Tri-Continental Leasing Co. v. Neidhardt

• Decision Date: 10 August 1976
• Docket Number: TRI-CONTINENTAL,No. 37245,37245
• Citation: 540 S.W.2d 210
• Parties: LEASING CO., Plaintiff-Appellant, v. Arthur F. G. NEIDHARDT et al., Defendants-Respondents. . Louis District, Division Three
• Court: Missouri Court of Appeals

Page 210

540 S.W.2d 210

96 A.L.R.3d 848

TRI-CONTINENTAL LEASING CO., Plaintiff-Appellant, v. Arthur F. G. NEIDHARDT et al., Defendants-Respondents.

No. 37245.

Missouri Court of Appeals, St. Louis District, Division Three.

Aug. 10, 1976.

Davis & Davis, Warren W. Davis, Robert Schwendinger, Clayton, for plaintiff-appellant.

Ziercher, Hocker, Tzinberg, Human & Michenfelder, George Bude, Clayton, Nick Vasileff, Madison, Ill., and Warren Friedman, St. Louis, for defendants-respondents.

GUNN, Judge.

This appeal concerns an action for tortious interference with a contract. Plaintiff-appellant, Tri-Continental Leasing Company (Tri-Continental) instituted action against the defendants-respondents, Arthur Neidhardt, Louis Levin, and Midwest Petroleum Company (Midwest) alleging that defendants, in some sort of cabal and without justifiable cause, procured the breach of a leasing agreement between the plaintiff and James Rayfield, thereby euchring plaintiff out of a profit. Pursuant to the agreement, Rayfield was to lease commercial laundry equipment from Tri-Continental for a term of 60 months. Tri-Continental sought both actual and punitive damages. The jury awarded the plaintiff $9,600 in actual damages and assessed punitive damages against defendant Neidhart at $2,000, against defendant Levin at $5,000, and against defendant Midwest at $5,000. The trial court sustained the defendants' motions for directed verdict and thereby set aside the jury verdict. The plaintiff appeals the ruling, asserting that the evidence was sufficient to support the jury verdict.

Prior to presentment of the facts, we delineate the general legal principles that govern this appeal and which gave direction to a denouement of this complex case. To make a submissible case under its theory of recovery, the plaintiff must produce substantial evidence that will support each and every element of the cause of action. No fact essential to submissibility can be inferred in the absence of a substantial evidentiary basis. Liability cannot be based upon speculation, conjecture or guesswork. Probst v. Seyer, 353 S.W.2d 798 (Mo.1962); Frazier v. Stone, 515 S.W.2d 766 (Mo.App.1974); Merriman v. Johnson, 496 S.W.2d 326 (Mo.App.1973). When asserting a cause of action for intentional inducement of a breach of contract, the plaintiff must show that the defendant maliciously, that is, with knowledge of the contract and without justifiable cause, induced the breach. Cady v. Hartford accident and Indemnity Co., 439 S.W.2d 483 (Mo.1969); Downey v. United Weather Proofing, Inc. 363 Mo. 852, 253 S.W.2d 976 (1953). ¹ To properly submit its case, the plaintiff must establish by substantial evidence the following five elements: 1) that a contract was in existence; 2) that the defendant had knowledge of the contract; 3) that the defendant induced or caused the breach of the contract; 4) that the defendant's acts were not justified; and 5) that the plaintiff thereby suffered damages. Cady v. Hartford Accident and Indemnity Co., supra; Downey v. United Weather Proofing, Inc., supra. See also Harber v. Ohio National Life Insurance Company, 390 F.Supp. 678 (E.D.Mo.1974) aff'd, 512 F.2d 170 (8th Cir. 1975); 45 Am.Jur.2d Interference, § 39 (1969). We find that the plaintiff has failed to meet its burden as to the third element--that the defendants induced or caused the breach of the contract--and will assume arguendo that the plaintiff has produced sufficient evidence to establish the other elements of its cause of action.

In determining whether the plaintiff has made a submissible case, and, consequently, whether the trial court erred in setting aside the jury verdict, we are guided by the rather primordial principle that we must view the evidence in the light most favorable to the plaintiff and give the plaintiff the benefit of all inferences which may be reasonably drawn from the evidence that supports its cause of action. Smith v. Allied Supermarkets, Inc., 524 S.W.2d 848 (Mo.banc 1975). Of course, we will not make the plaintiff's case for it by supplying mising evidence. Merriman v. Johnson, supra; Graham v. Conner, 412 S.W.2d 193 (Mo.App.1967). Having so postulated, we now essay dauntedly and with effort to collocate the relevant facts deducible from the somewhat desultory gallimaufry of evidence produced by plaintiff. ² In fairness, we note that plaintiff was plagued by fulsome interruptions in the form of objections from defendants' attorneys which permeated the entire trial and which in turn has made difficult our task of assimulating a sensible factual statement.

