Harrison v. Prather

• Decision Date: 09 March 1971
• Docket Number: No. 29023.,29023.
• Citation: 435 F.2d 1168
• Parties: Gerard A. HARRISON and Harrison Ranch, Inc., Plaintiffs-Appellees, Cross-Appellants, v. Carey PRATHER, Defendant-Appellant, Cross-Appellee.
• Court: U.S. Court of Appeals — Fifth Circuit

435 F.2d 1168 (1970)

Gerard A. HARRISON and Harrison Ranch, Inc., Plaintiffs-Appellees, Cross-Appellants, v. Carey PRATHER, Defendant-Appellant, Cross-Appellee.

No. 29023.

United States Court of Appeals, Fifth Circuit.

December 16, 1970.

Rehearing Denied and Rehearing Denied March 9, 1971.

Philip Mansour, Greenville, Miss., Taylor Webb, Webb & Webb, Leland, Miss., for defendant-appellant.

Fred W. Moore, Harry Jed Lawson, Houston, Tex., George F. Woodliff, Heidelberg, Woodliff & Franks, Jackson, Miss., Douglas C. Wynn, Greenville, Miss., for plaintiffs-appellees.

Before BELL, THORNBERRY and CLARK, Circuit Judges.

Rehearing Denied and Rehearing En Banc Denied March 9, 1971.

CLARK, Circuit Judge:

Reluctant because our principal role is to end disputes, we must nevertheless add another chapter to the history of a bitter internecine legal war that flows from the termination of that closest of business relationships — a partnership. Our desire to write finis here is thwarted by conflicting instructions to the jury on the standard of proximate cause applicable to the tort of interfering with the making of a contract. The cause must now go back for a trial under the correct standard.

The plaintiffs, Gerard H. Harrison and Harrison Ranch, Inc. (Harrison), residents of Texas¹ brought suit against Carey Prather (Prather), a resident of Mississippi sewing: (1) a partition of real property under 28 U.S.C.A. § 1655 (1966); (2) damages resulting from the alleged appropriation by Prather of certain partnership personal property and (3) treble damages under 15 U.S.C.A. § 15 (1963), on the ground that Prather allegedly unlawfully prevented Harrison from obtaining a loan in the amount of 1,090,000 dollars from the Prudential Insurance Company of America (Prudential), thereby causing a loss of anticipated profits from future farming operations and cattle business. Prather counterclaimed, alleging that Harrison should be required to honor an agreement to dissolve the partnership and to partition the property; and, that certain partnership property had been appropriated by Harrison.² A jury trial, making use of special interrogatories to segregate the jury's action on the various claims, resulted in a net verdict for Harrison. After a remittitur, the verdict was embodied in a judgment in Harrison's favor. The appeal by Prather and cross-appeal by Harrison eventuated.³

Among the multiplex issues spawned by this judicial donnybrook, the primary controversy in this forum focuses on Prather's activities relating to Harrison's attempt to obtain the Prudential loan in late 1964 and the consequences of Prudential's declination. Many of the material facts relating to this particular transaction, as developed at the trial, are in sharp dispute, but the following synopsis sufficiently frames the controversy.

This suit had its genesis on December 20, 1963 when Harrison and Prather entered into an agreement creating a partnership named "P & H Farms", which was to last for one year commencing January 1, 1964. The partnership was organized for the purpose of farming lands located in Washington County, Mississippi. During the autumn of 1964, Harrison notified Prather of his desire to terminate the partnership and a formal agreement to such effect was signed by the parties on February 1, 1965.

On December 15, 1964, Harrison made application to Prudential for a loan of 1,090,000 dollars. Prudential declined to make the loan on January 15, 1965. Harrison asserts that Prudential declined the loan because of a conspiracy between Prather and two others which had as its object to destroy Harrison's credit, thereby making it impossible for Harrison to obtain a loan and thus force him to sell his lands at a reduced price. Specifically, Harrison alleges that Prather and his fellow conspirators interfered with the processing of his loan application to Prudential and that this meddling actually killed the loan. Harrison's principal proof of his fiscal ambush was a tape recording of a conversation between Prather and a third party (secretly Harrison's envoy) in which Prather stated that he knew who could stop a loan approval. The taped conversation further tended to establish that one Pickett Myers killed Harrison's loan at Prather's direction. Prather introduced witnesses employed by Prudential who testified that they were in no way influenced by Pickett Myers, but rather that they declined the loan because the loan application forms were incomplete, Harrison's financial statement was weak, the real estate security was located in two states, part of the lands were utilized in cattle operations and the lands had a low ratio of crops allotments to the total acreage.

