Joseph v. Cohen

• Decision Date: 16 February 1983
• Citation: 658 P.2d 544,61 Or.App. 559
• Parties: Lila JOSEPH, Appellant, v. Allen COHEN and Josephine Cohen, personal representatives of the Estate of Paul Gold, Respondents. A7910; CA A21760; 05135. *
• Court: Oregon Court of Appeals

Page 544

658 P.2d 544

61 Or.App. 559

Lila JOSEPH, Appellant, v. Allen COHEN and Josephine Cohen, personal representatives of the Estate of Paul Gold, Respondents.

A7910; CA A21760; 05135.

Court of Appeals of Oregon In Banc ^*.

Argued and Submitted June 23, 1982.

Resubmitted In Banc Feb. 9, 1983.

Decided Feb. 16, 1983.

Margaret H. Leek Leiberan, Portland, argued the cause for appellant. With her on the briefs was Mitchell, Lang & Smith, Portland.

Tyler Marshall, Portland, argued the cause for respondents. With him on the brief was Bouneff, Muller & Marshall, Portland.

JOSEPH, Chief Judge.

Plaintiff brought this action on behalf of herself and other minority shareholders of Z & M, Inc., against the personal representatives of the estate of Gold for the recovery of damages to the corporation that were allegedly caused by Gold's intentional interference with the corporation's restaurant business. At the close of plaintiff's case, defendants moved for involuntary dismissal on the ground of insufficiency of the evidence. ORCP 54 B(2). The motion was granted with prejudice, and plaintiff appeals. ¹

Z & M, Inc., was formed in July, 1977, for the purpose of creating and operating Antoine's, a restaurant and bar in downtown Portland. Of the corporation's 500 shares, Gold owned 50 percent; plaintiff, 25 percent; and plaintiff's brother and sister-in-law, each 12 1/2 percent. Plaintiff was the corporation's president and the general manager of Antoine's. Gold was both the corporation's secretary-treasurer and the landlord from whom the corporation leased its restaurant space. Antoine's opened in December, 1977, and closed in November, 1979, with four months' rent in arrears. On January 31, 1980, a bankruptcy petition was filed.

Plaintiff alleged:

"[S]ubstantially contemporaneously with the commencement of the said restaurant and bar business, the decedent Paul Gold commenced a course of conduct in bad faith with the intention and design of immediately interfering with, undermining and destroying the business of Z & M, Inc., and that this conduct has interfered with, undermined and destroyed the business."

Gold's alleged wrongful conduct consisted, in substantial part, of:

(a) advising equipment suppliers, tradesmen, customers, employes and the public that the restaurant was failing, that plaintiff was a poor manager, that the food and service were poor, that he would evict the operators of the restaurant and that his grandson would take over;

(b) refusing to account for the balance of monies due Gold from the Portland Development Commission for the relocation of his "Stockmen's Club," whose assets were transferred to the corporation by Gold in exchange for his share of the corporation's stock;

(c) indicating to plaintiff that written exercise of an option to lease the second floor was not required and later declaring the option terminated and refusing to allow the corporation to rent it under any circumstances; and

(d) appearing daily at the restaurant to harass plaintiff by accusing her of dishonesty and poor managerial skills, bringing unpaid creditors to the restaurant during business hours and insisting in the presence of customers that the bills be paid and advising employes that he was going to close the restaurant and that they should seek other employment.

The trial court's order of dismissal stated:

"Upon motion of defendants for the dismissal, the court found the plaintiff had not proven the requisite intent on the part of defendant's decedent, Paul Gold, to cause the destruction of Z & M, Inc., and further found an absence of proof on which to base plaintiff's claim for damages."

Plaintiff first assigns as error the trial court's failure to state its findings of fact and conclusions of law. Under ORCP 54 B(2), when a trial court grants an involuntary dismissal with prejudice based on insufficiency of the evidence, it must make findings:

"After the plaintiff in an action tried by the court without a jury has completed the presentation of plaintiff's evidence, the defendant, without waiving the right to offer evidence in the event the motion is not granted, may move for a judgment of dismissal on the ground that upon the facts and the law the plaintiff has shown no right to relief. The court as trier of facts may then determine them and render judgment of dismissal against the plaintiff or may decline to render any judgment until the close of all the evidence. If the court renders judgment of dismissal with prejudice against the plaintiff, the court shall make findings as provided in Rule 62." (Emphasis supplied.)

ORCP 62 A provides:

"Whenever any party appearing in a civil action tried by the court so demands prior to the commencement of the trial, the court shall make special findings of fact, and shall state separately its conclusions of law thereon. In the absence of such a demand for special findings, the court may make either general or special findings. If an opinion or memorandum of decision is filed, it will be sufficient if the findings of fact or conclusions of law appear therein."

One apparent purpose for the interlocking of Rules 54(B)(2) and 62 is to provide a reviewing court a basis for determining how and why the trial court concluded that a terminal judgment on the merits was appropriate at the close of the plaintiff's case. We conclude that the trial court must make the findings of fact and conclusions of law required by Rule 62. Its findings here do not meet that requirement.

In Castro and Castro, 51 Or.App. 707, 626 P.2d 950 (1981), we held that a dismissal under ORCP 54 B(2) without the making of Rule 62 findings could not be sustained. The issue there was child custody. The trial court made no findings, and we concluded that we could not meaningfully review the order.

The trial court's order in this case is similarly defective. In granting defendant's motion under the rule, the judge sat as trier of fact, but the order is devoid of any findings of fact as a basis for his legal conclusions that plaintiff failed to prove the "requisite" intent and that there was an "absence of proof" of damages. We are unable to discern whether the trial court concluded that plaintiff put on no evidence to prove these elements, whether it disbelieved the evidence plaintiff did put on or whether it found it legally insufficient to make out her case. ² Without adequate factfinding by the trial court, we cannot determine whether the trial court properly applied the law to the facts. It is not our function to review the record to determine what the facts are. That is for the trial court to do. The plaintiff has put on her case, and a retrial is not required. It will be sufficient for the trial court to rectify the defects in the order by making the requisite findings and conclusions. ³

Reversed and remanded.

VAN HOOMISSEN, Judge, dissenting.

The majority reverses the trial judge because it finds that he did not make findings of fact. I would hold that the judge did make general findings and that that was sufficient.

The trial judge stated in pertinent part:

"THE COURT: * * * I do not find that the proof that was offered establishes that [defendant], by anything that he did, intended to cause the demise of Z & M, Inc. * * *

"I find that there has been a failure of proof of the underlying intent that's necessary to sustain this cause of action.

"I further find that there is an absence of proof with any specificity upon which the Court could, if I found deliberate interference with the intent to destroy the corporation, how the plaintiff has been damaged in this action. So on that cause of action I will allow the motion for directed verdict.

" * * *

"THE COURT: * * * [B]ased on the facts that you...