The identity of the parties and their relationship to one another is as follows. The plaintiff, Tri-Continental, was in the business of leasing equipment to be used for manufacturing or in commercial enterprises. James Rayfield, an individual who desired to go into the laundry business, executed a lease for commercial laundry equipment with Tri-Continental. Defendant Arthur Neidhardt, d/b/a Monday's Maid Coin Laundry, was a distributor for Cook Equipment Company of Dallas, Texas, which manufactured the laundry equipment to be used by Rayfield in his laundromat. Defendant Midwest owned the land upon which Rayfield's laundromat was to be located. Defendant Louis Levin was the president of Midwest.

In early 1972, James Rayfield met with Arthur Neidhardt to discuss the possibility of Rayfield's opening a Monday's Maid Coin Laundry operation. About the same time, Louis Levin approached Neidhardt with the idea of establishing a laundromat on property owned by Midwest in Belleville, Illinois. Levin and Neidhardt had been involved in previous business transactions involving car washes and laundromats. Neidhardt introduced Rayfield to Levin and they discussed leasing Midwest's property to Rayfield for the purpose of operating a laundromat. Rayfield thereupon entered into a lease with Midwest. Rayfield had difficulty in obtaining financing for the purchase of the laundry equipment, so he turned to Neidhardt and Levin for assistance in obtaining the needed financing. Neidhardt contacted Levin asking him if he knew of anyone who would either finance or lease the equipment to Rayfield. Leving or lease the equipment to Rayfield. Levin with Tri-Continental and introduced Neidhardt and Rayfield to Orion Litzinger, Jr., an officer of Tri-Continental. Negotiations were held, and near the end of March 1972, a lease agreement was entered into between Tri-Continental and Rayfield. In essence, the lease agreement was a financing arrangement whereby Rayfield was able to obtain the necessary equipment to run his laundromat.

The lease between Tri-Continental and Rayfield was signed by Rayfield and his wife on March 20, 1972 and by the president of Tri-Continental. Under the terms of the agreement, Tri-Continental was to obtain the laundry equipment from a supplier and Rayfield was to lease the equipment for a period of 60 months with an option to purchase the equipment at the end of the term for $3,300. Monthly payments were to be $932. The lease was to begin on August 5, 1972 and was contingent upon Rayfield's obtaining a lease of the Belleville site from Midwest. ³ Before the lease was signed, Tri-Continental required Rayfield to pay $932 as earnest money. Rayfield only had $500 but was able to satisfy this requirement by obtaining a loan of $450 from Neidhardt.

In addition to the actual lease agreement, Tri-Continental required that several other documents be executed. These were designed to provide additional security for the performance of the lease. Tri-Continental viewed these documents as indispensible due to the low collateral value of the laundry equipment itself. ⁴ One such document was a lease purchase agreement entered into between Tri-Continental and Midwest on March 20, 1972, by which Midwest guaranteed performance of the lease. Pursuant to the terms of this agreement, if Rayfield defaulted within the first 30 months of the lease, Tri-Continental could demand that Midwest purchase the laundry equipment for $20,000. If Rayfield were to default in the last 30 month period of the lease, Tri-Continental could demand that Midwest purchase the equipment for $15,000. In conjunction with this agreement, Tri-Continental required that the board of directors of Midwest pass a resolution authorizing Levin, as its president, to execute the lease purchase document. This was accomplished on March 20, 1972. Tri-Continental also entered into a 'holdback' agreement with defendant Neidhardt. Pursuant to this document, Tri-Continental was permitted to hold back $10,000 of Neidhardt's commission from the sale of the laundry equipment for a period of 30 months. If Rayfield were to default on the lease, the $10,000 would be paid over to Tri-Continental as liquidated damages. The holdback agreement was executed April 13, 1972. As further security, Rayfield was required to supply Tri-Continental with a note and deed of trust on his home. At the time of the signing of the lease, Litzinger gave Rayfield an additional document, a delivery and acceptance form, which was to be signed and returned by Rayfield once the equipment was delivered and in good working order. Under the terms of the delivery and acceptance form, Tri-Continental's obligation to pay Cook Equipment (the equipment manufacturer) for the equipment was contingent upon receipt of the completed document from Rayfield. ⁵

After the equipment lease had been signed, Tri-Continental sought to obtain financing for the purchase of the equipment. After being unsuccessful with a New York bank, Tri-Continental was able to secure a letter of commitment from the Bank of St. Louis. The letter, which was introduced into evidence, was dated April 17, 1972 and committed the bank to loan Tri-Continental $40.000. The letter provided that the commitment would extend through June 20, 1972. ⁶ Upon receipt of the commitment letter, Tri-Continental sent a purchase order for the laundry...