General Aggregate Corp. v. LaBrayere

Decision Date07 February 1984
Docket NumberNos. 47075,47076,s. 47075
Citation666 S.W.2d 901
PartiesGENERAL AGGREGATE CORPORATION, Appellant, v. Don E. LaBRAYERE, Respondent.
CourtMissouri Court of Appeals

Edward C. Cody, St. Louis, for appellant.

David L. Welsh, St. Louis, for respondent.

REINHARD, Judge.

Defendant appeals from a judgment entered on a jury verdict for plaintiff in the amount of $36,800.00. Plaintiff has filed a cross appeal from the trial court's refusal to award pre-judgment interest. We affirm in part and reverse and remand in part.

This action was tried on Count III of plaintiff's second amended petition in which plaintiff alleged that it provided consultant services and general management guidance to defendant to assist him in the acquisition of a quarry business known as the Hunt Quarry, for which services plaintiff was entitled to recover $36,800.00 in quantum meruit.

In 1971, Marlin J. Veesaert founded General Aggregate Corporation, a one man corporation which provided general management consultation services to mining and aggregate businesses throughout the United States and abroad. Veesaert had an extensive background in geology and mining. He had both a baccalaureate and a masters degree in geology and additional coursework in geophysics, economic geology and business. Prior to the formation of General Aggregate, he had worked as vice-president of St. Louis Slag Products and Lincoln Stone.

In 1972, defendant was the president and a stockholder in Earthmoving, Inc. (EMI), a corporation whose primary business was grading subdivisions and industrial parks. John Givens, Ed Ryder and defendant's father, Ray LaBrayere, were the remaining shareholders. At that time, the company decided to enter the quarry business by acquiring the 56 acre Pitman farm near Wentzville in St. Charles County. The Pitman farm was raw ground and did not have an operating quarry on it. Test drilling had to be done on the property in order to determine its suitability as a quarry. Test Drilling, Inc. was hired to perform that task. Defendant testified that Don Ramsey of Test Drilling brought "Marlin [Veesaert] along because we needed help to go about doing this .... I don't know how to do it and he brought Marlin along because that is the nature of his business ...."

Because of EMI's need for expert advice in the quarry business, plaintiff and EMI entered into a contract which provided that General Aggregate would "act as Earthmoving, Incorporated's sole general management agent in the planning, opening and equipping of Earthmoving, Incorporated's Quarry Co." Towards that end, General Aggregate would work to acquire zoning approval for the quarry and for a period of eight years after zoning was obtained would:

1) study and select all plant and mobile equipment necessary to remove, crush, screen, handle and sell crushed stone;

2) provide consultation concerning installation of the plant and opening of the quarry;

3) recommend quarry supervisory personnel;

4) recommend pricing for crushed stone;

5) assist in acquisition of licenses and permits;

6) assist management with consulting services.

General Aggregate would be paid $35.00 per hour for Veesaert's time and in addition, would receive a fee of ten percent of all cost outlay as goods, equipment, additional lands and services were acquired during the full term of the contract. Defendant signed the agreement in his capacity as president of EMI. During the fall and winter of 1972-73, Veesaert worked extensively on rezoning for the Pitman farm. Ultimately, in 1973, rezoning was denied by St. Charles County. In January, 1973, Vic Koepke, operator of an excavating company and a competitor of EMI, approached Veesaert about working for him. Veesaert testified he declined the work because he would be in competition with EMI. Defendant agreed with that assessment.

While the application for rezoning of the Pitman property was pending, two of the principals of EMI instructed Veesaert to "find an alternate site to the Wentzville site, a going operation if possible ...." He examined numerous quarry operations throughout Missouri in early 1973. During the summer of 1973, Veesaert testified there was continued interest by EMI and defendant in a going quarry operation.

On July 12, 1973, defendant, Veesaert and Don Ramsey took an aerial tour of several eastern and central Missouri quarries, including the Hunt Quarry. Veesaert testified that he learned the Hunt Quarry was for sale from the executive director of the Missouri Limestone Producers Association. Defendant testified that he knew Hunt was in financial trouble. Veesaert testified that based on "the geology ... the condition and the quality of the rock at that location I ... thought it might be a very, very good area." Defendant then directed Veesaert to find out how much Paul Hunt wanted for the quarry.

