*1 states, “The majority opinion deci- As the injected ANDERSON, in a Dennis D. al., the Fisher cases
sions reached et Respondents, the ‘most lender attribute into favored new status,’ allowing resulted in inter- which v. by rates national shipment of interest state Gayton KAMMEIER, Appellant, R. programs.” card Ad- in their credit banks ditionally, simple a credit card trans- should K., INC., Employment G. R. between a local citizen and a local action Counselors, Inc., Appellants, by be construed as bank loan merchant bank a Minnesota citizen Nebraska v. question? proclaims without Min- as Fisher ANDERSON, al., Dennis D. et reject such an extension as a nesota should Respondents. misinterpretation the National Bank No. 47205. judgment. its own Act1 and exercise Supreme Court of Minnesota. we not matters are bound Fed- such only by holdings circuit court cases but eral 18, Nov. Supreme E. of the United States Court.2 Rehearing Denied Jan. rel. v. g., United ex Lawrence States Woods, (7 1970). 432 F.2d Cir.
I would therefore affirm the trial court’s injunction permanent
issuance
against prohibiting Omaha Service the so- of credit card customers in Minne-
licitation
sota as violation of Minn.St. 48.185.
YETKA, (dissenting). Justice join
I in the dissent of Mr. Justice
SCOTT.
WAHL, (dissenting). Justice join
I dissent of Mr. Justice
SCOTT. court, court, 1. The trial in its order 2. “While a decision of a federal Court, Supreme may stated: “To take a statute that has been than persuasive years matter, is, the books for almost 100 and find in a state court on a federal it never- intention, theless, nullify law an binding, not since the state court owes practice years standing financial of 200 is ludi- court, namely obedience to one federal mockery crous and makes a Moore, the doctrine of Supreme Practice, Court.” IB Federal legislative intent. If there intent p. 0.402[1], (2 ed.). Par. Congress preserve must be the financial long Republic.” standing customs of so in our *2 Miller,
Monte M. Minneapolis, Craig D. *3 Larson, Champlin, appellants. for Simonson & Bartsh and Thomas C. Bartsh, Minneapolis, for respondents. KELLY, Heard YETKA, before and SCOTT, JJ., and considered and decided by the court en banc.
YETKA, Justice. appeal following An trial in bench Hen- nepin County District Court in which the respondents were allowed to rescind a man- agement consultant and awarded $1,000 punitive damages for slander. We affirm. appeal
This raises these issues: (1) appellant Whether the actions of the agree- constituted a material breach of the parties. ment between the (2) agreement Whether the entered into between parties was divisible or entire. (3) Whether the that a statements busi- nessman was a “draft dodger,” that he trusted,” “should not be and that he would anyone “stab per back” are slander se.
This case an involves sale of employ- several ment business to employees. Appel- Gayton lant R. Kammeier owned Employ- Counselors, (ECI) Inc. ment and managed Bloomington office. Respondent its Dennis Anderson for D. worked ECI and managed Minneapolis its office. In October of Anderson told Kammeier he wanted to leave ECI and start his own agency. Dur- ing negotiations Kammeier met with other employees two of the Minneapolis of- (Richard Thompson fice Rost) and Richard who were considering leaving join- ECI and ing During Anderson. the course of their conversation, Kammeier referred Ander- and they son asked if “put could their faith a draft dodger.” Subsequently, both em- ployees joined Anderson. matters, occasions, legal 28, 1969, executed twice for the ne- Kammeier
On October Thomp- cessity and of licensure the affiliated D.S.I. with Anderson agreement1 an application wage Kam- the minimum a consideration of son. For counselors, and once Minneapolis employment law to to transfer agreed meier bonding necessary respect Kam- Thompson. and Anderson office to operate Twice the employment agency. remainder to transfer agreed meier erroneous. advice was office, the Minneapolis the lease and all the equipment, and office furniture 16,1970, day after the first On March applicant job completed orders standing was due on the consultation installment addition, agreed he to release forms. a letter agreement, Kammeier received employment contracts their parties from Thompson purporting from Anderson covenants), and (which restrictive contained the consultation terminate running to advise the letter that em- alleged with G.R.K. *4 agree- the execution of the business. After “circulat- ployees of Kammeier’s had been the ment, decided to allocate parties the and informa- ing false slanderous certain $40,000 management to the majority of the Personnel, Inc. and its Graduate tion about fa- to more agreement receive consultation “intentionally engaged had employees,” and the Accordingly, treatment. vorable