Doss v. EPIC Healthcare Management Co.

Equity Rental Co. Inc. (Copytech) leased two copy machines to EPIC Healthcare Management Co. (EPIC) (defendant). The lease contained a hell-or-high-water clause providing that EPIC remained obligated to pay any assignee of the lease regardless of any defenses EPIC may have against the assignor. Though the lease contained a non-cancelation provision and a zipper clause providing that the lease constituted the parties’ entire agreement, on the same date, EPIC exchanged a purchase order with Copytech stating that either party could cancel the lease upon 30 days’ notice, and Copytech confirmed EPIC’s right of cancellation in a letter. Copytech assigned the lease to Boatmen’s Bank of Southern Missouri (Boatmen’s). EPIC started timely paying the lease-installments to Boatmen’s. The copy machines began experiencing issues. Accordingly, EPIC advised a Boatmen’s officer of its intent to cancel the lease and to leave the copy machines at a certain location for pick-up. Boatmen’s never responded but did retrieve the copy machines, purportedly only to mitigate its losses because it had no knowledge of EPIC’s right of cancellation. Boatmen’s subsequently leased the copy machines to someone else and made no attempt to collect further payments from EPIC. Thereafter, Boatmen’s assigned this lease and other leases to Henry E. Doss (plaintiff), which were all listed on a list of nonperforming leases. Doss knew that Boatmen’s picked up the copy machines before agreeing to purchase the lease. After unsuccessfully demanding payment from EPIC, Doss sued EPIC for the remaining lease-installments. EPIC filed a third-party complaint against Boatmen’s seeking indemnification. The trial court entered summary judgment for Doss and Boatmen’s. EPIC appealed.