HOLD IT PRODUCTS CORP V TEXTUS INTL INCAnnotate this Case
STATE OF MICHIGAN
COURT OF APPEALS
HOLD IT PRODUCTS CORPORATION,
July 21, 1998
TEXTUS INTERNATIONAL, INC. and DAVID
Oakland Circuit Court
LC No. 95-507260-CZ
TEXTUS USA, INC.,
Before: Hood, P.J., and Markman and Talbot, JJ.
The trial court granted a directed verdict in favor of defendants on plaintiff's claim for tortious
interference with contractual relations1. Plaintiff appeals as of right, and we reverse and remand for trial.
The jury, not the trial judge, is the trier of fact. Whenever a fact question exists, upon
which reasonable persons may differ, the trial judge may not direct a verdict.
Conversely, when no fact question exists, the trial judge is justified in directing a verdict.
In deciding whether or not to grant a motion for a directed verdict, the trial judge must
accord to the non-moving party the benefit of viewing the testimony and all legitimate
inferences that may be drawn therefrom in a light most favorable to the non-moving
party. If the evidence, when viewed in this manner, establishes a prima facie case, the
motion for a directed verdict must be denied. [Caldwell v Fox, 394 Mich 401, 407;
231 NW2d 46 (1975).]
See also Locke v Pachtman, 446 Mich 216, 223; 521 NW2d 786 (1994). If reasonable jurors could
honestly reach different conclusions, then the motion should be denied, and the
controverted matter should be decided by jury verdict. Hutton v Roberts, 182 Mich App 153, 155;
451 NW2d 536 (1989), citing Bonelli v Volkswagen of America, Inc, 166 Mich App 483, 495-496,
514; 421 NW2d 213 (1988). Our review of the trial court's action with regard to the motion for
directed verdict is de novo. Meagher v Wayne State Univ, 222 Mich App 700, 706; 565 NW2d
401 (1997), lv pending.
The elements of tortious interference with contractual relations are (1) a contract; (2) a breach,
and (3) instigation of the breach without justification by the defendant. Wood v Herndon & Herndon
Investigations, Inc, 186 Mich App 495, 499-500; 465 NW2d 5 (1990); Jim-Bob, Inc v Mehling,
178 Mich App 71, 95-96; 443 NW2d 451 (1989).
[O]ne who alleges tortious interference with a contractual or business relationship must
allege the intentional doing of a per se wrongful act or the doing of a lawful act with
malice and unjustified in law for the purpose of invading the contractual rights or
business relationship of another. [ citing Formall, Inc v Community National
Bank of Pontiac, 166 Mich App 772, 779; 421 NW2d 289 (1986).]
Citing to the standard jury instructions for this tort, the trial court stated:
The elements of tortious interference with contractual relations are, one, that the
plaintiff had a contract with Cubbison's at the time of the claimed interference; two, that
defendant knew of the contract at the time; three, that the defendant intentionally and
improperly interfered with the contract; four, the defendant's conduct caused
Cubbison's to breach its contract with the plaintiff; and five, that the plaintiff suffered
damages as a result of the defendant's conduct.
It then found that plaintiff had a contractual relationship with Mrs. Cubbison's Foods, Inc. (Cubbison's)
for the sale of i s product, that the defendants knew of the relationship and that defendants interfered
with that relationship. It also found that defendants interfered in order to exact revenge for plaintiff
having rejected a previous shipment of product from them, causing financial loss. However, the trial
court determined that there was not sufficient evidence to allow the jury to decide causation:
Absent further evidence as to why Cubbison's did not place an order with the
plaintiff in 1994, the jury would be left to speculate that the reason was due to
[defendant's] contacts as opposed to a business decision to cut costs.
