The opinion of the court was delivered by: Bua, District Judge.
Defendant, General Electric Company ("G.E."), has moved this
Court for an order dismissing Count II of plaintiff's, P-K Tool
& Mfg. Co. ("P-K"), complaint pursuant to Rule 12(b)(6) of the
Federal Rules of Civil Procedure. Plaintiff has moved for leave
to file an amended complaint. For the reasons stated below, P-K's
motion for leave to file an amended complaint is granted. G.E.'s
motion, considered as a motion to dismiss Count II of the amended
complaint, is granted.
In considering a motion to dismiss under Rule 12(b)(6), a
complaint should not be dismissed unless it appears beyond doubt
that the plaintiff can prove no set of facts in support of his
claim that would entitle him to the relief requested. Cruz v.
Beto, 405 U.S. 319, 322, 92 S.Ct. 1079, 1081, 31 L.Ed.2d 263
(1972). The following facts are alleged by P-K in its amended
complaint.*fn1 For purposes of this motion, the Court assumes they
are true. City of Milwaukee v. Saxbe, 546 F.2d 693, 704 (7th Cir.
In 1974 G.E. sought to obtain a second source for the purchase
of a metal stamping referred to as "the blade." The same year P-K
quoted G.E. tooling and production prices for the blade. P-K
alleges that G.E. accepted the terms and conditions of P-K's
quotation, including the condition that G.E. leave the tooling
with P-K for the first 3,000,000 pieces of the blade. P-K alleges
that it furnished the necessary tooling work in 1976 under a G.E.
purchase order. During 1977 and early 1978, P-K further alleges
that it performed purchasing, manufacturing and testing services
for G.E. As a result of these services, G.E. changed its material
specifications, which led to an improved manufacturing process
and greater uniformity in the blade. P-K claims that the
reasonable value of these services is $5,000, and that G.E. would
be unjustly enriched if it was allowed to retain this benefit,
without being required to pay for them.
P-K also alleges that to produce the blade, G.E. required P-K
to purchase raw material in billets of steel which met specific
G.E. standards. A billet produces approximately 400,000 to
460,000 pieces of the blade. P-K alleges that in 1978, G.E.
authorized P-K to purchase a billet of steel. Furthermore, in May
of 1978, October of 1979 and March of 1981, P-K made purchases of
raw materials pursuant to releases on open ended purchase orders
placed by G.E. P-K alleges that in December of 1983, G.E.,
without prior notice, notified P-K that no further releases for
the blade would be issued, and in doing so breached their
contract. In Count II of the amended complaint, P-K seeks payment
for the services furnished in 1977 and early 1978 on a quantum
In support of its motion to dismiss Count II, G.E. argues that
P-K's quantum meruit claim, being a claim on an implied contract,
is subject to the five-year statute of limitations period within
Section 13-205 of the Illinois Code of Civil Procedure, which
governs "actions on unwritten contracts, expressed or implied."
G.E. further argues that because P-K's complaint was filed in
February of 1985, more than six years after
the services were completed, the claim is barred.
In response, P-K argues that its claim did not accrue until
December of 1983, because the services were performed under one
continuous contract, which was not breached until that December
of 1983. P-K therefore contends that the complaint was filed
within the required statutory period. G.E., however, argues that
when services are performed to gain a business advantage or
enhance an already existing contract, quantum meruit recovery is
not possible. Accordingly, G.E. argues that not only does the
amended complaint fail to cure the statute of limitations
problem, but it also destroys the substantive merits of P-K's
quantum meruit claim.
Recovery predicated on a quantum meruit theory is a claim "on
a contract implied by law." Edens View Reality & Investment, Inc.
v. Heritage Enterprises, Inc., 87 Ill.App.3d 480, 42 Ill.Dec.
360, 408 N.E.2d 1069, 1075 (1st Dist. 1980). Section 13-205 of
the Illinois Code of Civil Procedure, Ill.Rev.Stat. ch. 110, §
13-205 (1983), provides:
"actions on unwritten contracts, expressed or
implied, or on awards of arbitration, or to recover
damages for an injury done to property, real or
personal, or to recover the possession of personal or
damages for the detention or conversion thereof, and
all civil actions not otherwise provided for, shall
be commenced within 5 years next after the cause of
A quantum meruit claim based on a contract implied by law is
therefore subject to the five-year statute of limitation period
under Section 13-205 of the Illinois Code of Civil Procedure.
A cause of action on an oral contract or on a quantum meruit
theory accrues when the services are completed. Schmidt v.
Desser, 81 Ill.App.3d 940, 37 Ill.Dec. 206, 401 N.E.2d 1299 (1st
Dist. 1980). The services for which P-K seeks payment were
performed in 1977 and early 1978. P-K filed its complaint in
February of 1985, more than six years from the time when the
services were completed. Therefore, without more, P-K's quantum
meruit claim is barred by Section 13-205 because the complaint
was not filed within the required five-year period.
P-K, however, argues that its cause of action accrued in
December of 1983, and not in early 1978. P-K bases this argument
on the theory that the services were performed under one
continuous contract which was not breached until December of
1983. For this reason, P-K ...