The litigation spawning this appeal is rich in legal diversity as garnered from a voluminous transcript and untold exhibits revealing an action by a lessor for damages for breach of a lease of real property, enforcement of a written guaranty securing the lessee’s performance of the terms of the lease, and a counterclaim for alleged tor-tious interference with the lessee’s reasonable expectancy of a business relationship pointing toward acquisition of a favorable sublease. A far ranging prologue of facts and appropriate observations will be indulged at the outset in order to elucidate the various issues which were litigated, while reserving the liberty throughout treatment of the several points raised on appeal to intersperse and elaborate upon additional facts deemed germane to resolution of the various points.
On March 1, 1971, Manfred G. Martin, as lessor, entered into a written lease with Berbiglia, Inc., as lessee, for the letting of a commercial building then yet to be constructed on certain real property located at 2919 Vivion Road, Kansas City, Missouri. On March 30,1971, after encountering difficulty in securing financing to construct the proposed commercial building, Martin assigned all of his “right, title and interest in and to” said lease to C & M Developers, Inc., which obtained a loan from North Hills Bank to finance construction of the proposed commercial building. As conditions to making the construction loan, North Hills Bank demanded and received (1) a written assignment dated March 31, 1971, for rents owing under said lease and (2) a written guaranty whereby Forum Restaurants, Inc., guaranteed to C & M Developers, Inc. and North Hills Bank, “jointly and severally”, the “punctual and faithful performance of the terms of said lease by Berbiglia, Inc. for and during the ten year term thereof and any renewal or extension thereof.” Construction of the proposed commercial building was completed in early December, 1971, and occupancy thereof by Berbiglia, Inc., as tenant under said lease, commenced on December 8, 1971. Monthly rentai under the terms of the lease was “$1,250.00, payable on the first day of each month in advance.” Berbiglia, Inc. occupied the commercial building until April 30, 1973, at which time it voluntarily vacated the leased premises because the volume of business it was doing at the location had not lived up to expectations. Berbiglia, Inc. stopped making rental payments after August, 1973.
Berbiglia, Inc.’s default in rental payments during the term of said lease eventually precipitated the filing of a petition in two counts in the Circuit Court of Jackson County, Missouri, by C & M Developers, Inc. (hereinafter C & M) as plaintiff against Berbiglia, Inc. (hereinafter Berbiglia) and Forum Restaurants, Inc. (hereinafter Forum) as defendants. Count I of said petition sought judgment against Berbiglia for damages for breach of contract in the prayed for amount of $37,000.00 and Count II of said petition sought judgment against Forum under the written guaranty executed by it in the prayed for amount of $37,000.00. Berbiglia, by way of answer to Count I of C & M’s petition, denied that it was in default and affirmatively pleaded
Among innumerable stipulations entered into betwеen the parties, the following are deemed most pertinent at the moment for giving a broad overview of the case: (1) during March of 1971 Berbiglia was a Missouri corporation whose stock was wholly owned by Forum; (2) any and all acts or transactions engaged in by Martin appertaining to the lease were done for and on behalf of both himself and C & M; (3) Count I of C & M’s petition and Berbiglia’s counterclaim were to be tried to a jury and Count II of C & M’s petition was to be tried to the court; (4) the “sole issue” for trial in Count II was that of “Forum’s defense that there was no consideration for the guaranty”; (5) in the event the court returned a verdict in favor of C & M and against Forum under Count II of C & M’s petition upholding enforcement of the guaranty and the jury returned a verdict in favor of C & M and against Berbiglia under Count I of C & M’s petition the court was directed and authorized to render a “joint” judgment in the same amount against Forum; (6) in the event the jury returned a verdict in favor of Berbiglia and against C & M under Count I of C & M’s petition the court was authorized and directed to render and enter a judgment in favor of Forum under Count II of C & M’s petition; аnd (7) in the event the court returned a verdict in favor of Forum and against C & M under Count II of C & M’s petition the court was authorized and directed to render a judgment in favor of Forum and against C & M whether or not C & M recovered against Berbiglia under Count I of C & M’s petition.
