Frank H. Gibson, Inc. v. Omaha Coffee Co.

• Decision Date: 29 October 1965
• Docket Number: No. 35793,35793
• Citation: 179 Neb. 169,137 N.W.2d 701
• Parties: FRANK H. GIBSON, INC., a Corporation, Appellant-Cross-Appellee, v. OMAHA COFFEE COMPANY, a Corporation et al., Appellees-Cross-appellants.
• Court: Nebraska Supreme Court

Page 701

137 N.W.2d 701

179 Neb. 169

FRANK H. GIBSON, INC., a Corporation, Appellant-Cross-Appellee, v. OMAHA COFFEE COMPANY, a Corporation et al., Appellees-Cross-appellants.

No. 35793.

Supreme Court of Nebraska.

Oct. 29, 1965.

Syllabus by the Court

1. In determining the sufficiency of the evidence to sustain a verdict it must be considered most favorably to the successful party, any controverted fact resolved in his favor, and he must have the benefit of inferences reasonably deducible from it.

2. The jury is the sole judge on all fact questions. To justify this court in interfering with the findings of a jury on a fact question, the preponderance of the evidence must be so clearly and obviously contrary to the findings that it is the duty of the reviewing court to correct the mistake.

3. An action of conspiracy sounds essentially in tort. The principal element of conspiracy is an agreement or understanding between two or more persons to inflict a wrong against or injury upon another. It involves some mutual mental action coupled with an intent to commit the act which results in injury. Without the scienter persons cannot conspire.

4. Any person may do business with whomsoever he desires. Also, he may refuse business relations with any person whomsoever.

5. 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.

6. The good will connected with the establishment of any particular trade or occupation may be the subject of barter and sale. It is a valuable right, and if it be unlawfully destroyed or taken away, the law will award compensation to the injured party.

7. For harm resulting to a third person from the tortious conduct of another, a person is liable if he (a) orders or induces such conduct, knowing of the conditions under which the act is done or intending the consequences which ensue, or (b) knows that the other's conduct constitutes a breach of duty and gives substantial assistance or encouragement to the other so to conduct himself, or (c) gives substantial assistance to the other in accomplishing a tortious result and his own conduct, separately considered, constitutes a breach of duty to the third person.

8. The conspiracy was one to take plaintiff's business. Therefore the means adopted were unlawful. The actionable character of the means may be and often is determined by the use to which they are put. If, therefore, individuals conspire to commit the wrongful act of ruining one's business, the means, even though of themselves innocent, may be actionable.

9. If the trial court gave no reasons for its decision, then the appellant meets the duty placed upon him when he brings the record here with his assignments of error and submits the record to critical examination with the contention that there was no prejudicial error. The duty then rests upon the appellee to point out the prejudicial error that he contends exists in the record and which he contends justifies the decision of the trial court. The appellant then in reply has the right, if he desires, of meeting those contentions.

10. In an action at law for the loss of good will, the evidence must contain sufficient data to enable a jury, with a reasonable degree of certainty and exactness, to estimate the actual damages.

11. The question of the amount of damage is one solely for the jury and its action in this respect will not be disturbed on appeal if it is supported by evidence and bears a reasonable relationship to the elements of injury and damage proved.

12. An officer or director of a corporation has a fiduciary relationship to the corporation and its stockholders. He must refrain from all acts inconsistent with his corporate duties. He is not necessarily precluded from entering into a separate business because it is in competition with the corporation; but if he does he must prove by a preponderance of the evidence that he did so in good faith and did not act in such a manner as to injure or damage or contribute to the injury or damage of the corporation, or deprive it of business, and if he fails in this burden of proof there is a breach of that fiduciary trust or relationship.

13. The instructions of the court must be considered in toto, and if when so considered they cover the issues raised by the pleadings and supported by the evidence, they are adequate.

14. A party desiring a more explicit instruction than that given should offer such an instruction.

15. Instructions must be considered and construed together. If they are not sufficiently specific in some respects, it is the duty of counsel to offer requests for instructions that will supply the omission. And, unless this is done, the judgment will not ordinarily be reversed for such defects.

Pilcher, Howard & Hickman, Omaha, for appellant.

Fraser, Stryker, Marshall & Veach, Omaha, for appellees.

