Present: All the Justices
RAPPAHANNOCK PISTOL AND
RIFLE CLUB, INC.
OPINION BY
v. Record No. 001622 CHIEF JUSTICE HARRY L. CARRICO
June 8, 2001
ROBERT T. BENNETT, ET AL.
FROM THE CIRCUIT COURT OF LANCASTER COUNTY
J. Peyton Farmer, Judge Designate
In a motion for judgment filed below, Rappahannock Pistol
and Rifle Club, Inc. (the Club) sought compensatory and punitive
damages against Robert T. Bennett and Catherine A. Bennett (the
Bennetts) for their allegedly tortious interference with a
contract between the Club and C.F. Lumber Co., Inc. (C.F.
Lumber). The trial court struck the Club's claim for punitive
damages, and a jury awarded the Club $125,000.00 in compensatory
damages. Upon motion of the Bennetts, the trial court set the
verdict aside on the ground the Club failed, as a matter of law,
to prove the Bennetts tortiously interfered with the contract.
The court entered final judgment in favor of the Bennetts, and
we awarded the Club this appeal.
In Stover v. Norfolk & Western Ry. Co., 249 Va. 192, 455
S.E.2d 238 (1995), we stated as follows:
When the verdict of a jury has been set aside by the
trial court, the verdict is not entitled to the same weight
upon appellate review as one that has received the trial
court’s approval. Nonetheless, when considering the facts
under these circumstances, the appellate court will grant
the party prevailing before the jury benefit of all
reasonable inferences that may be drawn from the evidence
and of all substantial conflicts in the evidence.
Id. at 194, 455 S.E.2d at 239-40. See also Kelly v. Virginia
Elec. & Power Co., 238 Va. 32, 34, 381 S.E.2d 219, 220 (1989).
We shall state the facts with these principles in mind.
Since its inception in 1982, the Club has operated a
shooting range on leased premises near Whitestone in Lancaster
County. Desiring to build a clubhouse and expand its
operations, the Club conducted a ten-year search for a new site,
culminating in the discovery of a 53-acre parcel in the Regina
area of Lancaster County owned by C.F. Lumber, of which C.F.
Carter, Jr., was the president and sole stockholder. The 53-
acre parcel (the Property) met all the Club's criteria for a new
site.
In a written contract dated January 24, 1997, C.F. Lumber
agreed to sell the Property to the Club. The contract provided
that the Club would pay the purchase price of $22,000.00 at
closing and that “[t]ime is of the essence,” with settlement to
be made “on or before February 24th, 1997 or as soon thereafter
as title can be examined and papers prepared allowing a
reasonable time to correct any defects reported by title
examiner.”
Following the signing of the contract, members of the Club
visited residents of the Regina area to explain the Club's plans
2
for a shooting range. According to the testimony of Club
members, reaction to the plans was positive, with some of the
residents indicating an interest in becoming members of the
Club.
The Bennetts, both of whom are licensed real estate agents,
own a farm located approximately one and one-half miles from the
Property. They joined those opposed to the proposed shooting
range after learning of the Club's plans from Rebecca George, a
neighbor. In a telephone conversation with Ethel Register, the
wife of Marvin Register, chairman of the Club's committee to
search for a new site, Catherine Bennett stated that "she hated
guns," that "anybody who owned a gun automatically had to be a
bad person," and that Ethel Register's husband "had to be a bad
person because he owned a gun." 1 Catherine repeated these
statements in calls to Ethel Register over the next three days,
becoming more agitated with each call. In one of the calls,
Catherine told Ethel that Robert Bennett "was writing a noise
ordinance that would have an effect in Lancaster County of
eliminating hunting."
On February 15, 1997, members of the Club conducted a test
at the Bennetts' property to determine "if there was any noise
factor that could be heard at [the Bennett] place" from "any
3
firing down on [the proposed shooting] range." According to the
testimony of Marvin Register, who participated in the test, when
two shots each were fired from a pistol, a rifle, and a shotgun,
the sounds were "very faint." However, the Bennetts said the
noise was objectionable, and a tearful Catherine Bennett said
that she wanted the shooting range "out of the County," that she
was a realtor, and that she would find the Club "a perfect
spot." She asked Register whether the Club was "going to go
ahead with this after all [she had] said." When he answered in
the affirmative, she stated: "Then I will do whatever is
necessary to make sure that you never use that site at Regina
for a range. This game isn't over. I will do whatever is
necessary, whatever it takes, and I always win."