The trial court directed a verdict in favor of C & M and Martin and against Berbiglia on Berbiglia’s counterclaim; a jury found in favor of C & M and against Berbiglia under Count I of C & M’s petition and awarded damages totaling $41,951.00; and the court found the sole issue of “consideration for the guaranty” under Count II of C & M’s petition in favor of C & M and against Forum. Per stipulation of the parties, judgment in the amount of $41,951.00 was rendered against Berbiglia and Forum “jointly and severally”. A timely motion for new trial filed by Berbiglia was first overruled and then reinstated with C & M thereafter being advised that in the event it failed to make remittitur in the sum of $1,975.00 Berbiglia’s motion for new trial would be sustained. C & M responded by making remittitur in the sum of $1,975.00, and the trial court responded by rendering a final judgment in the amount of $39,-976.00 against Berbiglia and Forum “jointly and severally” and overruling Berbiglia’s motion for new trial. Timely appeals by both Berbiglia and Forum followed.
Berbiglia and Forum, after probing all facets of this convoluted litigation at the trial court level for signs of еrror, retreated to four points and two points respectively in their separate briefs on appeal. The four points ultimately advanced by Berbiglia on appeal are: (1) C & M was not the real party in interest in the cause of action alleged by C & M in Count I of its petition by reason of the assignment of rents to North Hills Bank; (2) error on the part of the trial court in directing a verdict in favor of C & M and Martin and against Berbiglia on Berbiglia’s counterclaim; (3) error on the part of the trial court in refusing to sustain Berbiglia’s motion for a new trial
Berbiglia’s first point, resting as it does on the contention that C & M was not the real party in interest by reason of an absolute assignment of rents due. and owing under the lease to North Hills Bank, is countered by C & M’s contention that it was a real party in interest as the assignment was not absolute but was merely given as collateral security for the loan made by North Hills Bank to C & M.
Rule 52.01 leads off with the positive command that “[ejvery civil action shall be prosecuted in the name of the real party in interest . Concomitantly, the general rule is that an absolute assignment of an entire right or interest works a divestiture of all right or interest of the assignor therein and for purposes of maintaining a civil action thereon the as-signee becomes the real party in interest.
Lumbermen’s Mutual Casualty Co. v. Norris Grain Co.,
The question of whether the assignment of rents in the instant case was absolute or made as collateral security for the debt incurred by C & M with North Hills Bank takes on a status of decisional importance and priority. As cogently stated in
Wickert v. Folk,
No merit is found in Berbiglia’s contention that C & M was not a real party in interest for purposes of bringing this action for damages for breach of the lease running between C & M and Berbiglia.
In the waning portion of its argument C & M takes an inverse approach to Berbiglia’s first point by suggesting in a very casual and offhanded manner that it is devoid of merit because Berbiglia waived any objection to Nоrth Hills Bank’s absence as a party to the action. After having met the principal issue head-on and disposing of it adversely to Berbiglia on the basis upon which it was tendered, no useful purpose will be served by engaging in a protracted discussion of this casually raised procedural facet. Suffice it to say, Berbiglia did not question C & M’s status as a real party in interest until after the trial commenced, at which time it did so in a rather convoluted or imprecise fashion by way of an oral motion in conjunction with an exhibit, even then neither raised any question about North Hills Bank’s absence as a party nor made any effort to have North Hills Bank added as a party to the litigation. In
Cantor v. Union Mut. Life Ins. Co., supra,
it was held that the assignor of an assignment made for purposes of collateral security retained a sufficient interest to maintain an action as a real party in interest and the assignee was a necessary, although not an indispensable, party to the action. Berbig-lia made no claim below that North Hills Bank was a nеcessary party, much less ask for a determination under Rule 52.04 that North Hills Bank was an indispensable party. This same silence on Berbiglia’s part as to North Hills Bank’s status as a party prevails on appeal. Academically, a claim that one is a necessary party is subject to waiver, and a failure to raise the matter either by way of a motion under Rule 55.27 or by alleging same in a responsive pleading constitutes an effective waiver. Rule 55.-27(g);
