Court Opinion

ID: 9457168
Source: CourtListenerOpinion
Date Created: 2023-08-04 20:14:24.65115+00
Date Added: 2024-06-11T17:35:14.631160
License: Public Domain

TIMBERS, District Judge
(concurring in part and dissenting in part):
I concur in the judgment of the Court and the able opinion of Judge Moore to the extent that it affirms the judgment of the District Court awarding plaintiff $90,845, plus $5,910.99 interest, on its quantum meruit recovery against Fidelity and Casualty.
With deference, however, I am constrained to dissent from the reversal of the District Court’s $50,000 judgment against Fidelity and Casualty and Brook-field-Baylor for tortious interference with plaintiff’s business relations. My dissent is based on the belief that the majority has failed to credit the findings of the District Court on this issue with the weight to which they are entitled under Rule 52(a), Fed.R.Civ.P.
The majority has correctly set forth the widely accepted legal standard for imposing liability based on tortious interference with business relations — in short, action without privilege which causes a third person to refuse to enter into or continue business relations with another, resulting in harm to the latter.
*447Restatement of Torts § 766 (1939). See also 1 Harper & James, The Law Of Torts § 6.11 (1956); 45 Am.Jur.2d Interference § 3 (1969).
Judge Oakes’ Findings of Fact Nos. 27-45 squarely support his conclusions that “defendant F & C’s interference was tortious, being willful and in bad faith” and “[defendant Brookfield-Baylor was a knowing participant in such interference although acting under defendant F & C’s. direction and control and is liable as is any other agent for tortious conduct even though acting for a principal.” Since, in my view, Judge Oakes’ findings on this issue are based on substantial evidence adduced at an eleven day trial before the late Judge Gibson and Judge Oakes,1 they are not clearly erroneous and should not be set aside.
In short, Judge Oakes found, and the evidence shows, that F & C and Brook-field-Baylor (a subsidiary of F & C) caused at least three separate third parties or groups to refuse to enter into or continue business relations with Spear: (1) suppliers and materialmen of Spear; (2) Spear’s sources of credit, such as banks; and (3) Spear’s bonding company. Moreover, Judge Oakes' found, and the evidence shows, that the tortious conduct which directly caused substantial financial harm to Spear consisted of (1) unreasonable delay by defendant F & C in making payment to Spear and Spear’s suppliers; (2) not permitting Spear to complete the subcontract and negotiating in bad faith in connection therewith; and (3) improperly instituting attachment proceedings and taking into possession Spear’s truck and causing its materials and equipment to be used.
While no useful purpose would be served by detailing the substantial evidence which I find supports these findings, brief reference to the undisputed evidence supporting the finding of unreasonable delay on the part of F & C in making payment to Spear and Spear’s suppliers will suffice to illustrate the point. Under the terms of its payment bond, F & C was obligated to “promptly make payment to . . . subcontractors . . . furnishing materials for or performing labor in the prosecution of the work provided for in such contract.” On December 20, 1968, Spear made formal demand upon F & C for payment to Spear and Spear’s materialmen under the bond. Not until July 4, 1969 — more than six months later — did F & C pay $51,492 to Spear and its suppliers and $681 to other creditors of Spear. In the meanwhile, F & C admitted in a letter written on May 28, 1969 that “we’ve offered what we consider a reasonable settlement — payment of his bills (which we owe under the bond anyhow) and some cash.” (Emphasis added.) On the basis of this evidence, Judge Oakes found that “Delay in payment by defendant F & C was unreasonably long. Such delay was intentional, vexatious and in bad faith on the part of defendant F & C.” 2
*448Similarly, there was substantial evidence that F & C’s delay in paying Spear under the bond had injured Spear’s credit rating with lending institutions — a matter of consequence to a small company with limited financial resources; that Spear’s relations with suppliers and materialmen likewise had been damaged by such delay; and that F & C’s intransigence in insisting that Spear’s bonding company, Aetna, in writing a bond to secure Spear’s completion of the job, must make Brookfield-Baylor the obligee (Brookfield-Baylor being in shaky financial condition because of its $2,000,000 indebtedness to F & C) resulted in a loss of Spear’s bonding capacity with Aetna, i. e. a temporary reduction from $2,000,000 to zero, and a subsequent restoration to $1,200,000.
All in all, I find Judge Oakes’ findings of fact to be clear, comprehensive and precise. In each instance they are buttressed by the evidence. As such, they are not clearly erroneous and should not be set aside. We should not substitute our findings as to the facts, or as to the inferences to be drawn from the facts, for those of the trial judge.3 United States v. 396 Corp., 264 F.2d 704, 709 (2 Cir. 1959) (Gibson, J.); Watson v. Joshua Hendy Corp., 245 F.2d 463, 464 (2 Cir. 1957); Ferguson v. Post, 243 F.2d 144, 145 (2 Cir. 1957); Purer & Company v. Aktiebolaget Addo, 410 F.2d 871, 878 (9 Cir.), cert. denied, 396 U.S. 834 (1969). Cf. Dunlop v. Warmack-Fitts Steel Co., 370 F.2d 876, 879 (8 Cir. 1967).4
I would affirm the judgment of the District Court in all respects, including its award of $50,000 for tortious interference with business relations.

. Judge Gibson died after nine days of trial and before deciding the case. The parties stipulated that Judge Oakes could decide the case upon the record made before Judge Gibson and upon such additional evidence as he wished to receive. Judge Oakes took additional evidence on two further days. He also viewed the construction premises in the presence of counsel.

. The case of Pierce Ford Sales, Inc. v. Ford Motor Co., 299 F.2d 425 (2 Cir.), cert. denied 371 U.S. 829 (1962), relied on by the majority, strikes me as being distinguishable in at least this critical respect: there the perpetrator of the tort, Ford Motor Co., clearly was privileged to refuse to accept certain franchises; here F & C was under a contractual duty promptly to pay all subcon-tors, suppliers and materialmen and it was not privileged to delay doing so. In Pierce a letter had been written by the injured party, Pierce, to the Ford Motor Co., stating that “because of your (Ford’s) legitimate concern with the character, ability and finances of dealers in your products, you have the right to decline, in your discretion, to enter a Sales Agreement with any person who may be willing to agree to purchase our assets.” 299 F.2d at 427. In the instant case, payment under the terms of the bond was not discretionary with the surety, nor was the time of payment.

. Put another way and with commendable succinctness (but allowing for license in paraphrasing), “when two skilled trial judges . . . have passed upon the facts, it should not be the function of an appellate court, as a nonparticipant in the events . . . . , to overrule the factual determinations of those charged with this responsibility.” United States v. Manning, 448 F.2d 992, 997 (2 Cir. 1971), (dissenting opinion).

. What happened in the instant case is both obvious and unfortunate. Appellants, in their brief and in oral argument, totally disregarded the careful findings of fact made by the District Court on the tortious interference issue and their support in the factual record. Instead, appellants engaged in their own selection of facts and inferences, just as though the issues of fact were to be tried de novo in this Court. This is precisely the course of conduct that Rule 52(a) was designed to prohibit. It is for this reason that I most emphatically would reject appellants’ disregard of this salutary Rule and would back to the hilt Judge Oakes’ faithful conformity to the Rule.