Recent Development by W. E. Eshelman
The 1984 Louisiana World's Fair was planned and conducted by Louisiana World Exposition, Inc. (LWE), a nonprofit corporation. LWE negotiated a contract with 9 to 5 Fashions, Inc. to furnish custom-made uniforms for Fair employees. When LWE declared bankruptcy, 9 to 5 Fashions could not collect any of the disputed amount due under the contract. As a result, 9 to 5 Fashions sued the chief executive officer of LWE, Petr Spurney, alleging damages caused by Spurney's numerous acts and omissions that constituted intentional and negligent interference with the uniform contract. 9 to 5 Fashions maintained that because of Spurney's interference, the contract became more burdensome and costly. The trial court held Spurney personally liable on the theory that, through his nonfeasance, malfeasance, or intentional misrepresentation, Spurney had breached a personal duty that he owed to 9 to 5 Fashions. Spurney was specifically found to have delayed the appointment of a uniform coordinator, which caused 9 to 5 Fashions to order excess uniform material, which in turn caused a loss of profits of $101,438. The court of appeal amended the trial court judgment to reduce the damage award to $45,308, but in all other respects affirmed the judgment. The court of appeal found that Spurney's three-month delay in appointing a uniform coordinator had resulted in delays in the design and manufacture of the uniforms and in misunderstandings as to the quantities of uniforms needed. Spurney, therefore, had breached a duty of due care that was owed to 9 to 5 Fashions both by Spurney individually and by LWE. The Supreme Court of Louisiana reversed, holding that Spurney's actions were justified because they were in the scope of his corporate authority, they were not intended to interfere with 9 to 5 Fashions' contract, and they were not detrimental to LWE. Notably, in reaching its decision the supreme court did recognize a corporate officer's duty to refrain from unjustified, intentional interference with the contractual relationship between his corporation and other persons. 9 to 5 Fashions, Inc. v. Spurney, 538 So. 2d 228 (La. 1989).
About the Author
W. E. Eshelman.
Citation
64 Tul. L. Rev. 631 (1989)