After a full trial, the jury rendered its verdict on special interrogatories, by which it made specific findings: that Prather personally or in conjunction with others acting in his behalf, wilfully and maliciously interfered with the granting of a loan by Prudential; that Prather's interference proximately contributed in whole or in part to the decision of Prudential to decline the loan; that Harrison incurred losses in connection with his cattle operation during the last part of 1964 and the first part of 1965 in the amount of 86,352 dollars proximately resulting from the said acts of interference; that Prather's conspiracy was in restraint of interstate trade.

The jury also specially found that Prather was liable to Harrison in the amounts of 2,600 dollars for the wrongful removal of parts and equipment by Prather and 750 dollars for the wrongful appropriation of tools in connection with the division of partnership property and that Harrison was liable to Prather for 900 dollars because Harrison had appropriated feed belonging to the partnership. The balance of these findings struck in Harrison's favor in the sum of 88,802 dollars. After first ruling that Prather had not violated the antitrust laws and refusing to treble the jury's loan interference award pursuant to 15 U.S.C.A. § 15 (1963), the trial judge entered a judgment in favor of Harrison for 88,802 dollars.

Prather filed post-judgment motions for relief from judgment, stay of execution, leave to withdraw the original tape recording for analysis by an expert and, in the alternative, for judgment notwithstanding the verdict or a new trial. The district court denied the motion for leave to withdraw the tape recording and denied Prather's motions for relief from judgment and for judgment notwithstanding the verdict, but sustained his motion for a new trial unless Harrison accepted a remittitur of 43,167 dollars — 50 per cent of the amount allegedly resulting from the failure to obtain the Prudential loan. Without protest, Harrison filed the remittitur and the district court entered final judgment in Harrison's behalf in the sum of 45,626 dollars.

On the direct appeal, Prather insists that the district court committed thirteen errors. In the cross-appeal Harrison asserts that three errors occurred. In view of the basis for our ruling here, it becomes unnecessary to discuss all of these contentions. The pivotal issue is the claimed error of the district court in instructing the jury as to the standard to be applied in determining whether Prather's alleged interference caused the disapproval of Harrison's loan. Because we determine that the court adopted an incorrect gauge to measure this critical element and the case must be reversed for a redetermination of this issue under a more stringent rule, we deem it appropriate to pass upon two other issues that may recur upon retrial — (a) were future cattle profits established by competent proof and (b) did the district court err in holding that the federal antitrust laws were not applicable in this case?

I. THE PROXIMATE CAUSE vs. A PROXIMATE CAUSE

It is not the abstruse concept of probable cause alone that controls our decision in this cause, but, literally, the issue sharpens to whether "the" or "a" is the proper modifier. Even within the dubious logic of semantics, it is apt to observe that seldom has so little led to the downfall of so much.

During his charge the trial judge initally instructed the jury that they would be required to answer an interrogatory providing: "Do you believe from a preponderance of the evidence that the defendant's interference caused Prudential not to make the loan?"⁴ However, on taking objections of counsel after completing his charge, the judge observed the quoted interrogatory language conflicted with another interrogatory which provided that liability should be affixed if Prather took actions "proximately contributing in whole or in part to the decision of the Prudential Insurance Company of America to decline the loan. * * *"

To resolve the clear conflict between the sole cause and contributing cause standards in these two statements, the judge proposed to change the former interrogatory to accord with his concept that Prather's actions need not be the sole cause of Prudential's refusal to render him liable.

Prather's attorney objected to this alteration in the interrogatory on the basis that it did not state the correct rule in a claim for interference with the making of a contract, contending that the plaintiffs must prove that the loan would have but for the defendant's interference. The judge disagreed.

Back in the presence of the jury, the judge announced and explained the change he was making. He then struck out the typed word "the" with his pen and inserted in its place the word "a". He concluded his remarks by declaring: "I have changed the question to provide whether or not it was a `proximate cause', not a sole cause." Upon that comment the jury retired to deliberate. Before us, Prather reasserts his position that the but for test is the proper guide.

To determine if the verdict of the jury on the contract interference issue should have been permitted to stand, we must pass upon the threshold question as to whether any real...