Chanay v. Chittenden

Citation563 P.2d 287,115 Ariz. 32
Decision Date13 April 1977
Docket NumberNo. 12667,12667
PartiesDon CHANAY and Kathleen Chanay, his wife, Appellants, v. George A. CHITTENDEN and Frances Chittenden, his wife, Anita Blanchard, a single woman, and Union Mutual Life Insurance Company, a Foreign Corporation doing business in Arizona, Appellees.
CourtSupreme Court of Arizona
Finn, Finn & Finn, by Ruth G. Finn and Elizabeth R. Finn, Phoenix, for appellants

Lewis & Roca by John P. Frank and Thomas C. Horne, Phoenix, for appellees.

HAYS, Justice.

This is an appeal from an order granting the appellees' motion for summary judgment. We have jurisdiction pursuant to 17A A.R.S. Supreme Court Rules, rule 47(e)(5). The pertinent facts are as follows.

Appellant Don Chanay filed a complaint claiming four causes of action against appellees, Union Mutual Life Insurance Co. (hereinafter referred to as Union Mutual) and George Chittenden (hereinafter referred to as Chittenden). Chittenden previously had been a vice-president of Union Mutual and was, at the time the action was filed, a general agent for Union Mutual in Arizona. A third defendant was named in the complaint but was never served. That was Anita Blanchard, appellant's one-time personal secretary.

After the answer was filed, depositions were taken from appellant and Chittenden. Without further discovery, except some interrogatories served on the appellees, a motion for summary judgment was made by the appellees. It was denied. On a motion for reconsideration, the same trial judge again denied summary judgment. Two months later, the action having been transferred to a new trial judge, another motion for reconsideration was made. Although no further discovery or affidavits were filed, the second judge granted summary judgment on all four counts.

( We wish to say at this juncture, we do not approve of the practice of a trial judge redeciding such a motion when no new discovery has taken place).

Upon appellant's motion for a new trial and to amend the judgment, the trial court reversed itself as to the fourth cause of action, and a modified judgment was filed. We are only concerned in this appeal, therefore, with the three causes of action in which summary judgment was granted.

The first cause speaks in terms of breach of contract by Union Mutual. The second cause alleges interference with appellant's contract and business relations with Union Mutual by Chittenden. The third cause asserts that both appellees and Anita Blanchard misappropriated and used to appellant's detriment 'trade secrets, personal contacts and confidential information' gained by Blanchard in her position as appellant's confidential secretary for ten years.

After careful review of all the pleadings, depositions, motions and supporting affidavits submitted on appeal in this case, we are of the opinion that the trial court was correct in granting summary judgment on the contract cause of action, but incorrect in doing so on the second and third causes.

BREACH OF CONTRACT

In November, 1968, appellant entered into a written agreement with Union Mutual entitled 'MAP Special Agent Agreement.' This contract made him a 'non-exclusive' agent, entitling him to overrides on any business produced by him in Arizona. He apparently also had a broker's contract with Union Mutual, which is not in the record before us. In any event, under these contracts he was able to sell Union Mutual insurance policies directly to individuals as a broker and receive a commission, or to other brokers and receive override compensation on the Union Mutual policies they sold.

Appellant specialized in health and disability insurances and testified at his deposition that Union Mutual policies in those fields were probably the best available. However, appellant continued to maintain his licenses to sell for a number of other large insurance companies, and, as we pointed out, his contract with Union Mutual was 'non-exclusive'; that is, he was not an agent for Union Mutual alone. The 'MAP' contract additionally declared him an independent contractor.

Termination of this contract by the parties could be achieved at the will of either of the parties upon fifteen days written notice to the other, or for cause, by either, without notice. Addendums to this contract, the last of which is the only one in the record before us and is dated October, 1971, were incorporated by reference into the basic agreement. They merely changed appellant's expense allowance schedule. The addendum before us contains a sentence referring to the basic agreement and the termination clause thereof. Appellant admitted at his deposition that he read and understood all of these agreements which he signed. He was terminated in December, 1972, upon fifteen days notice.

