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Johnson v. Sundstrand Mach. Tool Co.

June 8, 1953

JOHNSON
v.
SUNDSTRAND MACH. TOOL CO.



Author: Finnegan

Before FINNEGAN, LINDLEY and SWAIM, Circuit Judges.

FINNEGAN, Circuit Judge.

Appellant, A. M. Johnson, seeks to reverse an order of the United States District Court for the Northern District of Illinois, Western Division, which adjudged that "his complaint and all amendments thereto be and the same are hereby stricken and that plaintiff go hence without day."

The case originated in the Circuit Court of Winnebago County, Illinois, from whence it was removed to the District Court because of diversity of citizenship. After causing the transcript of record to be filed in the District Court, the defendants moved in that court that the complaint be stricken stating that: (1) the complaint fails to allege a cause of action; (2) that the pleadings are vague, indefinite and general; (3) that plaintiff seeks to vary the terms of a written contract by parol; and (4) that it would be contrary to public policy to enforce the contract.Before this motion to strike was argued and plaintiff procured from the District Court leave to amend its complaint, the motion to strike was ordered to stand to the complaint as amended.

On hearing of the motion and consideration of the briefs and arguments by the respective parties, the District Court entered the order from which this appeal is prosecuted.

As amended, the complaint contains eight counts: The first count alleges that on January 2, 1941, Johnson entered into a written contract with defendants (a copy of which is attached to complaint and marked exhibit 1) under the terms of which contract Johnson was to devote his entire time as a salesman for the appellees, Sundstrand Machine Tool Company and American Broach and Machine Company, in a certain defined territory for a salary plus commission on sales. The written contract of January 2, 1941, provided in part as follows:

"11.Either party to this Agreement may cancel same by giving notice in writing to the other party, termination under such circumstances to be effective on the first day of the month occurring after the date of notice.

"12. This Agreement continues in full force and effect for a period of one (1) year from January 2, 1941, and thereafter yearly unless terminated by either party as provided in clause 11."

In December of 1941, while said contract was in full force, Sundstrand requested Johnson temporarily to leave his employment with them and accept a civil service position which had been offered by the United States Office of Production Management as Sundstrand's contribution to the war effort. Johnson objected because of the great financial loss involved in such a change. In order to overcome the objections of Johnson, Sundstrand made a verbal contract with Johnson by which it promised that, it would:

"at the end of the year 1942, unless it would then be illegal to do so, pay plaintiff an amount equal to the difference between the amount of commissions plaintiff would have earned during the year 1942, pursuant to the terms of said written contract, from orders obtained during the year 1942 for products of defendant Sundstrand and products of its subsidiary, American Broach, in the territory assigned to plaintiff by said written contract, if, pursuant to the terms of said written contract, plaintiff had continued to act in the capacity of Direct Sales Representative and Sales Engineer in said territory during the year 1942, less the expense required to service said territory in 1942, and thereafter all commissions plaintiff would have received under the provisions of the aforesaid written contract on orders taken for products of defendants in the territory described in the written contract referred to herein during the year 1942 but shipped and billed thereafter had plaintiff's employment with defendants terminated on January 1, 1943."

The consideration running to defendants as expressed in the complaint consisted of Johnson's promise to:

"temporarily leave his employment with defendant Sundstrand and its subsidiary, American Broach, and accept said civil service position, and to refrain from severing all of his connections with defendant Sundstrand and its subsidiary, American Broach, and to refrain from giving notice of termination of the signed written contract, copy of which is attached hereto as Exhibit 1, pursuant to the terms hereof, and to refrain from seeking lucrative private employment elsewhere in a similar capacity with some other manufacturer of machine tools covering either the same or other territory, and in consideration of the benefits defendant Sundstrand and its subsidiary, American Broach, would derive and could expect to derive as the result of having contributed plaintiff's services to the war effort, in good will during the time plaintiff would remain in the employ of the United States Government, and in good will and financially thereafter."

Plaintiff accepted this offer and worked for the Office of Production Management during 1942 and claims, under the terms of the contract set forth in count 1, $198,000 from Sundstrand alone based upon the combined sales of Sundstrand and the American Broach.

Count 2 alleges that the oral contract as above stated was made by both Sundstrand and American Broach on the one hand and Johnson on the other and demands judgment in the amount of $198,000, based upon the combined sales of ...


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