Skidmore v. Back,
Next, Berbiglia faults the trial court for directing a verdict in favor of C & M and Martin and against Berbiglia on its counterclaim. First, the theory behind the cause of action asserted by Berbiglia in its counterclaim against C & M and Martin will be placed under closer scrutiny. Fairly summarized, Berbiglia’s counterclaim rests upon the theory that C & M and Martin tortiously interfered with a reasonable expectancy on Berbiglia’s part of securing a favorable sublease from Custom Music Corporation for the balance of Berbiglia’s term under its original lease with C & M. A substantive basis for this narrow but crucial aspect of Berbiglia’s pleaded ■ theory of recovery, redress for an intentional interference with a reasonable expectancy of a valid business relationship short of the existence of a contract, is found in
Downey v. United Weather Proofing,
For purposes of reviewing the action taken by the trial court in directing a verdict in favor of C & M and Martin and against Berbiglia on the latter’s counterclaim, it is elementary that the evidence must be viewed in the light most favorable to Berbiglia’s theory of recovery and that Berbiglia be given the benefit of every reasonable favorable inference.
Mathes v. Trump,
Berbiglia contends that the above facts unquestionably supported submission of the cause of action espoused by it in its counterclaim against C & M and Martin. At first blush Berbiglia’s contention tends to strike a responsive cord. A closer analysis of the record however reveals a total absence of evidence that Martin and C & M were unjustified in engaging in separate negotiations with Custom Music Corporation under the attendant circumstances, and Berbiglia’s remissness in this respect constitutes a fatal flaw in the submissibility of its counterclaim. The absence of justification is a vital component of аny action predicated upon tortious interference with a valid business relationship or expectancy. One of the requisite elements under Missouri law as explicated in
Salomon v. Crown Life Ins. Co., supra,
for making such tortious interference actionable spotlights this vital component. Although a majority of jurisdictions hew to the position that a claim of justification in an action for tortious interference with a valid business relationship is in the nature of an affirmative defense which must be pleaded and proved by the defendant.
1
Missouri takes an opposite position. The polarization just mentioned is explicated in
Gerstner Electric, Inc. v. American Insurance Company,
Assuming arguendo that Berbiglia produced sufficient evidence to establish all other requisite elements of its cause of action, the thorny issue of whether there was any evidence or reasonable favorable inference to support the essential element of lack of justification possesses an entirеly different legal complexion. Getting to the heart of the matter, where is there any
From beginning to end the essential element of lack of justification, at best, foundered in an abyss of speculation and conjecture. The trial court properly rejected submission of Berbiglia’s counterclaim on such tenuous grounds.
Osterhaus v. Gladstone Hotel Corporation,
Berbiglia’s third point invokes numerous variations of a common theme — excessiveness of the verdict. For purposes of clarity, the numerous variations will be referred to in terms of subpoints. Subpoint one: the verdict returned by the jury in the amount of $41,951.00 was excessive in that it exceeded the amount of damages claimed by C & M in Count I of its petition, namely, damages in the sum and amount of $37,-000.00. Subpoint two: the verdict returnеd by the jury in the amount of $41,951.00 was
During the course of the trial C & M was permitted to amend by interlinеation various amounts of damages attributed to separate items making up the whole of the damages sought by it under Count I of its petition. However, these amendments were never reflected in the total amount of damages formally claimed by C & M in Count I of its petition, to wit, $37,000.00, which remained the same and was never amended by interlineation. The jury returned a verdict in favor of C & M and against Berbiglia in the amount of $41,-951.00 which on conditional order of the trial court was reduced by remittitur to $39,976.00 and judgment in the latter amount was rendered by the trial court in favor of C & M and against Berbiglia and Forum “jointly and severally”.
