Clouse v. Myers

753 S.W.2d 316 (1988)

Purchase the Printed Copy at bsmsphd.com

Nature of the Case

To access this section all you need to do is click here and register.

Facts

D, wife. was operating the Green Door Tavern and had a three-year lease. D had a sole owner, 5 percent beer by-the-drink license issued by the Missouri Division of Liquor Control. The assets of the business consisted of the stock of beer on hand, glassware, an air conditioner, and a beer box. P was a patron of the Green Door. During one of his visits, D (husband) asked P if he would be interested in purchasing an interest in the business. The agreement, titled 'Employment/Management Contract,' was executed on January 28, 1987. In the contract, Ds are referred to as 'Employers' and P as 'Employee.' Ds agreed to hire P to manage the business for a four-year period, with P to receive 60 percent of the net profit of the business as salary, and P pay to Ds $15,000, with $7,500 to be paid at the time of the signing of the contract and the remainder at a later date. At the termination of the agreement or upon the exercise of the lease option to purchase, whichever came first, P was to get a 60 percent ownership interest in the Green Door, with Ds agreeing to exercise their option to purchase the property. Upon purchase of the property P and D were each to pay 50 percent of the purchase price. P paid $ 7,500 and began operating the tavern. Larry Fuhr, an agent with the Missouri Division of Liquor Control, discovered the transaction and told D that if she sold part of the business, she would have to form a partnership and apply for a new license in the names of the partners. D voluntarily relinquished her liquor license to Fuhr. P later applied for and received a liquor license to operate the tavern in his own name, and renegotiated the lease of the premises retaining the inventory that he had obtained from Ds. P requested that Ds return his $7,500. P sued D. P claimed that the withdrawal of the license triggered paragraph 12 of the contract which provided that should the Ds engage in any act which would have the direct result of the loss of the liquor license, any monies paid by P to Ds would be refunded. Ds filed a counterclaim, denying they had breached the contract, and claiming that P still owed them $7,500 on the contract. P got the judgment for the $7,500 and on Ds' counterclaim. Ds appealed.