Searching over 5,500,000 cases.

Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Federated Petroleum Services, Inc. v. Daniels

FEBRUARY 3, 1965.




Appeal from the Circuit Court of Cook County; the Hon. WILLIAM V. DALY, Judge, presiding. Affirmed in part, reversed in part and remanded with directions.


Rehearing denied March 11, 1965.

This is an appeal by plaintiffs after a bench trial from a judgment entered in favor of defendants and against plaintiffs.

Plaintiffs' major contention is that the trial court erred in denying to them a commission of $31,542.86 arising out of the sale of defendants' business. Federated maintains that it had an exclusive agency or exclusive listing; that this arrangement permits an owner to sell his business but requires the owner to pay the agreed upon commission if the broker was the procuring cause of the sale.

Defendants owned the Daniels Oil Company which had a bulk plant and general offices in Downers Grove, Illinois, and engaged in the fuel oil business at six service stations in northern Illinois. During the pendency of this action defendant, Charles J. Daniels, died and on June 28, 1960, J.I. Watson, executor of his estate, was substituted as a party defendant.

Defendants first evidenced a desire to sell their business in 1952. Evelyn Daniels testified that in 1952 or 1953 the property was listed with the former employer of Mel Putnam, now president of plaintiff Federated; that there had been discussions with Russell Havens, sales supervisor of Bulk Petroleum, about selling defendants' business to Bulk. Sol Hoffman, a director of Bulk Petroleum, testified that he had two meetings with the defendants in Chicago in 1955 and that there was "a general discussion about the purchase by Bulk Petroleum Corporation of the business of the Daniels Oil Company . . ."; that in February 1956, "there were no pending negotiations between Bulk Petroleum Corporation and . . . (the) Daniels(es) . . . with relation to the purchase of their property."

Putnam *fn1 testified that as the result of a conversation with defendants in Downers Grove, Illinois, in late September, 1955, "Mr. Daniels said he would list the property with Federated Petroleum Services. I asked that an exclusive listing agreement be signed and Mr. Daniels and Mrs. Daniels said they would agree to it." Putnam met with the Danielses twice in October.

On January 7, 1956, a written agreement was entered into between the Danielses and Federated. Its pertinent provisions were:

The Daniels hereby appoint Federated their exclusive agent for the sale of all of the outstanding stock of the Corporation, and the improved land, buildings and equipment which is leased by The Daniels to the Corporation.

The term of this agreement shall be from January 1, 1956, to June 30, 1956.

. . . . . .

The Daniels agree that during the period of this agreement they will not sell or otherwise dispose of any of the shares of the Corporation or any other property which is the subject of this agreement.

The commission was to be $30,000, with a provision for adjustment if the sale price deviated from $525,000.

Putnam testified as to the role that Federated assumed in merchandising defendants' complex:

After this last conversation in October 1955, I advertised the Daniels Oil Company property in the Wall Street Journal, the Chicago Tribune, the National Petroleum news at various times and proceeded to compile the accounting information which Mr. Hickman *fn2 had secured. I had taken pictures of the properties and I prepared a brochure to promote the sale of this petroleum business. The financial information was placed in the back part of the brochure and the pictures in the front.

The twenty page prospectus, admitted into evidence, contained extensive information about the physical assets and financial status of the Daniels company; it described the bulk plant and the service stations and set out in detail the equipment and gallonage of gasoline sold at each site. Putnam further stated that he distributed about fifteen copies of the prospectus on January 1, 1956; that he updated the brochure and redistributed it early in 1956; that he sent a copy to the Danielses on February 8, 1956.

Plaintiff Alan G. Schwartz testified that he first became acquainted with Federated in the latter part of 1955 as a result of its advertisement of the Daniels property in the Wall Street Journal; that he wrote Federated for further information and that about February 3, 1956, he received the detailed information sheet on the Daniels Oil Corporation as well as a transmittal letter; that he added a note to the letter and on February 14, 1956, directed it to Sol A. Hoffman, Bulk Petroleum's vice-president, for referral to the company's president, Joseph L. Stone. Schwartz further testified that he spoke to Mr. Hoffman on the telephone "several days after February 14, 1956," and that:

I said to Mr. Hoffman, "Did you send this prospectus to Mr. Stone? did you send on the prospectus and the Federated Petroleum letter to Mr. Stone?" and Mr. Hoffman answered "Yes, I did send it to Mr. Stone."

Schwartz and Hoffman had several conversations about defendants' company between March and December, 1956. Schwartz further testified that he received another information sheet from Federated which complemented figures already furnished; that he sent these to Hoffman; that a conversation between Schwartz and Hoffman around the last part of March or the first part of April revealed that "Bulk and Daniels were negotiating"; that a conversation with Hoffman the end of May disclosed "it looked like there would be a deal. . . ." Schwartz stated that he advised Federated some time around September 20, 1956, of Bulk Petroleum's interest in the Danielses' business.

Sol A. Hoffman testified that he was counsel for Bulk for twenty years and an officer and director as well; that he was "told generally about everything that was going on"; that he had received correspondence from Schwartz about Daniels Oil Company in the middle of February, 1956; that he added a note, "Joe, please call me," to Schwartz's communication of February 14, 1956, and mailed it to Stone. More importantly, Hoffman stated that as of that date "there were no pending negotiations between Bulk Petroleum Corporation and . . . (the) Danielses with relation to the purchase of their property." During his testimony, Hoffman stated that "[T]he negotiations commenced in March or April of 1956 and continued on for several months resulting in a contract for the sale of the property, sale and purchase"; that the figures contained in the prospectus "formed the basis for a revival of interest in the acquisition of properties . . ."; that in the spring of 1956 he met with Mr. Daniels; that he told him that the information had been presented to Bulk by Schwartz; that "some consideration should be given to Federated in connection with this sale"; that Mr. Daniels stated that he had an arrangement with Federated but that he was not concerned about them because the deal would not be closed until after the exclusive contract had lapsed; that he (Daniels) had been dealing with Bulk before he had made the (present) arrangements. Hoffman also testified that the ...

Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.