Drummond v. McKinley

The court did not err in sustaining the general demurrer and in dismissing the action.

DECIDED JUNE 19, 1941. STATEMENT OF FACTS BY SUTTON, J. Mrs. Margaret Drummond filed her petition against Lawrence A. McKinley, Beatrice Carroll, Alice Landreth, Mrs. Arthur H. Tuck, Arthur H. Tuck, Saul Schacter, and Mrs. Elizabeth Kline as an individual and doing business as J. M. Kline Company, alleging that for many years previously to October 5, 1939, she was engaged in operating beauty parlors in the downtown section of the City of Atlanta, and over this period had built up a lucrative and valuable business, the earnings of which netted her about $175 a month; that on the date mentioned and for some months previously thereto she was operating a beauty parlor known as the "Marlene Beauty Shop" at 522 Grand Theater Building; that she had bought the equipment for said beauty parlor from the J. M. Kline Company, which was the trade name for the business owned and operated by the defendant, Mrs. Elizabeth Kline, and this equipment was purchased under a title-retention contract with the agreement and understanding that certain dryers would have coin-slot meters on them, requiring a deposit of a certain amount of money per day before they would operate, which sums in turn would be collected by the J. M. Kline Company from the meters and applied towards the purchase-price of the equipment; that the defendant, Lawrence A. McKinley, was employed by the Burdette Realty Company Inc., which handled the leasing of offices in the Grand Theater Building and collected rent for the owners of the building; that the collection of the rents in the building was handled principally by the defendant, Lawrence A. McKinley; that the plaintiff had in her employ the defendants, Beatrice Carroll, Alice Landreth, and Mrs. Arthur H. Tuck on the date mentioned and for some time previously thereto, and these defendants were in contact with all of the plaintiff's customers of the "Marlene Beauty Shop" and knew the patrons by name and were thoroughly familiar with the operation of the business; that the defendant, Arthur H. Tuck, was the husband of the defendant, Mrs. Arthur H. Tuck, and was an experienced business man; that the plaintiff was paying $45 a month rent on No. 522 Grand Theater Building, and most of these payments were made to the defendant McKinley; that the defendant, Saul Schacter, was an employee of the defendant, Mrs. J. M. Kline, doing business as J. M. Kline Company, and handled the collections from the coin meters attached to the dryers mentioned hereinbefore, and was alleged to be the general manager of the J. M. Kline Company and a general agent of the defendant, Mrs. Elizabeth Kline; that the defendants, Beatrice Carroll, Alice Landreth, and Mrs. Arthur H. Tuck, knowing that the business of the plaintiff was valuable, and being acquainted with her clientele, were desirous of going into the business themselves and carrying with them the plaintiff's customers and patrons, and thus acquiring for themselves the valuable business which the plaintiff had built up over a period of years; that these defendants, together with the defendant, Arthur H. Tuck, on or about October 1, 1939, fraudulently and unlawfully devised a scheme and conspiracy, the purpose of which was to steal the business of the plaintiff "lock, stock, and barrel," and to obtain the same equipment and location in order that they might more easily retain the plaintiff's customers; that pursuant to the said purpose, scheme, and conspiracy the defendants, Beatrice Carroll, Alice Landreth, and Mrs. Arthur H. Tuck, discussed with the defendants, Lawrence A. McKinley, Saul Schacter, and Mrs. Elizabeth Kline the purpose, scheme, device, and conspiracy, and said defendants agreed to aid the plaintiff's employees in the commission of the fraudulent and unlawful acts for the accomplishment of the said conspiracy; that the plaintiff's rent of $45 per month was payable monthly, and, while it was billed in advance, it was the custom to pay the rent any time during the calendar month, and on October 5, 1939, the plaintiff was behind with her rent for August and September, and she called the defendant McKinley and told him she had $90 for him, which would have paid the August and September rent, whereupon the defendant McKinley, pursuant to the conspiracy previously devised as hereinbefore set forth, refused to accept the rent, and, without previous notice, demanded the space immediately, whereupon the plaintiff told him that if he desired the space she would obtain another place and vacate as soon as possible; that before the plaintiff could get to her place of business the defendant McKinley had called the defendants, Mrs. Kline and Schacter, and told them of his demands and advised them to get their equipment immediately, and, as the plaintiff started to enter the Grand Theater Building within about ten or fifteen minutes after the conversation aforementioned with the defendant McKinley, she met the defendants, Schacter and McKinley, in the lobby of the building in the act of moving her equipment from the building and loading it on a truck without having resorted to any process or legal procedure whatever, and without the consent or acquiescence of the plaintiff, but unlawfully and without lawful warrant and authority; that the plaintiff protested, and the defendant Schacter stated that he had been instructed by the defendant McKinley to move it, but that it would be kept available for the plaintiff, and if she got another location any time within a few days thereafter he would immediately move it into her new location; that later the same day the plaintiff saw her equipment sitting in the J. M. Kline Company place of business on Pryor Street, and subsequently the same day, missing it from the J. M. Kline Company, inquired as to its whereabouts and was informed by the defendants, Schacter and Mrs. Kline, that they were still holding it for her but had moved it to get it out of the way; that pursuant to the previous plan, scheme, conspiracy, and device, the defendants, Carroll, Landreth, and Mrs. Tuck, immediately leased the space that the plaintiff had occupied at 522 Grand Theater Building, through the defendant McKinley, on the same morning that the plaintiff's equipment was removed; that at the time the statements were made to the plaintiff by the defendants, Schacter and Kline, to the effect that the equipment of the plaintiff had been removed from the floor of the J. M. Kline Company, but was being held for her, the said equipment had in fact been already moved back to the space at 522 Grand Theater Building, which had then been leased by the defendants, Carroll, Landreth, and Mrs. Tuck, and the said defendants were then using the equipment and are still using it to carry on the business at the said location; that on the afternoon of October 5, 1939, the same day the plaintiff's equipment was removed, and on the morning of October 6, 1939, appointments with the plaintiff's customers were kept by the defendants, Carrol, Landreth, and Mrs. Tuck, which appointments had been made by the plaintiff on and before the 4th of October, 1939; that the defendants, Carroll, Landreth, and Mrs. Tuck, approved of the unlawful and oppressive acts of the defendants, McKinley, Schacter, and Mrs. Kline, in moving and causing to be removed all of the plaintiff's equipment from said place of business, which was done for their benefit; that at the time of the removal of the plaintiff's equipment from the location at 522 Grand Theater Building the defendants took, not only the plaintiff's equipment, but her personal papers, documents, receipts, and other personal belongings, including beauty supplies, and said beauty supplies have been used by the defendants, Carroll, Landreth, and Mrs. Tuck, in their business, and a large part of the plaintiff's receipts and personal belongings were lost, purloined, or destroyed; that the conspiracy alleged was the combination of all of the defendants to do the unlawful, oppressive, and immoral acts alleged by the unlawful, oppressive, and immoral means set forth, in order to maliciously drive the plaintiff out of business, so as to procure the business for the defendants, Carroll, Landreth, and Mrs. Tuck; that pursuant to said combination and conspiracy the plaintiff was injured and damaged by the total loss and destruction of her business, which was netting her, and would in the future have continued to net her, about $175 a month, except for the acts of the defendants.