On February 17, the Bennetts prepared and signed a backup
contract, offering to purchase the Property for $26,000.00. The
Bennetts placed the contract with their attorney, Paul C. Stamm,
Jr. Included was a cover letter addressed to Raymond Wesley
Edwards, attorney for C.F. Lumber and its president, C.F.
Carter, as well as a check for $6,000.00 payable to Edwards as a
deposit on the purchase price. A copy of the cover letter was
sent to Carter. Robert Bennett admitted in his testimony that
1
Interestingly, Robert Bennett testified that he and Catherine
owned a pistol and a rifle, leased their farm to a hunt club,
and regularly attended the hunt club’s annual dinner.
4
he and Catherine decided to buy the Property because the Club
"wanted to locate a firing range there."
On February 18, Catherine Bennett and her attorney, Stamm,
visited Edwards, attorney for C.F. Lumber and Carter, whose
office was on the second floor of Stamm's building. Catherine
told Edwards "how she had to have [the Property] because the
shooting on that piece of property would bother her [ewes] when
they were having lambs and how the rifle fire would knock the
plaster off of the walls." Testifying as a witness for the
Club, Edwards stated that he told Catherine there was "a valid
contract out on that piece of property" and as far he could see
"under law, that is where it is gone." When Stamm told Edwards
the Bennetts had a backup contract on the Property, Edwards said
that "[i]f the time comes that a back-up contract would be
appropriate," he "would submit it to Mr. Carter for his
consideration." Stamm told Edwards the backup contract was
"right downstairs any time you want to look at it."
Also on February 18, Edwards discussed with Carter the
validity of C.F. Lumber's contract with the Club, particularly
"the portion about 'time is of the essence.' " It was apparent
at that point the contract could not be closed on February 24th,
as the contract required, because Edwards had been unable to
obtain certain documents from C.F. Lumber's predecessor in title
that were necessary before the transaction could be closed.
5
Edwards advised Carter that it was C.F. Lumber's responsibility
to obtain the documents, that the contract was still valid, and
that only the Club could exercise the "time is of the essence"
provision of the contract.
On February 20, members of the Club attended a meeting
arranged by Rebecca George. The members expected to join "a
handful of people" to consider the views of a young mother
concerned about the safety of her child as a result of the
Club's proposed shooting range. Instead, the meeting place "was
jam packed full of people," numbering more than sixty, most of
whom were "very hostile" to the Club's proposal. The Bennetts
were present, but remained "relatively quiet." Catherine
Bennett engaged Marvin Register in conversation. She asked him
whether the contract between the Club and C.F. Lumber had been
closed. When he said the contract had not yet closed, she said
that February 24 was "the last day . . . [t]hat is what the
contract says." He responded, "No, it's been extended." She
then offered to purchase the Property for $22,000.00. Register
said the offer would not be of interest to the Club because
"that is exactly what we are paying for the land."
Also on February 20, Carter, on behalf of C.F. Lumber,
executed a deed conveying the Property to the Club. The next
day, Carter delivered the deed and other closing documents to
the Club’s counsel, to be held in escrow.
6
On February 24, Catherine called Edwards' office and left
him a message. The message stated that Catherine had sent a
check and agreement to a representative of C.F. Lumber and that
her attorney, Stamm, "has a check and offer downstairs."
On February 26, Edwards' secretary received a telephone
call from Carter that she remembered "very well" because he was
"very upset with [her]." Carter "spent a great deal of time
telling [the secretary] that he did not want [her] to ever give
his telephone number to anybody, and [she] had given it to Mrs.
Bennett." According to the secretary, Carter went on to say
that he did not want to sell the Property to the Club, "if at
all possible," because "[h]e couldn't stand the aggravation."
When Edwards returned Carter's call, Carter stated that “he
did not want to sell [the Property] to the Pistol and Rifle
Club; that it was a very aggravating situation; that he had
received several phone calls. He mentioned [that] this sale has
been all over the newspaper and he was concerned as a business
— as most businessmen, that they don't want . . . a big public
disclosure of all his big activities." According to Edwards,
Carter said he received a number of telephone calls "from 'a
bunch of women,' " and he "mentioned Mrs. Bennett's name" and
said "she had called him up and he didn't need any more."
