Wigley v. Capital Bank of Southwest Missouri

• Decision Date: 18 October 1994
• Docket Number: 18916 and 18917,Nos. 18913,s. 18913
• Citation: Wigley v. Capital Bank of Southwest Missouri, 887 S.W.2d 715 (Mo. App. 1994)
• Parties: Fred J. WIGLEY, Plaintiff-Respondent, v. CAPITAL BANK OF SOUTHWEST MISSOURI, Robert Hale King, and Majir Kornblit, Defendants-Appellants.
• Court: Missouri Court of Appeals

Page 715

887 S.W.2d 715

Fred J. WIGLEY, Plaintiff-Respondent, v.CAPITAL BANK OF SOUTHWEST MISSOURI, Robert Hale King, and Majir Kornblit, Defendants-Appellants.

Nos. 18913, 18916 and 18917.

Missouri Court of Appeals,

Southern District,

Division Two.

Oct. 18, 1994.

Motion for Rehearing and/or Transfer to

Supreme Court Denied Nov. 9, 1994.

Application to Transfer Denied

Dec. 20, 1994.

Brian Timothy Meyers, Gotschall and Meyers, Kansas City, James B. Condry, Lynn C. Rodgers, Hall, Ansley, Rodgers & Condry, Springfield, for plaintiff-respondent.

Jason M. Rugo, Patricia S. Williams, Gallop, Johnson & Neuman, L.C., St. Louis, Joe C. Greene, Benn K. Upp, Greene & Curtis, Springfield, for defendant-appellant Capital Bank of Southwest MO.

Kurt H. King, Liberty, for defendant-appellantRobert Hale King.

Richard E. Dorr, Dorr, Bair and Lightner, P.C., Springfield, for defendant-appellantMajir Kornblit.

PREWITT, Judge.

Plaintiff filed a four-count petition seeking damages from defendants.Count I alleged breach of contract against defendant Kornblit.Count II claimed defendant Capital Bank of Southwest Missouri (Capital Bank) tortiously interfered with plaintiff's agreement with defendant Kornblit, seeking actual and punitive damages for that interference.Count III sought actual and punitive damages against defendant King, also for tortious interference of that contract.Count IV alleged that defendants conspired to interfere with the contract between plaintiff and defendant Kornblit, seeking actual and punitive damages against each defendant.Defendant Capital Bank counterclaimed, alleging that plaintiff had guaranteed a note of Crystal Cube Ice Co. for $399,762.33 which was unpaid.

Following jury trial, verdicts were returned in favor of plaintiff on Count I for $250,000; on Counts II and III, $850,000 actual damages, $500,000 punitive damages against Capital Bank and $1,100,000 punitive damages against defendant King; Count IV $3.00 actual damages, $100,000 punitive damages against defendant Capital Bank, $100,000 punitive damages against defendant King and $50,000 punitive damages against defendant Kornblit.A verdict was also returned denying Capital Bank's counterclaim.Judgment was entered in accordance with the verdicts.Each defendant appeals and the appeals have been consolidated.

On appeal the evidence and inferences therefrom are viewed in the light most favorable to plaintiff, as the prevailing party, and all contrary evidence is disregarded.Community Title v. Roosevelt Federal S & L, 796 S.W.2d 369, 371(Mo. banc 1990).

Plaintiff developed a process for transporting ice in medium temperature trucks.This enabled ice to be distributed along with other grocery products through a warehouse, resulting in more versatile availability for businesses purchasing ice and lower costs of production and delivery.

Plaintiff enlisted defendant Kornblit for financial help in constructing a facility to produce ice using the process he had developed.In November 1987, the two secured a contract with Associated Wholesale Grocers to buy and warehouse ice.Additionally, plaintiff began to reach agreements with others to buy ice through the warehouse program.A business plan was submitted to Landmark Bank, who in January 1988 approved, with contingencies, a loan of $1.1 million.¹

In May 1988 Crystal Cube was incorporated and plaintiff began to search for a location to build the ice facility.In the summer of 1988 Wigley met defendant King, who owned a building.King contributed the land and building, plus a promise to inject $150,000 cash, in exchange for 1/3 of the stock.Plaintiff granted the corporation a license to use his patented ice distribution process.

Plaintiff's claims arise from a "Stockholders' Agreement" entered into in August or September of 1988 by plaintiff, defendant Kornblit and Tom Sanford.The agreement recites that they are the incorporators of Crystal Cube Ice Company(Crystal Cube), a Missouri corporation.It states that the company intends to construct an ice plant in Springfield, Missouri and to finance the construction applied for a Small Business Administration (S.B.A.) loan of $450,000 and a conventional bank loan of $400,000.The bank loan was with defendant Capital Bank, although the agreement does not so state.Plaintiff and defendant Kornblit were to personally guarantee the loans.

