Title: Doud v. First Interstate Bank of Gillette

State: wyoming

Issuer: Wyoming Supreme Court

Document:

Doud v. First Interstate Bank of Gillette1989 WY 58769 P.2d 927Case Number: 88-268Decided: 03/01/1989Supreme Court of Wyoming
BEN R. 
DOUD, DEBTOR-IN-POSSESSION, AND LAKEWAY DEVELOPMENT, A PARTNERSHIP, APPELLANTS 
(PLAINTIFFS),

 
 
v.

 
 
FIRST 
INTERSTATE BANK OF GILLETTE AND HOMER A. SCOTT, JR., APPELLEES 
(DEFENDANTS).

 
 
Appeal from 
the District Court, CampbellCounty, Timothy J. Judson, 
J.

 
 
Georg 
Jensen of Law Offices of Georg Jensen, Cheyenne, for appellants.

 
 
Robert G. 
Berger of Lonabaugh and Riggs, Sheridan, for appellee First Interstate Bank of 
Gillette.

 
 
Kim D. 
Cannon of Burgess & Davis, Sheridan; and Myron L. Listrom and Ann L. Hoover 
of Sloan, Listrom, Eisenbarth, Sloan & Glassman, Topeka, Kan., for appellee Homer A. Scott, 
Jr.

 
 
Before 
CARDINE, C.J., and THOMAS, URBIGKIT, MACY and GOLDEN, JJ.

 
 

MACY, 
Justice.

 
 
[¶1.]     Appellants Ben R. Doud 
and Lakeway Development filed an action against appellee First Interstate Bank 
of Gillette alleging breach of a contract to lend money and against appellee 
Homer A. Scott, Jr. alleging tortious interference with contractual rights 
between appellants and First Interstate Bank. The district court granted summary 
judgments in favor of appellees.

 
 
[¶2.]     We 
affirm.

 
 
[¶3.]     Appellants present the 
following issues for our review:

 
 
1. Did the 
District Court err in granting summary judgment on the question of whether a 
contract existed between [appellants] and [appellee] First Interstate Bank - 
Gillette[?]

 
 
2. Did the 
District Court err in granting summary judgment on the question of whether 
[appellee] Scott tortiously interfered with a contractual relationship between 
[appellants] and [appellee] First Interstate Bank - Gillette or 
others[?]

 
 
[¶4.]     Doud served on the 
board of directors of First Interstate Bank during the years 1983 and 1984, and 
he was a partner in Lakeway Development. During his term as a director of First 
Interstate Bank, Doud received a line of credit for the year 1983. He also 
received a line of credit for the year 1984, with that credit line to expire on 
January 17, 1985. In late 1985, Doud, who was no longer a director of the bank, 
sought financing for a business purchase to be made through Lakeway Development. 
Consequently, Doud approached Ronald Ostermiller, who was then president of 
First Interstate Bank, regarding a loan or a line of credit. In January 1986, 
First Interstate Bank, through Ostermiller, informed Doud that the requested 
funds would not be advanced.

 
 
[¶5.]     On December 31, 1987, 
Doud filed this action alleging, inter alia, breach of contract to loan money 
against First Interstate Bank and tortious interference with contract against 
Scott, a director of First Interstate Bank throughout all times material to this 
suit. Due to his involvement in bankruptcy proceedings and the involvement of 
Lakeway Development in the transaction for which Doud had sought financing, Doud 
was allowed to amend his complaint to designate himself, as debtor-in-possession 
of the claim against First Interstate Bank, and Lakeway Development as the 
proper party plaintiffs. Both appellees filed motions for summary judgment with 
supporting affidavits and discovery materials. After separate hearings the 
district court granted summary judgment for each appellee. With respect to the 
claim against First Interstate Bank, the district court found there was no 
enforceable contract, and thus there was no breach. The district court 
consequently found, with respect to the claim against Scott, that, since there 
was no contract, there could be no interference therewith.

 
 
I.

 
 
[¶6.]     Appellants first 
contend that there are genuine issues of material fact regarding the existence 
of a contract precluding the entry of summary judgment on that issue. In 
reviewing the grant of summary judgment,

 
 
we review 
the judgment in the same light as the district court, using the same 
information. A party moving for summary judgment has the burden of proving the 
nonexistence of a genuine issue of material fact. Material fact has been defined 
as one which, if proved, would have the effect of establishing or refuting an 
essential element of the cause of action or defense asserted by the parties. 
Upon examination of a summary judgment, we view the record from the vantage 
point most favorable to the party opposing the motion, giving him all favorable 
inferences which may be drawn from the facts.

