Life also contends that despite its failure to comply with the statute, the three year statute of
limitations should bar Hicks's claim since she filed her lawsuit three years and six days after the loan had
been paid off. In so arguing, MIC Life blurs the period of time for statute of limitations purposes with the
period of time imposed upon it by statute to make refunds.

¶86. MIC Life contends that if it had an obligation to refund the unearned premium within thirty (30) days
from the payoff of the note, the statute of limitations bars Hicks's suit because the note was paid off on June
29, 1992, and Hicks did not file her lawsuit until July 5, 1995. The majority appears to agree that, if MIC
Life had an obligation to pay without being notified by the insured or his representative, the statute of
limitation had indeed run. What both the majority and MIC Life fail to recognize is that the statute gives
MIC Life thirty (30) days to refund. Hicks would not have a cause of action until MIC Life failed or refused
to make the refund. Since the legislature has given insurance companies thirty (30) to pay, no cause of
action accrues to the insured until the thirty-first day. In other words, a statutory presumption of the refusal
to pay arises on the thirty-first day. Hicks's cause of action did not accrue until July 30, 1992, and since she
filed her lawsuit on July 5, 1995, it was not time barred. Had Hicks filed a claim for a refund during the
initial thirty-day period and been refused, an argument could be made that the statute of limitations began to
run on the date of the refusal assuming the refusal was not based on its right to the full thirty (30) days. That
is not our case.

¶87. The majority holds that the statute of limitations had not run on Hicks's lawsuit but arrives at that
conclusion by finding that MIC Life's obligation to refund the premium did not arise until MIC Life was
notified of the payoff. In explaining its rationale for this conclusion the majority says, "'[a]ccrual' is undefined
in the statute, but fulfillment of the obligation requires as a matter of common sense that the credit life
company know of the right to refund . . . . How the credit life company is to learn is a central issue."
Majority opinion at 7. It may be a central issue but that is a problem for credit life companies doing business
in Mississippi which requires the refund to be paid within thirty (30) days of the accrual of the refund. Can it
be legitimately argued that the right to the refund does not accrue when the note is paid off prematurely?
Moreover, the majority seems to suggest that notification from the insured is the only way credit life
insurance companies may receive notice of a payoff. As the evidence reflects in this case, in circumstances
when the refund is not being returned to the insured, the credit life insurance company gets notice without
being notified by the insured. The notice comes from the lender.

      2. GMAC's liability

¶88. The certificate of insurance listed GMAC as the creditor beneficiary. In case of death of the insured,
GMAC would contact MIC Life directly so that it could be paid the balance of the contract price from the
insurance proceeds. Likewise, when the unearned portion of a premium was coming to GMAC as a result
of repossession of a vehicle that had credit life covering the loan, GMAC, according to its corporate
representative, Mildred Wilbanks, did not go through the OLA procedure. That is the procedure whereby
GMAC sends a notice to the dealership and the purchaser advising that the purchaser may be entitled to a
refund because of early pay-off and that the purchaser should contact the dealership or the insurance
company. Understandably, in repossession cases, since GMAC was entitled to apply the unearned
premium to the debtor's outstanding balance, GMAC had controls in place to make sure MIC Life
refunded the premium directly to GMAC.

¶89. As stated, Hicks sought recovery against GMAC on several bases, including negligence, breach of
fiduciary duty and, though not specifically pled but tried, conspiracy to circumvent MIC Life's statutory and
contractual obligation to Hicks to provide a timely refund of the unearned premium. Hicks concedes that
GMAC's liability hinges upon GMAC's involvement in the premium refund process and any conspiratorial
actions with MIC Life to make the refund process more burdensome than required by state law and MIC
Life's contractual obligations to Hicks. Otherwise, GMAC would not be liable because of the well
established principle of tort law that one person owes no duty t o another to protect him from harm. Hicks
further argues that, though GMAC may not have had a duty to protect her, once GMAC voluntarily
involved itself, it then had a duty to act reasonably to prevent the harm. Hicks contends GMAC's actions
failed the reasonableness test which renders GMAC liable. Further, Hicks contends that GMAC's actions
may have amounted to gross negligence since it was aware of the facts and circumstances which led eight
states to change their laws to require the lender to refund unearned premiums for credit life insurance. What
is the basis for Hick's contention that GMAC was involved?