Edwards was under the impression that "something was bothering
[Carter]." Edwards again advised Carter that C.F. Lumber's
7
contract with the Club was still valid and that he, Carter,
“would be held accountable for it to some point."
On February 27, the Bennetts and a group of their
neighbors, through their counsel, William G. Broaddus, presented
an emergency ordinance to the Board of Supervisors of Lancaster
County that would have, according to the Club, prevented its use
of the Property. The Board of Supervisors declined to adopt the
ordinance on an emergency basis. It did, however, amend the
County's zoning ordinance, effective October 1997, in a manner
that would require the Club, if it sought to use "an alternative
site," to meet certain requirements it would not have had to
meet had it acquired the Property according to its contract with
C.F. Lumber.
On February 27 or 28, Carter went to Stamm's office and
told Stamm to close the Bennetts' purchase of the Property.
Stamm advised Carter to see his own counsel, Edwards. Carter
visited Edwards' office on the morning of February 28 and
"wanted to talk . . . about not going through with [the]
contract" with the Club. Edwards told Carter that the Club's
contract was valid and that, if he did not go through with it,
he was subject to suit by the Club. When Carter left, Edwards
thought he would go through with the Club's contract.
However, on the afternoon of February 28, Stamm, the
Bennetts’ counsel, told Edwards that Carter wanted to close on
8
the sale of the Property to the Bennetts that day. Edwards
telephoned Carter and repeated his advice that the Club’s
contract was valid and that Carter was exposing himself to
potential suit by selling the Property to the Bennetts.
According to Edwards, Carter said: “I don’t care. I am going
to have it closed on this afternoon, and . . . do what you got
to do.” 2 Edwards then informed Stamm that Carter wanted to
“close this afternoon,” and Stamm said he “had it all ready.”
Carter signed the Bennetts’ backup contract, Carter and his wife
executed a deed conveying the property to the Bennetts, and
Stamm conducted the closing and recorded the deed, all on
February 28.
On March 6, Edwards received the documents whose earlier
absence had prevented the closing of the sale of the Property to
the Club on February 24. Edwards testified that C.F. Lumber
would have been in a position to close the sale to the Club on
March 6 but for the sale to the Bennetts.
At the time of trial, the Club had found only one suitable
replacement site, but it contained 266 acres and was priced at
$245,000.00, an amount the Club considered “out of the
2
Carter testified that he disagreed with Edwards that the Club’s
contract with C.F. Lumber was still valid after February 24,
1997, the date fixed in the contract for closing. Carter, who
had sold some two hundred parcels of real estate in the past ten
years, said he considered the “time is of the essence” provision
9
question.” The Club had also filed an action for damages
against C.F. Lumber and recovered a judgment for $4,000.00, the
difference between the original sale price in the Club’s
contract with C.F. Lumber and the sale price in the Bennetts’
backup contract.
On appeal, the parties discuss the elements a plaintiff
must establish in proving a case of tortious interference with a
contract. The parties agree on four of the elements, both sides
citing the same case, Chaves v. Johnson, 230 Va. 112, 335 S.E.2d
97 (1985), as authority. There, we stated as follows:
The elements required for a prima facie showing of the
tort [of intentional interference with a contract] are:
(1) the existence of a valid contractual relationship or
business expectancy; (2) knowledge of the relationship or
expectancy on the part of the interferor; (3) intentional
interference inducing or causing a breach or termination of
the relationship or expectancy; and (4) resultant damage to
the party whose relationship or expectancy has been
disrupted.
Id. at 120, 335 S.E.2d at 102.
The Bennetts contend, however, that, in this case, the Club
had to establish a fifth element. Citing Duggin v. Adams, 234
Va. 221, 360 S.E.2d 832 (1987), and Maximus, Inc. v. Lockheed
Info. Mgmt. Sys. Co., 254 Va. 408, 493 S.E.2d 375 (1997), the
Bennetts argue that “[i]f the contract survived [the closing
date], it must have become a contract at will, subject to
rendered the contract void when the Club failed to close on
February 24.