Despite the express contract, appellant urges that Union Mutual, through Chittenden and other of its officers, created some kind of equitable contract with appellant by continuously assuring him that his position with Union Mutual as their only agent in Arizona would be secure as long as he did a good job for the company. He complains, in effect, that he was urged to act as an exclusive agent and he did so (although maintaining the right to sell policies of other insurance companies if he so chose), in reliance on these assurances, but was terminated anyway, in bad faith. Appellant relies heavily on the Restatement of Contracts § 90. We do not think that section assists him in light of his testimony at the deposition:

Q. My question to you was: Did you retain the right at all times for you to terminate the contract without cause and say you will not do any further work for this company?

A. Did I give up that right?

Q. Yes.

A. No.

Q. And you kept that right to quit this company any time you chose to?

A. Yes.

Q. And did they keep their contract right to quit you any time they chose to?

A. Yes.

There can be no implied contract where there is an express contract between the parties in reference to the same subject matter. Ewing v. Sargent, 87 Nev. 74, 482 P.2d 819 (1971); Fox v. Cities Service Oil Co., 201 Okl. 17, 200 P.2d 398 (1948); Wilson v. Frederick R. Ross Inv. Co., 116 Colo. 249, 180 P.2d 226 (1947); Keith v. Kottas, 119 Mont. 98, 172 P.2d 306 (1946); Chandler v. Washington Toll Bridge Authority, 17 Wash.2d 591, 137 P.2d 97 (1943); 17 Am.Jur.2d Contracts § 3.

Although appellant may have been able to prove an implied agreement not to terminate at will under some equitable theory, he could only have done so if there were no express agreement to the contrary. By his own admission, there was no issue to try, and therefore the granting of a summary judgment on this nonexistent cause of action was proper. 16 A.R.S. Rules of Civil Procedure, rule 56(c). Appellant could not raise a genuine issue by merely asserting the contrary in his affidavits.

'The general allegation under oath must give way as against . . . (his) . . . own deposition . . ..' Stevens v. Anderson, 75 Ariz. 331, 334, 256 P.2d 712, 714 (1953).

There was no error in granting the summary judgment as to the cause of action alleging a breach of contract.

INTERFERENCE WITH CONTRACT RELATIONS

For his second cause of action, appellant alleged that Chittenden 'contrived to use his position with the Company to induce the Company to sever its contract with' appellant, in order that Chittenden might come to Arizona and 'take over' appellant's Union Mutual business. Appellant alleges this was done with 'malicious motive,' and that appellant has been damaged. In his brief, in support thereof, appellant relies on the Restatement of Torts § 766:

'. . . (O)ne who, without privilege to do so, induces or otherwise purposely causes a third person not to

(a) perform a contract with another, or

(b) enter into or continue a business relation with another

is liable to the other for the harm caused thereby.'

The requisites for this commercial tort were set out by Professor Prosser in his Law of Torts, Interference with Contractual Relations § 129 (4th Ed. 1971). The interference must be intentional, not negligent; there must be an absence of a justifiable purpose; there must be actual damages. Arizona law agrees. Tipton v. Burson, 73 Ariz. 144, 238 P.2d 1098 (1951); Meason v. Ralston Purina Co., 56 Ariz. 291, 107 P.2d 224 (1940).

The privileges which may justify an interference are set out in §§ 767 through 774 of the Restatement of Torts.

Appellee Chittenden urged successfully below that there was no genuine issue as to any material fact in this cause of action. He urges us to agree with the ruling below on the matter by arguing first that his affidavit in support of the motion for summary judgment is uncontested. In that affidavit, Chittenden avowed that his decision to move to Phoenix was made before Union Mutual's decision with respect to the Arizona agency, and was motivated by his wife's health. He also asserts therein that the decision to terminate appellant's contract was made by officers other than himself, and that he did not use any improper means with these officers.

Like appellant, however, appellee cannot escape his own admissions at the deposition:

Q. Who made the decision to have a general agency in Arizona?

A. Who made the decision?

Q. Who in the company participated in the decision?

A. Al Perkins, executive vice president.

Q. Who else?

A. That's the only one I know of.

Q. Did you participate in that decision?

A. Did I participate in it?

Q. . . . (W)ere you consulted in making the decision?

A. Well, I didn't have any power. . . .

Q. Did Mr. Perkins talk to you about it?

A. Yes.

Q. When did you first become personally interested in the general agency in Arizona?

A. In November, December of '71.

Q. And how did the decision of a general agency in Arizona first start?

A. Well . . . in the upper chambers. But with me, I just said that I was going to go to Phoenix. . . .

Q. When did you make that decision?

A. Probably when I was seven or eight years old, I...

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