tax potential the designed impair in conduct on agreement executed a second of existing relationships business Gradu- of in a bill parts, three Personnel, In response, ate Inc.” Kammei- ($5,000), a equipment and sale for the lease willingness perform the er reiterated his employment contracts of the payments release No were ever made. contract. consulting management ($5,002), and thereafter, Shortly the Minnesota De- for ($32,500). The consideration agreement Industry, respond- and partment of Labor in paid agreement was to consulting the 3M, contacted complaint from ing to $1,250 starting on of monthly installments investigation an Kammeier about return, Kammeier March (D.S.I.) he had sold to An- affiliated firm services following agreed to furnish Graduate, informing Without derson. request: upon specific contents of the disclosed the Kammeier advice consultation Provide and “a. time, At the state. Graduate tape to employees, hiring training and regarding attempting employ- to sell to an was D.S.I. advertising, placement of and preparation employee advised to be Kammeier ee. orders, purchasing, super- job obtaining from Ander- purchasing cautious in D.S.I. bookkeep- accounting, vising employees, anyone in the he would “stab son because proper chance,” services for the and further that ing, given and back if from the money Graduate. still owed him operating practices Anderson Minneapolis office. The state sale of the advice and consultation Provide “b. refused D.S.I. n a license. application for problems and procedures with collection legal services).” (excluding Kammeier advised In November personnel Fingerhut Cor- representatives business Thompson would do and Anderson Thompson Anderson were poration that and Personnel, also Inc. Kammeier as Graduate highbinders,” couple “a and employment in a sold interest second his “left much to of Anderson’s wife reputation in- had been which Anderson agency in Fingerhut to do be desired.” continued recorder, $400, D.S.I., tape volved, Thompson. with Anderson and business tape dis- profits. A percent and 40 recruiting by a activities closing illegal Thereafter, present was insti- action inadvertently included. was employee D.S.I. sought payment Kammeier tuted. $32,500 months, remaining purchase Kammeier on the next During price. Thompson three Anderson and claimed a give upon was advice called and agreements of Em- both of which owned Kammeier were made on behalf Inc., Counselors, Inc., G.R.K., president. ployment for which Kammeier served as and rescission, problems and consideration to G.R.K. expect rely failure upon for slander. its requested Management advices. The Agreement sultant gone was at that Graduate was court held The trial point a practical Anderson, as matter and March 1970 rescission of justified in its Thompson justified and Graduate were respect to the claim for contract. With declaring it rescinded.” slander, that statements the court found personal Given the nature of the services per se and awarded were slanderous expected degree of confidence nec- though even punitive damages, Graduate essary proper to assure the completion of any not lose clients or suffer mone- did them, the trial court was correct conclud- damage. tary
ing that the actions of Kammeier constitut- Contract Claim ed a agreement. material breach of the appeal,
On
appellants
one,
contend the
Because the breach was a material
trial
in allowing
court erred
the rescission the issue then becomes
merely
whether
management
agreement
consultation
management
agreement
consultation
or the
first,
breach,
grounds,
on two
that the
if
entire transaction should have been rescind-
material, second,
any, was not
ed,
is,
con-
whether
management
con-
sultation
was not severable from tract was severable from the lease of office
agreements.
the other
space and
employment
release of the
con-
tracts. The appellants argue the three
breach,
With respect
alleged
*5
agreements
a single
constituted
transaction
the trial court held that the advice which
and thus the rescission must be of all three
gave,
Kammeier
alleged
re
slanderous
agreements.
respondents,
The
on the other
Kammeier,
by
marks
turning
over
hand, contend the three agreements are di-
of the tape to the state of Minnesota consti
visible.
grounds
tuted
for rescission because-—
“ * * * after the bad advice that
Whether a contract is entire or
had
given,
been
the slanderous remarks
divisible depends on the intent of
par
by Kammeier,
ties;
and the method used to
it must be
by
determined
considering
get the contents of the
tape
used,
DSI
to the
the language
subject
matter of
State, Graduate
go
could not
contract,
feel-
parties
and how the
them
ings of
safety
reasonable
to confide its
selves treated it.2
g.,E. McGrath v. Can
ascertaining
parties,
5,
the intent of the
238(1),
there
240(c).
tracts 2d Tent. Draft No.
