Macke Laundry Service Ltd. Partnership v. Mission Associates, Ltd.

• Decision Date: 06 May 1994
• Docket Number: No. 69588,69588
• Citation: 19 Kan.App.2d 553,873 P.2d 219
• Parties: MACKE LAUNDRY SERVICE LIMITED PARTNERSHIP, Appellee, v. MISSION ASSOCIATES, LTD., d/b/a Heritage Hills Apartments, and Jetz Service Company, Inc., Appellants.
• Court: Kansas Court of Appeals

Page 219

873 P.2d 219

19 Kan.App.2d 553

MACKE LAUNDRY SERVICE LIMITED PARTNERSHIP, Appellee, v. MISSION ASSOCIATES, LTD., d/b/a Heritage Hills Apartments, and Jetz Service Company, Inc., Appellants.

No. 69588.

Court of Appeals of Kansas.

May 6, 1994.

Review Denied July 7, 1994.

Syllabus by the Court

1. Written notice of termination of a contract shall be effective upon mailing when the contract expressly requires the notice to be given by mail and when the notice provision is silent as to receipt. To be effective, the notice must be correctly addressed, stamped, and mailed within the specified period of time required by the contract for giving timely notice, and the addressee or the addressee's employee or agent must receive that notice within a reasonable time after its mailing.

2. If the notice of termination of a contract is not received within a reasonable time after its mailing, the notice shall be ineffective. Nevertheless, a presumption will occur that notice was received by the party to whom it was addressed if that notice is correctly addressed, stamped, and mailed. This presumption, however, is rebuttable and may be overcome by evidence that notice was never received.

3. A claim for tortious interferences with a contractual relationship requires the existence of a valid and enforceable contract at the time of the interference between the plaintiff and a third party.

4. To maintain a cause of action for tortious interference with a prospective business advantage, the plaintiff must establish: (1) the existence of a business relationship or expectancy with the probability of future economic benefit to the plaintiff; (2) knowledge of the relationship or expectancy by the defendant; (3) that, except for the conduct of the defendant, the plaintiff was reasonably certain to have continued the relationship or realized the expectancy; (4) intentional misconduct by the defendant; and (5) damages suffered by the plaintiff as a direct or proximate result of the defendant's misconduct.

Emily Jane Bailey, Watson, Ess, Marshall & Enggas, Kansas City, MO, and Gerald L. Goodell, Goodell, Stratton, Edmonds & Palmer, Topeka, for appellants.

Stephen G. Mirakian, Wyrsch, Atwell, Mirakian, Lee & Hobbs, P.C., Kansas City, MO, for appellee.

Before LEWIS, P.J., GREEN, J., and JAMES J. SMITH, District Judge, Assigned.

GREEN, Judge:

This appeal involves a tortious interference with a contractual expectancy claim brought by Macke Laundry Service Limited Partnership (Macke). Macke contends Jetz Service Company, Inc., (Jetz) tortiously interfered with its contractual expectancy with Mission Associates, Ltd., d/b/a Heritage Hills Apartments (Heritage Hills). Originally, Macke's action included a claim against Heritage Hills for breach of contract; however, this claim was stayed as a result of Heritage Hills' bankruptcy. The jury found in favor of Macke, and the trial court entered judgment accordingly. Jetz appeals, arguing the trial court erred in granting Macke's partial summary judgment motion, in denying its motion for directed verdict on Macke's tortious interference claim, in certain of its evidentiary rulings, and in awarding Macke punitive damages. Our resolution on Jetz' first claimed error makes a detailed recitation of the facts unnecessary. Accordingly, we will only recite the facts necessary to present our decision.

On October 19, 1982, Heritage Hills entered into an agreement with Laundry Equipment Services, Inc., for use of laundry space and equipment at the apartment complex. Sometime before the events causing this action, Macke acquired the rights to this agreement by purchasing Laundry Equipment Services, Inc.

The agreement provided for a minimum term of five years and automatic annual renewal thereafter without notice. The agreement also provided that either party could terminate the agreement "at the expiration of the minimum period ... or at the end of any subsequent twelve-month period, by giving written notice thereof by mail to the other party at least 60 days prior to the expiration of said minimum period, or at least 60 days prior to the end of said subsequent twelve-month period."

It is undisputed that on August 20, 1990, exactly 60 days prior to end of the 12-month period ending October 19, 1990, Heritage Hills sent, by certified mail, a written notice of termination to Macke. The return receipt showed Macke received the notice on August 21, 1990, or 59 days prior to the end of the 12-month period. Macke then notified Heritage Hills that since notice was untimely given, it expected the agreement to be honored until October 19, 1991. On November 18, 1990, despite Macke's claim that the agreement automatically renewed, Heritage Hills removed Macke's laundry room equipment from its apartment complex. Macke then brought the present action against Heritage Hills for breach of contract and against Jetz for tortious interference with a contract or business expectancy.