¶90. GMAC requires all of its dealerships to sign the following letter of agreement:

      CREDITOR LIFE AND DISABILITY/MECHANICAL SERVICE - DEALERSHIP LETTER OF
      AGREEMENT

      BRANCH LETTERHEAD

      Dealership Name and Address
      Creditor life and disability insurance purchased through a carrier is eligible for financing as long as you
      agree that on prepayment of an account, the unearned insurance charge will be refunded to the
      customer. This is accomplished either by our notifying the customer to make application to you
      for the insurance refund, or by you authorizing us to make the refund.

      Where you authorize us to make the refund, or in those jurisdictions where certain provisions of
      the law require lien holder processing of refunds, the unearned insurance premiums will be
      charged to your account and shown on your monthly Statement of Dealer Credits.

      Mechanical service agreements are eligible for financing as long as you agree that on repossession or
      total loss of an account, the unearned charges will be debited from your account and credited to the
      customer.

      To evidence your agreement to this arrangement, please have an authorized officer of the dealership
      sign the original of this letter and return it to us. The second copy is for your records. (emphasis).

¶91. As stated, Hicks argues that had GMAC not become involved in the credit life refunding process, it
would have had no liability, but once it became involved, it knew that the OLA notice procedure was
inadequate to ensure compliance with state law requiring a refund, within thirty (30) days of unearned
premiums. Hicks also argues that because of GMAC's experience in other states, which require the lien
holder to refund unearned premiums directly, it knew that a lower percentage of premiums was refunded
under the OLA procedure than under the direct refund procedure. Hicks contends that is why GMAC
utilizes the OLA procedure.

¶92. Further, Hicks argues that MIC Life and GMAC deliberately and intentionally entered into a plan or
scheme designed to circumvent Mississippi law requiring the timely return of unearned premiums. Of
course, GMAC argues that all it did was finance the premium and nothing more. It then lays claim to the
role of the Good Samaritan by asserting it did not have to do anything to alert the debtor that he may be
entitled to a refund of unearned premium, but it did. GMAC then claims outrage that it would be sued for
only trying to help. GMAC's contention boils down to this: it is okay for GMAC to finance lump sum
premiums for credit life insurance even though it knows, based on experience in other states, the purchasers
of that insurance who become eligible for a refund of unearned premiums, may never receive them. Also,
GMAC knows that the insurance company, which receives the premiums financed by GMAC, does not
have controls in place to ensure either compliance with state law or the provisions of the insurance contract.
In other words, it is okay to knowingly participate in a financing scheme with an insurance company that is
arguably fraudulent as long as it is the insurance company, not GMAC, which is charged by law with taking
the actions necessary to prevent the unlawful retention of customers' money. This is against the backdrop
that the financing scheme benefits both GMAC and the insurance company, in this case MIC Life. GMAC
is benefitted by the fact that its outstanding loan will be paid in full in case of the untimely death of the
insured, and in case of a repossession of the vehicle, it will be able to attach the unearned premium and
apply it to the defaulting debtor's account balance. Additionally, if there is a premature payoff of the note,
MIC Life would get to keep the unearned premium which would increase its assets, thereby allowing it to
pay greater dividends to its investors, one of whom is GMAC, the corporate grandparent of MIC Life. I
believe this evidence is sufficient to warrant a finding of a fiduciary relationship in such a situation between
GMAC and the purchaser of the insurance, and in this case, between MIC Life, GMAC and Mr. Hicks.

¶93. As stated, I think the evidence is sufficient to warrant a finding that a fiduciary relationship existed
between GMAC and Mr. Hicks. However, I do not believe such a finding would impose a duty upon
GMAC to actually make the refund. That duty is imposed by statute upon MIC Life.

¶94. The majority correctly states the law that a finding of actual damage is a prerequisite to a finding of
punitive damages. However, it is well-settled law that the actions of one co-conspirator bind other co-
conspirators; therefore, any liability flowing from MIC Life's actions and inactions would be binding upon
GMAC, making GMAC liable. The actions, however, must be actions taken in furtherance of the
conspiracy.

