Barish v. Chrysler Corp.

• Citation: 3 N.W.2d 91,141 Neb. 157
• Decision Date: 20 March 1942
• Docket Number: 31193.
• Parties: BARISH v. CHRYSLER CORPORATION et al
• Court: Nebraska Supreme Court

3 N.W.2d 91

141 Neb. 157

BARISH v. CHRYSLER CORPORATION et al

No. 31193.

Supreme Court of Nebraska

March 20, 1942

Syllabus by the Court.

1. Any person may do business with whomsoever he desires. Also he may refuse business relations with any person whomsoever whether the refusal is based on reason, whim, or prejudice. And where, by the terms of a contract, it is specified that either party may terminate the agreement at any time, such termination may likewise be had as stipulated and upon the conditions in such contract contained.

2. One who causes intended or unintended harm to another by refusing to continue a business relation with him, terminable at his will, is not liable for that harm.

3. Under the Junkin Act, Comp.St.1929, § 59-818, recovery is limited to damages for injuries "in his business or his property." Injuries to corporate business are not injuries to the business of an officer or stockholder within the meaning of that act, and for such injuries only the corporation may pursue the statutory remedy.

4. Under the circumstances of this case, there can be no recovery for future profits to accrue to corporate stockholders or future salaries to accrue to corporate officers, as elements of damage in a tort action, after the due termination and cancellation by the corporate parties thereto of the contracts, whose continued existence furnishes the sole basis of the same.

Webb, Beber, Klutznick & Kelley, Loyal G Kaplan, and Harold R. Lebens, all of Omaha, for appellant.

Crofoot, Fraser, Connolly & Stryker, Kennedy, Holland, DeLacy & Svoboda, and Fred N. Hellner, all of Omaha, for appellees.

Heard before SIMMONS, C. J., ROSE, EBERLY, PAINE, CARTER, and MESSMORE, JJ., and POLK, District Judge.

EBERLY Justice.

This is an action for tort brought by Barish in the district court for Douglas county against the defendants named to recover treble damages under the Junkin Act of Nebraska, for injuries in his business and property by reason of the results of a conspiracy declared unlawful by the terms of that enactment referred to, and alleged to have been participated in by the defendants. At the close of plaintiff's evidence, the trial court, upon the several motions of the defendants, directed the trial jury to return a verdict for the defendants, and dismissed plaintiff's petition, and later also overruled plaintiff's motion for a new trial. The plaintiff appeals.

It may be said that among the facts established by the pleadings and the evidence are the following: The defendants Chrysler Corporation and Dodge Brothers Corporation are automobile manufacturers engaged in the manufacture of automobiles and the distribution of same throughout the United States, through representative dealers. At the times involved herein Barish-Sanders Motor Company, a Nebraska corporation, was the dealer possessed of the usual franchise and was handling the products of the defendants "Chrysler" and "Dodge" in Omaha and vicinity. The plaintiff Barish was the president and general manager of Barish-Sanders Motor Company, and actively engaged in the management of its business. He owned 75 shares of common stock of Barish-Sanders Motor Company. There was also outstanding $30,000 of preferred stock issued by the company last named, which was owned by Ben Sanders and the Hubbell family of Des Moines, Iowa, who also owned the remaining 125 shares of the common stock. The board of directors of Barish-Sanders Motor Company, at all times involved herein, was Max M. Barish, plaintiff, Ben Sanders and James Hubbell. Sanders and the Hubbells were owners of a majority of the stock of a Des Moines, Iowa, company which was engaged in the same business at that place that was being carried on by Barish-Sanders Motor Company at Omaha. The defendants Commercial Credit Company, a Nebraska corporation, and Commercial Credit Company, a Delaware corporation, are engaged in the business of purchasing retail and wholesale commercial paper from automobile distributors and dealers, and also in the business of financing automobile transactions. They were affiliated organizations. The Chrysler Corporation also entered into a direct dealers agreement with Barish-Sanders Motor Company covering the sale and distribution by the latter of Dodge and Plymouth motor products in Cass, Douglas, Washington and Sarpy counties in Nebraska, and in Harrison county, Iowa. This contract is usually termed a "franchise" in the trade, and contains stipulations as to the rights and duties of all the parties to the same with reference to the subject matter of the agreement. It provided, among other things, for "Termination without Notice" for various reasons, such as an attempted assignment by the direct dealer, its bankruptcy or receivership. It also provided for "Termination Upon Cessation of Proper Representation," if in the opinion of the Chrysler Corporation the direct dealer shall have ceased proper representation in his territory, the company to immediately notify the dealer in writing of such termination. It also provided for "Termination by Notice" as hereinafter set forth; and for "No Liability on account of Termination" as later stated in this opinion.

