Opinion ID: 1870807
Heading Depth: 3
Heading Rank: 1

Heading: West Palm

Text: There is no dispute that West Palm did not sign a Pro Net membership application. However, appellants seek to compel West Palm to arbitrate under the arbitration clause in Pro Net's Terms and Conditions as a third-party beneficiary of Ken Stewart or Stewart Associates' agreement with Pro Net. For the same reasons that West Palm is not a third-party beneficiary of the agreement with Amway, it is not a third-party beneficiary of the Pro Net agreement. The Pro Net Terms and Conditions do not express any intent to benefit West Palm. Further, to the extent that West Palm did obtain any benefit from Pro Net, the benefit was merely incidental to Stewart's relationship with Pro Net, and, as explained, an incidental benefit is insufficient to establish third-party beneficiary status. Appellants also argue that West Palm is estopped from avoiding arbitration under the Pro Net agreement with Stewart because West Palm received benefits from Pro Net membership. To be sure, [b]y accepting benefits, a party may be estopped from questioning the existence, validity and effect of a contract, Dunn, 112 S.W.3d at 437 (citing Dubail v. Medical West Bldg. Corp., 372 S.W.2d 128, 132, (Mo.1963)), but here, appellants do not identify any benefits to West Palm. They claim instead only that Nitro and Stewart had access to the tapes of other Pro Net members that they otherwise would not have had the right to purchase and sell and that the Stewart Organization profited from selling Mr. Stewart's audio tapes through Pro Net.... There is no allegation that West Palm, itself, as opposed to Nitro or Stewart Associates, was doing business with Pro Net or otherwise availing itself of Pro Net membership. Appellants' legal theory on the estoppel issue is unclear, but it seems to be (1) that West Palm is estopped even if it benefited only indirectly from Nitro and Stewart's membership in Pro Net, and (2) that West Palm is estopped because it is the alter ego of Nitro and Stewart Associates, and (3) that in any event, West Palm conceded that it is a member of Pro Net. On the first point, appellants cite no case holding that mere indirect benefits are sufficient to establish estoppel, and although Missouri courts have not expressly addressed the issue, the authority from other courts is wholly to the contrary and wholly persuasive. See, e. g., Thomson-CSF, S.A. v. American Arbitration Ass'n, 64 F.3d 773, 779 (2d Cir.1995). See also 31 C.J.S. Estoppel and Waiver sec. 123 (1996). The reasoning, of course, is that the nonsignatory is benefiting from the contractual relationship of those who are indeed parties to the contract, rather than benefiting from the contract, itself. Thomson-CSF, S.A., 64 F.3d at 779. On the second point  the alter ego theory  Appellants would have this Court disregard West Palm's status as a separate and independent corporation, but the only way to achieve that result is by piercing the corporate veil. That remedy, however, in the context of the issues presented here, is only available where outside control of the corporation has been used to commit fraud or wrong, to perpetrate the violation of statutory or other positive legal duty, or [a] dishonest and unjust act.... 66, Inc. v. Crestwood Commons Redevelopment Corp., 998 S.W.2d 32, 40 (Mo. banc 1999). Suffice it to say that appellants have neither pled nor proven this element. As for the third point, appellants make much of the fact that respondents pled in a related federal case that Nitro and West Palm were lured into Pro Net and then boycotted or minimized. In the context of the entire complaint, however, plaintiffs were merely making the point that Pro Net was part of a larger conspiracy to misappropriate the respondents' businesses in which appellants were giving Amway-related companies the option of joining Pro Net or being boycotted from the BSMs industry. They were not, as appellants suggest, conceding that West Palm had agreed to the Pro Net Terms and Conditions or taken advantage of Pro Net membership. The same holds true, in context, for respondents' preparation of a summary chart for discovery purposes showing Nitro and West Palm under Pro Net's umbrella. There is no estoppel by concession. In sum, because West Palm is a separate corporation from Nitro and Stewart Associates, was not a signatory to the Pro Net agreement, and did not accept direct benefits from Pro Net, it is not now estopped to deny Pro Net membership.