The suit was brought for actual damages for loss of income from the plaintiff's business and for punitive damages. To meet a special demurrer the plaintiff amended her petition by alleging that the title-retention contract held by the J. M. Kline Company contained, among others, the following provisions: "1. Title to said property shall remain in the said seller or its assigns until the entire purchase-price shall have been paid in full in cash and all the terms and conditions hereof fully complied with and performed by said purchaser. . . 4. Time is of the essence of the contract, and in the event the purchaser defaults on any payment, or fails to comply with any condition hereof, or a proceeding in bankruptcy, receivership, or insolvency be instituted against the purchaser, or his property, or the seller deems the property in danger of misuse or confiscation, or if the property is removed or attempted to be removed from the county where the purchaser now resides, or to be otherwise disposed of, or if the purchaser shall sell or incumber or shall attempt to sell or incumber or hire out said property, the full amount unpaid hereunder shall become due and payable forthwith, and any payments hereunder thereafter shall be treated as payments on account of the full unpaid balance and not payment of any installment, and the acceptance thereof shall not waive the right to claim the whole, and the said seller or its assigns may take immediate possession of said property without demand or notice; and for this purpose seller may enter upon the premises where said property may be and remove same. At its option seller may make such disposition of said property as it may deem fit, and all payments hereunder shall be retained by seller or its assigns as liquidated damages for the use and possession of said property by purchaser, and not as a penalty. Or the seller may resell said property so taken, at public or private sale, without demand for performance and with or without any notice to the purchaser, with or without having the property at the place of sale, and upon such terms and in such manner as the seller may determine."

