Court Opinion

ID: 9645977
Source: CourtListenerOpinion
Date Created: 2023-08-22 21:41:24.711453+00
Date Added: 2024-06-11T18:11:33.601029
License: Public Domain

OPINION
BUTTS, Justice.
Victor M. Solis Underground Utility and Paving Co., Inc. and Victor M. Solis, individually, (Solis) originally sued the City of Laredo, Marvin Townsend, Amador Es-cudero, Baldmero Ortiz, Jack Van Horn, and Lockwood, Andrews and Newnam, (LAN) for breach of contract, harassment, conspiracy, tortious interference with contractual relationship, and defamation. The City of Laredo counterclaimed for breach of contract. During trial Solis dismissed, with prejudice, all causes of action against Townsend, Escudero, and Ortiz. Solis also dismissed all causes of action against the City of Laredo, except a claim for damages resulting from the City’s alleged breach of contract. The breach of contract actions were tried to the jury.
At the close of Solis’ evidence, the trial court directed verdicts in favor of appellees Jack Van Horn and LAN. The court then submitted special issues to the jury relating to Solis’ claim against the City for breach of contract. The court also submitted issues regarding the City’s counterclaim for breach of contract. Based on the jury’s findings, the court entered judgment that Solis take nothing in his breach of contract claim and further, that Solis pay the City $136,500.00 for damages in its breach of contract counterclaim and attorney’s fees.
This case stems from a contract between Solis and the City whereby Solis agreed to construct a storm sewer system known as the Mother Cabrini Project. The company began work on the project in January, 1984. After several months with continuing delays and disputes concerning the quality of the work, Van Horn, engineer-employee of LAN, the City’s consulting engineer on the project, recommended that the City order Solis to suspend work on the drainage project.
Solis obtained a temporary injunction, but that order was suspended. Solis filed for bankruptcy shortly thereafter. The City subsequently terminated the contract and completed the project using City employees. The instant suit resulted.
Solis argues in the first point of error that the trial court erred in directing a *534verdict in favor of Van Horn and LAN. We disagree.
A defendant is entitled to a directed verdict only if reasonable minds cannot differ in their conclusion that the plaintiff failed to establish a cause of action against it. Jones v. Tarrant Utility Co., 638 S.W.2d 862, 865 (Tex.1982). Further, we must consider all the evidence in the light most favorable to the plaintiff, disregarding all contrary evidence and inferences.
Solis went to trial on two causes of action against Van Horn and LAN: one for tortious interference with a contractual relationship, the other for conspiracy. To establish a cause of action for tortious interference, the claimant must show (1) that the defendant maliciously interfered with a contractual relationship and (2) the defendant did so without legal justification or excuse. Sakowitz v. Steck, 669 S.W.2d 105, 107 (Tex.1984).
The Texas Supreme Court in Massey v. Armco Steel Co., 652 S.W.2d 932 (Tex.1983), held that:
An actionable civil conspiracy is a combination by two or more persons to accomplish an unlawful purpose or to accomplish a lawful purpose by unlawful means. [Citations omitted] The essential elements are: (1) two or more persons; (2) An object to be accomplished; (3) a meeting of minds on the object or course of action; (4) one or more unlawful, overt acts; and (5) damages as the proximate result.
Id. at 934.
The evidence shows that the City hired LAN with its employee, Van Horn, to serve as the project’s consulting engineer. Under its contract with the City LAN was obligated to continuously inspect the contractor’s work and report any failures of the work or materials to conform to the project specifications. The contractor was informed in its contract with the City of this duty to inspect.
Van Horn served as the project engineer for the Mother Cabrini work. He helped the City select the contractor, drafted the plans, and was responsible for overseeing the project through completion. Ortiz was City Inspector and worked as an on-site inspector under the direction of Van Horn.
Solis alleged that Van Horn and Ortiz went beyond the scope of their contract with the City and sought to prove that Van Horn conspired with Ortiz to harass appellant into breaching its contract with the City.
Solis testified that on numerous occasions Ortiz would disrupt the work at the work site. He maintained that Ortiz would hinder Solis’ ability to perform the contract. Other testimony came from Reynaldo Roberto Esparza, Ortiz’ former son-in-law. During direct examination Esparza testified:
Q: ... Did Mr. Ortiz ever tell you anything during this period of time that Mr. Van Horn said to him?
A: Mr. Ortiz told me that they had told him to put pressure on Mr. Solis. That’s what he told me.
Q: Was this at the time that the Mother Cabrini job was going on?
A: Yes.
Q: This is what — I know this is a little confusing.
This is what Mr. Ortiz told you that Mr. Van Horn had told him:
A: Yes.
Q: Did he tell you what kind of pressure?
