Finova Capital Corp. v. Ream

230 S.W.3d 35, 2007 Mo. App. LEXIS 1072, 2007 WL 2091174
CourtMissouri Court of Appeals
DecidedJuly 24, 2007
Docket27503, 27580
StatusPublished
Cited by7 cases

This text of 230 S.W.3d 35 (Finova Capital Corp. v. Ream) is published on Counsel Stack Legal Research, covering Missouri Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Finova Capital Corp. v. Ream, 230 S.W.3d 35, 2007 Mo. App. LEXIS 1072, 2007 WL 2091174 (Mo. Ct. App. 2007).

Opinion

PHILLIP R. GARRISON, Judge.

This is a breach of contract case filed by Finova Capital ■ Corporation (“Plaintiff’) against Anne C. Ream, O.D., P.C. (“Defendant P.C.”) arising from its lease of an electronic message board (“message board”). Plaintiff appeals a judgment entered, after trial to the court, in favor of Defendant P.C. and Anne C. Ream (“Ream”). 1

*39 In 1995, Ream, an optometrist and president of Defendant P.C., attended an optometrist convention and trade show where she saw and became interested in a message board displayed by Recomm International Display Ltd. (“Recomm”). Re-comm’s representative demonstrated the message board for Ream, explaining that it could be operated with a custom computer disc or with a basic disc that permitted the user to attach a keyboard and type in messages to be displayed by the board. The representative also demonstrated that if neither disc was inserted in the board, it displayed only a red light when turned on.

Thereafter, Recomm sent a representative to one of Defendant’s business locations in West Plains, Missouri, where he met with Ream. On August 25,1995, Ream signed, on behalf of Defendant P.C., three forms furnished by the Recomm representative: an acknowledgement, addressed to “Recomm’s Designated Leasing Company,” that the lease would be non-cancella-ble; a “Lease Application”; and a “Lease Agreement,” which Ream also signed as personal guarantor. The Lease Application included a portion titled “Certificate of Acknowledgement and Acceptance of Leased Equipment,” signed by Ream on behalf of Defendant P.C. that stated that Defendant P.C. acknowledged receipt of the equipment “described in its Lease with Lessor ... and accepts the Equipment after full inspection thereof as satisfactory for all purposes of the Lease”; and that “Lessor has fully and satisfactorily performed all covenants and conditions to be performed by Lessor.” Defendant, however, did not have the message board when that was signed. When signed by Ream, the Lease Agreement showed the vendor as Recomm; the box entitled “Equipment Description” only had the “Qty: 1” filled in and the portion for “Serial Number” was blank. There was also a box on the Lease Agreement titled “Accepted: Lessor” that was blank. The blanks on those forms were filled in with handwriting in black ink. Ream gave the Recomm representative Defendant P.C.’s check payable to Re-comm for the first lease payment when those documents were signed.

At some point after August 25, 1995, additions were made to the Lease Application and the Lease Agreement by a person or persons other than Ream, and apparently without her knowledge or consent. 2 The “Date of Lease” in the portion of the Lease Application titled “Certificate of Ac-knowledgement and Acceptance of Leased Equipment” was filled in with “9-5-95” in blue ink. Additionally, the Lease Agreement was amended by filling in “Recomm Advisory Board” and serial number “15053” in blue ink in the box titled “Equipment Description”; and additions were made to the box titled “Accepted: Lessor” in that an ink stamp stating “FI-NOYA Capital Corporation, 3601 Minnesota Drive + 960, Bloomington, MN 55435” was added as well as the signature, “Bill Anderson Ops. Dir.” and the date of “9-5-95,” also in blue ink. As indicated above, all of the writing on those documents when signed by Ream was in black ink.

A message board was shipped to Defendant, but it did not include a software diskette to make it functional other than to display a red fight when it was turned on. Ream explained that “[w]hat I wanted it for was the messages. I have lighting in my office.” No diskettes to make the equipment operational as a message board were ever delivered to Defendant P.C.

*40 Recomm, along with related companies, filed for bankruptcy protection pursuant to Chapter 11 of the United States Bankruptcy Code in January 1996 (“the bankruptcy”). At some point, Ream started calling Recomm attempting to return the message board because it did not work, but was told that Recomm had taken bankruptcy, making it unclear who to return the message board to. At the direction of a Recomm representative, Ream wrote Recomm a letter saying that the message board was not operational and that she needed help with the problem. While this was going on, Defendant P.C. sent lease payments to Plaintiff in October, November, and December 1995 as well as January 1996 pursuant to statements received. Defendant P.C. made no lease payments thereafter.

During the bankruptcy, Plaintiff, along with Recomm and other lease finance companies, filed a Plan of Reorganization referred to as the “Fourth Amended Joint Plan of Reorganization of the Debtors, the Official Committee of Unsecured Creditors and Certain Leasing Companies Under Chapter 11 of the Bankruptcy Code” (“the Plan”). The bankruptcy court later entered an order confirming the Plan (“Confirmation Order”). It is the Plan and Confirmation Order that Plaintiff in part relies on to establish trial court error in entering judgment for Defendants.

Plaintiff filed suit, in two counts, both of which were based on breach of contract. In allegations applicable to both counts, it alleged, inter alia, that Defendant P.C. is bound by the Plan and Confirmation Order, the latter being a final judgment that adjudicated the rights and liabilities of Plaintiff, Defendant P.C. and Ream regarding the lease and personal guarantee. It further alleged that the Confirmation Order modified the terms of the lease between Plaintiff and Defendant P.C.; adjudged that the lease, as modified was valid and binding on Defendant P.C.; released Plaintiff from any claims and defenses that otherwise may have been raised by Defendant P.C. in connection with the lease on matters occurring before June 30, 1998; and enjoined Defendant P.C. from raising any claim or defense against Plaintiff in connection with the lease on any matters occurring before June 30,1998.

In the answer, Defendants alleged, inter alia, as an affirmative defense, that the transactions lacked consideration, in that an integral part of the signage equipment was computer software that was never delivered. As a result, Defendant P.C. alleged that it received no consideration for the contract.

This appeal arises from a judgment entered in favor of Defendants. As with other court-tried cases, our review is dictated by the standards set out in Murphy v. Carron, 536 S.W.2d 30, 32 (Mo. banc 1976), whereby the trial court’s ruling is to be affirmed if it is supported by substantial evidence, is not against the weight of the evidence, and does not erroneously declare or apply the law. 3 We are to exercise the power to set aside a judgment on the ground that it is against the weight of the evidence with caution and with a firm belief that the decree or judgment is wrong. Id. Due regard is to be given to the opportunity of the trial court to have judged the credibility of the witnesses inasmuch as the trial court is free to believe or disbelieve all, part or none of the testimony of any witness. T.B.G. v. C.A.G., 772 S.W.2d 653, 654 (Mo. banc 1989). *41

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Bluebook (online)
230 S.W.3d 35, 2007 Mo. App. LEXIS 1072, 2007 WL 2091174, Counsel Stack Legal Research, https://law.counselstack.com/opinion/finova-capital-corp-v-ream-moctapp-2007.