Wieberg v. Resthaven Gardens of Memory, Inc.
| Decision Date | 05 February 1991 |
| Docket Number | No. 89-1509-C.,89-1509-C. |
| Citation | 759 F. Supp. 687 |
| Parties | Nick WIEBERG, d/b/a Family Memorial Planning Inc., and Family Memorial Planning Inc., Plaintiffs, v. RESTHAVEN GARDENS OF MEMORY, INC., and Harry D. "Hap" Bledsoe, Defendants. |
| Court | U.S. District Court — District of Kansas |
Randall K. Rathbun, DePew, Gillen & Rathbun, Wichita, Kan., for plaintiffs.
Stephen P. Weir, Carpenter, Weir & Myers, Topeka, Kan., for defendants.
The case comes before the court on the defendants' motion for summary judgment (Dk. 23), motion to strike and for attorney's fees (Dk. 34), and supplemental motion for partial summary judgment (Dk. 44). This lawsuit ensues from the termination of business dealings between the parties. In October of 1986, the parties entered into a business relationship concerning Resthaven Gardens of Memory, Inc. ("Resthaven"), a cemetery and mortuary in west Wichita, Kansas. The parties executed a written sales agency contract in March of 1987, whereby Family Memorial Planning, Inc. ("Family Memorial") would market cemetery property and funeral merchandise on behalf of Resthaven. Plaintiff Family Memorial alleges the defendants breached the sales contract and owes as damages those commissions earned and the profits lost from the last eight months of the sales contract. Plaintiff, Nick Wieberg ("Wieberg"), alleges defendant, Harry D. "Hap" Bledsoe ("Bledsoe") fraudulently misrepresented his intentions to sell his stock in Resthaven to Wieberg thereby damaging Wieberg who relied upon the representation in moving his family to Wichita. Finally, Wieberg alleges Bledsoe orally agreed to sell his stock, and Wieberg seeks to recover $1,300,000 under the theory of promissory estoppel for the loss of the benefit of that bargain. Defendants generally deny the factual allegations and assert several legal challenges, some of which are the grounds of these motions.
A motion for summary judgment gives the judge an initial opportunity to assess the need for a trial. Without weighing the evidence or determining credibility, the court grants summary judgment when no genuine issue of material fact exists and the movant is entitled to judgment as a matter of law. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250, 106 S.Ct. 2505, 2511, 91 L.Ed.2d 202 (1986). Essentially, the inquiry is "whether the evidence presents a sufficient disagreement to require submission to a factfinder or whether it is so one-sided that one party must prevail as a matter of law." Anderson, 477 U.S. at 251-252, 106 S.Ct. at 2512.
An issue of fact is "genuine" if the evidence is significantly probative or more than merely colorable such that a jury could reasonably return a verdict for the nonmoving party. Id. at 248, 106 S.Ct. at 2510. An issue of fact is "material" if proof of it might affect the outcome of the lawsuit. 477 U.S. at 249, 106 S.Ct. at 2510. Factual inferences are drawn to favor the existence of triable issues, and where reasonable minds could ultimately reach different conclusions, summary judgment is inappropriate. See Riley v. Brown & Root, Inc., 896 F.2d 474, 476-77 (10th Cir.1990).
The movant's initial burden under Fed.R. Civ.P. 56 is to show the absence of evidence to support the nonmoving party's case. Windon Third Oil and Gas v. Federal Deposit Ins., 805 F.2d 342, 345 (10th Cir. 1986), cert. denied, 480 U.S. 947, 107 S.Ct. 1605, 94 L.Ed.2d 791 (1987). The movant must specify those portions of "`the pleadings, depositions, answers to interrogatories and admissions on file, together with affidavits if any,'" which demonstrate the absence of a genuine issue of fact. Windon, 805 F.2d at 345 (quoting Fed.R.Civ.P. 56(c)). It may be sufficient for the movant to establish that the alleged factual issues are without legal significance. Dayton Hudson Corp. v. Macerich Real Estate Co., 812 F.2d 1319, 1323 (10th Cir.1987).
The opposing party may not rest upon mere allegations or denials in the pleadings but must set forth specific facts supported by the kinds of evidentiary materials listed in Rule 56(c). Anderson, 477 U.S. at 250, 106 S.Ct. at 2511. The evidence is deemed true and all reasonable inferences are drawn in his favor. Windon, 805 F.2d at 346. More than a "disfavored procedural shortcut," summary judgment is an important procedure Celotex Corp. v. Catrett, 477 U.S. 317, 327, 106 S.Ct. 2548, 2555, 91 L.Ed.2d 265 (1986).
For purposes of these motions, the following facts are uncontroverted:
1. In October of 1986, Wieberg and Bledsoe verbally agreed that Wieberg would assume sales responsibilities for Resthaven and, in return, would receive commissions for the sales.
