Custom Roofing Co., Inc. v. Alling

• Court: Arizona Court of Appeals
• Writing for the Court: LIVERMORE; BIRDSALL, P.J., and FERNANDEZ
• Citation: Custom Roofing Co., Inc. v. Alling, 706 P.2d 400, 146 Ariz. 388 (Ariz. App. 1985)
• Decision Date: 09 July 1985
• Docket Number: No. 1,CA-CIV,1
• Parties: , 42 UCC Rep.Serv. 63 CUSTOM ROOFING CO., INC., an Arizona corporation, Plaintiff-Appellee, Cross- Appellant, v. Robert ALLING; Owens-Corning Fiberglas Corporation, a Delaware corporation, Defendants-Appellants, Cross-Appellees. 7238.

Page 400

706 P.2d 400

146 Ariz. 388, 42 UCC Rep.Serv. 63

CUSTOM ROOFING CO., INC., an Arizona corporation, Plaintiff-Appellee, Cross- Appellant, v. Robert ALLING; Owens-Corning Fiberglas Corporation, a Delaware corporation, Defendants-Appellants, Cross-Appellees.

No. 1 CA-CIV 7238.

Court of Appeals of Arizona Division 1.

July 9, 1985.

Law Offices of Hubert E. Kelly, P.C. by Hubert E. Kelly, Phoenix, for plaintiff-appellee, cross-appellant.

Ryley, Carlock & Ralston by Raymond M. Hunter, and David J. Hamilton, Phoenix, for defendants-appellants, cross-appellees Robert Alling and Owens-Corning Fiberglas Corp.

OPINION

LIVERMORE, Judge.

Plaintiff, Custom Roofing Co. (Custom), entered into a subcontract to provide roofing on a school construction job specifying the use of materials from defendant, Owens-Corning Fiberglas Corp. (OC). OC had two offices in Phoenix, Branch and Supply. Branch sold exclusively to approved roofing contractors. Custom was not an approved contractor. Custom, however, had bought OC materials from Supply for many years. Custom sought quotes for materials from Supply and then placed an order with Supply. Supply ordered materials to fill this order from an OC factory and arranged a shipping schedule. OC sent a preliminary notice of lien to the school and to the general contractor. Thereafter, at the direction of defendant, Robert Alling, an employee of Branch, those orders were cancelled. Custom, because of its inability to obtain the necessary materials, lost its contract. It brought suit for breach of contract and tortious interference with contract. The jury found in its favor, awarding $35,000 compensatory and $105,000 punitive damages. Remittitur reduced the compensatory award to $14,144. OC appeals from the judgment and Custom cross-appeals from the remittitur and from the refusal to allow prejudgment interest.

OC contends first that it did not accept the Custom order so that no binding contract was formed. It further argues that if such a contract was created, it is unenforceable for failure to comply with the statute of frauds. While an express acceptance obviously creates a contract, acceptance can be implied by unambiguous "language or circumstance," A.R.S. § 44-2313, now renumbered as § 47-2206. See Cook v. Cook, 142 Ariz. 573, 691 P.2d 664 (1984). There is ample evidence of acceptance by OC Supply of Custom's order. The order was prepared in response to price quotations prepared by Supply and was picked up at Custom's office by agents of Supply. Delivery schedules were discussed. In the context of the long-standing business relationship between Custom and Supply, it is hard to imagine circumstantial evidence more strongly probative of acceptance. Ordinary people do not speak "legalese." They do business. Their conduct implies the legal conclusion. On this record, there is no question that the agents of Supply believed they had accepted Custom's order, indeed they admitted it, and that such acceptance was conveyed to Custom by the actions of those agents. See A.R.S. § 44-2314(C), now renumbered as § 47-2207(C). Alternatively, these facts could as easily be construed as an offer by the price quotation of Supply which was accepted by Custom's purchase order.

The requirements of the statute of frauds, A.R.S. § 44-2308, now renumbered as § 47-2201, are met by the following facts:

(1) The failure to object to the written purchase order confirming an oral understanding of the prior day. A.R.S. § 44-2308(B);

(2) The internal memoranda of OC ordering the goods to fill the Custom order, conduct clearly evincing a belief in a contractual obligation;

(3) The filing of a preliminary notice of lien by OC in approximately the amount of the purchase order; and

(4) The testimony at trial of agents of Supply that they had accepted the order. A.R.S. § 44-2308(C)(2).

OC concedes that if its contract with Custom is valid, as we have determined, it is liable for tortious interference with the contract between Custom and the general contractor on the school job. It contends, however, that its employee, Alling, because he was acting in the scope of his employment cannot be independently liable for his acts of interference. We know of no general rule insulating employee tortfeasors from liability. The cases cited to us, Petroni v. Board of Regents, 115 Ariz. 562, 566 P.2d 1038 (App.1977), Perry v. Apache Junction Elementary School District. No. 43, 20 Ariz.App. 561, 514 P.2d 514 (1973), and Wise v. Southern Pacific Co., 223 Cal.App.2d 50, 35 Cal.Rptr. 652 (1963), hold only that an employee cannot be held liable for inducing his corporate employer's breach. This rule makes sense; otherwise, every breach of contract would also involve, because a corporation can act only through its employees, an inducing to breach by the agent who caused the breach to occur. But that rule does not provide that an employee may induce the termination of a contract between third parties and be free of liability if motivated by a desire to benefit his employer. No...