The opinion of the court was delivered by: Marovitz, District Judge.
Motion For Partial Summary Judgment
This is an action by an automobile dealer against a
manufacturer and distributor for violation of the Automobile
Dealers' Day in Court Act 15 U.S.C. § 1221, 1222 (Count I),
Fraud and Deceit (Count II) and Breach of Contract (Count III).
The case is presently before us on defendant's Mid-Southern
Toyota Distributors, Inc. (MST) and Amco Industries, Inc. (AMCO)
Motion For Partial Summary Judgment.
Plaintiff alleges that he was induced to establish a dealership
of Toyota automobiles by oral promises on the part of defendants'
representatives that he would be supplied with a) a minimum of 20
cars per month, the number of cars necessary to finance the
dealership; b) all necessary parts and equipment for servicing
and repair of Toyota automobiles; and c) substantial sums of
money for advertising and that subsequently defendants decided to
open a factory-owned dealership in the same area and thereupon
entered upon a course of conduct designed to compel the
cancellation of plaintiff's franchise. The acts of misconduct and
bad faith alleged are the purposeful refusal of defendants to
supply an adequate or minimum number of automobiles; the refusal
to provide parts and equipment essential for repair and servicing
of Toyota vehicles; further acts of coercion aimed at forcing the
relinquishment of the Toyota Franchise; the compelling of
plaintiff to join an advertising cooperative; the defendants'
refusal to approve sale of the operation to a prospective
purchaser though he was a party provided by defendants; and
demand by defendants' that plaintiff sell to them stock and
equipment below their value once plaintiff had ceased operations.
We therefore hold that the conduct alleged by plaintiff in
Count I falls well within 15 U.S.C. § 1222 and that a cause of
action having been sufficiently stated, defendants' motion as to
this Count must be denied.
Plaintiff's Second Count realleges the oral promises of 20 cars
a month, parts and tools, and advertising costs, and the breach
of those promises. The basis for this Count is fraud and deceit.
Defendants argue that summary judgment ought to be granted given
the unquestionable fact that Illinois adheres to the minority
rule which does not permit an action for fraud where the
misrepresentations involved relate to an executory or future
performance rather than to a past or existent fact even where the
promise was never intended to be fulfilled. There is a multitude
of both Federal and State cases that support this proposition.
Keithly v. Mutual Life Ins. Co., 271 Ill. 584, 111 N.E. 503
(1916); Brodsky v. Frank, 342 Ill. 110, 173 N.E. 775 (1930);
Classic Bowl Inc. v. AMF Pinspotters, Inc., 403 F.2d 463 (7th
Cir. 1968); Repsold v. New York Life Insurance Co., 216 F.2d 479
(7th Cir. 1954).
"Nor can it be successfully maintained that fraud
may not under any circumstances be based upon the
nonperformance of promises. If such promises are made
to induce the fraud, if they induce one to change his
status to his damage, he may seek the relief of one
defrauded. It is only essential that the evidence
disclose that they were fraudulent in their
inception, were made in bad faith, with the intention
to deceive and were the inducing cause of the
detrimental change in his condition made by the
complaining party in reliance thereon." 61 F.2d at
Likewise the court in Carroll said:
"The general rule in Illinois denies recovery for
fraud based on a false representation of intention or
future conduct, but there is a well recognized
exception, where, as here, the false promise or
representation of future conduct is claimed to be the
scheme used to accomplish the fraud." 413 F.2d at
Assuming the allegations to be true for the purposes of this
Motion it is not sufficiently evident that plaintiff will not be
able to prove that the promises were themselves a part of the
scheme used to accomplish the fraud and we therefore are not