Almar Forming Machine Co. v. F. & W. Metal Forming Machinery Co.

31 N.E.2d 415, 308 Ill. App. 151, 1941 Ill. App. LEXIS 1068
CourtAppellate Court of Illinois
DecidedJanuary 22, 1941
DocketGen. No. 41,229
StatusPublished
Cited by2 cases

This text of 31 N.E.2d 415 (Almar Forming Machine Co. v. F. & W. Metal Forming Machinery Co.) is published on Counsel Stack Legal Research, covering Appellate Court of Illinois primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Almar Forming Machine Co. v. F. & W. Metal Forming Machinery Co., 31 N.E.2d 415, 308 Ill. App. 151, 1941 Ill. App. LEXIS 1068 (Ill. Ct. App. 1941).

Opinion

Mr. Justice Burke

delivered the opinion of the court.

On May 12, 1937, the Almar Forming Machine Company, a corporation (hereinafter referred to as “Almar” or “plaintiff”), and F. & W. Metal Forming-Machinery Company, a corporation (hereinafter referred to as “F.. & W.”), signed, sealed and delivered a written contract, the preamble of which recited that F. & W. was the sole licensee under two applications for letters patent, filed by Harold Flagler, serial No. 122,892 filed January 29, 1937, entitled, “Method of and machine for bending sheet metal,” and serial No. 136,984 filed April 15, 1937, entitled, “Edge Bending Machine,” and that Almar desired to obtain the sole and exclusive right from F. & W. for a certain period to sell machines embodying either or both of the inventions. The agreement further provided that:

“ Almar shall have the sole and exclusive right of sale and distribution (except as hereinafter provided) of machines as described in the specifications of the above identified applications for Letters Patent for three years from the date hereof, with the right to extend this agreement from year to year thereafter; but F. & W. shall have the right to amend clause III and clause VI.
“II. Almar will pay to F. & W. for each of the machines, as hereinafter described which it shall sell, as follows: (a) for each machine as described in the specification of application Serial No. 122,892, — irrespective of what claims are now included in said application or which may hereafter be included in a patent which may be. issued on said application, — the sum of Two Hundred Dollars ($200.00) plus the actual and legitimate costs of producing said machine inclusive of all overhead properly allocatable to the manufacturer thereof, it being agreed that such production cost of each machine is at the date of this agreement Two Hundred Fifty Dollars ($250.00); provided, however, that for each ten per cent (10%) increase in such legitimate and actual cost of manufacture, the amount to be paid shall result in an increase of Twenty Dollars ($20.00) in the first figure herein recited, it being the intent of this provision that as the cost of manufacture increases by steps of ten per cent (10%), the named figure of Two Hundred Dollars ($200.00) shall be similarly increased a like percentage, it being understood, however, that this latter provision does not modify the agreement that any increase in the cost of manufacture, — whether amounting to ten per cent (10%) or not, — shall be paid by Almar. (b) For each machine as described in the specification of application Serial No. 136,984, — irrespective of what claims are now included in said application or which may hereafter be included in a patent which may be issued on said application, — the sum of Five Dollars ($5.00) plus the actual and legitimate costs of producing said machine inclusive of all overhead properly allocatable to the manufacture thereof, it being agreed that such production cost of each machine is at the date of this agreement Twelve Dollars ($12.00); . . . (c) Whenever F. & W. shall report to Almar that the cost of producing either or both of the above machines has increased above the figures named in (a) and (b), i.e., Two Hundred Fifty Dollars ($250.00) and Twelve Dollars ($12.00) respectively, Almar shall have the right to call upon F. & W. to exhibit the invoices indicating the reasons for such asserted increase. . . .
“III. It is of the essence of this contract that the minimum number of machines to be sold by Almar per year shall be twenty-five (25) of those embodying the structure described in the specification of application Serial No. 122,892, and Three Hundred (300) of the machines described in the specification of Serial No. 136,984; it being understood, however, that in determining these 'figures for the first year of the life of this contract, Almar shall be given credit for those machines which may already have been sold by it at the date of the execution of this contract. . . .
“V. The exclusive right to sell as hereinbefore granted by F. & W. to Almar shall be extended to include'the right to Almar to grant sub-licenses to other persons, real or corporate, to promote the sale and distribution of the above mentioned machines, it being understood, however, that in all cases Almar shall be responsible for the acts of its thus-appointed agents in all respects relating to this agreement, and that in all cases the responsibility for paying for the machines thus sold in accordance with paragraphs (a) and (b) of Section II shall rest upon Almar in all respects as if Almar were making the sale itself.
“VI. F. & W. will manufacture and furnish the aforesaid machines in reasonable quantities required by Almar, but does not obligate itself to furnish more than eight of the big machines and fifty of the little machines in any thirty day period; . . . ”

On June 15,1939, plaintiff filed a complaint in equity in the circuit court of Cook county for specific performance of the contract to manufacture and sell the machines, for an injunction forbidding the defendants from violating the contract and for damages and loss of profits resulting from the alleged breach of contract. Defendants filed an answer, to which plaintiff filed a replication. Shortly after the filing of the complaint, plaintiff appeared before the chancellor, and without having served a notice on the opposing parties, obtained an order granting a temporary injunction for specific performance of the contract for the manufacture and delivery of the machines. The order was reversed in an opinion reported as Almar Forming Machine Co. v. F. & W. Metal Forming Machine Co., 301 Ill. App. 591, where, at page 596, this court said that “such multitudinous and detailed activities of individuals are not supervised and directed by a court of equity and the order directing that this be done should not have been entered.” The cause was referred to a master in chancery, who reported in favor of the plaintiffs. Objections filed to the master’s report were allowed to stand as exceptions. These exceptions were overruled and a decree was entered substantially in accordance with the recommendations of the master. The decree directed that the defendants and each of them be enjoined until May 12,1940, “from in any way or manner violating the terms, conditions and provisions of the contract dated May 12, 1937, between Almar Forming Machine Company and F. & W. Metal Forming Machinery Company,” and from in any manner accepting any order, selling or offering for sale or distributing to any person, firms or corporation, except plaintiff and its sublicensees, any and all of the metal-forming machines referred to in the contract, likewise from in any manner advertising, exhibiting or displaying any and all of the metal-forming machines designated in the contract, and the decree also required defendants to account to the plaintiff “for its loss of profits, damage and costs, together with other damages and costs sustained in or to be sustained up to and including May 12,1940, ’ ’ by plaintiff as a result of having sold the above-described machines to persons, firms or corporations other than plaintiff.

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Bluebook (online)
31 N.E.2d 415, 308 Ill. App. 151, 1941 Ill. App. LEXIS 1068, Counsel Stack Legal Research, https://law.counselstack.com/opinion/almar-forming-machine-co-v-f-w-metal-forming-machinery-co-illappct-1941.