Tashma v. Nucrown, Inc.

23 S.W.3d 248, 2000 Mo. App. LEXIS 1113, 2000 WL 994193
CourtMissouri Court of Appeals
DecidedJuly 18, 2000
DocketNo. ED 76158
StatusPublished
Cited by9 cases

This text of 23 S.W.3d 248 (Tashma v. Nucrown, Inc.) 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
Tashma v. Nucrown, Inc., 23 S.W.3d 248, 2000 Mo. App. LEXIS 1113, 2000 WL 994193 (Mo. Ct. App. 2000).

Opinion

GARY M. GAERTNER, Presiding Judge.

Appellants, Nucrown, Inc. and Charles D. Matthews, (“Nucrown”), appeal the judgment and order of contempt issued on November 10, 1998, by the Circuit Court of St. Louis County, holding them in contempt for failing to provide Respondent, Austin Tashma, (“Tashma”), with audited financial statements for the period of June 1, 1991, through May 31, 1996. We reverse and remand in part and affirm in part.

This case originated pursuant to the sale of Tashma’s optometry practice to Nuc-rown in May of 1991. Both parties entered into an asset purchase agreement, (“agreement”). The agreement, in pertinent part, stated the following:

[Nucrown] shall pay the Purchase Price as follows: (i) Twenty Thousand Dollars ($20,000.00) paid on the Closing Date ... (ii) Balance of Fifty-Five Thousand Dollars ($55,000.00) payable as follows: [Tashma] will receive fifty percent (50%) of Net Profits in excess of Thirty Thousand Dollars ($30,000.00) per annum earned by [Nucrown] at its Lemay Ferry Road location ... until the earlier of (i) a five (5) year period of time from the date of closing, or (ii) [Tashma’s] payments received under the earn-out arrangement total Fifty Thousand Dollars ($50,000.00). No later than sixty (60) days after the close of [Nuc-rown’s] fiscal year [Nucrown] shall forward to [Tashma] a certified statement prepared by its certified public accountant setting forth the profits and losses attributable to the Lemay Ferry store ... and such other documents necessary to determine the amount due, if any, under this Agreement.... In addition, Five Thousand Dollars ($5,000.00) will be paid to [Tashma] after ninety (90) consecutive days of employment.

[250]*250Tashma contended he was not provided with financial statements pursuant to the agreement and filed an equity action in the Circuit Court of St. Louis County. On October 25, 1996, the trial court issued an order in equity requiring Nucrown to provide Tashma with “annual audited financial statements prepared by a Certified Public Accountant for the period commencing June 1,1991 through May 31,1996,” within ninety days of the order.

Nucrown appealed the order in equity and this court affirmed the order. On June 26, 1998, Nucrown, concerned with the prospect of spending a significant amount of money on the preparation of audited financial statements, filed a motion for clarification of the order in equity. In their motion for clarification, Nucrown claimed the accounting firms they were interviewing could not produce an “unqualified audit” for the period in question. In response, Tashma filed a motion for contempt because he had yet to receive any “audited financial statements” within ninety days of the order in equity.

On July 2, 1998, the trial court denied Nucrown’s motion for clarification and granted, in part, Tashma’s motion for contempt. The trial court issued an order compelling Nucrown to “produce the documents in compliance with the Court’s Judgment of October 25, 1996, within 30 days.” The trial court ordered Nucrown to pay a $500 per diem fine for each day in which they failed to comply with the trial court’s order. The $500 per diem fine was to begin on August 2,1998.

Nucrown retained the accounting firm of Schmersahl, Treloar & Company. Jim Schmersahl, (“Schmersahl”), was chosen to be the supervising accountant.

On July 31, 1998, Nucrown delivered to Tashma documents entitled “special purpose profit and loss statements” for the period in question. Claiming the documents failed to comply with trial court’s judgment and contempt order, Tashma filed another motion for contempt on August 18,1998.

On September 25, 1998, the trial court held an evidentiary hearing on Tashma’s motion for contempt. At the hearing, Tashma adduced testimony from his expert, Michael J. Prost, (“Prost”). Prost, a certified public accountant with nineteen years’ experience, testified the “special purpose profit and loss statements” provided by Nucrown did not meet the criteria of “audited financial statements” as defined by Statement On Auditing Standards No. 29. Therefore, Prost concluded Nucrown failed to comply with the trial court’s judgment and contempt order.

However, Schmersahl, who testified for Nucrown, stated he reviewed the trial court order in equity of October, 25, 1996, as well as the agreement in question. Schmersahl testified the reports he issued were “audited financial statements” that complied with the order in equity. Schmersahl testified he and his staff had complete access to Nucrown’s books and records and Nucrown fully cooperated with the “audit.”

On November 10, 1998, the trial court issued its judgment and order of contempt. The trial court found Nucrown in contempt of both its October 25, 1996, and July 2, 1998, orders. The November 10, 1998, judgment and order of contempt stated:

... because [Nucrown has] failed and refused to comply with this Court’s Judgment and Order regarding the production of financial documents necessary to determine the amount due [Tashma] under the Asset Purchase Agreement, [Nucrown] shall pay a compensatory fine to [Tashma]. In this Court’s Order of Contempt of July 2, 1998, [Nucrown was] ordered to produce said financial documents within 30 days of the Order and pay a compensatory fine in the amount of $500.00 for each day thereafter until these documents are produced. Accordingly, this Court enters final judgment in the amount of $50,500 representing the per diem compensatory fine from August 2, 1998 through No[251]*251vember 10, 1998. This compensatory per diem fíne shall continue until [Nuc-rown complies] with this Court’s Judgment and Order of Contempt. The maximum compensatory fine shall be $50,000 plus interest at nine percent (9%) from October 25, 1996 in the amount of $9,197.26. This amount represents the monetary loss [Tashma] suffered under the Asset Purchase Agreement as a result of [Nucrown’s] refusal to produce the financial documents required under the Asset Purchase Agreement.

Nucrown was also to pay Tashma $6,272.00 for attorney’s fees and costs. Nucrown appeals the November, 10, 1998, judgment and order of contempt.

Nucrown raises three points on appeal. In their first point, Nucrown alleges the trial court erred in issuing its judgment and order of contempt because the contempt order does not recite the specific facts and circumstances constituting contempt and the order was vague, recites mere conclusions, and does not set forth what Nucrown must do to purge themselves of the contempt. We disagree with Nucrown’s contention that the judgment order was vague and did not recite specific facts and circumstances constituting contempt; however, we agree the trial court failed to specifically state what Nucrown must do to purge themselves of the contempt.

In a civil contempt case, a blanket reference to non-compliance with a court order which does not, set forth the specific requirements for compliance, does not inform contemnors of what they must do to purge themselves of contempt; thus, the judgments are flawed. Lewis v. Murray, 738 S.W.2d 953, 956 (Mo.App. E.D.1987). Contemnors are entitled to a final judgment of contempt which details the specific actions they must take to purge themselves of the contempt. Id. at 957.

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Cite This Page — Counsel Stack

Bluebook (online)
23 S.W.3d 248, 2000 Mo. App. LEXIS 1113, 2000 WL 994193, Counsel Stack Legal Research, https://law.counselstack.com/opinion/tashma-v-nucrown-inc-moctapp-2000.