ST. LOUIS – The United States District Court for the Eastern District of Missouri in the Eastern Division determined an oral agreement was sufficient for a company claiming it was stiffed out of $690,000 , according to a recent opinion.
Rangeline Capital LLC filed a lawsuit against Forrest L. Preston, LC, Healthcare Holding Company LLC and Life Care Centers of America Inc. Rangeline accused the defendants of breaching an oral contract the parties had with one another. Based on the opinion, the plaintiff and defendants agreed the plaintiff would be the exclusive financial service provider for Life Care. The plaintiff would subsequently get 1 percent of the total financed amount once Life Care closed out its transaction, based on the agreement.
Things went south after Life Care went to a third-party company to provide its financial services outside of the one the plaintiff recommended. The defendant then closed on $69 million but did not pay the plaintiffs the alleged $690,000 it owes as the 1 percent fee.
Still, the defendants stated they did not have a valid contract because the oral agreement didn’t include necessary terms. They filed a motion for summary judgment in the plaintiff’s lawsuit against them, which the district court denied.
The district court first evaluated the plaintiff’s breach of contract claim. It determined the plaintiffs provided enough information to prove the details of oral agreement, that it would receive 1 percent of the defendants’ total financed amount, and that the amount was due when the defendants closed. The district court had a similar ruling on the plaintiff’s breach of the duty of good faith and fair dealing claim.
When it comes to the unjust enrichment and quantum meruit claim, the district court had to determine if it would be applied in Missouri, where the plaintiffs said the agreement was finalized, or Tennessee, where the defendants live. The court ultimately decided to apply Missouri law.
The district court stated the defendants didn’t provide a relevant argument to dispute this case and allowed the summary judgment on unjust enrichment and quantum meruit.
“Plaintiff has shown there is at least a genuine issue of material fact barring summary judgment for each of its four claims,” said the court.