Court Opinion

ID: 9766252
Source: CourtListenerOpinion
Date Created: 2023-08-29 04:38:00.231586+00
Date Added: 2024-06-11T07:30:20.701755
License: Public Domain

On Motion for Rehearing
BARRON, Justice.
Contrary to appellant’s apparent position on motion for rehearing, we did not hold that the doctrine of res judicata applied in this case. What we did hold was that the doctrine of collateral estoppel or estoppel by judgment is applicable so far as findings on undisputed issues were concerned in the federal decision by the Court of Appeals for the Fifth Circuit referred to in the opinion.
We cannot ignore material findings by the Fifth Circuit in this case by the identical parties. In Mayfield Co. v. Rushing, 133 Tex. 120, 127 S.W.2d 185, 187, (Tex.Com.App.), op. adopted, the Court said:
“We think it entirely proper to look to said opinion (the Fifth Circuit) to determine the basis of its judgment affirming the action of the lower court.” (Parenthesis added.)
In the federal case of Martin v. Phillips it was said:
“Martin protested Phillips being brought into the deal, and commenced a search for financing elsewhere the next day. Neither Martin nor his representative were invited or in attendance at the morning meeting which consisted of representatives of Phillips, the Bank, De-Laat, and others. At this meeting, materials furnished by Martin to the Bank were made available to Phillips. Martin was brought into the meeting that afternoon and was informed that his original proposal was not acceptable to the Bank. He was offered participation in a revised deal submitted by Phillips, whereby he would have received a three-sixteenths overall interest. Martin rejected this counter-proposal; withdrew his loan application; and proceeded in his efforts to obtain financing elsewhere. Unable to obtain such financing, his sub-option expired unexercised on January 25, 1961.” (365 F.2d 629, 632.)
The federal court in an appeal from a summary judgment below in effect held that the above was undisputed evidence, and such was evidence and findings with the identical appellant and the identical ap-pellees before the court. Martin’s termination of any further dealings with the bank on January 16, as above, completely foreclosed any right he might have had to the subsequent imposition of a constructive trust. It cannot be said that a constructive trust can be imposed for acts occurring after negotiations and dealings were terminated by Martin, regardless of what his reasons or intentions were. Moreover, the prior agreements or understandings with regard to the bank’s proposed financing (which appellant contends created the fiduciary relationship) of necessity had to be tentative, depending strictly upon whether the bank desired to make the loan of $2,-000,000 which Martin had applied for. Appellant’s only real contention, as we understand this case, is based upon his claim of wrongful interference with business relations.
Appellant still insists that he made a pri-ma facie case for jury consideration on the ground of tortious and wrongful interference with advantageous business relations with the bank, and that Phillips and others wrongfully interfered therewith and are *441therefore liable to Martin. Phillips was invited into this complicated deal by the bank either as an adviser to the bank, for Phillips’ own interests, or both. In the case of Delz v. Winfree, 80 Tex. 400, 16 S.W. 111, 112, it was said:
“ ‘Every one has a right to enjoy the fruits and advantages of his own enterprise, industry, skill, and credit. He has no right to be protected against competition, but he has a right to be free from malicious and wanton interference, disturbance, or annoyance. If disturbance or loss come as a result of competition, or the exercise of like rights by others, it is damnum absque injuria, unless some superior right, by contract or otherwise, is interfered with. But if it comes from the merely wanton or malicious acts of others, without the justification of competition or the service of any interest or lawful purpose, it then stands upon a different footing.’ ” (Emphasis added.)
There was obviously no contract or completed agreement involved, and we find that there was no malicious or wanton acts of which Phillips was legally guilty, though the deal was a hard one. The fact that the bank and Phillips contended that Phillips was in the deal only as an adviser to the bank, that Martin was a mere finder of the Locust Ridge deal, that Phillips had a lawsuit against the Locust Ridge plant (which was justified in that loss of income resulted from improper gas processing), and other statements and opinions offered during the negotiations do not show malicious, wanton or fraudulent interference necessary for recovery by Martin upon such a theory under the circumstances.
Appellant, however, contends that the law requires only that such interference be intentional. But we believe the Texas decisions do not so indicate. See 33 Tex. Jur.2d, p. 104, Sec. 8. Considering the facts at best in favor of appellant, the interference, if any, came as a result of lawful competition or as a result of the service of Phillips’ own interest and lawful purposes. The bank was never obligated to make the loan to Martin as he proposed it, and the rejection of the loan as originally proposed was not arbitrary but was based upon reasonable and sound banking principles. Martin’s oral sub-option with Jett was not simply an unenforceable contract but was a nullity as to all persons under Louisiana law. No interference with contractual rights was involved.
Yet the facts show that the bank brought Phillips into the deal without the knowledge or consent of Martin, and made certain information available to Phillips which Martin had given the bank for its evaluation of the proposed loan. The bringing in of Phillips was not surreptitious, as claimed by Martin, for appellant was notified the next day by the bank that Phillips had been consulted. Although Martin objected, the bank and Phillips arranged a meeting in Houston on January 16, 1961 to evaluate the proposed loan, and Martin was not invited to such meeting until the afternoon of the same day. The events which took place have been outlined above, which resulted in a rejection of Martin’s proposed loan by the bank, a counter-offer to Martin made by the bank and Phillips, and Martin’s termination of any future relations with the bank.
The authorities are somewhat at odds upon the question of what is required to prove a prima facie case in tort for wrongful interference with business relations. No fixed and definite rule can be devised.
It has been said that:
“In short, it is no tort to beat a business rival to prospective customers. Thus, in the absence of prohibition by statute, illegitimate means, or some other unlawful element, a defendant seeking to increase his own business may cut rates or prices, allow discounts or rebates, enter into secret negotiations behind the plaintiff’s back, refuse to deal with him or threaten to discharge employees who do, or even *442refuse to deal with third parties unless they cease dealing with the plaintiff, all without incurring liability.” (Emphasis added.)
And in the same text it is stated further:
“The privilege of competition is limited to bona fide competition. It does not extend to situations where the defendant is not seeking to acquire the business diverted from the plaintiff for himself, but to gratify ill will or further some unrelated interest. Thus it does not extend to cases where there is no genuine competitive interest, but competition is simulated for spiteful ends or ulterior purposes * * Prosser on Torts, (3rd Ed.), pp. 979, 980. See and compare Restatement of the Law, Torts, Sec. 708, 709, 768 and 772; The Law of Torts, Harper & James, Sec. 6.11-6.13.
If Phillips was not solely an adviser to the bank in this difficult decision concerning a loan to Texas San Juan or to Martin, then it clearly had the right to compete with Martin for the acquisition of the Locust Ridge properties. The question here is somewhat difficult, but we believe that Phillips’ participation in the deal was invited by the bank for the bank’s benefit, that there is no evidence of malicious, wanton or fraudulent interference by Phillips and others, and that such participation was justified in law by competition and not with intent maliciously to injure Martin. See Goldman v. Hartford Road Building Ass’n, 150 Md. 677, 133 A. 843 (1926). Moreover, we belive that as a matter of law no reasonable likelihood was proven by appellant that the bank would make the loan as expected by Martin under the circumstances. The prerequisites to the contemplated financing were never met. Union Car Advertising Co. v. Collier, 263 N.Y. 386, 189 N.E. 463 (1934).
In our opinion, there were no material issues of fact to be submitted to the jury, and for the reasons stated here and in our original opinion, appellant’s motion for rehearing is respectfully overruled.