§§
impediment
construing
See,
agree
also,
is no
to
Thus,
the three
Minn.St. 366.2-202.
as stated
together.
writings
ments
Restatement,
Contracts in several
in comment b of
Contracts 2d
relating to
5,
the same transaction will be con
Tent. Draft
§ 238:
No.
g.,
strued with reference to each other. E.
“It is sometimes said that extrinsic evidence
Casualty
Produce,
Anchor
Inc.,
Co. v. Bird Island
change
plain meaning
writing,
cannot
of a
(1957);
249 Minn.
371 See, (1893). drafts instruments in a form 150 other than 57 N.W. non, Minn. 55 Contracts, Corbin, 687 that of the intent §§ avoid 3A generally, 870; Contracts, Williston, otherwise valid income taxes §§ should not be 328; 4 Am.Jur.2d, Contracts, 324 to permitted to benefit §§ from such an attempt 1727, Williston Dunnell, (3 ed.) Dig. by arguing later contract for serv- terms: in these contract merely disguises a divisible ices what should have been defines higher payment for either per- whole the value of which the under “A contract par- business or for the release of into two sets the non- is divided formance clauses, competition of each set or both. part each performances, tial for a corre- exchange agreed performances part of the set sponding Slander is promisor, by be rendered the other The trial court found that there were Or, as ex- divisible contract. called a per three incidents of slander se. These in the cases: pressed dodger;” were that Anderson was “draft by its where is divisible ‘A trusted;” he “should not be and that is terms, 1, party of each performance anyone in the he would “stab back.” No and, 2, the parts, or more into two divided however, proven; actual is party from each parts due number punitive damages. court awarded each same, and, 3, performance appeal, appellants contend the use On exchange agreed is the party part per of these terms was not slander se. the other part by corresponding not, dodger” term “draft is party.’ alone, defamatory because the term taken way: ‘The dis- “Or, another stated in hand, the one ambiguous. might is On is divisible contract tinguishing mark of a person who had used to describe violated apportionment it admits the selective service laws. This would be side so as to corre- on either consideration and, false, an accusation of a crime if would unascertained consideration spond See, Prosser, per constitute slander se. purpose such a side. Where *6 112, (4 ed.) pp. 754 to 756. Torts On the § contract, clearly or is de- in the appears hand, might other the same statement therefrom, great sig- it is allowed ducible merely person refer to a who took advan of ascertaining the intention nificance ’ ” * * * service, tage legitimate of deferments Williston, 6 parties. the such as a 2-S student deferment. tracts, § standard, against this Judged defamatory meaning When Each of are divisible. agreements apparent upon arises from facts not type and of a different was agreements publication, plaintiff has the face of the to its specific a consideration each allocated such pleading proving the burden of consideration The amount
performance. facts, g.,E. Ten Broeck or the inducement. bargained was each allotted to 173, Co., 207 Printing v. Journal 166 Minn. parties. performance The by the Likewise, (1926). he must estab 497 N.W. into sev was divided party specifically each defamatory publication sense of the lish the appor was consideration and the parts eral facts, or the innuen with reference to such trial court accordingly. tioned 209, See, Larson, Sharpe v. 70 Minn. 72 do. rescind respondents correctly allowed case, (1897). present In the N.W. 961 agreement. consultant management on the matter was the evidence introduced following: that the appellant argument The attorney] What did “Q [Respondents’ consult separating the the contract form of you? mean dodger’ the term ‘draft personal property from the ing agreement Well, I [by Thompson] “A Richard employment transferred spent years, four three months just income had payment was to avoid release days in the United States Air deliberately and nine who valid. One taxes is not 372 captain, many lost as a friends son in professional