It was also alleged by the amendment that the defendants, Carroll, Landreth, and Mrs. Tuck, knew that the plaintiff was purchasing said equipment under title-retention contract and that they were familiar with the provisions thereof, and that they also knew that she was in arrears with her rent and they, with the defendant, Arthur H. Tuck, devised the scheme of procuring the aid and assistance of the defendants, McKinley, Schacter, and Mrs. Kline, to cooperate with them in accomplishing the ends of their conspiracy so devised, by having the landlord to demand possession of the space occupied by the "Marlene Beauty Shop" and then for the defendant, Mrs. Kline, to use this as an excuse for claiming that the property which she had sold under title-retention contract was in danger of confiscation and abuse and to retake possession thereof under the provisions of the contract hereinbefore set forth, and then themselves lease the space being occupied at that time by the "Marlene Beauty Shop," and procure the same equipment, so as to facilitate and accomplish the ends of their conspiracy and scheme.

To the petition as amended the defendants filed a general demurrer. The general demurrer was sustained and the action was dismissed. The exception here is to that judgment. 1. It appears from the allegations of the petition that the plaintiff was operating a beauty-shop at No. 522 Grand Theater Building, which she rented by the month from the Burdette Realty Company at $45 per month, and that the defendant, Lawrence McKinley, collected the rents on the Grand Theater Building for said realty company. She purchased the equipment used in her beauty shop from the J. M. Kline Company under a retention-of-title contract, and Mrs. Elizabeth Kline, the owner of this company, and Saul Schacter, the manager thereof, were named as two of the defendants. Beatrice Carroll, Alice Landreth, and Mrs. Arthur H. Tuck, employees of the plaintiff in her beauty shop, and Arthur H. Tuck, the husband of one of these employees, were the other defendants. The plaintiff's cause of action is based on an illegal conspiracy by the defendants to steal the plaintiff's business. The question for determination is whether or not the petition as amended set out a cause of action good against general demurrer.

A conspiracy, upon which a civil action may be based, is a combination between two or more persons, either to commit a tortious act, or to do some lawful act by methods constituting a tort. The conspiracy of itself does not constitute the cause of action, but the gist of the action, if one exists, is the tort committed against the plaintiff and the resulting damage. The petition fails to show that any of the employees of the plaintiff, or the husband of one of them, who are named as defendants, committed any unlawful or tortious act against the plaintiff. It is alleged by the plaintiff that these four defendants conspired and devised a scheme to steal her business and to obtain the same equipment and location in order that they might retain her customers, and that the defendants, McKinley, Kline, and Schacter, agreed to aid them in the commission of fraudulent and unlawful acts for the accomplishment of said conspiracy. The plaintiff was three months in arrears with her rent, and it was not unlawful for the defendant McKinley to refuse to accept her offer to pay part of the past-due rent and to demand possession of the premises. In fact, she told him that if he wanted the space she was occupying, she would obtain another place and vacate as soon as possible. It is alleged that McKinley called Mrs. Kline and Saul Schacter and told them of his demands as to the possession of the beauty shop premises and advised them to get their equipment immediately. Did Mrs. Kline or her agent, Saul Schacter, commit a tort against the plaintiff in removing the equipment from the beauty shop and in reselling it? It is specifically provided in the retention-of-title contract, under which the plaintiff alleged she bought the equipment in her beauty shop, that time was the essence of the contract, and that in the event of default in payments or a failure to comply with any condition of the contract, or if the seller should deem the property in danger of misuse or confiscation, it should have the right to take immediate possession of the property without demand and without notice, and for that purpose was authorized to enter upon the premises and remove said property and thereafter to sell it at public or private sale without demand for performance and with or without notice to the purchaser, upon such terms and in such manner as the seller might determine. There is no allegation in the petition that the plaintiff was not in default with her payments under the retention-of-title contract, and it is argued by the defendants in error that it is inferable from the petition that she was in default in that respect. But even if she was not in default as to payments, the seller was authorized to repossess the property whenever it deemed the property in danger of misuse or confiscation. The plaintiff in her petition does not negative that the defendants were proceeding to repossess the property under the terms of the contract. The petition shows that she was in arrears with her rent, and that her landlord had notified the seller of the equipment of his demand for possession of the space occupied by the beauty shop. In these circumstances and under the terms of the retention-of-title contract, as alleged in the plaintiff's petition, the defendants, Mrs. Kline and Saul Schacter, committed no unlawful or tortious act against the plaintiff in repossessing the property and in selling it again.