10
cancellation by [C.F. Lumber] because of the violation of the
time of the essence clause.” The Bennetts then say that because
the contract was terminable at will, “the burden on the [Club]
increases,” requiring it to prove the Bennetts “used improper
methods” to induce C.F. Lumber to breach the contract. On the
other hand, the Club says that it only had to establish the
elements applicable to a contract not terminable at will, as
approved in Chaves, and that it did not have to prove the
Bennetts “used improper methods” to induce C.F. Lumber to breach
the contract.
We do not need to resolve this issue. It has been settled
by the granting below of an instruction that is not questioned
on appeal and, hence, has become the law of the case. Bostic v.
Whited, 198 Va. 237, 239, 93 S.E.2d 334, 335 (1956). Embodying
the principles stated in Chaves, the instruction is worded as
follows:
You shall find your verdict for the [Club] if [it]
proved by the greater weight of the evidence:
(1) that there was a valid contract between the [Club]
and C.F. Lumber Co., Inc.; and
(2) that the [Bennetts] knew of this contract; and
(3) that the [Bennetts] intentionally caused C.F.
Lumber Co., Inc. to breach its contract with [the Club];
and
(4) that the [Club] was damaged by the breach of
contract.
11
You shall find your verdict for the [Bennetts] if the
[Club] failed to prove any one or more of these elements.
It will be noted that the instruction did not require the Club
to prove the Bennetts “used improper methods” to induce C.F.
Lumber to breach its contract with the Club. Therefore, the
requirement did not exist.
However, under the third element of the instruction, the
Club was required to prove that the Bennetts intentionally
caused C.F. Lumber to breach the contract with the Club. The
Club says it made a prima facie showing of this element by
establishing that “the Bennetts engaged in a persistent,
affirmative and intensive course of conduct intended to cause
[C.F. Lumber] to breach the contract.” According to the Club,
its evidence showed that the Bennetts “whipped the neighborhood
into [a] frenzy of opposition,” “turned the neighborhood against
[the Club],” “led the neighborhood effort to prevent [the Club]
from buying the property,” “created the notoriety which resulted
in the media coverage which was a concern to Carter,” and
“[w]ith knowledge of the [Club’s] contract [with C.F. Lumber],
. . . negotiated a contract to buy the property for a higher
price.” The Club also says that Catherine Bennett “tried to
coerce [the Club] to withdraw [from the contract with C.F.
Lumber] through her threats following the demonstration of
February 15.”
12
But it must be borne in mind that it is the corporation,
C.F. Lumber Co., Inc., in the person of Carter, its president
and sole stockholder, that the Club must show was induced by the
Bennetts to breach the contract between the Club and the
corporation. It is irrelevant what the Bennetts may have done
to induce the Club to abandon its plans. It must also be noted
that it is only what the Bennetts did, and not what their
neighbors or others may have done on their own, that is relevant
to the question whether the Bennetts are liable to the Club.
There is absolutely no evidence to show that Carter knew of
anything Catherine may have said to Ethel Register in their
telephone conversations early on in the squabble over the Club’s
plans, or anything the Bennetts said or did during the
demonstration by the Club members at the Bennetts’ farm on
February 15, 1997, or anything Catherine said to Marvin Register
at the public meeting arranged by Rebecca George. Nor was it
even shown that Carter knew of Catherine’s contacts with
Carter’s and C.F. Lumber’s counsel, Raymond W. Edwards, even
though Edwards testified as a witness for the Club. Finally,
there is nothing to indicate that the Bennetts did anything, by
way of newspaper advertisements or otherwise, to instigate the
media coverage of the public controversy that erupted over the
Club’s proposed use of the Property.
13
The Club says on brief, however, that Carter “received
aggravating telephone calls from Catherine and had been
threatened by her with public disclosure of his business
activity.” This misrepresents the record. The Club cites two
references to the joint appendix as the sources of the
statement. First, testifying as a witness for the Club on direct
examination, Edwards relates a conversation he had with Carter,
as follows:
A. The conversation was by Mr. Carter stating that he
did not want to sell the property to the Pistol and Rifle
Club; that it was a very aggravating situation; that he had
received several phone calls and he didn’t like these kinds
of phone calls. He mentioned to me, you know, this sale
has been all over the newspaper and he was concerned as a
business — as most businessmen, that they don’t want a
large — I believe and from what he told me — a big public
disclosure of all his big activities.
