Central Imports, Inc. v. Dortmunder Actien-Brauerei AG

574 N.E.2d 27, 214 Ill. App. 3d 461, 158 Ill. Dec. 233, 1991 Ill. App. LEXIS 736, 1991 WL 71935
CourtAppellate Court of Illinois
DecidedMay 7, 1991
DocketNo. 1—89—3050
StatusPublished
Cited by2 cases

This text of 574 N.E.2d 27 (Central Imports, Inc. v. Dortmunder Actien-Brauerei AG) 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
Central Imports, Inc. v. Dortmunder Actien-Brauerei AG, 574 N.E.2d 27, 214 Ill. App. 3d 461, 158 Ill. Dec. 233, 1991 Ill. App. LEXIS 736, 1991 WL 71935 (Ill. Ct. App. 1991).

Opinion

PRESIDING JUSTICE SCARIANO

delivered the opinion of the court:

Plaintiff, Central Imports, a beer distributor, brought an action for wrongful termination of its distributorship, basing it on common law contract theories and the Illinois Beer Industry Fair Dealing Act (Ill. Rev. Stat. 1987, ch. 43, par. 301 et seq.) (the Act). After plaintiff was granted a preliminary injunction enjoining defendant Dortmunder Actien-Brauerei AG (DAB or brewery) from terminating plaintiff as a distributor, DAB took an interlocutory appeal.

DAB is a German brewery which manufactures DAB brand beer. Beginning in the early 1950’s, it distributed beer in Illinois and surrounding States through a succession of wholesale companies owned and operated by Joseph Gies. In 1978, Gies, along with Arnold Holán, formed a wholesale company called Charter Imports, Inc., which continued to market the DAB brand in a nine-State Midwest region.

In 1985, the Heileman Brewery succeeded Charter Imports as distributor of Hacker Pschorr beer, leaving Charter Imports with DAB beer as its only major brand. Gies and Holán thereupon decided that it was no longer economically feasible for them to remain in the market because, in their opinion, a company with only one import brand would find it very difficult to survive.

In the summer of 1986, Gies and Holán approached another beer distributor, then known as Central Chicago Distributing Company and now known as Central Distributing, Inc., regarding the possible sale to it of Charter Imports. An agreement was reached to sell certain assets of Charter Imports to Central Distributing, including the right to distribute DAB beer, but the transferring of the right was conditioned upon the approval of the brewery.

Gies and Holán sent a letter to the brewery on September 5, 1986, advising it that Charter Imports would cease doing business on October 30, 1986. On September 14, 1986, as a result of that letter, a meeting took place between Gies and Holán, three representatives of Central Distributing, and representatives of the brewery. DAB and Central Distributing determined, at this time, to establish a separate company, Central Imports, Inc., to handle the DAB brand. The brewery thereafter sent a letter dated October 22, 1986, to Central Imports, appointing it as the new distributor for DAB beer for a trial period running from November 1, 1986, through December 31, 1987, with a provision for future negotiation of a “final agreement.”

Although the contemplated “final agreement” never materialized, on November 18, 1988, DAB shipped $63,210.75 worth of beer to Central Imports under invoices which stated that payment was due on January 18, 1989. On January 6, 1989, Tarlock Chhokar, who did Central Imports’ bookkeeping, prepared a check made payable to DAB for the full amount due and had it signed by Bruce Ruzgis, the president of Central Imports and one of its owners, and Kenneth Hartmann, who was the president of Central Chicago Distributing and one of the principals of Central Imports. However, before it was mailed, the check was voided on the instruction of Donna Spagnolla, Central Imports’ controller, because, as she testified, “Central Imports was waiting for some receivable money to come in.”

On January 24, 1989, Frederick Hess, Jr., the president of DAB, called Chhokar and told him that the brewery was “upset” that it had not received payment when it was due. Hess Jr. continued to call Chhokar through the remainder of January and into February of 1989 regarding payment, but without any favorable result. Chhokar acknowledged that in February 1989, “one of the Fred Hesses” called him and stated that “payments were overdue, and they want their money.”

On March 8, 1989, Hess Jr. called Chhokar again regarding payment and was told that the check had been made out and that he would look into its progress. Hess Jr. made a contemporaneous note of this phone call on a “faxed” communication he had received from the brewery. On March 13, 1989, Hess Jr. again called Chhokar regarding payment and Chhokar informed him that the check was in the mail, but the check was never received.

On March 17, 1989, Hartmann called Frederick Hess III, the secretary-treasurer of DAB, and told him that DAB should stop dealing with Chhokar regarding the past-due invoices and to deal instead with Timothy Mirkiewicz, the general manager of Central Imports. Hess III testified that when, on March 20, 1989, he called Mirkiewicz and told him that $63,210.76 was “well overdue,” Mirkewicz stated that he “didn’t have a good knowledge of the complete situation” and asked if he could call “back the next day to respond to that.” The next day, Mirkewicz called Hess III and, after telling him that he understood that the payment was “long overdue,” informed him that Central Imports’ controller had suggested paying the bill in four equal installments over the following four weeks. Hess III testified that he informed Mirkiewicz during this conversation that stretching out the payments in the manner suggested was “totally unacceptable” and that he demanded full payment. Mirkiewicz, however, testified that Hess III stated in response to the suggestion of an extended payment schedule, “If that’s what you have to do, that’s what you have to do. Any payment is better than no payment.” Mirkiewicz also stated that he took part in several other conversations with the Hesses regarding the $63,210.75.

On March 23, 1989, Hess III again called Mirkiewicz and was told that not even a partial payment had been sent but that such a payment would be mailed the next day. Although Central Imports alleges in its brief that it sent its first payment of slightly more than $15,000 by check on March 27, 1989, the record shows that when Hess called Mirkiewicz on March .28 and told him that no check had been received, Mirkiewicz stated that no check had been sent out, but that Central Imports would send it immediately.

Mirkiewicz testified that in these conversations, Hess III merely “inquired” about the status of the payment for the outstanding invoice. Ruzgis stated that he had had several conversations with the Hesses during the period from January 1989 through April 2, 1989, but that in none of those conversations did the Hesses ever indicate that Central Imports was late in its payments, nor did they ever request payment from him.

On March 28, 1989, the brewery informed Hess Jr. that it had decided to terminate Central Imports as a distributor and sent him a draft of a proposed letter addressed to Central Imports informing it of its decision. Hess Jr. returned the letter to the brewery and advised it that it should use March 28, 1989, as the date of the letter, since that was the date it had made the decision to terminate. Hess Jr. also recommended that the brewery send the letter to Central Imports by way of regular mail, the slowest route, in order to give Hess Jr. and his son additional time in which to try to collect payment. Hess Jr. had surmised that Central Imports would refuse to pay once it learned that it had been terminated.

On April 3, 1989, Hess III made a trip to Central Imports’ office in Chicago to try to collect the $63,210.75. Mirkiewicz met Hess III at the airport and gave him a check for $15,800 and informed him that another partial payment had been sent to his office.

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Bluebook (online)
574 N.E.2d 27, 214 Ill. App. 3d 461, 158 Ill. Dec. 233, 1991 Ill. App. LEXIS 736, 1991 WL 71935, Counsel Stack Legal Research, https://law.counselstack.com/opinion/central-imports-inc-v-dortmunder-actien-brauerei-ag-illappct-1991.