Our review of the record reveals that the following facts were presented to the jury prior to the
directed verdict: Plaintiff developed a product, stuffing sacks, and arranged with defendants to make
the sacks; plaintiff entered into an exclusive distribution contract with Cubbison's for the sacks;
defendants began making the sacks after plaintiff contracted with them for their manufacture; in 1992, a
dispute over the sacks caused financial loss to defendants because plaintiff used an alternative supplier
and did not accept defendants' sacks; defendants contacted Cubbison's directly, hoping to solve its
problem relative to the approximately 200,000 sacks that plaintiff had refused to accept; when
defendants contacted Cubbison's they learned of the relationship between it and plaintiff; defendants
continued to contact Cubbison's after this time, knowing of the relationship between it and plaintiff;
defendants wrote a letter to Cubbison's in September 1993, stating that defendants would like to begin
to sell directly to Cubbison's and that “everything will be the same as you are currently receiving";
Cubbison's and plaintiff had discussed lowering the price of the sacks in prior years, but price had never
been a deal breaker; plaintiff consistently charged Cubbison's a price of 56 cents per unit purchased;
Cubbison's historically placed orders with plaintiff for the following season's sacks between June and
July; Cubbison's did not place an order with plaintiff between June and July of 1994; instead,
Cubbison's placed its 1994 order with defendants for similar quantities as it requested in previous years
from plaintiff, but with an average price much lower than plaintiff’s price; the sacks sold by defendants
were substantially similar to those it had previously manufactured for plaintiff to sell to Cubbison's; and,
defendants' representative indicated to plaintiff's president that their conduct was prompted in order to
retaliate for the financial loss suffered in 1992 because of plaintiff's refusal to accept the shipment of
sacks. Viewing this evidence in a light most favorable to plaintiff, we find that a jury could reasonably
find that plaintiff had established all of the elements of its prima facie case. We disagree with the trial
court that the jury would have had to speculate as to whether Cubbison's ordered from defendants in
1994 because of their cheaper price or because of defendant's wrongful interference.
The issue of causation is generally a question of fact to be decided by the jury. Teodorescu v
Bushnell, Gage, Reizen & Byington, 201 Mich App 260, 266; 506 NW2d 275 (1993). In negligence
cases and malpractice cases, the Supreme Court has stated:
The plaintiff must introduce evidence which affords a reasonable basis for the
conclusion that it is more likely than not that the conduct of the defendant was a cause in
fact of the result. A mere possibility of such causation is not enough; and when the
matter remains one of pure speculation or conjecture, or the probabilities are at best
evenly balanced, it becomes the duty of the court to direct a verdict for the defendant.
[Skinner v Square D Co, 445 Mich 153, 164-165; 516 NW2d 475 (1994) (citations
See also Weyners v Khera, 454 Mich 639, 648; 563 NW2d 647 (1997).
Although this is neither a negligence nor malpractice cause of action, there is no reason that the
general standard as set forth in Skinner, supra, should not apply. In this case, plaintiff introduced
evidence upon which a reasonable jury could conclude that, more likely than not, the conduct of
defendants led to the breach of contract between plaintiff and Cubbison's. There was evidence that
defendants purposely designed a situation where they would solicit Cubbison's away from plaintiff by
contacting it, letting it know that they wanted its business, and offering a lower price, which could be
accomplished by cutting out plaintiff, the middle-man and developer of the product. There was
evidence that defendants did this in order to make plaintiff suffer for the previous financial loss that
defendants had taken. There was also evidence that defendants' purposeful conduct resulted in the
desired goal, that being that Cubbison's began ordering sacks directly from them. It was not a matter of
pure speculation that defendants' conduct, and not the price issue, was the cause of the destruction of
the contractual relationship. This is especially so where there was evidence that a cheaper price was
previously discussed between Cubbison's and plaintiff; that plaintiff had consistently charged Cubbison's
the same price; and that price had never been a deal breaker between plaintiff and Cubbison's. Only
when defendants interfered with the relationship did Cubbison's fail to order more sacks from plaintiff.
Further, as part of its prima facie case, plaintiff was not required to offer evidence to rebut every
possible reason why Cubbison's may have ordered from defendants instead from it2. Plaintiff clearly
offered sufficient evidence as to all of the elements necessary to prove the tort of interference with
contractual relations, including the element of causation. Based on the record presented, the jury should
have decided the issues in this case. The trial court's grant of a directed verdict was improper.
Reversed and remanded for trial. We do not retain jurisdiction.
/s/ Harold Hood
/s/ Michael J. Talbot
Plaintiff's complaint alleged both tortious interference with contractual relations and tortious
interference with business relations. The trial court dismissed plaintiff's claim of tortious interference with
business relations, finding that it was redundant to the first claim. Plaintiff does not take issue with the
trial court's actions in this regard. It discusses the directed verdict, which was granted on its claim for
tortious interference with contractual relations.
As part of its defense, defendants could have called a representative from Cubbison's, assuming that
one could have been found, to state that it stopped ordering from plaintiff because of price and not
because of defendants' conduct. In the alternative, defendants could have argued to the jury that the
inferences shown from the evidence, along with the lack of testimony from anyone at Cubbison's as to
why they did not purchase sacks from plaintiff, demonstrated that Cubbison's decision to order from
defendant was not based on any improper interference. Plaintiff would then have argued that the
evidence and inferences therefrom demonstrated to the contrary, that Cubbison's stopped ordering from
plaintiff because of defendants' interference.