 
 
Garner v. 
Hickman, 709 P.2d 407, 410 (Wyo. 1985) 
(citations omitted), quoted in Albrecht v. Zwaanshoek Holding En Financiering, 
B.V., 762 P.2d 1174, 1176 (Wyo. 1988). A proper grant of summary judgment 
depends upon the dual findings that there are no genuine issues of material fact 
and that the prevailing party is entitled to judgment as a matter of law. Teton 
Plumbing and Heating, Inc. v. Board of Trustees, Laramie County School District 
Number One, 763 P.2d 843 (Wyo. 1988); St. Paul Fire and Marine Insurance Co. v. 
Albany County School District No. 1, 763 P.2d 1255 (Wyo. 
1988).

 
 
[¶7.]     Appellants, in their 
complaint and amended complaint, alleged that in November 1985 Doud approached 
First Interstate Bank, through Ostermiller, regarding Doud's need for a $90,000 
line of credit; that Doud was advised that such a draw was "not any problem"; 
that Doud and First Interstate Bank agreed to conclude the loan immediately 
after the first of the new year; and that First Interstate Bank thereafter 
breached such agreement by refusing to advance the agreed upon funds. In support 
of its motion for summary judgment, however, First Interstate Bank produced bank 
records and affidavits from bank personnel which indicated that no loan 
application had been filed with the bank with respect to the alleged agreement; 
that Doud had applied for and received lines of credit for the years 1983 and 
1984 after submission of written applications to and approval by the board of 
directors; that no subsequent lines of credit had been approved; that in late 
1985 or early 1986 Doud verbally inquired about a line of credit on behalf of 
the Lakeway Development partnership; that First Interstate Bank did not agree to 
loan appellants money at that time; that no loan amount, interest rate, 
repayment schedule, or acceptable collateral was agreed upon during this oral 
discussion; and that in January 1986 Ostermiller became aware of Doud's 
delinquency on an obligation due another bank whereupon he advised Doud that a 
new loan would not be approved.

 
 
[¶8.]     First Interstate Bank, 
therefore, established a prima facie case for summary judgment, and the burden 
shifted to appellants to come forth with competent evidence of specific facts, 
rather than general allegations, to counter the facts presented by the movant. 
Roth v. First Security Bank of Rock Springs, 
Wyoming, 684 P.2d 93 (Wyo. 1984); W.R.C.P. 
56(e). Appellants, accordingly, submitted the affidavit of Doud in opposition to 
First Interstate Bank's motion for summary judgment. In this affidavit Doud 
stated that, in prior dealings with the bank, he had never submitted written 
loan requests or applications before the loans had been approved. He stated that 
in past transactions his loan requests were granted verbally and later reduced 
to writing at board meetings. Doud stated that the alleged loan commitment at 
issue was made in the same manner as these prior transactions and that he always 
had been able to rely upon such course of business. Doud further stated in this 
affidavit that the terms of the alleged loan agreement had not been specifically 
set out because they were known to both himself and Ostermiller pursuant to 
their positions with the bank and past course of dealing. Doud additionally 
stated that it was well known to himself and "all other directors" that 
directors' loans were granted at the bank's base rate and were evidenced by 
demand notes. Doud maintained in this affidavit that Ostermiller had committed 
verbally to extend a line of credit to him.

 
 
[¶9.]     Applying our standards 
of review of summary judgment, as set out above, we agree with the district 
court that there are no genuine issues of material fact and that as a matter of 
law no contract, agreement, or commitment was ever formed obligating First 
Interstate Bank to lend money to appellants. We acknowledge that a bank may 
sustain liability as a result of failing to lend money in accordance with a 
contractual agreement to do so. 10 Am.Jur.2d, Banks § 683 (1963). Reviewing the 
record from the vantage point most favorable to appellants, however, reveals, at 
most, an agreement to agree in the future. While a party to such an agreement 
may perceive that a binding obligation is created by this type of agreement, the 
courts are incapable of ordering enforcement, as they cannot supply the terms of 
the agreement for the parties. Rialto Theatre, Inc. v. Commonwealth Theatres, 
Inc., 714 P.2d 328, 334 (Wyo. 1986). Doud admitted in his affidavit 
that the terms of the alleged agreement were not 
established.

 
 
[¶10.]  Doud claims that his previous dealings 
under similar circumstances with First Interstate Bank gave him an expectation 
that the loan at issue in this case would also be forthcoming, but this claim 
simply is not borne out by his affidavit. The circumstances were not similar. 
Doud was no longer a bank director when the disputed loan inquiry was made, and, 
even assuming that Doud expected to be treated as he had been in the past for 
purposes of acquiring loans, he did not follow the procedure utilized when he 
actually was a director of First Interstate Bank. The factual assertions by 
Doud, considered in a light most favorable to him, fail to establish that a loan 
commitment was made in late 1985. Thus, although certain factual disputes are 
presented by the materials submitted by the parties, they are not material to 
the question of the existence of a contract. In addition, if we accept Doud's 
factual allegations concerning his past dealings with First Interstate Bank, we 
can only conclude that none of the loans made to him were made pursuant to a 
contractual obligation to make those loans. The fact that Doud received loans on 
the earlier occasions does not support a conclusion that he was entitled to a 
loan in 1986.

