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Central Ice Cream Co. v. Sweetheart Cup Corp.

OPINION FILED JUNE 22, 1976.

CENTRAL ICE CREAM COMPANY, INC., PLAINTIFF AND COUNTERDEFENDANT-APPELLANT,

v.

SWEETHEART CUP CORPORATION ET AL., DEFENDANTS AND COUNTERPLAINTIFFS-APPELLEES.



APPEAL from the Circuit Court of Cook County; the Hon. ARTHUR L. DUNNE, Judge, presiding.

MR. PRESIDING JUSTICE GOLDBERG DELIVERED THE OPINION OF THE COURT:

These proceedings were commenced by the filing of a complaint for declaratory judgment by Central Ice Cream Company, Inc. (Central), against Sweetheart Cup Corporation (Sweetheart) and Maryland Cup Corporation (Maryland) (jointly defendants). Defendants filed a joint answer to the complaint together with an affirmative defense and a counterclaim seeking recovery from Central of $224,414.69 for quantities of supplies sold and delivered to Central. On September 9, 1975, after a hearing, the trial court entered an order finding the issues in favor of defendants and entering summary judgment of $224,414.69 against Central. Central has appealed.

In passing upon the motion for summary judgment, the trial court had before it: first set of 64 interrogatories directed to Central by defendants and answer of Central thereto; second set of interrogatories numbered 65 to 101 also directed to Central and answer thereto; motion by defendants for production of documents by Central; documents produced in accordance therewith by agreement of the parties; discovery deposition of Thomas N. Cummings, president of Central, commencing on September 25, 1974, and continuing intermittently on various dates until October 10, 1974, comprising record pages 190 to 788 inclusive; motion of defendants for summary judgment supported by memorandum submitted by counsel for defendants comprising 41 pages of the record; additional motion by defendants for judgment dismissing the complaint and awarding the relief sought in their counterclaim; affidavit of John M. Foley, treasurer of Sweetheart regarding balance due from Central; response by Central to defendants' motion for summary judgment made by counsel for plaintiff comprising 12 pages of the record; affidavit by Thomas N. Cummings in support of the complaint; and, finally, reply memorandum by defendants' counsel in support of their motion for summary judgment. The last of these documents was filed August 27, 1975.

In this court, Central urges that when reasonable persons could draw different inferences from the same facts, trial issues of fact exist; the motion for summary judgment should be denied if the record discloses that a triable issue of fact exists; summary judgment cannot be entered where there is any material question to be determined; and, if an examination of the pleadings, deposition, etc., discloses that there is a genuine issue as to any material fact, motion for summary judgment should be denied. Defendants urge that summary judgment was granted based on Central's own version of the material facts; that is, that Central's admissions provide a proper basis for summary judgment; Central cannot create genuine issues of fact by arguing with itself that the admissions contained in its president's deposition conflict with the allegations of its complaint; Central's assertion of the existence of triable issues with respect to immaterial facts cannot preclude the entry of summary judgment and there are no conflicting inferences or opinions to be drawn from the undisputed facts as the only question presented was the application of settled law to the undisputed facts. Defendants also contend that application of settled law to the admitted material facts requires the granting of summary judgment in favor of defendants.

It has been repeatedly held that summary judgment is proper, "if the pleadings, depositions, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment or decree as a matter of law." (Ill. Rev. Stat. 1975, ch. 110, par. 57(3); Heidelberger v. Jewel Companies, Inc. (1974), 57 Ill.2d 87, 92, 312 N.E.2d 601, and Carruthers v. Christopher & Co. (1974), 57 Ill.2d 376, 380, 313 N.E.2d 457.) In the case before us no affidavits have been filed in support of the motion for summary judgment. As above shown, defendants have relied primarily upon a lengthy memorandum prepared by their counsel and also upon the testimony of Thomas N. Cummings given in his discovery deposition. Similarly, no affidavits have been filed by Central in opposition to the motion for summary judgment and the record contains only an affidavit by Cummings as to the truth and veracity of the allegations in Central's complaint.

• 1 Our study of the record and briefs, together with the oral arguments presented by counsel for both sides, has convinced us that there are important and material disputed issues of fact presented by this record so that the case is not one in which the remedy of summary judgment should be invoked. Accordingly, we reverse the order for summary judgment and remand the cause for trial.

An analysis of the factual issues is required in this case. However, in view of our decision that the cause is to be tried, we wish expressly to abstain from expressing a conclusion of any kind which might tend to usurp the function of the trier of fact. Therefore, we wish it clearly understood that the following factual statement is based only upon the record before us as above detailed and is presented solely and only in connection with our analysis of that record as pertinent to the inquiry whether there actually exists disputed issues of material fact.