Defendant King is not a party to the agreement, but it states that he agreed to convey certain land and buildings to the corporation subject to a mortgage of $77,500 plus pay $150,000 to Crystal Cube for one-third of its issued stock.The agreement says that the incorporators intend to issue 25,000,000 shares of stock.The remaining 2/3 of the stock is to be issued to defendant Kornblit.Kornblit agrees that when the indebtedness to the S.B.A. and the bank has been paid, "or at such time as he is released from the guaranty thereon, he will assign and transfer ... twenty-eight and one-third percent (28.333%--7,083,333 shares) to Fred Wigley."

In September, 1988 Landmark made a loan for $400,000 payable March 14, 1989.An additional $450,000 was loaned by Landmark by a 15 year note, 85% guaranteed by S.B.A.A first deed of trust on the land and buildings was to secure the notes.S.B.A. was to have a second deed of trust.Although the buildings were on lots numbered 2 and 3, the bank's deed of trust only covered lot 3.The property the bank intended the deed of trust to cover was appraised in May 1989, with improvements, at $700,000.After learning of the mistake in the deed of trust, the bank considered the loan greatly undersecured.Additionally, the bank believed their S.B.A. guaranty to be in jeopardy, as a condition of the guaranty was a valid second deed of trust on all the property.

There were difficulties constructing the ice plant and with the operation of its equipment, and disagreements between plaintiff and defendants King and Kornblit.When the $400,000 note came due March 14, 1989, Kornblit refused to pay off the note or contribute any more money, and wanted off of his guarantee.

The bank pursued a plan where King replaced Kornblit as a guarantor.The S.B.A. required King to have $260,000 in assets before S.B.A. would agree to the release of Kornblit.King had a net worth of $300,000 with his 1/3 stock interest in Crystal Cube valued at $250,000, a valuation which the bank and S.B.A. accepted.Defendant King requested the bank not to release Wigley from his guaranty and King conditioned his participation in the plan on transfer of all the shares controlled by Kornblit to him.An agreement regarding this transfer was apparently put in writing on April 1, 1989 and was modified on May 8, 1989.

On May 31, 1989, defendant bank by its "Senior Vice President" executed a document which purported to release defendant Kornblit and his wife "from any and all obligations to pay any promissory notes or other evidences of indebtedness in connection with any debt incurred by Crystal Cube Ice Company" with the bank.Below the signature of the vice president the document recited, "The above release is contingent upon the 16,666,667 shares of CRYSTAL CUBE ICE COMPANY, INC. owned by Majir Kornblit being assigned and transferred to R. Hale King and Donna J. King."

In June 1989, King signed on behalf of Crystal Cube an extension of the note due March 14, 1989.The bank "back notarized" the document making it appear to have been signed March 14 when the original note came due.Kornblit was released from his guaranty of the note, while Wigley was not.

On November 29, 1989 the bank made Crystal Cube an additional loan of $100,000 to receive a corrected deed of trust.The loan officer testified he did not expect the bank to receive payment.He said, "I needed that piece of land."The note was almost immediately charged off.Other facts are mentioned later in discussing the parties' contentions here.

Plaintiff submitted the breach of contract claim against defendant Kornblit, by an instruction requesting the jury to find if Kornblit breached the contract by not transferring 28.333% of the shares of Crystal Cube Ice Company to plaintiff"at such times as he[Kornblit] was released from the guaranty on the promissory note totalling $850,000.00".

Plaintiff's claim against defendant bank was submitted based upon it causing Kornblit to breach the contract with plaintiff"intentionally and without justification or excuse".The submission against King for tortious interference was on the same basis as the claim against the bank.The conspiracy claim was submitted by an instruction asking the jury to find if defendants"agreed that the bank would require conveyance [?] of all of the shares of stock in Crystal Cube Ice Company, Inc., in the possession of defendantMajir Kornblit to defendantRobert Hale King as a condition of release of defendantMajir Kornblit from the guaranties referred to in evidence, in order to deprive Fred Wigley of those shares".²

We first discuss plaintiff's motion to dismiss the appeal of defendant King.That motion is premised on King's after-trial motion being untimely filed.Ordinarily, Friday, May 7, 1993 would have been the last day for filing such a motion.The motion was filed on Monday, May 10, 1993.The circuit clerk's office was closed on Friday, May 7, 1993 in observation of the birthday of Harry Truman.Section 9.010, RSMo 1986, makes May 8 a public holiday.Administrative Rule 7.01.c.2.2(a) of the Missouri Supreme Court states that in "the event that a state holiday falls on a Saturday, such holiday shall be observed on the preceding Friday."

Rule 44.01(a) provides that when the last day of a period for filing is a Saturday, Sunday or legal holiday, the period runs until "the end of the next day which is neither a Saturday, Sunday nor a legal holiday."In accordance with the administrative rule, we conclude that Friday, May 7, 1993 was a legal holiday within the...