United States District Court, N.D. Illinois, Eastern Division
Donald J. Ulrich Associates, Inc., Plaintiff,
Tec Air, Inc., Defendants.
MEMORANDUM OPINION AND ORDER
JOHNSON COLEMAN United States District Judge.
matter is before the Court on Plaintiff's and
Defendant's cross motions for summary judgment [74, 77].
Donald J. Ulrich Associates, Inc. (“Ulrich”)
filed its three count first amended complaint  against
Tec Air, Inc. (“Tec Air”) alleging breach of
contract and a violation of the Illinois Sales Representative
Act (“ISRA”) and asserting a claim for
declaratory relief. Ulrich moves for summary judgment as to
the liability aspects of Counts I, II, and III, and Tec Air
moves for summary judgment on Count II and on Ulrich's
purported request for damages based on anticipated future
sales. For the following reasons, Ulrich's motion for
summary judgment  as to Counts I and III is granted and
Tec Air's motion for summary judgment  is granted;
Ulrich's motion is denied as to all other requests.
following facts are undisputed. Ulrich is an independent
manufacturer's representative that represents principals
to the automotive industry. (Dkt. 75 ¶ 1; Dkt. 77-2
¶ 1). Tec Air produces parts, components, and assemblies
used in the manufacture of automobiles by original equipment
manufacturers. (Dkt. 75 ¶ 2; Dkt. 77-2 ¶ 2). In
September, 2008, the parties entered into a written sales
agreement (the “Agreement”). (Dkt. 75 ¶ 4;
Dkt. 75-1; Dkt. 77-2 ¶ 4; Dkt. 77-5). Under the
Agreement, Ulrich was to be the exclusive sales
representative for Tec Air to certain customers listed in the
Agreement, including Behr and Valeo. (Dkt. 75-1 § 1.1,
exhibit A; Dkt. 77-5 § 1.1, exhibit A; Dkt. 77-2 ¶
6). Section 6.2 of the Agreement provided that Tec Air was to
pay commissions on any sales solicited by Ulrich for the life
of the product, (Dkt. 75 ¶ 5; Dkt. 77-2 ¶ 7), and
in the event of a termination of the Agreement, commissions
were to be paid pursuant to section 9.1. (Dkt. 75 ¶ 7;
Dkt. 77-2 ¶ 8). The Agreement was set to last three
years and was to automatically renew for successive one-year
terms unless terminated by written notice. (Dkt. 75 ¶ 6;
Dkt. 75-1 § 8.1; Dkt. 77-2 ¶ 9; Dkt. 77-5 §
8.1). In the event of a breach, the non-breaching party was
permitted to terminate the Agreement by written notice only
after it afforded the breaching party an opportunity to cure.
(Dkt. 75 ¶ 6; Dkt. 75-1 § 8.2; Dkt. 77-5 §
McMurtry (“Mr. McMurtry”), Tec Air's
president, testified that he believed the parties'
relationship was terminated in 2013, (Dkt. 77-6 at 60:9-11),
and, at the very latest, he believed the Agreement was
terminated when this lawsuit was filed. (Dkt. 77-6 at
69:9-11). Donald Ulrich, Ulrich's president and owner,
declared by affidavit that he believed the Agreement between
the parties was terminated when this lawsuit was filed. (Dkt.
77-4 ¶ 10). Neither party, however, has produced
evidence of a written notice of termination.
successfully solicited sales for Tec Air products from Behr
and Valeo. (Dkt. 77-2 ¶ 12). Mr. McMurtry, has admitted
Ulrich is owed commissions for sales made to Behr and Valeo.
(Dkt. 77-2 ¶ 14). Mr. McMurtry testified that Tec Air
still owed Ulrich more than $50, 000 in sales commissions.
(Dkt. 77-6 at 68:14-22).
judgment is appropriate where the pleadings, depositions,
admissions and affidavits demonstrate that there is no
genuine issue as to any material fact and that the movant is
entitled to summary judgment as a matter of law. Fed.R.Civ.P.