Otherwise stated, we are not attempting in any manner to detail facts but simply to show the existence of factual disputes between the parties which, in our opinion, effectively negate the propriety of summary judgment. In doing so we depend upon the following legal analysis showing the quantum of care required to be exercised by any court in availing itself of the admittedly salutary remedy of summary judgment. The cases bearing upon this issue are numerous. It has been frequently held that the purpose of summary judgment is to determine whether any factual issue exists. If there is a material issue of fact, the motion for summary judgment should be denied. (Carlson v. Prestige Casualty Co. (1975), 28 Ill. App.3d 926, 930, 329 N.E.2d 477, and cases there cited.) Before a motion for summary judgment can be allowed, the right of the moving party must be clear and free from doubt and determinable solely as a question of law. (O'Brien v. Kawazoye (1975), 27 Ill. App.3d 810, 815, 327 N.E.2d 236, and authorities there cited.) Although summary judgment has been described as "an important tool in the administration of justice * * *" so that its use should be encouraged in a proper case, this remedy has also been described as a "drastic method of disposing of litigation." Green v. McClelland (1973), 10 Ill. App.3d 350, 352, 293 N.E.2d 629, leave to appeal denied, 54 Ill.2d 592, and cases there cited.

• 2 As we would expect, it follows necessarily, and has been held, that summary judgment should "be awarded with due caution in view of its drastic nature." (Rivan Die Mold Corp. v. Stewart Warner Corp. (1975), 26 Ill. App.3d 637, 640, 641, 325 N.E.2d 357, and cases there cited.) Otherwise stated, the standard to be applied by trial and reviewing courts is "that the right to summary judgment must be clear beyond question." (Powell v. R.J. Anderson, Inc. (1970), 124 Ill. App.2d 1, 5, 260 N.E.2d 103, and cases there cited.) Consequently, "[a]ny doubt as to the right of the moving party to entry of a summary judgment should be resolved by trial rather than by summary judgment." National Bank v. S.N.H., Inc. (1975), 32 Ill. App.3d 110, 117, 336 N.E.2d 115, leave to appeal denied, 61 Ill.2d 602.

Central is engaged in manufacturing ice cream and ice cream products in Chicago. Maryland manufactures machinery and equipment used in the preparation and packaging of ice cream products. Sweetheart is a wholly owned subsidiary of Maryland. Sweetheart manufactures sugar cones and paper and plastic items in which ice cream products are packed for public consumption.

Central had a business relationship in connection with supplying large quantities of ice cream products to be used on a nationwide basis by the well-known restaurant chain operating under the name of McDonald's Systems Inc. The existence of such a relationship between Central and McDonald's is undisputed. Commencing about December of 1970, Thomas Cummings, president of Central, met with Ray Kroc, apparently one of the executive officers of the McDonald's firm to explore the possibilities of use by McDonald's of a quantity of ice cream cones. This delicacy was to be sold to numerous McDonald's retail outlets and was to be called the "Tripple Ripple" cone. Central first attempted to develop a type of ice cream requested by Ray Kroc which would not drip immediately upon removal from refrigeration but which would remain intact for at least 12 minutes. Central was successful in working out this type of ice cream formula. The executives of McDonald's and Central visualized sales of this item at a possible rate of 100 million per year.

Beginning in April of 1971, defendants loaned or leased a machine to Central which filled ice cream cups for this purpose. Central produced these articles for test marketing by McDonald's. Apparently, with reference to additional machines later provided, no rental was charged for the machines but the affiliated defendants were compensated by sale of cones, and packaging, including dome-shaped plastic lids.

During the latter part of 1971, a new type of packaging was evolved by Central. This consisted of a sugar cone covered by a printed paper sleeve of similar shape, all to be covered by a plastic lid or dome. Central filed an application for a United States patent covering this article in December of 1971. Negotiations were held between Central and defendants with reference to the possibility of obtaining attachments for use with a machine which would pack the containers with ice cream manufactured by Central and seal them with the plastic domes. Central gave specifications to Sweetheart and a drawing of the proposed lid or dome. Various prototypes were designed by Sweetheart and submitted to Central. Eventually a design was accepted by Central and orders were placed with Sweetheart for huge quantities of these dome lids. Delivery began in later March or early April 1972.

At the same time, Sweetheart undertook to supply the paper jackets with the required printing on them. Defendants also designed and fabricated special or "novel" attachments to be used as equipment on the packaging machinery required to fulfill Central's needs. By April 20, 1972, the first of these machines was delivered to Central and placed in operation. Commencing at or about this time, McDonald's would place various orders with Central for the fabrication and shipment of large numbers of these items consisting of the cone, surrounding sleeve ...


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