The foregoing agreement was executed in writing February 19, 1936, and was in effect at all times involved in this litigation. It was signed on behalf of Barish-Sanders Motor Company by the plaintiff, as "M. M. Barish, Pres." On October 15, 1936, the Barish-Sanders Motor Company became a "Parts Wholesale Dealer" in the Dodge division of the Chrysler Corporation, under the terms of a contract then executed by it which also contained provisions similar to and substantially identical with its automobile franchise contract executed February 19, 1936, with reference to termination thereof.

These contracts are strictly corporation contracts, and as such binding only upon the corporate entities that are the makers thereof, and necessarily subject to all the limitations therein expressed. It follows that causes of action in the nature of tort arising from, growing out of, or pertaining to the obligations or duties created or declared thereby are necessarily limited in scope by the terms thereof.

The relations between the Chrysler Corporation and the two Commercial Credit Companies, defendants, were substantially created and fixed by the terms of a written contract entered into between it and the Commercial Credit Company, a Delaware corporation, effective January 1, 1935, and which remained in full force during the entire period covered by the events involved in the present suit. The Commercial Credit Company, a Nebraska corporation, was an affiliate company of the Delaware corporation of that name, and also a beneficiary of the contract last referred to. So far as involved in the present litigation, it may be said that this contract evidenced an agreement that the Chrysler Corporation would, "by proper means, to encourage, endorse, promote, recommend, develop and endeavor to bring about the use by its dealers of the financing plans and facilities of Commercial Credit in connection with the sale by its dealers of Chrysler cars on a time payment plan basis ***. (b) To mention in advertising and in radio broadcasts that Commercial Credit is the finance company approved and recommended by Chrysler. (c) To furnish a letter of recommendation, facsimilies of which Commercial Credit may use in advertising and on its finance charts and plans."

In consideration thereof, the Commercial Credit Company, a Delaware corporation, agreed to pay the Chrysler Corporation for such services not less than a minimum of $150,000 for each calendar year. This agreement also provided that the Commercial Credit Company, a Delaware corporation, might cause the contract to be performed by any or all of its affiliated companies, and that this contract should be for the benefit of all of the same.

It must be obvious that the success of the Chrysler Corporation under the set up heretofore detailed was wholly dependent on the number of its automobiles sold and the amount of its products disposed of by the Barish-Sanders Motor Company. As a matter of necessary precaution, it was the adopted business policy of the former to keep in close touch with the business transacted by the latter; to aid, advise, and cooperate with the latter to the end that the interests of both, if possible, be advanced. In the event that the relation between these parties should become unsatisfactory for any reason the contracts above referred to contemplated that either party thereto could at his own option terminate the same without liability for damages to the other. In line with this policy thus outlined, representatives of Chrysler Corporation and of the Barish-Sanders Motor Company discussed each year the prospective sales for the coming year and agreed upon quotas which the dealer believed represented the number of automobiles he could sell in his territory. It appears that Barish-Sanders Motor Company did not sell its quota of cars in 1936 or 1937. In fact, it did not sell as large a percentage of its quota as did the Sanders Motor Company at Des Moines, Iowa, and fell far below average sales of Plymouth and Dodge cars throughout the nation. Also, the Barish-Sanders Motor Company which had been financing with the Commercial Credit Company, because of difficulties arising which culminated about September 16, 1937, after full concurrence by its...