Heritage Hills, Jetz, and Macke all filed motions for summary judgment on the issue of whether Heritage Hills had properly terminated the agreement because it had not given timely notice of termination. On May 17, 1991, the trial court granted Macke's motion for summary judgment, finding Heritage Hills failed to give timely notice and the agreement had not terminated on October 19, 1990. Therefore, Heritage Hills breached the agreement by refusing to honor its terms after October 19, 1990.

Jetz first argues the trial court erred in determining Heritage Hills breached its agreement with Macke by failing to give written notice within 60 days of October 19, 1990. Jetz contends the plain language of the contract establishes notice was timely given.

"Where the facts are not disputed, summary judgment is appropriate.... [I]f the only questions presented are questions of law, the summary judgment is proper. [Citation omitted.]" Finstad v. Washburn University, 252 Kan. 465, 468, 845 P.2d 685 (1993).

"The construction of a written instrument is a question of law, and the instrument may be construed and its legal effect determined by the court on appeal. [Citation omitted.]" Barbara Oil Co. v. Kansas Gas Supply Corp., 250 Kan. 438, 455, 827 P.2d 24 (1992). Further, "regardless of the construction given a written contract by the trial court, an appellate court may construe a written contract and determine its legal effect. See Kennedy & Mitchell, Inc. v. Anadarko Prod. Co., 243 Kan. 130, Syl. p 1, 754 P.2d 803 (1988)." State v. Smith, 244 Kan. 283, 284, 767 P.2d 1302 (1989).

Here, the parties agree no material facts are in dispute. The only issue presented was whether the termination of the agreement provision was complied with when the written notice was mailed by Heritage Hills or when received by Macke. Accordingly, the issue presented was appropriate for summary judgment.

In interpreting an agreement, if the language "is clear and can be carried out as written, there is no room for rules of construction." Simon v. National Farmers Organization, Inc., 250 Kan. 676, 680, 829 P.2d 884 (1992). "To be ambiguous, a contract must contain provisions or language of doubtful or conflicting meaning, as gleaned from a natural and reasonable interpretation of its language." 250 Kan. at 680, 829 P.2d 884.

Both parties argue the contract is unambiguous but place differing interpretations upon the termination provision. Macke contends the language "giving written notice thereof by mail to the other party" requires notice of termination be received before it is effective. Jetz, on the other hand, contends the language makes notice effective upon mailing.

After examining the agreement, we conclude it is clear and unambiguous. Our analysis has been guided by several rules of contract construction.

"First, words cannot be written into the agreement imparting an intent wholly unexpressed when it was executed. Quenzer v. Quenzer, 225 Kan. 83, 85, 587 P.2d 880 (1978). The intent of the parties and the meaning of a contract are to be determined from the plain, general, and common meaning of terms used. Johnson v. Johnson, 7 Kan.App.2d 538, 542, 645 P.2d 911, rev. denied 231 Kan. 800 (1982). Second, in construing a written instrument, language used anywhere in the instrument should be considered and construed in harmony with all provisions and not in isolation. Kennedy v. Classic Designs, Inc., 239 Kan. 540, 722 P.2d 504 (1986). Further, doubtful language in a contract is construed most strongly against the party preparing the instrument or employing the words concerning which doubt arises. First National Bank of Lawrence v. Methodist Home for the Aged, 181 Kan. 100, 104, 309 P.2d 389 (1957)." Wood River Pipeline Co. v. Willbros Energy Services Co., 241 Kan. 580, 586, 738 P.2d 866 (1987).

The trial court found that the Heritage Hills-Macke agreement was a private service contract, not a lease, and therefore "not subject to compliance with statutory notice requirements for termination of leases." Relying on Mosher v. Kansas Co-op. Wheat Mkt. Ass'n., 136 Kan. 269, 276, 15 P.2d 421 (1932), the trial court then concluded that Macke was entitled to at least 60 days actual notice of the termination, measured from the date the notice was received.

Macke contends Mosher requires the termination provision to be construed against the party terminating the agreement.

In Mosher, the Supreme Court reversed the trial court's determination that a grain delivery contract was void for indefiniteness and held the elevator operator had breached the contract. The contract provided both parties an option of early termination by giving notice of their intentions to do so prior to the first day of April. The grain elevator operator argued its April 17, 1926, notice was sufficient to cancel the contract. In rejecting this argument, the court stated:

"The parties had a right to agree on a means of terminating the contract, and such provision is binding and will be...