2. Also during these discussions, Wieberg understood Bledsoe to say that he needed someone young and enthusiastic about sales to come to Wichita and set up a sales program for Resthaven. If the person performed, Bledsoe said he was interested in selling Resthaven because he was sixty-five years old. Wieberg understood that he had to move to Wichita, build capital by generating sales under the sales contract, and prove that he could run Resthaven and make the payments necessary for purchasing it. Wieberg said that Bledsoe offered to sell his stock in Resthaven for $3,700,000 if Wieberg could come up with $1,000,000 and Bledsoe then would carry the balance of $2,700,000 over a ten year period on an annually renewable note if Wieberg also could show that he could make the payments, that he could run the pre-need sales program at Resthaven, and could generate enough receivables that if sold would pay off 60% of the $2,700,000 note one year after the stock conveyance. Wieberg also testified that Bledsoe told him:
3. On March 5, 1987, Wieberg and Bledsoe entered into a written agreement in which, among other things, the defendants agreed to pay commissions on sales and the plaintiffs agreed to fulfill certain sales quotas. The agreement provided for its cancellation by Family Memorial upon thirty days prior written notice to Resthaven. By letter dated April 19, 1989, plaintiffs' attorney gave thirty days notice of their intent to cancel this contract and further stated:
This cancellation is not a voluntary act on the part of FMPI. This is only being done to avoid any unnecessary harm or interruption in your business affairs. As far as FMPI is concerned, you have deliberately breached this contract and deliberately expelled them from the premises as a practical matter.
4. Wieberg and Bledsoe never entered into any written contract concerning the sale of Resthaven stock. This sale of stock never occurred.
5. Wieberg believed that as of June 1987 he had built the receivables to a level which satisfied one of the conditions to his purchase of the stock. He recalls the last conversation with Bledsoe about acquiring the stock occurred before July 1, 1987. Wieberg believed that in late summer or early fall of 1987, defendant Bledsoe had decided to renege on the sale of Resthaven stock.
6. Plaintiffs filed this lawsuit on September 20, 1989.
Defendants argue that plaintiff's claim for breach of an oral agreement to sell Resthaven stock must fail, as the agreement is not in writing nor meets any of the exceptions of K.S.A. 84-8-319, and, therefore, is unenforceable. Citing Mildfelt v. Lair, 221 Kan. 557, 561 P.2d 805 (1977), defendant further contends the plaintiff may not recover on its fraud claim based on misrepresentations about the stock sale agreement, because a tort action may not be maintained if based on promises or representations stemming from an oral contract that is unenforceable as a result of the statute of frauds.
Plaintiff Wieberg says his claim for breach of the oral agreement to sell stock is grounded on the theory of promissory estoppel which he insists is an exception to the statute of frauds found at K.S.A. 84-8-319. In support of his argument on this exception, plaintiff cites the Kansas Comment 1983 to K.S.A. 84-8-319, which reads:
Presumably, common law exceptions to the statute of frauds, such as promissory estoppel, would also be available under this provision, as they are under the statute of frauds in Article 2. See Decatur Coop. Ass'n v. Urban, 219 Kan. 171, 547 P.2d 323 (1976). See, however, Thomas v. Prewitt, 355 So.2d 657 (Miss.1978), where the court stated that it need not recognize estoppel as a non-statutory exception to the statute of frauds under this section.
Plaintiff also cites the case of Kiely v. St. Germain, 670 P.2d 764 (Colo.1983), holding that the doctrine of promissory estoppel may be invoked to enforce an oral agreement for the sale of stock in the face of a statute of frauds defense under Uniform Commercial Code provision, § 8-319.
Defendant replies that the issue of promissory estoppel being an exception to K.S.A. 84-8-319 is one of first impression in Kansas. Defendant calls the Kansas Comment 1983 to § 8-319 speculative. Additionally, defendant cites the Thomas case referred to in the comment as a decision counter to the Kiely case. Without leave of the court, plaintiff filed a response to defendant's reply and argued that Thomas was factually inapplicable and no longer representative of the law in Mississippi.
The availability of a promissory estoppel exception under § 8-319 has not been squarely addressed by any Kansas court to date. It is also true that other courts are divided on this issue. Nevertheless, an obvious answer is yielded from reviewing Kansas law on related issues and discerning the rationale for the...
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Holmes v. Torguson
...that the Minnesota Supreme Court would apply equitable estoppel to Sec. 8-319 as well. See generally Wieberg v. Resthaven Gardens of Memory, Inc., 759 F.Supp. 687 (D.Kan.1991). However, to avoid the statute of frauds by equitable estoppel requires proof of a misrepresentation or concealment......
- US v. Bailey, Cr. A. No. 90-CR-191.