On October 1, 1973, Veesaert and defendant discussed the future of EMI and the possible liquidation of EMI's earthmoving equipment. Veesaert testified defendant requested him to proceed to meet with the Hunts on defendant's behalf or behalf of whomever defendant represented.

On October 3, 1973, Veesaert presented an agreement to defendant to be signed by defendant, as president of Earthmoving, Inc. and by defendant, individually. The agreement provided that General Aggregate would act as defendant's or Earthmoving's sole and exclusive management agent and would:

1) study and select all plant and mobile equipment necessary to remove, crush, screen, handle and sell crushed stone or aggregate;

2) provide consultation concerning installation of the plant and the opening of the quarry at a new location or those revisions and modifications in the interest of operation efficiency at an existing operation;

3) recommend quarry supervisory personnel;

4) recommend pricing of aggregate and evaluation of markets;

5) assist in the acquisition of licenses and permits;

6) closely assist management with general consulting services.

The agreement provided for compensation at the rate of $35.00 per hour and "ten percent of all cost outlay ... as goods, equipment, services, additional lands, and other companies or operations and services are acquired during the full term of the contract."

Defendant did not sign the agreement. Veesaert testified that defendant "said not to be concerned about it, that he did not want to sign it at that time, that the fee would be paid, that we would go just as before on the initial agreement and that I should not be concerned about it and that it would be paid."

On October 5, 1973, Veesaert inspected the Hunt Quarry and prepared a memorandum. The inspection entailed a detailed geological examination of the quarry, the crushing plant and operations, employees and pay scale, and pricing structure of the aggregate sold. On October 10, defendant proposed to Veesaert that he pay $50.00 per hour (instead of $35.00 per hour) and give plaintiff 30% of the company stock in lieu of the 10% contingent bonus. Veesaert rejected the offer. On October 16, 1973, defendant and Veesaert had a second meeting with Paul Hunt at the quarry to further investigate the quarry and its operations. On October 26, 1973, Veesaert met with the Hunts to examine in detail their financial statements, including sales and cost figures, as well as a depreciation schedule for all equipment. He met with defendant that afternoon to discuss his findings and prepared a detailed memorandum two days later.

Veesaert testified that defendant reiterated during this period that he would be paid, that he did not need to concern himself about that; he could be well assured that defendant had been instructed by his father to pay his debts and he considered this a just debt which would be paid.

In early December, 1973, defendant resolved that Hunt's price for the quarry was too high. He decided to stop looking for a quarry and opened a pizza parlor. At some time in the winter or early spring of 1974, EMI ceased doing business and a decision to liquidate its assets was made.

On February 1, 1974, Veesaert received a call from Paul Hunt that he wanted to sell the quarry very badly. Veesaert passed this information on to defendant. On March 6, 1974, Paul Hunt attended the final liquidation auction of EMI and asked defendant if he wanted to see the quarry again. Shortly thereafter, defendant met with Hunt at the quarry and they began serious negotiations for its purchase. Veesaert testified that on April 1, 1974, defendant called him and told him that he had reached an agreement with Paul Hunt to purchase the Hunt Quarry for $368,000.00. Veesaert suggested that defendant hire Dave Merks, Quarry Superintendent of O'Fallon Quarry. Defendant authorized Veesaert to meet with Merks and prepare an incentive employment contract to entice Merks to quit his job at O'Fallon Quarry and work for defendant. Merks accepted the proposal Veesaert prepared.

Defendant testified that he needed Veesaert's help to measure the stockpiles, inventory and other such items. Veesaert had numerous meetings with defendant and his attorney in regard to preparation of the written contract. On April 18, 1974, Veesaert and defendant went to the Hunt Quarry to examine the rock and Veesaert photographed the equipment for documentation purposes.

The contract price was $368,000.00; $168,000.00 for the land, $200,000.00 for all remaining assets. The sellers conveyed to defendant the quarry, plant, facilities, including real property, furniture, fixtures, equipment and machinery used in connection with the operation of the quarry, trucks, trailers, automobiles and the rolling stock used in the quarry operation and stockpile inventory located at the quarry operation based upon actual, usable inventory on and at the close of business on May 1, 1974. Also...

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