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12/31/87 Falcon, Ltd., Et Al., v. Corr's Natural Beverages

December 31, 1987

FALCON, LTD., ET AL., PLAINTIFFS-APPELLEES

v.

CORR'S NATURAL BEVERAGES, INC. A/K/A R. J. CORR NATURALS, INC., ET AL., DEFENDANTS-APPELLANTS



APPELLATE COURT OF ILLINOIS, FIRST DISTRICT, FIRST DIVISION

520 N.E.2d 831, 165 Ill. App. 3d 815, 117 Ill. Dec. 480 1987.IL.1970

Appeal from the Circuit Court of Cook County; the Hon. Joseph M. Wosik, Judge, presiding.

APPELLATE Judges:

JUSTICE BUCKLEY delivered the opinion of the court. CAMPBELL and O'CONNOR, JJ., concur.

DECISION OF THE COURT DELIVERED BY THE HONORABLE JUDGE BUCKLEY

Falcon, Ltd., an Illinois corporation, and its president Thomas Paulus (plaintiffs), filed a three-count complaint against Corr's Natural Beverages, Inc., also an Illinois corporation, and its chairman and chief executive officer Robert Corr (defendants), seeking to recover damages and to enjoin defendants' breach of a distributorship agreement that gave plaintiffs the exclusive right and license to sell and distribute through wholesale distributors certain nonalcoholic beverages on a commission basis, throughout the State of Illinois, and to enjoin defendants' tortious interference with plaintiffs' contractual and prospective relationships with its subdistributors. Defendants appeal from the trial court's order granting plaintiffs' subsequent motion for a preliminary injunction. For the reasons set forth below, we affirm.

The distributorship agreement entered into by the parties in September 1985 provides, inter alia :

"1.9 Corr's agrees and warrants that during the existence of this Agreement:

(a) It shall supply MASTER DISTRIBUTOR with a quantity of Beverages sufficient to meet the reasonable requirements under the price and terms agreed to by Corr's and Master Distributor at the time of sale and from time to time thereafter agreed to.

(b) It will not sell, deliver, ship, consign or distribute in any manner other than as provided herein to any person, corporation, firm, partnership or entity for sale, resale or use within the Territory other than to MASTER DISTRIBUTOR.

(c) It will promptly forward to MASTER DISTRIBUTOR all inquiries it receives for the sale or purchase of the Beverages in the aforesaid Territory for MASTER DISTRIBUTOR'S sale, response, handling and delivery.

2. 1(a) MASTER DISTRIBUTOR hereby agrees to Sell the Beverages as provided in this Agreement and may, as a Master Distributor, delegate the Sale of the Beverage by appointing wholesale distributors. . . . Corr's will grant MASTER DISTRIBUTOR the right to partition off the Territory to various wholesale distributors at its discretion . . .."

While the above agreement has no termination date, paragraph 5.3 lists the causes for which defendants could terminate the agreement. Paragraph 5.3(f) of the agreement provides that if plaintiffs violate the provisions of paragraph 5.3 or are in default in any other manner, defendants could terminate the agreement 60 days after receipt by plaintiffs of written notice of the breach. During this period, plaintiffs have the right to cure.

In a letter dated August 28, 1986, defendants notified plaintiffs that they considered them to be in breach of the agreement and that they intended to terminate the agreement 60 days after plaintiffs' receipt of the letter. Defendants subsequently agreed to stay termination of the ...


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