## Facts

- Equity Rental Co., Inc., also known as Copytech, leased two photocopiers to EPIC Healthcare Management Co. under a written equipment lease.
- The lease included (1) a non-cancellation provision, (2) an entire-agreement (zipper) clause, and (3) a “hell-or-high-water” clause requiring EPIC to pay any assignee regardless of defenses EPIC might have against the original lessor.
- On the same date as the lease, EPIC exchanged a purchase order with Copytech stating either party could cancel on 30 days’ notice, and Copytech sent a letter confirming EPIC’s right to cancel.
- Copytech assigned the lease to Boatmen’s Bank of Southern Missouri (Boatmen’s). EPIC paid installments to Boatmen’s for a period of time.
- The copiers later experienced operating problems. EPIC told a Boatmen’s officer it intended to cancel and that EPIC would leave the copiers at a specified location for pickup.
- Boatmen’s did not respond to the cancellation notice but did retrieve the copiers. Boatmen’s asserted it picked up the machines to reduce losses and that it did not know about any cancellation right when it obtained the lease.
- Boatmen’s later leased the copiers to another customer and made no further effort to collect additional lease payments from EPIC.
- Boatmen’s later assigned this lease, along with other leases listed as “nonperforming leases,” to Henry E. Doss. Doss knew before purchasing that Boatmen’s had already taken back the copiers.
- Doss demanded that EPIC pay the remaining balance due under the lease. EPIC refused, relying on the asserted 30-day cancellation arrangement and Boatmen’s conduct after pickup.
- Doss sued EPIC for the remaining installments (plus interest and fees). EPIC filed a third-party claim against Boatmen’s seeking indemnification.
- The trial court entered summary judgment for Doss on his claim and for Boatmen’s on EPIC’s third-party claim. EPIC appealed.

## Issues

1. Whether the summary-judgment record eliminated genuine disputes of material fact concerning the existence and effect of a 30-day cancellation agreement (shown by the purchase order and confirmatory letter) despite the lease’s non-cancellation and entire-agreement clauses.
2. Whether Boatmen’s retrieval and reletting of the copiers, and its lack of collection activity afterward, could support fact findings of cancellation accepted by conduct, waiver, discharge, or estoppel.
3. Whether Doss, as a later assignee who knew the copiers had been picked up and purchased the lease as “nonperforming,” was entitled to enforce the hell-or-high-water clause as a matter of law.
4. Whether summary judgment for Boatmen’s on EPIC’s third-party indemnification claim was proper given the disputed facts tied to cancellation and Boatmen’s conduct.

## Decision

- The Missouri Court of Appeals (Southern District) reversed the summary judgment in favor of Doss against EPIC.
- The court also reversed the summary judgment in favor of Boatmen’s on EPIC’s third-party claim.
- The case was remanded for further proceedings because the record did not show the absence of genuine issues of material fact.

## Legal Principles

- Summary judgment is proper only when the movant shows there is no genuine dispute as to a material fact and that the movant is entitled to judgment as a matter of law; the record is read in the light most favorable to the party against whom judgment was entered.
- Even when a written lease contains an entire-agreement clause and a non-cancellation term, contemporaneous documents (such as a purchase order and a confirmatory letter) may support a claim that the parties formed a separate enforceable agreement or modification; whether that occurred can present fact questions.
- Where an alleged cancellation right is accepted by performance (for example, notice plus making the equipment available for pickup), whether acceptance occurred and what legal effect follows may depend on disputed facts.
- A lessor’s or assignee’s conduct after notice of cancellation—such as retrieving the equipment, reletting it, and not pursuing further payments—can support competing inferences about waiver, discharge, or acceptance of termination, making summary judgment inappropriate.
- An assignee generally acquires the assignor’s rights subject to defenses that exist based on prior events; whether a later assignee can rely on a hell-or-high-water clause despite disputed termination or waiver is not resolved on a summary-judgment record that leaves material facts in dispute.

## Conclusion

The court reversed and remanded because the documents and course of dealing created triable fact questions about whether EPIC had and exercised a 30-day right to cancel, whether Boatmen’s conduct after pickup amounted to termination or waiver of EPIC’s payment duty, and whether Doss—who bought the lease as nonperforming with notice that the copiers had been repossessed—could enforce continued payments as a matter of law under the hell-or-high-water clause.


Doss v. EPIC Healthcare Management Co., 901 S.W.2d 216 (1995)