Wade v. Culp
| Decision Date | 29 November 1939 |
| Docket Number | 16099. |
| Citation | 23 N.E.2d 615,107 Ind.App. 503 |
| Parties | WADE et al. v. CULP. |
| Court | Indiana Appellate Court |
Walter R. Arnold and John Degnan, both of South Bend, for appellants.
Yeagley & Yeagley, of South Bend, for appellee.
This action was instituted by the appellee against the appellants to recover damages against the appellants for wrongfully conspiring together to cause a breach of contract between the appellee and the appellant Charles T. Wade.
The issues were closed by an answer in general denial and the case was submitted to the court for trial without jury and the court made a special finding of facts and stated conclusions of law thereon. The court found for the appellee and rendered judgment in his favor against the defendants in the sum of $4984. The exceptions to the conclusions of law are the basis of the assigned errors in this court.
The findings of fact are long and it would serve no good purpose to embody them all in this opinion. It is sufficient to say that the complaint alleged and the facts as found by the court recite that in 1933 the appellee, George K. Culp, was engaged in the manufacturing business in Dowagiac, Michigan that prior to June 21, 1933, Charles T. Wade, appellant herein, consulted with Culp about the possibility of inventing an electric steak broiler. As a result of these interviews, the said Charles T. Wade and George K. Culp entered into a contract by the terms of which the appellee agreed to furnish his shop facilities, materials, engineers designers, money and the necessary wherewithal to enable the said Charles T. Wade to develop a working model of said steak broiler along the lines indicated by the said Wade. It was further agreed that after such working model had been perfected, the said Culp was to arrange for the production and sale of such commodity, the said Wade to have twenty percent interest in the enterprise. It was further stipulated that the said Wade should continue to be employed at a satisfactory salary so long as his services were satisfactory.
The court further found that at the time of the making of said contract, the said Culp had in his employment a civil engineer whose name was Shrum, and the said Wade, together with the said Shrum, entered upon the work of perfecting a steak broiler and the said Culp furnished his factory, his employees, material, and money necessary in the development of said broiler. After said broiler had been so developed that the model worked successfully, the said Culp began contacting different manfacturing establishments respecting the manufacture and sale of said broiler. On May 4, 1934 Culp was notified by Wade that he had made arrangements for the production and sale of said broiler by the Electric Sprayit Company, appellant herein, and had assigned all his patent and other rights in connection therewith to them. The court further found as a fact that prior to said date and in February or March, the said Wade had contacted the Electric Sprayit Company through its president, Simon Deutsch, in an effort to induce them to take over the manufacturing and sale of the electric steak broiler. Following said interview, said appellant Deutsch submitted a proposition to the said Wade for the purpose of inducing the said Wade to abandon the said contract he had with Culp and to contract with the appellant Electric Sprayit Company for the purpose of manufacturing and marketing the electric steak broiler. This contract was subsequently entered into between the said Wade and the Electric Sprayit Company, by the terms of which contract the Electric Sprayit Company employed Wade to devote his full time and effort to the development and improvement of said broiler. As a part of this contract the said Wade assigned all his rights, title, and interest in said electric broiler to the Electric Sprayit Company. After the said Electric Sprayit Company had entered into this contract, said company also entered into a contract with the appellee's engineer Shrum for his services and the said Shrum also agreed to devote his entire time to the development and improvement of said broiler. Following the execution of said contracts, the Electric Sprayit Company notified all the manufacturing establishments with whom they knew Culp had been dealing that the said Culp had no further interest in the electric steak broiler and that all of the rights pertaining to the same were now owned by the Electric Sprayit Company.
The court further found by Finding No. 15: "That thereafter, to-wit: after the said defendant, Charles T. Wade, and D. J. Shrum identified themselves with the defendant, Electric Sprayit Company, as hereinbefore found and after said notices were sent out to different manufacturing institutions by the said defendants, the plaintiff herein was unable to carry on and to further perform his contract with the defendant, the said defendant, Electric Sprayit Company, and said defendant, Charles T. Wade, and with the said D. J. Shrum, and because of such notices sent by said defendants to other manufacturing industries."
The court further found that the said Culp had expended in the furnishing of materials, labor, and manufacturing facilities the sum of $8,661 in the development of said model and "that the plaintiff (Culp) lost all of the money by him expended in the performance of his contract with the defendant Charles T. Wade."
Finding No. 21 of the court is as follows: "That the defendants herein did collude and conspire together for the purpose of rendering the plaintiff unable to perform his contract with the defendant, Charles T. Wade."
On this finding of facts the court stated its conclusions of law as follows:
The errors assigned and the propositions discussed by the appellants challenge the correctness of these conclusions of law. The appellants contend that the trial court erred in its conclusion of law No. 1, first for the reason that Wade had a right to sell the subject matter of the enterprise and that such a sale actually resulted in the final objective which the agreement contemplated. We cannot agree with these contentions. We think it sufficient answer to these contentions to note that the appellee by the terms of his contract was given the express right to arrange for the production and sale of this device. This right was definitely denied him by the conduct of the appellants and we cannot assume that such conduct was harmless.
It will be noted by the court's finding No. 21, above quoted, that the appellants herein did collude and conspire together for the purpose of rending Culp unable to perform his contract. This finding of fact must be accepted as true by this court on appeal. Ft. Wayne Smelting & Refining Works v. City of Ft. Wayne, 1938, 214 Ind. 454, 14 N.E.2d 556; Central Pharmacal Co. v. Salb, Ind.App., 1938, 13 N.E.2d 875; Mooresville Building, Savings & Loan Ass'n v. Thompson et al., 1937, 212 Ind. 306, 9 N.E.2d 101. Such conduct on the part of the appellants resulted in a loss to the appellee and their conduct was therefore wrongful and unlawful. The rule in such cases has been announced as follows: 11 Amer.Juris. Sec. 50.
The appellants also contend under their first assignment of error that there can be no cause of action for inducing a breach of contract unless the same has been accomplished by the employment of force, threats, intimidation, or fraud. They rely upon Jackson v. Morgan, 1911, 49 Ind.App. 376, 94 N.E. 1021, as authority for their contention. In America as well as in England, it is uniformly held that inducing a breach of contract by use of force, threat of force, or fraud is actionable. If the elements of intimidation and fraud are absent, the great majority of American states nevertheless still follow the English doctrine which allows a right of action for maliciously procuring a breach of contract regardless of the nature of that contract. 41 Harvard Law Review 728; 33 Mich.Law Review 943. The rule has frequently been announced that: "A person that induces a party to a contract to break it, intending thereby to injure another person or to get a benefit for himself commits an actionable wrong unless there is sufficient justification for interference." 15 Ruling Case Law 54.
The court found as a fact in the case at bar that the defendants by their conduct intended to interfere with the business of the plaintiff and...
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