Opinion ID: 1262875
Heading Depth: 1
Heading Rank: 2

Heading: Contract Duties

Text: Because Sharp was not in privity of contract with either Security Investments or Security Police, the only possible contractual duty owed to her by these two defendants would be under a third party beneficiary theory. Here, Sharp alleges, and the majority opinion by reversing apparently assumes, that the contracts between (1) Moore and Security Investments, and (2) Security Investments and Security Police were intended to benefit her as an employee of Moore's tenant, Swan. However, a review of our prior cases clearly demonstrates that plaintiff Sharp was not a third party beneficiary of those contracts between (1) Moore and Security Investments, and (2) Security Investments and Security Police. We have previously set forth requirements for recovery under third party beneficiary theory: [B]efore recovery can be had by a third party beneficiary, it must be shown that the contract was made for his direct benefit, or as sometimes stated primarily for his benefit, and that it is not sufficient that he be a mere incidental beneficiary. ... . ... [T]he contract itself must express an intent to benefit the third party. `This intent must be gleaned from the contract itself unless that document is ambiguous, whereupon the circumstances surrounding its formation may be considered.' [ Stewart v. Arrington Construction Co., 92 Idaho 526, 532, 446 P.2d 895, 901 (1968)]. Adkison Corp. v. American Building Co., 107 Idaho 406, 409, 690 P.2d 341, 344 (1984). A third party may only enforce a contract if he can show he is a member of a limited class for whose benefit it was made. Stewart v. Arrington Construction Co., 92 Idaho at 532, 446 P.2d at 901; Just's, Inc. v. Arrington Construction Co., 99 Idaho 462, 464, 583 P.2d 997, 999 (1978). Here, in order for Sharp to recover from Security Investments under a third party beneficiary theory, the contract between Security Investments and Moore must express an intent to benefit her as a third party. However, the contract does not express such an intent. In its Management Agreement with Moore, Security Investments agreed to manage the plaza and to provide for the smooth and efficient physical operation of the [ plaza ] by making appropriate arrangements for and supervising the delivery of utilities, security, emergency response, inspection and other services incidental to the operation of the [ plaza ]... . In the contract, Security Investments undertook no duty with reference to the safety of the tenants' employees. It only agreed to promote a harmonious relationship with Tenants on behalf of Owner, and in furtherance thereof shall visit all tenants at their premises on a regular basis to express the owner's appreciation of their tenancy and to solicit their suggestions and comments and shall provide prompt and courteous response to tenant inquiries and problems. Such a provision is insufficient to demonstrate that the parties intended that employees of a tenant would be able to exercise rights under the contract. At most the tenants' employees were only incidental beneficiaries of Security Investments' contractual duty to manage the plaza. Under our prior cases such an incidental beneficiary may not maintain a third party beneficiary action. Just's, Inc. v. Arrington Construction Co., 99 Idaho 462, 583 P.2d 997 (1978); Stewart v. Arrington Construction Co., 92 Idaho 526, 446 P.2d 895 (1968). It follows that if Security Investments' contract with W.H. Moore did not undertake an express contractual duty to intentionally benefit Sharp, then it could not further pass on such a duty in its contract with Security Police. Even if it could, Security Investments in fact did not contract expressly with Security Police to provide safe conditions for employees working in the plaza. Rather, in its Service Agreement with Security Investments, Security Police merely agreed to (1) furnish night patrol services to [the plaza] intermittently during the hours of 8:00 o'clock PM and 7:00 o'clock AM seven nights per week ... doors to be locked at 7-8:00 o'clock PM and unlocked at 7:00 o'clock AM on weekdays only; (2) check the above named premises for Forcible Entry, Unauthorized Persons, Unlocked Doors, Broken Windows, Fire ...; (3) [c]heck three front doors and fire escape on third floor, East end at opening, regular rounds and closing; and (4) protect the above premises from Prowlers, Vandals or Unauthorized Intruders. The contract makes no mention of providing personal security for either tenants or tenants' employees. Again, while tenants' employees may have derived some incidental benefits from the Security Investments-Security Police contract, the contract itself was not expressly intended to benefit them, and there is no indication that the contracting parties intended that third parties, such as Sharp, would be entitled to exercise rights under the contract as third party beneficiaries. The only arguable third party beneficiary from the Security Investments-Security Police contract was Moore, the plaza's owner. Even if the contracts of the defendants Security Investments and Security Police had been worded so as to express an intention that tenants or their employees were to be third party beneficiaries who could exercise rights under those contracts, violation of such a third party beneficiary provision would not have been a tort, but would merely have provided Sharp with contract damages. Taylor v. Herbold, 94 Idaho 133, 138, 483 P.2d 664, 669 (1971) (Ordinarily, a breach of contract is not a tort.). Sharp's claim against Security Investments and Security Police alleged a tort, not a breach of contract. Therefore, even if those two contracts had clearly provided that the tenants and their employees were intended to be direct third party beneficiaries, not merely incidental beneficiaries, Stewart v. Arrington Construction Co., 92 Idaho 526, 446 P.2d 895 (1968), the mere breach of the contract would not constitute a tort. To found an action in tort, there must be a breach of duty apart from the non-performance of a contract. Taylor v. Herbold, 94 Idaho at 138, 483 P.2d at 669. Accordingly, because Security Investments and Security Police did not owe any contractual duty to Sharp, the summary judgment entered in favor of Security Investments and Security Police should be affirmed.