Q. And when he said he received a number of telephone
calls, did he say from whom?
A. He said from “a bunch of women”, is how he phrased
it to me.
It will be noted that in this repartee, the name of
Catherine Bennett is not even mentioned as being the source of
any telephone calls. Nor by any stretch of the language
reported can any threat to Carter be inferred, let alone
established by a preponderance of evidence.
Second, with Edwards testifying on redirect, these
questions and answers followed:
14
Q. The messages that you testified that you received:
You got one from Mr. Carter, that didn’t mention the
Bennett’s, did it, when he said that he did not want to
sell to the Gun Club?
A. No. No. He didn’t say, I want to sell to the
Bennett’s.
Q. And I think on another occasion you said that he
had received phone calls from several women?
A. Uh-huh.
Q. And he didn’t mention the Bennett’s?
A. He mentioned Mrs. Bennett’s name.
Q. He did mention?
A. Yeah.
Q. What did he tell you about Mrs. Bennett?
A. That she had called him up and he didn’t need any
more.
Q. That he didn’t need any more of those telephone
calls? Who else did he name as calling?
A. Didn’t name anybody else, just “those women.”
Q. “Those women”?
A. Yes.
Q. Okay.
This time, by prompting Edwards, the Club got Catherine
Bennett’s name into the story. But it was the Club’s lawyer,
not Edwards, who used the plural noun “calls” as related to
Catherine Bennett’s contact with Carter. Edwards stated only
that Catherine had “called [Carter] up,” indicating Catherine
15
had made only one telephone call. And Edwards never even came
close to saying, as the Club claims on brief, that Carter “had
been threatened by [Catherine Bennett] with public disclosure of
his business activity.” 3 Hence, the record utterly fails to
support the Club’s claim that Carter “received aggravating
telephone calls from Catherine and had been threatened by her
with public disclosure of his business activity.”
Remaining is the Club’s contention that the Bennetts caused
C.F. Lumber to breach the contract when, “[w]ith knowledge of
the . . . contract, [they] negotiated a contract to buy the
property for a higher price.” However, as the trial judge
stated in a letter opinion, “[t]he act of purchasing the
property for a price greater than that provided for in the
[Club’s] contract with Carter does not, in and of itself,
constitute tortious interference.” The Club had the burden of
showing not only that the backup contract existed but also that
its existence caused C.F. Lumber’s refusal to close on its
contract with the Club. Yet, the Club did not produce any
testimony or other evidence linking the existence of the backup
3
In his testimony, Carter said he talked to Catherine Bennett on
the telephone one time. He “guess[ed]” the conversation took
place in “[t]he middle of January [1997].” He said “she wanted
to know if she could buy the property and [he] told her that it
was under contract; but if the contract didn’t go through, that
[he] would get back in touch with her.” When asked whether the
Bennetts had threatened him, Carter replied, “No.”
16
contract to C.F. Lumber’s refusal, and the link cannot be
inferred from the evidence that was produced.
Indeed, if any inference can fairly be drawn from the
evidence, it would support the Bennetts’ position. Three
attorneys versed in real estate matters testified without
contradiction that the use of backup contracts is an accepted
practice. Raymond W. Edwards, counsel for C.F. Lumber and
Carter, described a backup contract as “an offer made by a party
who wants to buy the same piece of property that’s already been
placed under contract with another party,” and he testified that
the use of backup contracts is recognized in “real estate
circles.” William G. Broaddus, counsel for the Bennetts,
testified that the use of backup contracts is “certainly not
unusual” and is especially appropriate when the contract backed
up provides that time is of the essence. Paul C. Stamm, another
counsel for the Bennetts, testified that he had closed “[m]any,
many” backup contracts. And Broaddus testified that he and
Stamm “suggested” to the Bennetts that they might “well wish to
consider submitting what is commonly called a ‘backup offer’ to
the seller.”
In conclusion, we agree with the trial court that the Club
failed, as a matter of law, to prove that the Bennetts
17
tortiously interfered with the Club’s contract with C.F. Lumber. 4
Accordingly, we will affirm the judgment of the trial court.
Affirmed.
4
In view of this conclusion, we do not reach the Club’s
additional contention that the trial court erred in striking its
claim for punitive damages.
18