Berbiglia’s first subpoint is not totally without merit, although relief short of unconditionally granting a new trial, for reasons hereinafter set forth, was appropriate. True enough a jury verdict which exceeds in amount that which is claimed in a party’s petition is deemed excessive.
Acy v. Inland Security Company,
Berbiglia’s second subpoint, that the verdict was excessive in that it exceeded in amount that which was supported by the evidence, pivots on whether Berbiglia was given proper credit for rental income received by C & M from third parties during certain periods of Berbiglia’s default under the lease. A careful seining of apposite portions of the record compels the conclusion that Berbiglia was entitled to but did not receive credits in amounts totaling $1,975.00 and in the sense argued by Ber-biglia the verdict rendered by the jury ($41,951.00) exceeded the amount of damages supported by the evidence by the sum and amount of $1,975.00 and exceeded the amount of damages formally claimed in Count I of C & M’s petition ($37,000.00) by the sum and amount of $4,951.00.
At this juncture subpoints one and two lend themselves to being jointly discussed. Although the verdict returned by the jury exceeded the amount formally claimed as damages in Count I of C & M’s petition and, as well, the amount supported by the evidence, the judgment rendered thereon after remittitur ($39,976.00) did not exceed in amount that which was supported by the evidence and comported with the amount of damages claimed by C & M in its petition if Count I of its petition may be viewed as having been amended by the evidence. A verdict which exceeds in amount that which is supported by the evidence may be cured by remittitur if the excess is not so great as to indicate prejudice on the part of the jury.
Sanders v. Illinois Central Railroad Company,
Berbiglia’s third subpoint, that the verdict was excessive because it included anticipatory damages, centers on damages resulting from a loss of rentals incurred by C & M by reason of having leased the premises after Berbiglia’s default to another tenant at a monthly rental less than that provided for in its lease with Berbiglia. Berbiglia contends that any damages predicated on the difference in rentals beyond the date the case was tried were anticipatory in nature and nonrecoverable. Berbig-lia’s third subpoint is a thinly veiled attempt to attack on appeal certain evidence which was admitted during trial after an objection to its admission during trial was withdrawn. In reality, evidence underlying Berbiglia’s third subpoint was admitted without objection and no error associated with its admission was prеserved for purposes of appeal.
Nichols v. Blake,
Berbiglia’s fourth subpoint, that the verdict was excessive in that it improperly reflected evidentially unsupported calculations advanced by opposing counsel during closing argument, represents another attempt by Berbiglia to circuitously reach an instance of alleged trial error which occurred without objection at the time and which therefore was never properly preserved for appeal. Berbiglia’s poorly disguised effort to presently object to the argument of opposing counsel was waived by its failure to timely object thereto during trial.
Blevins v. Cushman Motors,
Berbiglia’s fifth subpoint, that the verdict was excessive because certain credits which it claimed it was entitled to were supposedly ignored by the jury during its deliberations in reaching its verdict, is, when put in proper posture, contradicted by the record. In particular, the genesis of this subpoint is that the jury failed to give Berbiglia proper credit for certain amounts received from a substitute tenant in excess of the rental amount owed by Berbiglia under the terms of the lease. Evidence thereof was offered and freely admitted. Notwithstanding its admission, the jury apparently rejected the notion of giving Ber-biglia credit for such amounts. Put in proper perspective, C & M made no claim for damages during the period Berbiglia claims the jury supposedly ignored or refused to give it credit for rental amounts in excess of those which Berbiglia was obligated to pay under the terms of its lease. In other words, Berbiglia was attempting to offset damages by obtaining credit for rentals inuring to C & M in the future during a period in which C & M was making no claim against Berbiglia for damages. Acceptance of the rationale emplоyed by Berbiglia would unjustly patronize Berbiglia by permitting it to extract a reward and reap a benefit by its own initial misdoing. In at least one other jurisdiction a court virtually rejected out of hand an attempt by a de
