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AAA Uniform & Linen Supply, Inc. v. Barefoot, Inc.
Citations: 17 S.W.3d 627; 2000 Mo. App. LEXIS 788; 2000 WL 680230Docket: No. WD 57092
Court: Missouri Court of Appeals; May 16, 2000; Missouri; State Appellate Court
AAA Uniform and Linen Supply, Inc. (AAA Uniform) filed a lawsuit against Barefoot, Inc. for unpaid account balances and breach of contract. The court ruled in favor of AAA Uniform on the account balance, awarding $1,533.37, but found for Barefoot on the breach of contract claim, concluding that the contract was mutually rescinded. AAA Uniform appeals this decision, disputing the trial court's finding of rescission. The background reveals a long-standing business relationship between Paul Heilman of AAA Uniform and Jeff Barefoot of Barefoot, established through written service rental agreements in 1994 and 1996. These agreements involved AAA Uniform supplying uniforms and other items, with payments structured as flat monthly amounts that increased over the years. Tensions arose due to Barefoot's increasing demands and AAA Uniform's inability to adjust the flat payments accordingly. In October 1997, following complaints from Barefoot about service quality, Heilman threatened to pick up rental merchandise. Subsequent correspondence included a demand for payment from AAA Uniform and a response from Barefoot indicating the intention to terminate services. Following the termination, AAA Uniform sought damages based on the rental service agreement's terms, which included liquidated damages for early cancellation. During the trial, Barefoot's defenses included anticipatory repudiation and modification of the contract. The trial court ultimately ruled that AAA Uniform's demand letter constituted an offer to rescind the contract, which Barefoot accepted in its reply. Consequently, the court denied AAA Uniform's claims for liquidated damages, prompting the current appeal. The appellate court has reversed the trial court's judgment and remanded the case for further proceedings. Appellate review follows the standards set in *Murphy v. Carron*, where a trial court's judgment is upheld unless unsupported by substantial evidence, against the weight of the evidence, or incorrectly applies or declares the law. In this case, AAA Uniform appeals the trial court's ruling of mutual rescission of a 1996 service rental agreement, arguing that the correspondence between the parties did not constitute a clear offer and acceptance for rescission. AAA Uniform highlights that evidence of mutual rescission was absent, emphasizing that any rescission must be clear, positive, and unequivocal, as established in *McBee v. Gustaaf Vandecnocke Revocable Trust*. The court determined that AAA Uniform’s October 9 letter merely demanded payment and referenced breach of contract provisions, showing no intent to rescind. Furthermore, the subsequent letter from Barefoot did not indicate acceptance of an offer to rescind, but rather expressed a decision to discontinue the business relationship due to perceived threats. The appellate court found that neither party's pleadings or evidence raised the issue of mutual rescission, as the trial court's authority is limited to matters presented in the pleadings or by consent. Consequently, the appellate court reversed the trial court's judgment on the breach of contract action and remanded the case for further proceedings, allowing the trial court to consider additional evidence and arguments as necessary.