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November 12, 1980


The opinion of the court was delivered by: Shadur, District Judge.


This action involves (1) claims by plaintiff Donald E. Payne ("Payne") charging breach of contract and fraud by defendants American Hospital Supply Corporation ("American") and AHFI/Netherlands, B.V. ("AHFI") relating to Payne's now-terminated employment relationship with defendants and (2) counterclaims by defendants against Payne and additional counterdefendants Daniel C. Lee ("Lee") and David M. Edwards ("Edwards") charging conspiracy, extortion, conversion and breach of fiduciary duties. Defendants have moved for summary judgment on Payne's complaint. For the reasons stated in this memorandum opinion and order, defendants' motion for summary judgment is granted.


On October 1, 1975 Payne was hired by the predecessor of AHFI, which is a wholly-owned subsidiary of American. Initially Payne was to work for AHFI on a project in Saudi Arabia. Though he commenced work there, the position for which he had been hired was terminated, and he was reassigned with his consent to AHFI headquarters in Illinois.

In early 1976 Payne was reassigned to the Korean team of the Seoul National University Hospital ("SNUH") equipping project. On that project his duties were to coordinate distribution of catalogues and handle correspondence relating to mechanical, electrical and architectural equipment.

Edwards and Lee were hired by AHFI in January and February 1976 to work on the SNUH project. Edwards served as director of the Korean-based AHFI team and Lee as a coordinator for architectural changes. After brief trips to Korea in early 1976, Payne, Edwards and Lee moved there permanently in about August 1976.

Payne's original assignment to the Saudi Arabian project was evidenced by an October 1, 1975 letter from AHFI executive Vansant. Among other provisions, the letter set Payne's salary "at an annual rate of [10,000£] ($20,850)" and stated that AHFI would pay Payne's airfare home "[i]n the unlikely event of termination of your employment with us." When Payne was reassigned to the Korean project a 20-page document captioned "Expatriate Foreign Assignment" was executed by AHFI and delivered to Payne in about June 1976. As Payne's memorandum in opposition to defendants' motion states:

  This document sets forth all the pertinent terms and
  conditions of Payne's employment on the Korean
  assignment and describes the term of said assignment.

In the latter respect the "Expatriate Foreign Assignment" ("EFA") document stated:

  It is expected that the employee will remain in the
  foreign post for duration of project which is
  expected to be approximately two (2) years. In some
  cases because of certain circumstances the EFA may be
  shorter or longer. There are many factors that would
  cause a shortening or lengthening of the EFA such as
  individual performance, economic conditions, foreign
  or domestic, AHFI's business plans, etc.

In addition the EFA document stated:

  Donald E. Payne's employment arrangement will be in
  compliance with the labor laws of thw (sic) State of
  Illinois and subject to all of that State's laws and
  regulations in all disputes arising out of this
  employment arrangement.
  Payne claims that before delivery of the EFA document his conversations with Vansant dealt with the terms of his employment, including a statement that the SNUH project would last not less than two years. At his deposition Payne was asked "whether Mr. Vansant phrased what he said about two years in terms of a prediction or in terms of a promise." Payne replied, "I cannot remember exactly what he said." Upon further questioning Payne said, "Corwin Vansant stated that in his opinion the project would be not less than two years and he never indicated to me that I would be required for a less period than that." Payne could remember no more about what he characterizes as the "oral promise" by Vansant. Vansant's memorandum of his conversations with Payne, which Payne admitted covered the "essence" of the talks, mentions termination as one of Payne's options but does not mention any specific term of employment.

Although the SNUH project in fact lasted more than two years, Payne was terminated as of September 30, 1977, exactly two years after he was hired by AHFI. We turn then ...

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