Force his capacity and not Asia, and to make a statement Southeast merely as an individual without regard to somebody go- that I like that about was profession.3 his g., High E. Supreme v. with, I didn’t believe ing into business Lodge, 164, 214 Minn. 7 (1943); N.W.2d 675 Denny dodger. was a draft But it Prosser, (4 ed.) 112, Torts pp. 758 and me, certainly sounded to or meant to Restatement, Torts, 573, comment e. pulling up every piece of me that he was The statements that Anderson get that he could hands on to mud his “should not be trusted” and would “stab myself make me not want to associate anyone in the back” clearly come within Dennis and Graduate Personnel.” with these standards. The terms contest The determination of whether commu- this honesty of Anderson operation in the of his defamatory question nication was was a business affairs and thus are per slander se. court, applied fact for the which the test as Under the proper circumstances these re person to whether a reasonable would be- might marks have been privileged;4 how defamatory. lieve the statement to be We ever, such issues not raised in the say cannot the court’s decision was pleadings or the trial court.5 clearly erroneous. The trial court found that respondents The contend that respondents did not suffer pecuniary other terms per also constitute slander se loss as a result of the remarks, slanderous they business, because affect Anderson’s yet awarded as punitive damages. trade, profession. or Along charges with When words are defamatory per se, how crime, imputations disease, of a loathsome ever, punitive damages are recoverable and unchastity, imputations affecting per without proof of actual damages. Lofts business, trade, son’s conduct of profes gaarden Reiling, v. 267 Minn. sion are proof actionable without special (1964), N.W.2d 154 denied, certiorari damage. words, however, The pe must be U.S. 85 S.Ct. (1965). L.Ed.2d 50 culiarly person harmful in his busi ness. General disparagement is insuffi trial court is affirmed.
cient.
It
depend
must
on the occupation
particular
statement.
OTIS, J.,
part
took no
in the considera-
words, the remarks must relate to
per-
tion or decision of this case.
Compare,
g.,
Co.,
e.
punitive
Gribble v. Pioneer
Press
are not recoverable in a
(1885) (actionable
34 Minn.
tion rather the true of the of the documenta- evaluation form substance the transaction would be had examination this sort tion. A factual by treating the 1 December as documents the true nature of a transac- reveal should an indivisible whole. theory, Under this it, any parties conceived tion as failure perform adequately defendant’s to divisibility issue on the should judgment arrangement under consulting would with the character so revealed. consonant but a constitute minor breach of the overall case, scarcely it could be more In this contract of sale. Under rule which the transaction in fact obvious breach nonmaterial of contract jus- neither a going was the sale of business occurred tifies rescission nor excuses counter-per- single one of December concern. No formance, defendant should answerable would have been executed instruments damages only See, for his breach. 5g., e. Corbin, 3A of the others.2 absence Corbin, Contracts, Williston, § tracts, pp. 281 to 283. Anderson and (3 ed.) Contracts 1467. were not Thompson plainly interested Accordingly, I would remand the matter lease, only equipment, office obtaining or with instructions judgment to enter for consulting was services. It the business or plaintiffs $32,500, in the amount less such, entity they sought. As it is which amount of defendant could estab- apparent consulting that more than mere lish were proximately by caused the im- by plaintiffs in re- services received proper advice and less the amount allowed $32,500 paid turn under the man- for punitive for damages. agement consulting agreement.3 going or goodwill concern value ECI also
changed guise under the of the hands con-
sulting agreement. circumstances, unjust it is to
Under these consulting agreement
sever the from the
overall sale and allow it to be by plaintiffs. Even though rescinded GODBOUT, Appellant, Medric C. plaintiffs judgment district court directs to v. personal prop- return certain of defendant’s NORTON, Respondent. V. John erty by the used former under the consult- ing agreement, possible it is not to order No. 47108. goodwill the return of the ECI which Supreme Court of Minnesota. passed plaintiffs under the Dec. spite instruments. 1977. loss employer lists and information file under Rehearing Denied Feb. order, court plaintiffs the district will re- advantage tain much of that business
gained solely by virtue succes- operation. plain-
sor to the ECI And since obligated pay-
tiffs are not to make further consulting
ments under rescinded con-
tract, the retention of such business advan-
tage windfall gain. constitutes substantial Indeed, quite impossible obligation it would been defendant was have under no affirmative Thompson employees oper- respect for plaintiffs’ monitor counsel with having procured daily is, ate the business without first operations. That defendant was re- from quired releases ECI. upon plaintiffs’ to render advice “specific request.” light con- great place emphasis 3. That the did not paid by plaintiffs, sideration such “consulta- consulting provided to be services under truly obligation tion” constituted a minimal the agreement is indicated terms of the defendant. contract, According itself.