Hoyt, Inc. v. Gordon & Assoc., Inc.

Decision Date13 June 1995
Docket NumberNo. 67443,67443
Citation104 Ohio App.3d 598,662 N.E.2d 1088
CourtOhio Court of Appeals
PartiesHOYT, INC., Appellant, v. GORDON & ASSOCIATES, INC. et al., Appellees.

Paul W. Ziegler, Cleveland, for appellant.

Eugene I. Selker and Harlan D. Karp, Cleveland, for appellee Gordon & Assoc., Inc.

David M. Jones, Toledo, for appellee Consolidated Biscuit Company.

NUGENT, Judge.

Plaintiff-appellant, Hoyt, Inc. ("Hoyt"), timely appeals from the decision of the Cuyahoga County Court of Common Pleas which granted the motions for summary judgment filed by defendants-appellees, Gordon & Associates, Inc. ("Gordon") and Consolidated Biscuit Company ("Consolidated Biscuit"). For the reasons that follow, we affirm the decision of the lower court.

Hoyt initiated the present action through the filing of its complaint on November 12, 1992. In count one, Hoyt alleged that defendant San Joaquin Figs, Inc. ("San Joaquin"), a California corporation engaged in the manufacture and sale of fig paste, breached an exclusive brokerage agreement with Hoyt wherein Hoyt was to serve as San Joaquin's exclusive broker of fig paste in Ohio and western Pennsylvania. Hoyt alleged that during the course of the brokerage agreement between Hoyt and San Joaquin, San Joaquin breached the agreement by entering into an exclusive brokerage agreement with Gordon wherein Gordon brokered future sales of San Joaquin's fig paste to Consolidated Biscuit. Hoyt also alleged that it had, in the past, brokered San Joaquin fig paste to Consolidated Biscuit. In counts two and three, Hoyt alleged that Gordon and Consolidated Biscuit tortiously interfered with Hoyt's exclusive brokerage contract with San Joaquin. Appellant demanded damages for breach of contract from San Joaquin 1 and compensatory and punitive damages from Gordon and Consolidated Biscuit for tortious interference with business relations.

Both Gordon and Consolidated Biscuit duly answered Hoyt's complaint, denying that they had tortiously interfered with Hoyt's business relations. Following discovery, Gordon and Consolidated Biscuit separately moved for summary judgment.

It is undisputed that Hoyt is an Ohio food broker which, on April 6, 1990, entered into an exclusive agreement with San Joaquin to broker San Joaquin's fig paste throughout Ohio and western Pennsylvania. According to Keith Jura President of San Joaquin, the brokerage agreement was customary for the industry: exclusive, verbal, of an indefinite duration, with a requirement of thirty days' written notice for termination. Larry Hoyt testified at his deposition that, during the course of the agreement, Hoyt marketed some half million pounds of San Joaquin fig paste to Consolidated Biscuit and attempted to introduce San Joaquin products to other consumers.

In June 1991, Robert Oehler, an agent of Consolidated Biscuit, and Bud Gordon, principal of Gordon, visited San Joaquin. According to Jura, Oehler told him and Roy Jura (Keith Jura's father and another principal of San Joaquin) that Consolidated Biscuit would only accept, in the future, fig paste brokered through Gordon. It is further undisputed that Consolidated Biscuit is a very important consumer of fig paste; Consolidated Biscuit is the maker of Fig Newtons.

Keith Jura expressed his concern to Oehler and Bud Gordon that if San Joaquin agreed to use Gordon, it would violate San Joaquin's contract with Hoyt. In response, Oehler told the Juras that he would handle any problem with Hoyt. According to Jura, Bud Gordon, however, told Oehler that San Joaquin should handle any problems with Hoyt.

Eventually, in September or October 1991, Oehler informed Hoyt that Gordon would be acting as San Joaquin's fig paste broker. On October 15, 1991, San Joaquin signed an exclusive brokerage agreement with Gordon. Jura further testified that he never sent Hoyt written notice of termination of their brokerage agreement. In any event, Jura testified that Hoyt was notified before it made any effort to broker San Joaquin fig paste to anyone and before it had even contacted Consolidated Biscuit to inquire about its needs for the coming year.

In Consolidated Biscuit's motion for summary judgment, Consolidated Biscuit argued it had a legitimate business reason for brokering contracts for fig paste from Gordon rather than Hoyt. Consolidated Biscuit argued that Gordon had superior knowledge and understanding of the fig paste market so as to provide aggressive and knowledgeable assistance to Consolidated Biscuit in June 1991 and into the future. In short, Consolidated Biscuit argued that it was in its interest, as well as that of San Joaquin, that Gordon act as broker.

