Tales from the Boulevard of Broken Promises
BOULEVARD OF BROKEN PROMISES
Today’s true tale from the Boulevard of Broken Promises is a reminder that some promises might be better off never having been made, and there simply may be no remedy at all when they are broken.
Long ago, in a city, not too far away – a city with a lake – the city elders decided they wished to have a marina on their lake. The lake was created by an earthen dam, and was just completed in that same year of 1987. The lake, named Arcadia Lake, is the water supply for the city in more or less central Oklahoma. The Public Works Authority of the city sought proposals for the design, construction and operation of a full-service marina on its lake.
In July 1987 a corporation was born with the purpose of developing, constructing and operating a marina on Arcadia Lake. An-Cor, Inc. built a scale model to demonstrate its concepts. It showed its model to the Public Works Authority and other city officials, up to and including the mayor, himself. In the course of things An-Cor met up with the man An-cor thought would be just the “consultant” it needed to get the lease from the city to build and operate its marina. The man whom we will call Jerry talked and An-Cor listened. It should be noted that our man named Jerry (and the mayor too) denies Jerry said all the things that An-Cor said it heard, but then this tale wouldn’t be nearly as interesting if we believed Jerry on this score instead of An-Cor.
An-Cor claimed it heard Jerry hold himself out to have particular influence with the city and the mayor. An-Cor claimed it heard Jerry promise he could secure the lease for the marina from the city for An-Cor. According to An-Cor, Jerry said he had done many other deals with the mayor, and all Jerry had to do was to “take care of” the mayor by paying the mayor in cash some of the money that An-Cor would pay to Jerry. In this manner Jerry promised to be able to secure the support of the mayor for the lease to be awarded to An-Cor. An-Cor agreed to hire Jerry as its consultant to represent it before the city for an initial fee of $5,000.00 to be paid after An-Cor was fully funded.
Things proceeded well, and shortly the Public Works Authority directed the city to begin lease negotiations with An-Cor. However, two months later the deal was not closed and Jerry came to An-Cor, and An-Cor heard Jerry say he needed $10,000 in cash with which to “take care of” the mayor. When An-Cor told Jerry no way, An-Cor heard Jerry say that Jerry needed $2,500.00, right then or he would kill the deal. An-Cor then paid Jerry $2,500 of the initial $5,000 consulting fee. An-Cor claimed it later heard Jerry say he gave half of the $2,500 to the mayor for spending money on a trip the mayor took, but of course the mayor and Jerry insisted An-Cor was still just hearing things.
The next six months were a roller coaster ride for An-Cor, alternately being told the deal was all but done or that the deal was dead. Finally in August 1988, the city council took up a vote on the lease. An-Cor claimed that when the mayor found out that An-Cor still had not paid the $10,000, the mayor told the city council he was opposed to the deal and urged its defeat. It was defeated.
Finding itself on the Boulevard of Broken Promises, An-Cor sued the mayor for not delivering on Jerry’s promise to deliver a lease and for extortion, loss of corporate opportunity and fraud. Not surprisingly, these claims went over with the court like – well like a lead anchor. “An-Cor’s own petition sets out that An-Cor knowingly and voluntarily entered into an agreement that contemplated paying the mayor in order to secure his support for its lease, thus establishing the contract was [felonious].” Oklahoma law does not permit the enforcement of unlawful contacts which are contracts contrary to an express provision of the law, contrary to the policy of express law and contrary to good morals. After the mayor moved for dismissal, the Judge dismissed the case finding the claims were based upon an illegal and unenforceable attempt to bribe the mayor. On appeal, the Supreme Court stated that even if the mayor had not moved for dismissal, the Court itself would have been bound to raise the issue of the illegality of the contract in the interest of the administration of justice. There simply is no remedy for broken promises that are illegal to begin with. That’s the law on the Boulevard of Broken Promises.
A unifying theme in the law practice of A. Craig Abrahamson is CONTRACTS. Mr. Abrahamson focuses his practice on contracts: negotiating them, drafting them, enforcing them and, in the cases of bankruptcy and divorce, dissolving them.