Procedural Posture

In a breach of contract action, appellants, insurance company and investment company, sought review of the decision of the Superior Court of Alameda County (California), which granted respondent founder's request for a new trial.

Overview

The founder hire a lawyer and brought separate actions against the insurance and investment companies for damages for the breach of a separate contract with each of them. The two cases were consolidated for trial and jury verdicts were returned in favor of the companies. The trial court granted the founder's motion for new trial because of insufficiency of the evidence to sustain the verdict. The court affirmed the trial court's order. The court held that there was not sufficient evidence to prove the companies' allegations that the contracts were the result of the founder's influence. The companies' attorney prepared the contract without any interference by the founder. The amounts of salary, disability, and death payments were not inserted therein until the directors had discussed them. The compensation was not excessive because the founder had done the promotional work for the organization of the insurance company, had successfully brought it into being, and was immediately reelected as the president and director when he resigned from those positions. The court held that both companies were aware that the founder had outside obligations to the other company.

Outcome

The court affirmed the orders granting a new trial for the founder.