¶95. The trial judge directed a verdict against GMAC for the actual damages stemming from the failure of
MIC Life to refund the unearned premium. However, GMAC's liability for the refund hinges not on MIC
Life's statutory and contractual obligation to do so but on a finding of a conspiracy on the part of MIC Life
and GMAC to circumvent MIC Life's statutory and contractual obligation to do so. Only a jury could make
such a finding. Since MIC Life had a statutory and contractual obligation to refund the premium, the
directed verdict against it for the premium amount was proper, but the finding of actual damages against
MIC Life, an alleged co-conspirator, cannot be imputed to GMAC for purposes of punitive damages since
the basis for the award of damages did not emanate from conspiratorial actions.

¶96. As stated, the majority reverses and remands the punitive damage awards against both MIC Life and
GMAC because of a combination of what the majority concludes to be prejudicial trial errors. As can
readily be seen from the majority opinion, these alleged errors affect, for the most part, GMAC only.

¶97. The first such error concerns the evidence regarding the procedures in other states imposing upon
lenders, like GMAC, the duty to make refunds of unearned premiums. Since MIC Life had a statutory duty
to do so, it is difficult to discern how admission of this evidence was prejudicial to MIC Life. MIC Life, as
the lenders in the other states, also had a statutory duty to refund unearned premiums.

¶98. The next error concerns alleged improper lay testimony drawing legal conclusions. This involved
questions put to a GMAC employee regarding her interpretation of the insurance contract between Mr.
Hicks and MIC Life and the OLA notice procedure employed by GMAC. Again, this information was
elicited in an effort to establish the parameters of scienter on the part of GMAC that would support Hicks's
claim against GMAC, not MIC Life.

¶99. The third area of alleged prejudicial trial errors deals with the trial judge's comments on the credibility
of the witness. The comments were made in response to a MIC Life witness's statement that he was not
qualified to describe the refund procedure systems in those states requiring the lender to make refunds.
Again, since MIC Life is required by Mississippi law to refund the premiums, any damage resulting from the
judge's comment would affect GMAC, not MIC Life. MIC Life's knowledge or lack thereof of the refund
procedures in the other states would have little relevance to its contractual and statutory obligation to refund
the premium to Hicks.

¶100. Finally, the majority believes Hicks's counsel's argument to the jury -- "that GMAC had been 'called
on the carpet' by eight states in which they are required by statute automatically to refund unearned
premiums upon payoff of the loan" -- was so prejudicial that a reversal is warranted. This argument may
have been harsh on GMAC, but it escapes logic to conclude the same about MIC Life. My review of the
argument by Hicks's counsel leads me to the conclusion that GMAC arguably may have reason to complain
but not MIC Life. The majority also finds it prejudicial that Hicks's counsel told the jury about a $38 million
verdict "up here not long ago." The assertion of prejudice to MIC Life emanating from this argument quickly
evaporates in light of the jury's verdict of only $6 million against MIC Life which was promptly remitted to
$1 million by the trial judge.

¶101. Since the improper questioning, comments and closing argument all related to evidence about GMAC
in support of the conspiracy theory between GMAC and MIC Life, and not to evidence in support the
separate and distinct claim against MIC Life, I find the errors to be harmless as to MIC Life. If conspiracy
had been the only basis for liability against MIC Life, perhaps the majority would have a point.

¶102. The majority also makes much of the fact that MIC Life and GMAC are separate companies. While
that is true, it is also true that there was much interaction between them on a daily basis that, in my view, is
at least relevant circumstantially on the conspiracy issue. Here is what the record reveals. MIC Life and
GMAC were represented by the same attorney from the date the lawsuit was filed on July 5, 1995 until July
11, 1996. On the latter date, another attorney entered his appearance on behalf of MIC Life. The attorney
who previously represented both corporate defendants continued to represent GMAC.

