Fleming v. Kirkpatrick

• Decision Date: 11 May 1979
• Citation: 371 So.2d 16
• Parties: Joe FLEMING and Lily Flagg Builders Supply Company, Inc., a Corporation, v. Howard KIRKPATRICK. 77-484.
• Court: Alabama Supreme Court

Page 16

371 So.2d 16

Joe FLEMING and Lily Flagg Builders Supply Company, Inc., a Corporation, v. Howard KIRKPATRICK.

77-484.

Supreme Court of Alabama.

May 11, 1979.

Paul L. Millirons, Huntsville, for appellants.

Charles A. Sullins, Huntsville, for appellee.

PER CURIAM.

This is an appeal from a judgment based on a jury verdict rendered against the defendants in an action for an accounting and breach of contract. We affirm.

On April 16, 1968, Howard Kirkpatrick entered into a contract with the appellants, Joe Fleming and Lily Flagg Builders Supply, Inc. (hereinafter Lily Flagg). The contract provided, in essence, that Howard Kirkpatrick would exchange certain stock certificates representing his 48% Interest in Lily Flagg for 48% Of the assets of Lily Flagg. The major portion of the assets was represented by Lily Flagg's accounts receivable, and the contract provided that Kirkpatrick was to be paid 48% Of the net collections on all of Lily Flagg's accounts receivable accruing prior to January 31, 1968. The contract indicated that the amount of the accounts receivable was approximately $327,000.

In November, 1972, Kirkpatrick filed this action for an accounting alleging generally that he was due certain amounts under the contract; that he was unable to ascertain the amount owed him and that a determination of the amount owed him was "peculiarly within the knowledge" of Joe Fleming and Lily Flagg. Kirkpatrick asked that the court determine the amount due him from Fleming and Lily Flagg and, further, that the court direct Fleming and Lily Flagg to pay him any amounts due.

For reasons not apparent on the record, no significant action was taken in this case until 1976. Masters were appointed pursuant to Rule 53, ARCP and the masters reviewed Lily Flagg's records in an attempt to ascertain the amount due Kirkpatrick. The masters' report was inconclusive and a jury trial was commenced on November 15, 1977, in Madison County Circuit Court. On November 18, 1977, the jury returned a verdict for $50,116.33 in favor of the plaintiff against both Joe Fleming and Lily Flagg. Judgment was entered accordingly and a motion for a new trial was filed on the following grounds: excessive verdict; verdict against the weight of the evidence; and quotient verdict. On March 20, 1978, the motion for a new trial was denied. This appeal followed.

The appellants contend that there was not sufficient evidence presented at trial to support the jury's determination that the appellants breached the provisions of five contract provisions set out below.

1. Each of the corporate parties hereto will purchase its stock held by Howard Kirkpatrick, said stock being fifty (50%) per cent of the stock in Bessemer Readi-Mix, Inc., and K & F Trucking Company, Inc., and forty-eight (48%) per cent or forty-eight (48) shares of Lily Flagg Builders Supply, Inc. The total payment to be made by the three corporations for the stock of Howard Kirkpatrick shall upon closing of this transaction be SEVEN THOUSAND FOUR HUNDRED SEVENTY & 39/100 ($7,470.39) DOLLARS, and in addition thereto in the case of Lily Flagg Builders Supply, Inc., Howard Kirkpatrick shall also be paid an amount equal to forty-eight (48%) per cent on all net collections for all accounts receivable accruing to said corporation prior to January 31, 1968. Said net collections on the accounts receivable are to be arrived at by deducting from gross collections all actual expenses, including but not limited to, attorneys' fees, court costs, the items specified in other paragraphs hereof and one (1%) per cent of all accounts collected as of March 31, 1968, and two and one-half (21/2%) per cent of all amounts collected after March 31, 1968, which percentages are to be retained by Lily Flagg Builders Supply, Inc., as its office expense for collecting said accounts.

7. Lily Flagg Builders Supply, Inc., shall be responsible for filing all liens on accounts accruing prior to the 31st day of January, 1968, within the time period prescribed by law and pursuing same to a conclusion judgment, and in the event the corporation should elect not to file a lien where the amount of indebtedness exceeds $500.00, then and in that event, the corporation would be liable to Howard Kirkpatrick for his percentage of the net amount that would have been collected had such a lien been filed, to be paid not later than the 10th of the month following the expiration of the time allowed by law for filing said lien.

12. All notes receivable and all other such items due the corporations as of January 31, 1968, shall be paid to Howard Kirkpatrick in the same manner and on the same percentage as the accounts receivable are paid hereunder. This should specifically include any refund for taxes due to any of the three corporations which arise for any years prior to the year 1968. It also being expressly understood and agreed that any tax liabilities or tax deficiency which might accrue against any of the said three corporate parties hereto for the taxable year 1967, or any prior taxable year, will be paid out of the accounts receivable of Lily Flagg Builders Supply, Inc., which came into being prior to the 31st day of January, 1968, and these payments will be deducted from the gross accounts receivable.

15. Lily Flagg Builders Supply, Inc., shall attempt to procure a deed in lieu of foreclosure on...