The plaintiff in error contends that where an action is based on an alleged conspiracy, and it is alleged that the means employed to consummate the conspiracy were immoral and oppressive, it is not necessary to show any unlawful act, andBurrus Motor Co. v. Patterson-Pope Motor Co., 50 Ga. App. 801 (179 S.E. 171), is cited and relied on to support this contention. That case, however, is distinguishable on its facts from the one now under consideration. The present case must stand or fall, depending on whether or not the defendants, or some of them, committed an illegal or tortious act against the plaintiff in consummating the alleged conspiracy to steal the plaintiff's business.

We think the present case is controlled adversely to the contentions of the plaintiff in error by the decision of this court in Vandhitch v. Alverson, 52 Ga. App. 308 (183 S.E. 105), where it was said: "A conspiracy upon which a civil action for damages may be founded is a combination between two or more persons either to do some act which is a tort, or else to do some lawful act by methods which constitute a tort. Where it is sought to impose civil liability for a conspiracy, the conspiracy of itself furnishes no cause of action. The gist of the action, if a cause of action exists, is not the conspiracy alleged, but the tort committed against the plaintiff and the resulting damage.Martha Mills v. Moseley, 50 Ga. App. 536, 538 (2) (179 S.E. 159). Thus, where the act of conspiring is itself legal, the means or method of its accomplishment must be illegal and tortious. See Clein v. Atlanta, 164 Ga. 529, 534 (139 S.E. 46, 53 A.L.R. 933); Woodruff v. Hughes, 2 Ga. App. 361,364 (58 S.E. 551). While some authorities appear to have extended the nature of the means employed so as to include not only methods which are illegal and tortious, but such as are merely immoral or oppressive (see cases cited in Brown Allen v. Jacobs Pharmacy Co., 115 Ga. 429, 433-452, 41 S.E. 553, 57 L.R.A. 547, 90 Am. St. Rep. 126; Turner v. SecurityPlumbing Co., 165 Ga. 479, 483, 484, 141 S.E. 291; BurrusMotor Co. v. Patterson-Pope Motor Co., 50 Ga. App. 801, 810,179 S.E. 171), those cases and others upon which the supposed rule rests, on examination and analysis, show that the immoral or oppressive methods constitute actionable fraud or deceit, or illegal agreements in general restraint of trade (Code of 1933, § 20-504), or agreements in contravention of the common law to stifle competition, or constituted a violation of some recognized rule of public policy, with the result that in all cases the means employed amounted to a tort." See also Frigidice Co. v.Southeastern Fair Asso., 58 Ga. App. 694 (199 S.E. 760).

The allegations of the petition in respect to personal belongings of the plaintiff fail to set forth a cause of action.

2. The court did not err in sustaining the general demurrer and in dismissing the action.

Judgment affirmed. Stephens, P. J., and Felton, J., concur.