¶103. At trial Michael Edward Bush, a MIC Life employee, testified as follows:

      Q. And how long have you been an employee of Motors Insurance Corporation?

      A. Twenty-four years.

      Q. Have you ever worked for anybody else?

      A. I worked as a GMAC employee for approximately two years before my MIC career.

      Q. As a matter of fact, it's not unusual -- is it -- that GMAC employees and MIC personnel have
      worked with one company or the other intermittently during their career, is it?

      A. No.

      Q. No. And the reason for that is, is that GMAC owns the parent company, which is Motors
      Insurance Company or MIC, don't they?

      A. Yes.

      Q. Nobody else owns any stock of that insurance company but the parent company who is then
      owned by GMAC; isn't that correct?

      A. That is correct.

      Q. And up there in Michigan it's not unusual for y'all all to be pretty close together working every day,
      isn't it?

      A. No.

      Q. In the same building?

      A. Yes.
      Q. Cubicles apart on occasion?

      A. They are separate -- may I explain my answer?

      Q. You may.

      A. Okay. We are separated in different offices within the same building.

      Q. But certainly, as this building is, GMAC may be in this office, MIC may be in that office, correct?

      A. Yes, that is correct.

      Q. And there is no impediment at all -- is there -- for if you have a question as an MIC employee, to
      go ask or pick up the phone and ask a GMAC employee, is there?

      A. No, there's no problem.

      Q. No reason whatsoever, is there?

      A. No.

¶104. As the above colloquy shows, MIC Life and GMAC have separate corporate identities but it
certainly can be inferred circumstantially that there was much interplay between the employees of the two
corporations. Therefore, it is not entirely unreasonable to infer that the employees of each corporation
probably knew a lot about the operations of the other corporation.

¶105. The majority seems to tacitly accept that the trial errors complained of primarily affect GMAC and
not MIC Life but dismisses the lack of prejudice flowing to MIC Life with the following observation:

      The dissent argues that the worse of the errors affect GMAC and not MIC Life. We cannot draw the
      lines quite so finely. This was a trial sufficiently flawed as to draw into question the verdict against
      both defendants, not only but perhaps most clearly because the central allegation below was that
      these two companies were in a conspiracy with each other. What dammed one alleged conspirator
      reasonably dammed the other in the minds of the jurors. Majority Opinion at 11.

¶106. This observation fails to fully take into consideration that MIC Life had a separate statutory and
contractual obligation to refund the unearned premium within thirty (30) days of the payoff of the note on
June 29, 1992. It did not refund the premium until October 1995. Even without a finding of a conspiracy
between MIC Life and GMAC, the jury could find that MIC Life's failure was actionable for punitive
damages. MIC Life admitted actual damages. MIC Life offers nothing to excuse its failure for three years to
honor the contract of insurance and abide by its statutory obligation to refund the unearned premium. It
attempts to explain its failure to do so, after being notified in March, as a clerical error. The jury was not
required to accept this explanation. The jury could reject the explanation on a credibility basis. It also could
conclude that notwithstanding the explanation MIC Life ignored a statutory obligation.

¶107. As stated, I see no reason for not affirming the judgment against MIC Life. The majority's suggestion
that -- "[w]hat could be made a separate issue on remand is an obligation on MIC Life that does not
depend on proof of a conspiracy with GMAC" -- is hardly an olive branch when only a casual reading of
the pleadings leaves it unmistakably clear that that is exactly what was before the jury that found MIC Life
liable.

¶108. Finally, I dissent from the majority's limitation of the admissible evidence on remand of the judgment
against GMAC. I agree with the majority that evidence that other states require lenders to refund unearned
premiums is inadmissible. But evidence of GMAC's and MIC Life's knowledge of the smaller percentage of
refunds made under the OLA procedure than under the direct refund procedure is certainly admissible. This
is so no matter the source of the knowledge. The jury cannot be told that other states require lenders to
refund unearned premiums unless Hicks can also show that the reason for the statutory enactment in the
other states was to prevent the low percentage of unearned premiums under the OLA or similar procedure
and that GMAC and MIC Life knew that was the reason behind the enactment.

¶109. For the reasons presented, I would affirm the judgment against MIC Life but reverse and remand the
judgment against GMAC.

      KING, P.J., LEE AND PAYNE, JJ. JOIN THIS SEPARATE WRITTEN OPINION.