Berbiglia’s sixth subpoint, that the verdict was excessive by reason of being the product of bias and prejudice on the part of the jury, is not persuasive. The dichotomy of mere excessiveness of a verdict and ex-cessiveness of a verdict due to bias and prejudice on the part of the jury, and accepted antidotes for each, is clearly spelled out in Blevins v. Cushman Motors, supra. Speaking in terms of lodging objections against jury verdicts on grounds of exces-siveness, the court in Blevins at 614-15 carefully drew the following distinction: “One is that it is merely excessive, and in that case the verdict may be cured by re-mittitur. The second type of objection is that the verdict is excessive as the product of bias and prejudice on thе part of the jury; and in this case the excessiveness cannot be cured by remittitur, but requires a new trial.” By way of further explicating excessiveness due to bias or prejudice on the part of the jury, the court in Blevins at 615 took pains to carefully point out that “[i]t is firmly settled that ‘ “the mere size of a verdict — the fact that it may be excessive — does not in and of itself establish that it was the result of bias or passion and prejudice * * *, without showing some other error committed in the trial.” ’ ” Ber-biglia castigates C & M for having had “a glorious feast at . [its] expense”, and chastises the jury for “complying placidly with the ‘evidence’ supplied in . [the] argument by counsel for . . [C & M]”, and for “slavishly . . [adopting] the specific amounts and calculations supplied by counsel for . [C & M] during his closing arguments to the jury.” This dramatically exceeds the bounds of subtly inferring that some degree of bias and prejudice must have crept into the jury’s deliberations absent specification of any particular instance of error committed during the course of the triаl which supposedly poisoned the jury’s thinking against the losing party. The jury in the instant case was unfortunately confronted with complicated issues presented in a complicated manner and its verdict, to the extent it was excessive, reflected the complicated nature of the issues and the manner in which they were presented rather than a manifestation of any overt or covert bias or prejudice on its part. Evidence as to the various elements of damages was presented in dollar amounts and the damages arrived at in the verdict ultimately involved a matter of mathematical computation. As C & M has been exonerated from any charged incidence of error interspersed throughout the previous five subpoints, Berbiglia’s sixth subpoint affords no relief because of its failure to establish any particular instances of error to transpose the jury’s verdict from a state of mere excessiveness to a state of excessiveness occasioned by bias or prejudice on the part of the jury.
Although the verdict in the instant case was excessive in that it exceeded the amount formally claimed by C & M in Count I of its petition before being amended by the evidence and also exceeded the amount supported by the evidence, Berbig-lia’s failure to convincingly demonstrate that it resulted from bias and prejudice instigated by some particular instance of error committed during the course of the trial placed the verdict in the category of excessiveness that could be cured by remit-titur. Such being the case, the conditional remittitur ordered by the trial court and accepted by C & M was appropriate under the circumstances and properly authorized rendition of a final judgment in the sum and amount of $39,976.00 against Berbiglia, and against Forum via the stipulation in the event it was liable under the guaranty. Minor v. Lillard, supra; Butler v. Equitable Life Assur. Soc., supra; Sanders v. Illinois Central Railroad Company, supra; Wandell v. Ross, supra; Arzberger v. Grant, supra; and Vitt v. Baer, supra.
Berbiglia’s fourth and finаl point criticizes the remittitur ordered by the trial court for being “inadequate” and for being in the form of a “blanket, non-specific” sum. Criticism presently leveled on
At this juncture attention turns to the two points relied upon by Forum on appeal — (1) lack of consideration to support the guaranty and (2) that C & M was not the “proper party” to enforce the guaranty. Reverting back to the stipulation entered into between the parties regarding submission of Count II to the court for trial rather than to the jury, the same specifically provided that the “sole issue” for trial in Count II was that of “Forum’s defense that there was no consideration for the guaranty”. Ergo, Forum will not be permitted at this late date to broaden the issues in total disregard of the formal stipulation entered into at the trial court level. Further reasons for not permitting Forum to jump the stipulation and broaden the issues on appeal lie in the faсt that Forum neither moved to have North Hills Bank added as a party at the trial court level nor makes any contention on appeal that North Hills Bank was an indispensable party within the purview of Rule 55.27(g)(2). However, the first of Forum’s two points on appeal, lack of consideration to support the guaranty, having been raised at the trial level and preserved for appellate review, merits attention and disposition on a substantive basis.
