Bauer v. Adams, KCD

Decision Date04 April 1977
Docket NumberNo. KCD,KCD
Citation550 S.W.2d 850
PartiesMargie A. BAUER et al., Plaintiffs-Respondents, v. Bobby D. ADAMS, Defendant-Appellant. 28117.
CourtMissouri Court of Appeals

C. B. Fitzgerald, Warrensburg, for defendant-appellant.

J. Kirk Rahm, Hensley, Rahm & Rahm, Warrensburg, for plaintiffs-respondents.



Plaintiffs sued their former employer for fraud. Defendant appeals from a jury verdict for plaintiffs. The jury awarded Margie A. Bauer $257.50 actual damages and $200.00 punitive damages. Marvin G. Warner $360.00 actual damages and $200.00 punitive damages, and Ward Douglas $600.00 actual damages and $200.00 punitive damages. Defendant's sole contention is that the trial court erred in overruling his motion for a directed verdict at the close of all of the evidence. Defendant claims that there was no evidence of a present intent not to perform a future promise.

The issue to be decided is the sufficiency of the evidence to support a submission of fraud. Thus, we must consider the evidence in a light most favorable to plaintiffs, giving plaintiffs the benefit of all reasonable inferences therefrom and disregarding evidence of defendant which is unfavorable to plaintiffs. Lazier v. Pulitzer Publishing Company, 467 S.W.2d 900 (Mo.1971), cert. denied 404 U.S. 940, 92 S.Ct. 273, 30 L.Ed.2d 253 (1971); Palermo v. Cottom, 525 S.W.2d 758 (Mo.App.1975); Yeager v. Wittels, 517 S.W.2d 457 (Mo.App.1974).

Defendant was the majority shareholder and president of Bob Adams Motor, Inc., a corporation. Plaintiffs are former employees of that corporation. In January, 1974, defendant's corporation was experiencing financial difficulty in common with other automobile dealers as a result of the "energy crisis." At this time, defendant requested and plaintiffs agreed to a 20% reduction in salary. The parties disagree as to the terms of the agreement for reduced salaries. This "agreement" is the basis for the plaintiffs' claim of fraud.

Plaintiffs testified that defendant asked them to take a 20% reduction in salary to be paid back when business improved, but no later than the end of the year. Plaintiff Marvin G. Warner testified that he would not have continued to work for defendant unless repayment had been guaranteed. Kenneth Hutcherson, a former auto mechanic for defendant, was also asked to take a cut in pay. He testified that defendant told the employees that he would pay them back in the future if possible.

Plaintiffs introduced part of a deposition of defendant as an admission against interest. In this deposition, the plaintiffs' counsel inquired of the defendant as to his intent at the time of his first conversation with plaintiffs. Defendant in this fragment of his deposition testified that he did not intend to pay them, and added, "They didn't intend to get it."

Counsel for plaintiffs called defendant as an adverse witness at the trial. Defendant testified that he asked plaintiffs to take a 20% cut in salary, to which they all agreed, and that then, or at a later time (defendant was unsure), he told plaintiffs that they would be reimbursed if business improved. Defendant denied having guaranteed repayment by denying any unconditional agreement to repay. The following colloquy between counsel for plaintiffs and the defendant then appears:

Q "It was not your intention when you talked to them about this reduction they would be paid the money back at least by the end of the year?"

A "Yes, it was my attention if I made the money back."

Q "If you made the money back?"

A "Right."

Q "In other words, you are saying it was not your intention to guarantee they would get it?"

A "No, I did not guarantee I would make the money back." (Emphasis supplied).

Defendant sold the dealership in April, 1974. He testified that he had no intention to sell in January when he reduced plaintiffs' wages. Plaintiffs' salaries were later returned to their original level, but the 20% withheld has never been reimbursed.

The essential elements of fraud are (1) a representation was made of a material fact which was false and known to be false, or was recklessly made, (2) the statement was made with the intent to deceive for the purpose of inducing the hearer to act upon it, (3) the hearer reasonably relied upon it (4) to his injury and damage. Latta v. Robinson Erection Co., 363 Mo. 47, 248 S.W.2d 569 (Banc 1952); King v. Morris, 315 S.W.2d 497 (Mo.App.1958); Yeager v. Wittels, supra. Defendant alleges plaintiffs failed to prove the elements of a statement of fact, intent and reliance. A failure to prove any one of these elements is fatal to plaintiffs' right of recovery. Latta, King, Yeager, supra.

Plaintiffs' theory of recovery is based upon the rule followed in Dillard v. Earnhart, 457 S.W.2d 666 (Mo.1970), and Brennaman v. Andes & Roberts Brothers Construction Co., 506 S.W.2d 462, 465 (Mo.App.1973), that misrepresentation of an intent to perform is misrepresentation of an existing fact if there is a "current intention by the promisor at the time the agreement is made not to perform." Such a misrepresentation of intention is to be distinguished from a mere promise or expression of opinion, both of which are not actionable. Brennaman, supra.

The issue thus narrows to the single question of whether the evidence is sufficient to support a jury finding of the defendant's present intent not to perform the claimed guarantee of the repayment by the end of the year.

Standing alone, the deposition testimony is ambiguous. It would support either the inference of defendant's promise being conditional or the inference that defendant had a present intent not to perform the promise of guaranteed payment which ...

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10 cases
  • Zahorsky v. Griffin, Dysart, Taylor, Penner and Lay, P.C.
    • United States
    • Missouri Court of Appeals
    • 13 d3 Fevereiro d3 1985
    ...cause but only to disregard the defendant's evidence which is unfavorable to the plaintiff. Palermo v. Cottom, supra; Bauer v. Adams, 550 S.W.2d 850, 852 (Mo.App.1977). In application, appellate courts have found that the plaintiff's evidence, standing alone, is sufficient to show the exist......
  • Bank of Kirksville v. Small, 69148
    • United States
    • Missouri Supreme Court
    • 15 d2 Dezembro d2 1987
    ...of performance does not establish knowledge or intent of the speaker to defraud, nor does it shift the burden of proof. Bauer v. Adams, 550 S.W.2d 850, 853 (Mo.App.1977). Moreover, the record lacks any evidence establishing that the alleged representations were made by plaintiff's agent wit......
  • Henty Const. Co., Inc. v. Hall, 55474
    • United States
    • Missouri Court of Appeals
    • 22 d2 Agosto d2 1989
    ...intent of the speaker to defraud, nor does it shift the burden of proof. Bank of Kirksville, 742 S.W.2d at 132 (relying Bauer v. Adams, 550 S.W.2d 850, 853 (Mo.App.1977)). Fraud is not presumed and its inference can be drawn only when the evidence points logically and convincingly to fraud.......
  • Citizens Bank of Appleton City v. Schapeler, WD
    • United States
    • Missouri Court of Appeals
    • 16 d2 Novembro d2 1993
    ...element of fraud need not be pleaded with particularity. Furthermore, intent can be inferred from the circumstances. Bauer v. Adams, 550 S.W.2d 850, 853 (Mo.App.1977). In the Schapelers' pleading, subparts (a), (e), and (f) of paragraph 6 allege sufficient facts from which intent can be inf......
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