A: Well, the way he told me, between all of them, they had a plan to put pressure on Mr. Solis so that Mr. Solis, during the project, would get angry, so he would commit something, so from there they could get a hold of him. Because their plan was that—
* * * * * *
A: So that he can be removed from the project.
* * * * * *
Q: You used the term “all of them,” Mr. Esparza. What do you mean by “all of them?” Who do you mean?
*535A: Amador Escudero, Marvin Townsend, Jack Van Horn, and the other one, what’s his name?

* * * * * *

Ortiz denied any such plan existed. Moreover, since Ortiz was no longer a party to the suit, this was clearly hearsay as to Van Horn, and the objection should have been sustained. There was evidence that much of the work of Solis did not meet the plans and specifications, that Solis would not cooperate with supervisors on the job, nor even later with the supervising engineer appointed by the bankruptcy court.
Ortiz testified that Solis failed to turn in any schedule of work progress as required and that work (laid pipes) would be covered up before he could inspect it. He testified that on one occasion there was no superintendent on the project. At Van Horn’s instruction, Ortiz would send letters of notice to Solis showing the construction contract terms were not being met. He stated that as inspector he had the right “in the specifications book” to stop the work if something was wrong. Ortiz at first gave the letters of notice to Solis’ worker who in turn handed them to Solis. He said that instead of putting the letters in the records, Solis threw them away. Ortiz then gave the notice letters to Solis in the office. Both Van Horn and Ortiz denied there was a plan by anyone to put pressure on Solis to cause the project to be ended unsuccessfully.
TORTIOUS INTERFERENCE
Not all interferences with contractual relations are tortious in nature.
An important element in a right of recovery for contract interference is that the interference must be without right or justification. Interference with contractual relations is privileged where it results from the bona fide exercise of a party’s own rights or where the party possesses an equal or superior interest to that of the plaintiff in the subject matter. Black Lake Pipe Line Company v. Union Construction Company, Inc., 538 S.W.2d 80, 91 (Tex.1976), citing Terry v. Zachry, 272 S.W.2d 157 (Tex.Civ.App.—San Antonio 1954, writ ref'd n.r.e.); 45 Am.Jur.2d Interference § 27 (1969), at 304-305.
In this case the consulting engineer employed by the City to oversee the project had the absolute right to reject work which did not meet contract specifications. This would not be evidence of malicious behavior, which is a necessary element of proof. The consulting engineer (LAN) along with its employee on the project was not liable because the recommendation to terminate the contract with Solis was based on the engineer’s superior contractual rights with the City and to protect those rights. Thus, the contractor was not entitled to recover against the City’s consulting engineer for interference with contractual relations where the engineer was justified in exercising its superior legitimate interest by recommending termination.
The scholarly discussion of interference actions in Terry v. Zachry, supra at 160 is instructive. It distinguishes those instances when the interference is caused by third party strangers, called an exception to the general rule, and when the interference is caused by a servant or agent, citing Greyhound Corporation v. Commercial Casualty Ins. Co., 259 App.Div. 317, 19 N.Y.S.2d 239, 242 (1940), which quotes from the English authority, Said v. Butt, L.R. 3 K.B. 497, which states:
“ ‘But the servant who causes a breach of his master’s contract with a third person seems to stand in a wholly different position. He is not a stranger. His acts are in law the acts of his employer. In such a case it is the master himself, by this agent, breaking the contract he has made, and in my view an action against the agent under the Lumley v. Gye principle must therefore fail, just as it would fail if brought against the master himself for wrongfully procuring a breach of his own contract. * * * ’ ”
In the present case LAN and Van Horn were agents of the City. Just as an instructed verdict in favor of the City on the interference action would have been proper, because the cause of action must fail, so it was in the case of its agents. We have *536no need to determine whether LAN, with Van Horn, was an independent contractor. Whether it was an independent contractor or not, it is plain that LAN, with Van Horn, was an agent of the City.
COMMON LAW CONSPIRACY
Similarly no cause of action was proved against Van Horn and LAN for common law conspiracy. Such an action arises only where two or more persons, acting together, commit an unlawful act, or they accomplish a lawful purpose by unlawful means. Massey v. Armco Steel Co., supra at 934. We hold it was not unlawful for Van Horn (as employee of LAN, the consulting engineer) to supervise the project as provided for in the contract with the City. There is no proof that Van Horn and Ortiz committed unlawful acts or that they used unlawful means to accomplish a lawful purpose. Solis’ civil conspiracy claim must fail. We therefore hold that the trial court properly instructed verdicts for Van Horn and LAN. The first point is overruled.
SUMMARY BUSINESS RECORDS
In the second point of error Solis argues the trial court erred in admitting in evidence one of the City’s exhibits introduced to establish the City’s damages for Solis’ breach of contract.