Forum posits its first point on the settled principle that “[a] contract of guaranty, like any other contract, must be founded upon a valuable consideration . [and] [w]here the guaranty is executed subsequent to the principal contract, it requires a new and independent consideration.”
J. R. Watkins Co. v. Smith,
C & M does not rely upon its promises in the lease to construct a commercial building on the premises and put Berbiglia in possession thereof as consideration to support the guaranty executed by Forum. It would appear that any attempt to do so would run afoul of the widely accepted principle that a promise to carry out an already existing contractual duty of the promisor does not constitute consideration.
Dobbins v. City Bond & Mortgage Co.,
It appears patently obvious that this court for the most part must resort to general principles of contract law in order to resolve the issue as to the presence or lack of a “new” and “independent” consideration to support the guaranty. Any meaningful discussion of this issue in the context just mentioned requires legal identification of the parties in terms of their relationship under the written guaranty. With this thought in mind Forum may be said to be both a guarantor and a promisor, North Hills Bank may be said to be both a guarantee and a promisee, C & M may be said to be both a guarantee and a promisee, and Berbiglia, whose performance under the lease was guaranteed by Forum, may be said to be the principal obligor. At the risk of being repetitious, it should be borne in mind throughout the following discussion that the construction loan made by North Hills Bank to C & M, and all its attendant conditions, occurred after the lease was executed and were in no way involved in the negotiation or execution of the lease.
Consideration to support a guaranty need not run to the guarantor-promis- or.
Industrial Bank & Trust Co. v. Hesselberg,
Resolution of the more crucial companion issue — was it essential or necessary that consideration to support the guaranty in favor of C & M move directly from C & M to Forum — calls upon this court to resort to general principles of contract law by reason of a dearth of specific case authority. The general principle deemed most pertinent and applicable is broadly put as follows (with this court once again engaging in interpolation) in
John Davis & Co. v. Cedar Glen # Four, Inc.,
If the single consideration, i. e. the loan by North Hills Bank to C & M, was adequate to separately support Forum’s guarantee of Berbiglia’s performance under the leаse to either North Hills Bank or to C & M, then the only remaining question is whether the single consideration was adequate to support both guaranties when viewed conjunctively. Once again, resort to accepted principles of general contract law supports the conclusion that a single consideration may support a number of promises. Reference is made to the following excerpt from 1 Corbin on Contracts § 125, at 535-36 (1963): “A single and undivided consideration may be bargained for and given as the agreed equivalent of one promise or of two promises or of many promises. The fact that there are many promises given in exchange for the one consideration does not make it insufficient as to any of them. If it would be sufficient to support each of the promises taken separately, it is sufficient for all of them.” (Emphasis added.) Accord : Williston on Contracts § 137A, at 594 (3d ed. 1957); and Restatement of Contracts § 83 (1932). A syllogistic application of the principle of general contract law gleaned from the highly respected texts just cited, in conjunction with all previous conclusions drawn, supports the final, capping conclusion that the single consideration, i. e. the loan by North Hills Bank to C & M, constituted a “new” and “independent” consideration to support Forum’s promise to guarantee Berbiglia’s performance under the lease to both North Hills Bank and C & M.
Having probed the various facets of the consideration issue raised by Forum in terms of applicable principles of general contract law, this court is constrained to hold that adequate consideration existed to support the guaranty in favor of C & M, as well as in favor of North Hills Bank, notwithstanding Forum’s argument that adequate consideration, at best, existed only in support of the guaranty in favor of North Hills Bank.
Having found no prejudicial error committed by the triers of fact, Berbiglia’s efforts to absolve itself of legal responsibility
Judgment affirmed.
All concur.
Notes
. For example see:
Thompson v. Allstate Insurance Company,