Heard before WHITE, C. J., and CARTER, SPENCER, BOSLAUGH, BROWER, SMITH, and McCOWN, JJ.

SPENCER, Justice.

This case was previously heard herein. Our former opinion, reported at 178 Neb. 329, 133 N.W.2d 462, reversed the judgment of the trial court and remanded the cause with directions to enter dismissal of the action on the defendants' cross-appeal. We now determine that our former opinion should be vacated.

This is an action brought by plaintiff, Frank H. Gibson, Inc., hereinafter referred to as Gibson, against Omaha Coffee Company, E. C. Conroy Coffee Company, Inc., hereinafter referred to as Conroy, and Kenneth Loseke, for damages alleged to have resulted from a conspiracy to purchase plaintiff's business on their own terms, and if unable to do so, to take over plaintiff's sales force, coffee routes, and customers.

In the trial of the action to a jury, Gibson recovered a judgment of $20,000. The trial court sustained a motion for a new trial. Gibson perfected an appeal, and the defendants perfected a cross-appeal.

Gibson was incorporated in 1931. At all times involved in this litigation, Edgar J. Bellows was its president, treasurer, and manager, and the owner of 625 shares of its stock. His wife was the owner of 10 shares. Kenneth Loseke was vice president and secretary, and the owner of 100 shares of stock for which he paid $2,500 in 1952. Bellows, his wife, and Loseke were the directors of the corporation, and the owners of all of its stock. George Christian, Mel Oliver, and Bill Dickens, along with Loseke, were the coffee salesmen employed by Gibson. Loseke was the customer's serviceman and supervised Gibson operations. For 2 months each summer he was in sole charge of the business. The business of Gibson was the selling of coffee, teas, and sundry items, primarily to restaurants, cafes, hospitals, factories, and other commercial enterprises, within a radius of 150 miles of Omaha. As a part of its business, Gibson provided certain equipment to regular customers using its products. The customers were served by established truck routes, over which the salesmen heretofore mentioned regularly delivered the products of the company. These salesmen were longtime, experienced employees, and operated without formal contracts of employment. For 2 years prior to October 1, 1962, Gibson had purchased all of its coffee from Conroy, whose place of business was in Kansas City, Missouri. These purchases amounted to approximately $150,000 per year. Conroy was not in the retail business but was strictly a wholesaler, and had no retail sales force available.

Edgar J. Bellows, who will hereafter be referred to as Bellows, was referred to in our previous opinion as being 74 years old. His age is not a matter of record, but from statements made on rehearing, his age was overstated in our former opinion by at least 13 years. Bellows testified that before leaving on a vacation August 19, 1962, he visited with his auditor and with Loseke about the possibility of selling Gibson because of his health, age, and business competition, and authorized the auditor to explore the possibility. The auditor made contact with the Continental Coffee Company and Conroy. Bellows did not return from his vacation until September. He had his first conference with Continental Coffee Company on September 11, 1962. At that time Continental made an offer for Gibson good will of $5 per pound on the average weekly coffee sales for the preceding 1-year period. It is undisputed that this average was 6,000 pounds per week, so the offer was for $30,000, exclusive of physical assets. According to plaintiff's evidence, employment was also offered certain Gibson employees, with or without contract, at a higher rate of pay.

The jury returned a verdict for the plaintiff, so this record must be reviewed in the light of the following rule: 'In determining the sufficiency of evidence to sustain a verdict it must be considered most favorably to the successful party, any controverted fact resolved in his favor, and he must have the benefit of inferences reasonably deducible from it.' Graves v. Bednar, 171 Neb. 499, 107 N.W.2d 12.

On September 12, 1962, Bellows had a conference at a motel in Omaha with Ralph Clark, who will hereinafter be referred to as Clark, president and sole stockholder of Conroy. The conference adjourned until the next morning. When Bellows and his wife returned the next morning, they observed papers scattered about the room on which appeared the names of Gibson customers. Clark then stated that Loseke had furnished him the names of the customers. It was Bellows' testimony that he had not authorized Loseke to negotiate any sale with Conroy, and particularly did not authorize the furnishing of the names of Gibson customers.

Clark and Bellows met the next day when the officers and stockholders of Gibson were discussed. Bellows quotes Clark as saying, with reference to Loseke's stock: "Well, you won't need to worry about that too much.' * * * 'We'll take care of Mr. Loseke on his...