It is argued the document was inadmissible because the person through whom the City sought to introduce the exhibit, the Public Works Director, admitted he had no personal knowledge of the contents of the document, and that the report was created in preparation for trial of this case. Objection was based on grounds that it contained hearsay and did not fall within any of the exceptions to the hearsay rule. TEX.R. EVID. 803.
The exhibit in evidence is a summary of costs to the City for completing the construction job after Solis’ contract was terminated.
A summary of business records may be admitted into evidence upon proof that (1) the records summarized are voluminous, (2) they have been made available to the opponent for a reasonable period of time to afford inspection and an opportunity for cross-examination, and (3) the supporting documents are themselves admissible in evidence. TEX.R.EVID. 1006; Aquamarine Associates v. Burton Shipyard Inc., 659 S.W.2d 820, 821-822 (Tex.1983); Duncan Development, Inc. v. Haney, 634 S.W.2d, 811, 812-13 (Tex.1982); Black Lake Pipe Line Co. v. Union Construction Co., 538 S.W.2d 80, 92-3 (Tex.1976).
The Director of Public Works testified that he, along with other City employees, had prepared this cost summary. He testified that while he did not have personal knowledge of some of the underlying data, the summary was based on data kept in the usual course of the City’s regularly conducted activity, and that it was the regular practice of the City to collect such data. He further testified that he had the underlying cost data presently available at trial.
Solis did not object to any of the underlying data or, as the record indicates, ask to examine it. Therefore, it may be presumed that all the underlying data was admissible. This being the case, the cost summary was properly admitted under Rule 1006 of the Texas Rules of Evidence as an exception to the hearsay rule. Rule 803(6). Point of error two is overruled.
In points of error three and four Solis maintains the trial court erred in submitting a special issue on damages based on the cost summary, and further, that judgment should not have been entered based on the jury findings. Because the summary was properly admitted as a business record exception to the hearsay rule, the trial court was correct in submitting the damages issue based thereon. The evidence thus adequately supported the findings of damages in favor of the City for breach of contract, and the judgment was properly entered. The points are overruled.
EXCLUDING FORMER TESTIMONY
The fifth and sixth points are that the trial court erred in excluding the testimony *537of Cesario Porras and Tim Donnell. Both testified at a prior temporary injunction hearing of the same case in June 1984. Solis argues the former testimony was germane to the conspiracy claim.
If a declarant is unavailable as a witness, Rule 806 of the Texas Rules of Evidence provides that testimony by that person at a former hearing is not excluded as hearsay if the party against whom the testimony is offered, “or a person with similar interest, had an opportunity and similar motive to develop the testimony by direct, cross, or redirect examination.” TEX.R.EVID. 804(b)(1). All parties, including Van Horn but excepting LAN, were present at the hearing. The Rules of Evidence define “unavailable as a witness” to include a person who “is absent from the hearing and the proponent of this statement has been unable to procure his attendance or testimony by process or other reasonable means.” TEX.R.EVID. 804(a)(5).
In the case of Cesario Porras, it was not shown that the proponent (Solis) was unable to secure Porras’ attendance or testimony by process or other reasonable means. Porras lived in Laredo at the time of trial. A subpoena was issued three days before trial began, but the subpoena was never served on Porras. The deputy constable testified that the only attempts to contact Porras were made at his office between 1:00 p.m. and 5:00 p.m. No one tried to contact Porras at his residence. It was known for approximately two years prior to trial that Porras was a potential witness, yet his deposition was never taken. Under these circumstances, therefore, the trial court correctly excluded his former testimony. See Hall v. White, 525 S.W.2d 860, 861-862 (Tex.1975).
Solis more clearly demonstrated that Donnell was unavailable at trial. The record showed that despite significant efforts to locate Donnell over a substantial period of time, Donnell’s whereabouts really were unknown. A close friend of Donnell’s testified that he had not heard from Donnell in over a year, but the last he knew Donnell was in Austin. Solis tried without success to locate Donnell in Austin.
Donnell read a letter he had written to Solis at the temporary injunction hearing. It contained conclusory opinions about efforts to hinder appellant’s ability to perform his contract. It contained no specific facts. Solis sought to introduce the same letter of Donnell at this trial. No other testimony of Donnell was offered in the bill of exceptions ... only the letter. We hold there was no error in excluding the letter. See, TEX.R.EVID. 103(a).
However, even if this were error, Solis admitted similar evidence was available through another witness, that is, the individual himself, Victor Solis. Moreover, he testified to facts whereas no specific facts were stated in Donnell’s letter. Therefore, we hold the trial court’s error, if any, in excluding the prior evidence, the letter, was harmless.
The judgment is affirmed.