Williams v. A.L. Williams & Associates, Inc.

• Decision Date: 08 December 1989
• Citation: 555 So.2d 121
• Parties: John Phillip WILLIAMS v. A.L. WILLIAMS & ASSOCIATES, INC. 88-404.
• Court: Alabama Supreme Court

Page 121

555 So.2d 121

John Phillip WILLIAMS v. A.L. WILLIAMS & ASSOCIATES, INC.

88-404.

Supreme Court of Alabama.

Dec. 8, 1989.

Robert H. Ford of Brinkley, Ford, Chesnut & Aldridge and Fulton S. Hamilton of Hamilton & Ryan, and Fred B. Simpson, Huntsville, for appellant.

Crawford S. McGivaren, Jr., Larry B. Childs and William H. Pryor, Jr. of Cabaniss, Johnston, Gardner, Dumas & O'Neal, Birmingham, and James E. Davis, Jr. of Lanier, Ford, Shaver & Payne, Huntsville, for appellee.

SHORES, Justice.

John Phillip Williams appeals from a summary judgment for A.L. Williams & Associates, Inc. ("ALW"). We affirm.

Williams originally filed suit in 1984 against ALW and William Worthington, an ALW regional vice president, because of injuries he sustained when Worthington assaulted him. Williams amended the complaint to include claims based on negligence, wanton misconduct, outrageous conduct, and interference with business relations. The amendment also included a claim by Williams's wife based on loss of consortium. Following a trial, the jury returned a general verdict in favor of Williams in the amount of $500,000, and in favor of Mrs. Williams for $1,000 on her loss of consortium claim. The jury denied the Williamses' claims directly against Worthington, and denied ALW's cross-claim against Worthington. Williams allowed the verdict in favor of Worthington to become final, but ALW appealed from the judgment in the Williamses' favor, based upon the inconsistency in the jury verdicts. This Court held that the irreconcilable verdicts indicated confusion on the part of the jury, and reversed and remanded for a new trial. A.L. Williams & Associates v. Williams, 517 So.2d 596 (Ala.1987).

On remand, Williams amended the complaint and pursued three claims against ALW: tortious interference with business relations; libel; and outrageous conduct. ALW filed a motion for summary judgment and filed supporting affidavits and deposition testimony. After reviewing the materials submitted and the briefs and arguments of the parties, the trial court granted the summary judgment motion. This appeal followed.

Many of the relevant facts were set forth in the earlier opinion, so we repeat from that opinion only those facts necessary to an understanding of the case, and we add the relevant facts that were developed on remand. ALW is a corporation with a multi-level marketing plan to sell insurance and securities. ALW is the general agent for Massachusetts Indemnity and Life Insurance Company ("MILICO") and supplies all of MILICO's sales agents. MILICO policies can be sold only by agents who also have contracts with ALW. ALW agents sign contracts with MILICO which provide that, during the term of the agreement, the agents will not directly or indirectly induce or attempt to induce any MILICO policyholders to terminate or to replace any MILICO policies or otherwise disturb the relationship between MILICO and its policyholders. The contracts also provide that the agents will not induce or attempt to induce any of MILICO's agents or employees either to terminate their relationship with MILICO or ALW or to associate in any other insurance business during the first year following the termination of the individual's association with MILICO. Finally, the terms of the MILICO contract state that the arrangement may be terminated with or without cause by either party and that ALW has the express right to notify MILICO to terminate the contract.

ALW owns a subsidiary, First American National Securities, Inc. ("FANS"), a broker-dealer regulated by the National Association of Securities Dealers ("NASD"). Some ALW/MILICO agents are also licensed to sell securities for FANS, and FANS sells its securities exclusively through those agents.

Williams signed contracts with ALW and MILICO in 1982 and with FANS in 1983. When he applied to become a FANS representative, Williams signed a document indicating his understanding that, as a FANS agent, he could not sell securities for another broker. Williams performed well at ALW and was promoted twice during 1983. On December 1, 1983, Williams's supervisor--ALW regional vice president William Worthington--called Williams into the supervisor's office. Shortly thereafter, the men engaged in a skirmish, the precise cause of which is unclear, and Williams suffered severe injuries. Several days after the altercation, Williams returned to his office and removed cards with clients' names and telephone numbers.

On January 18, 1984, Williams and his father went to the ALW offices in Atlanta to discuss the beating and any actions ALW intended to take. Williams spoke with Bob Buisson, an officer with ALW, but when he began to talk about the beating, Williams was told to leave Buisson's office and to contact ALW's attorneys if he had anything else to say. ALW terminated Williams's employment on March 19, 1984.

Beginning in January 1984, Williams became licensed with at least one other insurance company and, before he was terminated by ALW, he encouraged numerous MILICO policyholders to terminate their MILICO policies and to purchase coverage from another company. Williams admitted that in January or February 1984 he encouraged several MILICO agents to leave MILICO's employ and to work for another company.

On February 7, 1984, Worthington sent a MILICO termination form and a letter to Buisson at the Atlanta office, requesting Williams's immediate termination. In the letter, Worthington referred to Williams as "the asshole we've been discussing," and claimed that Williams was "badmouthing" ALW and recruiting its agents. Buisson, who is also an officer, director, and principal of FANS, sent the letter and termination form to four people: Kevin King, the corporate attorney for FANS and ALW; John Smithson, an ALW senior vice president; Barry Clause, a compliance officer at FANS; and Douglas Hartline, the president of FANS. MILICO and FANS terminated the contracts they had with Williams. Williams's securities registration with NASD was also terminated.

As noted earlier, Williams filed suit against Worthington and ALW, and, after a jury trial, Williams did not appeal from the judgment in favor of Worthington. On remand from this Court, Williams pursued a claim against ALW based on an alleged tortious interference with business relations; in that claim he alleged that ALW had caused him to be terminated from his employment with FANS and MILICO. On May 26, 1988, Williams amended the complaint to include a claim based on libel, alleging that Buisson had published Worthington's February 7, 1984, letter by distributing copies of it to individuals inside and outside of the ALW corporate structure. On June 7, 1988, Williams amended the complaint to include a claim based on the tort of outrage, alleging that ALW's agents had libeled him, had caused his business relations to be terminated, and had generally engaged in conduct designed to harass him and cause him severe mental anguish. After discovery was completed, the trial court granted ALW's motion for summary judgment as to all three counts of the complaint.

On the tortious interference with business relations claim, the trial court found that Williams was aware of the relationship between ALW, FANS, and MILICO, and that he had acknowledged that he had known since 1982 that he could not market MILICO or FANS products unless he was affiliated with ALW. Accordingly, the court held that ALW was not a stranger to Williams's business relations with FANS and MILICO, and that ALW's actions were within its contractual rights.

On appeal, Williams argues that summary judgment was improperly entered on the tortious interference claim because ALW was not a party to Williams's contracts with MILICO and FANS, and because, he argues, the question of whether ALW's interference was justified can be decided only...