In Gordon's motion for summary judgment, Gordon argued that it did not act improperly and was privileged, as a direct competitor of Hoyt, to enter into the exclusive brokerage agreement with San Joaquin. Gordon summarized the evidence in support of its motion for summary judgment as demonstrating that it had superior knowledge of the fig paste market, worked harder and did a better job to the mutual benefit of San Joaquin and Consolidated Biscuit than did Hoyt. As a result, Gordon argued, it was privileged to interfere with Hoyt's business relationship with San Joaquin.

Based on the arguments and evidence presented by the parties, the trial court granted summary judgment in favor of both Consolidated Biscuit and Gordon. In its opinion and journal entry, the trial court found that San Joaquin's decision to terminate the oral brokerage agreement with Hoyt was based on San Joaquin's sound business judgment. The trial court further found that Gordon, as a competitor, had a privilege to interfere with San Joaquin's relationship with Hoyt.

Hoyt timely appeals, raising the following assignments of error for our review:

"I. The trial court erred in granting summary judgment to defendant, Consolidated Biscuit Company.

"II. The trial court erred in granting summary judgment to defendant, Gordon & Associates, Inc."

While Hoyt raises two assignments of error, Hoyt fails to separately argue each assignment. See App.R. 16(A)(7). Instead, Hoyt argues in three separate sections in the argument section of its appellate brief that summary judgment was inappropriate. Therefore, this court will first address the standard of review on a grant of summary judgment, then consider the appropriateness of granting summary judgment in favor of each appellee.

In reviewing a summary judgment, an appellate court conducts a de novo review of the trial court's decision. "A court reviewing the granting of a summary judgment must follow the standards set forth in Civ.R. 56(C) * * *." Aglinsky v. Cleveland Builders Supply Co. (1990), 68 Ohio App.3d 810, 814, 589 N.E.2d 1365, 1369. Civ.R. 56(C) provides that before summary judgment may be granted, it must be determined that:

"(1) no genuine issue as to any material fact remains to be litigated; (2) the moving party is entitled to judgment as a matter of law; and (3) it appears from such evidence that reasonable minds can come to but one conclusion and, reviewing such evidence most strongly in favor of the party against whom the motion for summary judgment is made, that conclusion is adverse to that party." Temple v. Wean United, Inc. (1977), 50 Ohio St.2d 317, 327, 4 O.O.3d 466, 472, 364 N.E.2d 267, 274.

In reviewing a motion for summary judgment, the court must construe the evidence and all reasonable inferences drawn therefrom in a light most favorable to the party opposing the motion. Morris v. Ohio Cas. Ins. Co. (1988), 35 Ohio St.3d 45, 517 N.E.2d 904; Harless v. Willis Day Warehousing (1978), 54 Ohio St.2d 64, 8 O.O.3d 73, 375 N.E.2d 46. Because summary judgment represents a short cut through the normal litigation process by avoiding trial, summary judgment must be awarded with caution, resolving all doubts in favor of the party opposing the motion. Viock v. Stowe-Woodward Co. (1983), 13 Ohio App.3d 7, 13 OBR 8, 467 N.E.2d 1378.

The burden of establishing that no genuine issues to any material fact remain to be litigated is on the party moving for summary judgment. Turner v. Turner (1993), 67 Ohio St.3d 337, 340, 617 N.E.2d 1123, 1126; Fyffe v. Jeno's, Inc. (1991), 59 Ohio St.3d 115, 120, 570 N.E.2d 1108, 1113. Once a party moves for summary judgment and has supported his or her motion by sufficient and acceptable evidence, the party opposing the motion has a reciprocal burden to respond by affidavit or as provided in Civ.R. 56(C), setting forth specific facts explaining that a genuine issue of material fact exists for trial. Jackson v. Alert Fire & Safety Equip., Inc. (1991), 58 Ohio St.3d 48, 52, 567 N.E.2d 1027, 1031; Mitseff v. Wheeler (1988), 38 Ohio St.3d 112, 115, 526 N.E.2d 798, 801. A motion for summary judgment forces the nonmoving party to produce evidence on all issues for which that party bears the burden of production at trial. Wing v. Anchor Media, Ltd. of Texas (1991), 59 Ohio St.3d 108, 570 N.E.2d 1095, paragraph three of syllabus.

The key to a summary judgment is that there must be no genuine issue as to any material fact. A "material fact" depends on the substantive law of the claim being litigated. Anderson v. Liberty Lobby, Inc. (1986), 477 U.S. 242, 247-248, 106 S.Ct. 2505, 2509-2510, 91 L.Ed.2d 202, 210-212; Turner, supra. Therefore, in determining whether a genuine issue of material fact remains to be litigated, we must turn our attention to the substantive law of the claims being litigated. Hoyt's cause of action against both appellees is for tortious interference with business relations.

In Walter v. Murphy (1988), 61 Ohio App.3d 553, 555, 573 N.E.2d 678, 679, the court of appeals set forth the following elements of tortious interference with business relations as clarified in 4 Restatement of the Law 2d, Torts (1979) 20, Section 766B:

"One who intentionally and improperly interferes with another's prospective contractual...

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