Stiff v. Stiff
| Decision Date | 24 March 1999 |
| Docket Number | No. 22176,22176 |
| Citation | 989 S.W.2d 623 |
| Parties | R. Douglas STIFF and Laura W. Stiff, Plaintiffs-Respondents, v. Robert H. STIFF, Jr., and B.T. Bones Branson Steakhouse, Inc., Defendants-Appellants. |
| Court | Missouri Court of Appeals |
Randall J. Reichard, Lowther, Johnson, Joyner, Lowther, Cully & Housley, Springfield, for appellants.
William Stoner, Springfield, for respondents.
Plaintiffs sued Robert H. Stiff, Jr. ("Bob") requesting that the trial court order Bob to specifically perform a buy-out provision in a shareholders' agreement. 1 The shareholders' agreement related to the corporate stock of B.T. Bones Steakhouse, Inc. ("the Corporation"). Bob and the Corporation (collectively called "Defendants" herein) counterclaimed, alleging that Plaintiffs breached a duty of loyalty to the Corporation. The trial court entered judgment for Plaintiffs on both claims. Defendants appeal. We reverse and remand in part; we affirm in part.
This is a dispute between family members who hold most of the shares of the Corporation. The Corporation was organized in 1991 to operate a restaurant in the Branson area. Shortly after its incorporation, Bob solicited family members, including Plaintiffs, for money to help finance the proposed business. Ultimately, Plaintiffs invested $150,000 in the On June 4, 1992, the shareholders agreed to the following:
Corporation for which they received forty percent of its outstanding shares. The other original shareholders and their percentages of ownership were: Bob, forty percent; Mr. and Mrs. Larry Snyder, five percent; Mr. and Mrs. Harold Pate, five percent; and Mr. and Mrs. Robert Stiff, Sr., ten percent.
....
By July 1994, the triggering event mentioned in paragraph 20 D) had occurred, i.e., the Corporation was paying Bob a salary of $1,000 per week. On July 14, Plaintiffs wrote Bob requesting that he purchase their forty percent stock interest in the Corporation for $556,000. When Bob failed to respond, Plaintiffs sued the Corporation, seeking a judicial dissolution of that entity. Later, Plaintiffs filed a multiple-count amended petition against Defendants. In Count II, Plaintiffs asked the trial court to order Bob to specifically perform under the shareholder agreement by paying Plaintiffs $556,000 for Plaintiffs' interest in the Corporation. 2 Defendants responded with a counterclaim that charged Plaintiffs had breached their duty of loyalty to the Corporation and sought damages therefor. Ultimately, the case went to trial on a second amended petition for specific performance and on Defendants' counterclaim.
The court heard the case on April 28, 1997, and took it under advisement. On May 16, 1997, the court made the following docket entry:
"The [court] finds that under para 20(d) of the shareholder's agreement [Bob] is obligated to purchase the shares ... of [Plaintiffs]; that the purchase price is to be determined as set forth in paragraph 8 of said agreement; that the parties have never agreed, in writing, as to the value of said shares of stock; that para. 8 provides that an independent appraiser shall value said stock in the event that the parties haven't agreed in writing; that this [court] is acting in equity and can fashion remedies for the parties; that the parties cannot agree upon an independent appraiser...."
The court named three persons as appraisers, ordered them to value the stock as of July 14, 1994, and directed them to complete the appraisals within ninety days. It also ordered all parties to furnish any information requested by the appraisers.
As of December 23, 1997, the court-appointed appraisers had not completed their work. Several factors contributed to their failure to perform, including Bob's alleged refusal to furnish information about the corporation. Thereon, the trial judge made the following docket entry:
"The [court] finds that the appraisers appted by this [court] in its entries of 5-16-97 and 6-25-97 have been unable to meet and value the stock of the corporation as of 7-14-94 because of the failure or
refusal of [Bob] to furnish them with information necessary to form their opinions.
In this same docket entry, the judge assessed costs and allocated responsibility for the appraisers' fees and then directed Plaintiffs' lawyer to submit a "formal" judgment for his signature. A later docket entry ruled Defendants' counterclaims adversely to them.
The judgment did not include or incorporate all of the trial judge's findings as entered on the docket sheet. Leaving out the caption, opening paragraph, cost and expense assessments, and judge's signature, the judgment reads:
This appeal followed.
In his first point, Bob argues that the trial court erred in ordering specific performance of the buy-out provision because there was no evidence in this record of a "written valuation agreed upon by the shareholders" as described in the contract, no evidence of stock value established by independent appraisal as contemplated by the contract, and no evidence from any source "about the precise value of the stock" as of July 14, 1994.
Plaintiffs filed a brief with this court but it does not respond to Bob's first claim of trial court error. In oral argument, however, Plaintiffs conceded the correctness of part of Bob's first point, i.e., there is no evidence in this record of a "written valuation agreed upon by the shareholders" as contemplated by the shareholder agreement.
As best we can glean from Plaintiffs' comments during oral argument, they appear to say that certain testimony by Doug, along with an excerpt from a shareholder meeting held March 24, 1994, supports the $556,000 figure used by the trial court when it ordered specific performance. We disagree. Neither the minutes nor Doug's testimony provides substantive evidence regarding the source of the $556,000 figure.
Doug testified that in January 1994 he learned from Bob that a firm called "Roberts and Associates" of Springfield, Missouri, had appraised the Corporation at Bob's request. However, that appraisal was never admitted into evidence because the trial court sustained Bob's objection thereto.
The Roberts and Associates' appraisal was discussed at a March 24, 1994, shareholder meeting, and the minutes of that meeting are in evidence. We reproduce that part of the minutes concerning the appraisal.
The following is Doug's only testimony concerning the $556,000.00 figure.
The attorneys and the judge then had a lengthy colloquy, which ultimately ended in this fashion:
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