Intercall, Inc. v. Egenera, Inc.
| Decision Date | 07 December 2012 |
| Docket Number | No. S–11–1003.,S–11–1003. |
| Citation | 284 Neb. 801,824 N.W.2d 12 |
| Parties | INTERCALL, INC., appellant, v. EGENERA, INC., appellee. |
| Court | Nebraska Supreme Court |
OPINION TEXT STARTS HERE
Syllabus by the Court
[284 Neb. 801]1. Pleadings: Appeal and Error. Permission to amend a pleading is addressedto the discretion of the trial court, and an appellate court will not disturb the trial court's decision absent an abuse of discretion.
2. Jury Instructions: Appeal and Error. Whether a jury instruction is correct is a question of law, which an appellate court independently decides.
3. Verdicts: Appeal and Error. A civil verdict will not be set aside where evidence is in conflict or where reasonable minds may reach different conclusions or inferences, as it is within the jury's province to decide issues of fact.
4. Motions for New Trial: Appeal and Error. An appellate court reviews a denial of a motion for new trial or, in the alternative, to alter or amend the judgment, for an abuse of discretion.
5. Contracts: Fraud. A contract is voidable by a party if his or her manifestation of assent is induced by either a fraudulent or a material misrepresentation by the other party upon which he or she is justified in relying.
6. Contracts: Fraud. A misrepresentation induces a party's manifestation of assent if it substantially contributes to the party's decision to manifest his or her assent.
7. Contracts: Fraud. A party who has been induced to enter into a contract by a material misrepresentation has, upon discovery of such misrepresentation, an election of remedies: either to affirm the contract and sue for damages or to disaffirm the contract and be reinstated to the induced party's position which existed before entry into the contract.
8. Contracts: Fraud: Restitution. Where the induced party to a contract elects to disaffirm or avoid the transaction, it may claim restitution.
9. Torts: Contracts: Fraud. Misrepresentation or nondisclosure may render a transaction voidable even if there would be no tort cause of action for deceit.
10. Pleadings: Appeal and Error. A district court's denial of leave to amend pleadings is appropriate only in those limited circumstances in which undue delay, bad faith on the part of the moving party, futility of the amendment, or unfair prejudice to the nonmoving party can be demonstrated.
11. Pleadings: Proof. The burden of proof of prejudice is on the party opposing amendment of a pleading. Prejudice does not mean inconvenience to a party, but instead requires that the nonmoving party show that it was unfairly disadvantaged or deprived of the opportunity to present facts or evidence which it would have offered had the amendments been timely.
12. Actions: Pleadings: Words and Phrases. A cause of action consists of the fact or facts which give one a right to judicial relief against another; a theory of recovery is not itself a cause of action. Thus, two or more claims in a complaint arising out of the same operative facts and involving the same parties constitute separate legal theories, of either liability or damages, and not separate causes of action.
13. Records: Appeal and Error. It is incumbent upon the appellant to present a record supporting the errors assigned; absent such a record, an appellate court will affirm the lower court's decision regarding those errors.
14. Directed Verdict: Evidence. A directed verdict is proper at the close of all the evidence only when reasonable minds cannot differ and can draw but one conclusion from the evidence, that is to say, when an issue should be decided as a matter of law.
15. Contracts: Fraud. An essential element of actionable false misrepresentation is justifiable reliance on the representation.
16. Fraud. Whether a party's reliance upon a misrepresentation was reasonable is a question of fact.
17. Fraud. Justifiable reliance must be determined on a case-by-case basis. In determining whether an individual reasonably relied on a misrepresentation, courts consider the totality of the circumstances, including the nature of the transaction; the form and materiality of the representation; the relationship of the parties; the respective intelligence, experience, age, and mental and physical condition of the parties; and their respective knowledge and means of knowledge.
18. Jury Instructions: Proof: Appeal and Error. In an appeal based on a claim of an erroneous jury instruction, the appellant has the burden to show that the questioned instruction was prejudicial or otherwise adversely affected a substantial right of the appellant.
19. Jury Instructions: Proof: Appeal and Error. To establish reversible error from a court's failure to give a requested jury instruction, an appellant has the burden to show that (1) the tendered instruction is a correct statement of the law, (2) the tendered instruction was warranted by the evidence, and (3) the appellant was prejudiced by the court's failure to give the requested instruction.
[284 Neb. 803]20. Jury Instructions: Appeal and Error. If the instructions given, which are taken as a whole, correctly state the law, are not misleading, and adequately cover the issues submissible to a jury, there is no prejudicial error concerning the instructions and necessitating a reversal.
