John Deere Company of St. Louis v. Short

378 S.W.2d 496, 1964 Mo. LEXIS 757
CourtSupreme Court of Missouri
DecidedMay 11, 1964
Docket50157
StatusPublished
Cited by16 cases

This text of 378 S.W.2d 496 (John Deere Company of St. Louis v. Short) is published on Counsel Stack Legal Research, covering Supreme Court of Missouri primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
John Deere Company of St. Louis v. Short, 378 S.W.2d 496, 1964 Mo. LEXIS 757 (Mo. 1964).

Opinion

HOUSER, Commissioner.

John Deere Company of St. Louis sued Newton H. Short in three counts, Counts I and II in replevin for possession of farm equipment; Count III for damages for breach of a general agricultural dealer’s contract. Short filed an amended counterclaim in two counts, Count I for damages for fraud; Count II for $150,000 actual and $150,000 punitive damages, for conspiracy. By stipulation judgment was entered for plaintiff on Counts I, II and III of the petition under an agreement that the amount of the judgment on Count III would depend upon a determination by the court whether defendant was entitled to a volume discount. If so, the judgment was to be for $13,303.50 on Count III; if not, the judgment thereon was to be for $26,187.50. The issues on Count II of the counterclaim were tried to a jury, which returned a verdict for Short and against John Deere for $46,700 actual and $10,000 punitive damages. The court found that Short was not entitled to a volume discount and entered judgment for Short for the net sum of $30,512.50. John Deere filed an after-trial motion for judgment in accordance with its motion for a directed verdict and in the alternative for a new trial. The court granted the motion and entered a new judgment for John Deere for $26,187.50 under Count III of the peti-tioii; for John Deere for possession under Counts I and ’ II; against Short on his counterclaim, and made the appropriate order under Supreme Court RuU. 72.02, V.A. M.R. Short appealed.

Short was employed by John Deere in various capacities from March 1, 1950 until sometime in 1955, when he resigned to take other employment. During a part of the time he was employed by John Deere his immediate superior was one I. L. Parks, Division Sales Manager for John Deere. Parks not only worked for John Deere as -an employee but also owned an interest in a John Deere dealership at Elsberry, with his son Robert. In 1958 one Pottmeyer, Division Credit Manager for John Deere, told Wayne Carter, a traveling inspector for John Deere, that he knew that Parks had a'n interest in the Elsberry dealership; that Parks had sold his home in St. Louis and poured all the money he had into the dealership, and that in his opinion it was “broke.” Parks had given mortgages on John Deere equipment sold to farmers, and engaged in other practices which eventually resulted in his discharge by John Deere. In 1958, before Parks’ discharge, he met Short one day and sought to interest Short in buying into the Elsberry dealership. Several discussions culminated in Short buying into the dealership. A new corporation was formed for the conduct of the business. Short paid 'the corporation $15,-000. Parks and his son Robert put the assets of the old company into the new business, and each of the, three men put in an additional $1000 as operating capital. A franchise dealer contract was entered into between John Deere and the new corporation in January, 1959. Short actively entered the business, taking care of parts and service, while Robert handled sales and accounts. I. L. Parks continued in his capacity as division sales manager, came to Elsberry on weekends, and dictated the operation of the business. In February or March, 1960 I. L. Parks asked Short if he wanted to buy out the Parks. Between then and September, 1960 the parties met five or six times to discuss the proposition. Short’s father-in-law, an experienced business man, was concerned becarise operating capital was needed and Short’s resources were limited. Short realized that he would need operating capital the next spring. At the fourth meeting, in August, I. L. Parks made an oral promise that Short would get “an operating loan” from John Deere when Short needed it. ■ Short had talked to the John Deere dealer at Paris, Missouri, from whom he had learned that the company had made an operating loan to that dealer. Again in September, 1960 I. L. Parks gave *499 Short and his wife and father-in-law a promise that they would get an operating loan when they “needed one.” There was no evidence that I. L. Parks had authority to commit John Deere to an operating loan to Short. The only person with that authority was the vice-president and general manager. Paries did not discuss with Short the amount of the prospective loan, the period of the loan, or when it would be made, “except just generally in the spring.” According to Short the interest rate was to be either 5 or 6 per cent, but according to Mrs. Short the subject of interest was not discussed. Short testified that security was mentioned in the discussions but could not recall what security was discussed. No written application for a loan was ever made to the company. At no time did Short ever discuss a loan with any company employee or official other than Parks, although Short knew several John Deere officials and had an opportunity to discuss this matter with them. For instance, in September, 1960 Short visited the company’s general sales manager, P. M. Maddox, in his St. Louis office, at which time Short was assured that as a new dealer he would be treated “as fair as any new dealer going into the organization,” but Short did not ask Maddox about the capital loan.

The sale of the Parks’ interest in the Elsberry agency was consummated on October 20, 1960. Short paid Parks and his son $15,000 and gave a note for $26,830 to Elsberry Equipment Company, Inc. Short began operations as Short Equipment Company in October, 1960, with $2,000 operating capital and an inventory of $75,000. Early in November, 1960 John Deere and Short signed a dealer’s contract by which the company agreed to sell and Short agreed to buy the company’s products, subject to and in accordance with the terms of the contract, and the company agreed to make available to Short “Any finance plan for [dealers] which the Company may have in force during the term of this contract” to assist the dealer in financing sales, with the understanding that the company might without liability or obligation change or discontinue any such plan at any time without notice. John Deere agreed to reimburse the dealer for the cost of parts and for labor done under company’s authorized warranties. The parties also signed a floor-plan agreement for trade-in of agricultural equipment, and a credit plan for new and used equipment sold for agricultural purposes. The object of the floor plan was to assist the dealer in financing certain specified trade-in machines accepted as part payment in the original sale of new John Deere equipment. When a sale was made the dealer was to remit to the company the cash and the note received from the purchaser, and the dealer’s account would be credited with the cash and an “acceptable” purchaser’s note. The company reserved the right to establish the maximum value of any trade-in machine and a limit of credit to be extended to a dealer for total floor-plan notes. Under the credit plan the company agreed to accept purchasers’ notes as a credit to the dealer’s account with the company, subject to the conditions of the contract. Late in November, 1960 Short was called in to the St. Louis office of John Deere where inquiry was made of him concerning a customer’s tractor which I. L. Parks had mortgaged to John Deere. Apparently the company representatives were investigating Parks. This was the first time Short knew that I. L. Parks was in trouble with John Deere. Concerned about the repercussions which the investigation might have in his community, Short asked for and obtained from the company officials a promise of cooperation. Parks resigned in December, 1960 and was replaced by Willard Finn.

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Cite This Page — Counsel Stack

Bluebook (online)
378 S.W.2d 496, 1964 Mo. LEXIS 757, Counsel Stack Legal Research, https://law.counselstack.com/opinion/john-deere-company-of-st-louis-v-short-mo-1964.