56(a); Celotex v. Catrett, 477 U.S. 317, 324, 106
S.Ct. 2548, 91 L.Ed.2d 265 (1986). Summary judgment is
appropriate where the nonmoving party has failed to make a
sufficient showing on an essential element of his case with
respect to which it has the burden of proof.
Celotex, 477 U.S. at 322-23.
first moves for summary judgment as to Tec Air's
liability for breach of contract (Count I). A party is liable
for breach of contract if there is a valid and enforceable
contract, substantial performance by the plaintiff, a breach
by the defendant, and resultant damages. W.W. Vincent and
Co. v. First Colony Life Ins. Co., 814 N.E.2d 960, 967,
351 Ill.App.3d 752 (1st Dist. 2004). The parties do not
dispute that the Agreement is a valid and enforceable
contract, nor do they dispute that Ulrich performed its
duties under the Agreement by procuring business for Tec Air
from Behr and Valeo. Tec Air admits that it has not paid
Ulich commissions for Behr and Valeo sales. The Court grants
summary judgment in favor of Ulrich as to Tec Air's
liability for Count I because it is clear that Tec Air
breached the Agreement. The only remaining issue on Count I
is the issue of damages.
moves for summary judgment on Ulrich's ISRA claim (Count
II). ISRA provides that “[a]ll commissions due at
the time of termination of a contract . . . shall be
paid within 13 days of termination, and commissions that
become due after termination shall be paid within 13 days of
the date on which such commissions become due.” 820
ILCS 120/2 (emphasis added); 820 ILCS 120/3 (civil remedies
for ISRA violations). ISRA is intended to protect sales
representatives from being denied commissions that are due or
may become due after a contract is terminated. Fararo v.
Sink LLC, Nos. 01 C 6956, 01 C 6957, 2002 WL
31687671, at *7 (N.D. Ill. Nov. 27, 2002) (Coar, J.);
Klessman & Assoc., Inc. v. American Sensors,
Inc., No. 97 C 0556, 1998 WL 246481, at *1 (N.D. Ill.
Apr. 28, 1998) (Grady, J.). ISRA, therefore, will not apply
to a sales relationship where a contract is still in effect.
argues that because neither party satisfied the termination
requirements of the Agreement, the Agreement is still in
effect and therefore, Ulrich's ISRA claim is precluded.
Sections 8.1 and 8.2 - the only provisions in the Agreement
that discuss termination - require that the parties give each
other written notice of termination. If the parties fail to
properly terminate the Agreement, the Agreement automatically
renews for successive one-year terms. (Dkt. 75-1 § 8.1;
Dkt. 77-5 § 8.1). The parties failed to provide each
other with written notice of termination, therefore the
Agreement has renewed itself on an annual basis and is still
contends that strict compliance with sections 8.1 and 8.2 is
not required because Tec Air's breach should not permit
it to take advantage of the terms of the Agreement. In
support of this contention, Ulrich cites Assaf v. Trinity
Med. Ctr., 696 F.3d 681 (7th Cir. 2012), and James
v. Lifeline Mobile Medics, 792 N.E.2d 461, 341
Ill.App.3d 451 (4th Dist. 2003).
defendant in Assaf agreed to employ the plaintiff in
2010 and 2011 in exchange for a release of claims. 696 F.3d
at 683-84. Pursuant to the Assaf agreement, the
employment was to renew on an annual basis unless either
party chose to terminate the relationship. Id. at
684. Before the end of 2011, the defendant informed the
plaintiff that it was terminating the relationship, thereby
foreclosing the opportunity for employment in 2012.
Id. at 685. The plaintiff argued that because the
defendant breached the Assaf agreement by not
employing him in 2010 and 2011, it should not be permitted to
exercise the non-renewal option. Id. The Seventh
Circuit concluded that, despite its ...