 
 
[¶11.]  Our decision is supported by Roth, 684 P.2d  at 95-97. In that case, the plaintiff alleged that a bank and its officers 
had wrongfully denied him a loan and that the bank was estopped from asserting 
the nonexistence of the loan because of certain informal remarks made by a 
director of the bank to the plaintiff to the effect that the plaintiff had 
nothing to worry about concerning his loan request and that he could soon start 
writing checks on the loan. The plaintiff in Roth indicated that he had relied 
upon inferences made by a loan officer and past dealings with the local banking 
community in assuming he would obtain the loan. In affirming summary judgment 
for the defendants, we stated that the plaintiff, with an extensive background 
in banking and business, should have known that he had neither a loan nor a 
commitment for a loan from the bank "until he might be informed by the loan 
officer or bank official with whom he was dealing that the loan was approved." 
Id. at 97. In 
the instant case, Doud similarly demonstrated his complete understanding and 
knowledge concerning the handling of bank transactions generally, and certainly 
those with First Interstate Bank. Under these circumstances, Doud cannot sustain 
a claim that he was somehow passively led to believe that a loan commitment had 
been made when he, by his own admission, had not followed any application 
procedure, not even that informal one which he received the benefit of as long 
as he was serving as a bank director.

 
 
[¶12.]  Appellants' reliance on Landes 
Construction Co., Inc. v. Royal Bank of Canada, 833 F.2d 1365 (9th Cir. 
1987), is misplaced. In that case, which was described by the court as "little 
more than a swearing contest," id. at 1371, the plaintiff's assertion of an oral 
contract to lend money was clearly supported by undisputed facts that the 
plaintiff and a representative of the defendant bank had several documented 
meetings to discuss the terms of the loan, that the plaintiff had actually 
purchased the golf course property for which the loan was negotiated, that the 
bank had advanced some $3 million which had been applied by the plaintiff to the 
purchase of the golf course property consistent with the terms of the alleged 
oral contract, and that the dealings between the plaintiff and the defendant 
were the same as prior dealings they had conducted for the purchase of a golf 
course on another occasion. Id. at 1368-69. Appellants' claim of an oral 
contract may have all the flaws of the oral contract at issue in the Landes 
Construction Co., Inc. decision, but it has none of the features which the Ninth 
Circuit relied upon in affirming the jury verdict finding the oral contract had 
been formed. The summary judgment in favor of First Interstate Bank is 
affirmed.

 
 
II.

 
 
[¶13.]  We next address appellants' contention 
that the summary judgment in favor of Scott was erroneous.

 
 
[¶14.]  Appellants alleged tortious interference 
by Scott with a valid contractual relationship between appellants and First 
Interstate Bank, resulting in appellants' inability to prepay an installment 
purchase contract because they were not able to obtain a loan from First 
Interstate Bank. To establish a tortious interference with a contract, a 
plaintiff must prove: (1) the existence of a contract; (2) the defendant's 
knowledge of the contract; (3) intentional and improper interference inducing or 
causing a breach; and (4) resulting damages. First Wyoming Bank, Casper v. Mudge, 748 P.2d 713 (Wyo. 1988). Relying upon 
our determination that no contract existed, we hold that, as a matter of law, 
summary judgment was properly entered on appellants' claim against Scott for 
tortious interference with a contract because no contract was proved.1

 
 
[¶15.]  In an attempt to avoid affirmance 
premised on the lack of a contract, appellants additionally contend that the 
lack of a contract need not be fatal as to a claim against Scott for 
interference with their business expectancy, a claim not raised below. They cite 
Martin v. Wing, 667 P.2d 1159, 1161-63 (Wyo. 1983), wherein we recognized that 
individuals are entitled to be free from intentional interference with the right 
to conduct negotiations which have a reasonable probability of resulting in a 
contract and that it is not required that the existence of a valid contract be 
alleged in such an action. While it is tempting to merely conclude, viewing the 
record in the light most favorable to appellants, that they presented no facts 
indicating any wrongful interference by Scott with prospective contractual 
relations, we focus instead upon the fact that appellants simply did not raise 
this cause of action in the proceedings below. No such cause of action was 
addressed in the district court's judgment, and, if appellants were genuinely 
interested in pursuing such a theory, they made no post-judgment effort to call 
the district court's attention to its failure to dispose of such a claim. We do 
not consider issues raised for the first time on appeal except under unusual 
circumstances which are not present in this case. Thatcher & Sons, Inc. v. 
Norwest Bank Casper, N.A., 750 P.2d 1324 
(Wyo. 1988). 
The summary judgment in favor of Scott is affirmed.

 
 
[¶16.]  AFFIRMED.

 
 
FOOTNOTES

 
 

1 We also 
agree with the district court that appellants failed to present any evidence 
indicating any intentional or improper action on the part of Scott with respect 
to appellants' alleged contract rights.