21. Contracts: Fraud. A material misrepresentation may be a basis for avoiding a contract, even if it resulted from an honest mistake.
Patrick R. Guinan, of Erickson & Sederstrom, P.C., L.L.O., Omaha, for appellant.
Joel E. Feistner, of Locher, Pavelka, Dostal, Braddy & Hammes, L.L.C., Omaha, for appellee.
This case involves a dispute arising from a contractual relationship between InterCall, Inc., and Egenera, Inc. After Egenera failed to pay for certain services InterCall provided pursuant to a contract, InterCall brought an action in the district court for Douglas County. Egenera asserted affirmative defenses and a counterclaim to recover what it claimed to be overpayments. InterCall appeals from a judgment in favor of Egenera on the counterclaim. We affirm.
Egenera is a Delaware corporation with its principal place of business in Massachusetts. It is engaged in the sale of business software and routinely uses audioconferencing services provided by outside vendors for both interaction with its customers and internal communication and training.
Prior to March 2007, Egenera obtained audioconferencing services from Raindance Communications (Raindance). Raindance charged Egenera $.05 per minute for conference call service, with no minimum charge. Raindance was subsequently acquired by InterCall, a Delaware corporation conducting business in Nebraska and a provider of audio, Web, and video conferencing services. After this acquisition, Egenera could have continued its business relationship with Raindance for some period of time, but eventually Raindance's conferencing “platform” would have ended and Egenera would have been required to obtain audioconferencing services from InterCall or some other vendor.
In November or December 2006, Richard Visconte, a global account executive for InterCall, contacted Terry Lehane, the global technical director of customer service for Egenera, to explain the conferencing service platform offered by InterCall. Visconte and Lehane discussed pricing for audio and Web conferencing. In January 2007, Visconte told Lehane that InterCall could provide audioconferencing services at a rate of $.07 per minute. Lehane rejected the offer because it was more than the rate charged by Raindance. Lehane was satisfied with the service provided by Raindance and with its pricing structure, and he was not interested in doing business with InterCall unless it offered a better price and features than Egenera received from Raindance.
Visconte was then given permission by a regional vice president at InterCall to offer Egenera the same rate it had paid Raindance, $.05 per minute, for the audioconferencing services. In an e-mail message to Lehane, Visconte stated that he had been able to “talk [InterCall's regional vice president] into honoring your current Raindance rate of .05 cents and roll you into InterCall's [program] like we talked about, which is great news!” Relying upon this representation, Lehane agreed to the proposal. On behalf of Egenera, Lehane executed a service agreement with InterCall on March 1, 2007.
The service agreement provided for a rate of $.05 per minute for audioconferencing in the continental United States, with a “Monthly Volume Discount” and a “Minimum Annual Commitment” of $44,000 for all services. The agreement further provided:
BY SIGNING BELOW, EACH PARTY ACKNOWLEDGES AND AGREES THAT: UNLESS INDICATED OTHERWISE, SERVICES ARE CHARGED BY MULTIPLYING ALL INBOUND OR OUTBOUND LEGS OF ALL CONFERENCES BY THE APPLICABLE PER MINUTE RATE; SERVICE FEATURES, FEES OR SURCHARGES NOT LISTED HEREIN, INCLUDING CONFERENCE LEGS TO OR FROM A LOCATION OUTSIDE THE CONTINENTAL U.S. WILL BE CHARGED AT INTERCALL'S STANDARD RATES; CUSTOMER MAY OBTAIN INTERCALL'S STANDARD RATES THROUGH CUSTOMER'S WEB ACCOUNT OR THROUGH CUSTOMER'S SALES OR ACCOUNT REPRESENTATIVE; SUBJECT TO THE TERMS OF THIS AGREEMENT, ANY RATES INDICATED IN THE RATE INFORMATION OF THIS AGREEMENT WILL REMAIN IN EFFECT FOR THE TERM OF THIS AGREEMENT; AND IT HAS READ AND AGREES TO BE BOUND BY THIS AGREEMENT, INCLUDING THE TERMS AND CONDITIONS ATTACHED HERETO.
(Emphasis supplied.)
The service agreement also provided: “Customer must notify InterCall of any disputed charges within thirty (30) days from the date of the invoice, otherwise Customer hereby agrees to such charges and InterCall will not be subject to making adjustments.”
The dispute here involves a $15 “conference minimum charge” which was not mentioned in the service agreement but was included in InterCall's standard rate sheet. Visconte testified that he was not aware of the conference minimum charge and that he...
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