Appeal from Circuit Court of Macon County Honorable Thomas E. Little,Judge Presiding. No. 08MR565
The opinion of the court was delivered by: Presiding Justice Knecht
PRESIDING JUSTICE KNECHT delivered the opinion of the court:
Defendant, Veolia ES Valley View Landfill, Inc., appeals after a bench trial from the trial court's decision it materially breached its contract with plaintiff, CC Disposal, Inc., and rescinding that contract. Defendant argues the trial court erred in (1) finding the contract at issue required defendant to operate its landfill on Saturdays; (2) failing to find plaintiff did not have an adequate remedy at law; and (3) finding defendant's breach was a material breach justifying rescission of the contract. We affirm.
Plaintiff operates a waste-collection business. Plaintiff and other small, independent waste-collection companies formed Macon County Landfill Corporation (Macon County Landfill) to run a landfill in which the corporate shareholders could dispose of their collected waste. They operated this landfill for approximately 30 years. In 1998, the landfill was sold to a company named Superior. As part of the sale, a solid-waste-disposal agreement was entered into between Macon County Landfill and each independent waste hauler. Each waste hauler signed agreements with identical provisions. On July 18, 1998, plaintiff entered into one of these agreements with Macon County Landfill.
The agreement required Macon County Landfill and its successors to accept and dispose of all solid waste collected, received, generated, or transported by the waste hauler, in this case, plaintiff. The agreement required plaintiff to pay disposal rates subject to a yearly adjustment. Plaintiff was required to bring all waste it collected to Macon County Landfill. Attachments entitled "Exhibit A" and "Exhibit B" were attached to the agreement. "Exhibit A," titled "Disposal Site," provided the name and address of the landfill. "Exhibit B," titled "Disposal Rates," set forth the initial rates at the beginning of the contract. On its face, "Exhibit B" included Macon County Landfill's address, telephone number, and hours and days of operation, including Saturday from "7:00 to 1:30." The body of the contract itself did not set forth requirements for the hours and days of operation. Later, defendant became the owner of Macon County Landfill and changed the name to Valley View Landfill (Valley View).
On approximately January 1, 2008, defendant began closing Valley View on Saturdays. Plaintiff complained to defendant's personnel operating Valley View, to no avail. On September 29, 2008, plaintiff filed its complaint for a declaratory judgment, alleging defendant breached the agreement by failing to maintain Saturday hours at Valley View for collection of waste and asking for a rescission of the contract. In November 2008, defendant reopened Valley View on Saturdays. On November 12, 2008, defendant filed a motion to dismiss, arguing there was no current controversy because it reopened Valley View on Saturdays. On January 23, 2009, the trial court denied defendant's motion to dismiss.
On September 3, 2009, plaintiff filed a motion for summary judgment. On September 15, 2009, defendant filed a response to plaintiff's motion for summary judgment and a motion for summary judgment of its own. On September 21, 2009, plaintiff filed a response to defendant's motion for summary judgment. On November 12, 2009, the trial court heard arguments on the cross-motions for summary judgment. After taking the matter under advisement, the court denied both motions for summary judgment, finding (1) the only reasonable inference from the evidence was that under the disposal agreement, including exhibits A and B attached thereto, Macon County Landfill was required to be open for waste disposal on "Saturday from 7:00 to 1:30" and (2) more than one reasonable inference could be drawn from the evidence presented as to whether the Saturday closure of the landfill was a "material and important breach" "in light of the actual custom of persons in the performance of contracts similar to the one involved in the specific case."
On January 5, 2010, a bench trial was held. David Carter, plaintiff's current owner, testified Valley View had been closed on Saturdays from January 2008 to November 2008. Defendant presented some evidence Valley View had reopened on Saturdays in May 2008. Carter found another landfill, Clinton Landfill, where he hauled his waste on Saturdays and continued to haul it there after Valley View reopened on Saturdays. Although Clinton Landfill was a 15- to 20-minute drive farther away than Valley View, the parties stipulated the disposal rate at Clinton was less expensive than that at Valley View. Carter also testified Clinton Landfill offered to take all of plaintiff's waste for a rate $9 to $10 cheaper per ton than Valley View if plaintiff brought all of its waste there, thus improving plaintiff's ability to be competitive in the marketplace.
Clifford Carter, plaintiff's previous owner, and Glenn Lynch, previous owner of another independent garbage hauler, both retired, testified they were part of the negotiations for the agreement at issue as shareholders of Macon County Landfill. Having a landfill open on Saturdays was very important to them, and they would not have entered into the agreement absent a provision requiring the landfill to be open on Saturdays.
Clifford and David Carter and Lynch all testified they serviced both commercial and residential clients six days a week. They had Saturday pickups, which were mostly commercial, and needed a place to dump the waste collected that day. If waste collected on Saturday sat in the their enclosed trucks until Monday, there was a danger methane gas would accumulate, which could lead to an explosion. Further, if their trucks were full on Monday morning, they needed to begin their days with a stop at the landfill to dump the accumulated waste before they could start their pickup routes. This would put them behind schedule as they would need to dispose of waste collected on Monday by the 3 p.m. closing time of the landfill on Monday. If they could not finish their routes on Monday, they would start Tuesday's routes behind schedule and never catch up for the week. This could result in loss of customers and eventually the possibility of going out of business.
David Carter was asked by defendant the costs incurred by plaintiff for disposing of collected waste at Clinton Landfill instead of Valley View. David Carter said he could not calculate those costs, but he stated if he had not located Clinton Landfill, he would have gone out of business and those costs were incalculable. Carter also stated, in addition to offering plaintiff a lower rate to dispose of collected waste, Clinton Landfill offered to purchase CC Disposal, Inc., from him and the value of his business would be higher if it was free of the contract with Valley View.
Christopher Rooney, regional manager for defendant, testified he did not know why defendant stopped opening Valley View on Saturdays as he did not work for it then. He presented one disposal receipt for a private individual for a Saturday in May 2008 to show Valley View was accepting waste on Saturdays.
Rooney testified to defendant's corporate plan of "vertical integration" which meant both the taking over of independent waste haulers by defendant in order to assure a steady supply of waste for its landfills but also the entering into of long-term contracts for independent haulers to bring their waste exclusively to defendant's landfills. Rooney admitted the trend in the waste-disposal industry was ...