Templeton v. Interstate Electric Co.

37 So. 2d 809, 214 La. 334, 1948 La. LEXIS 965
CourtSupreme Court of Louisiana
DecidedNovember 8, 1948
DocketNo. 38070.
StatusPublished
Cited by8 cases

This text of 37 So. 2d 809 (Templeton v. Interstate Electric Co.) is published on Counsel Stack Legal Research, covering Supreme Court of Louisiana primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Templeton v. Interstate Electric Co., 37 So. 2d 809, 214 La. 334, 1948 La. LEXIS 965 (La. 1948).

Opinion

FOURNET, Justice.

The plaintiff, Boyd Templeton, alleging that the Dixie Auto Lee Stores, Inc., and *337 the Interstate Electric Company entered into a scheme or collusion with M. M. and Marshall Hearne for the purpose of inducing the latter two to breach their contract with him for the purchase of his business (including his stock and fixtures) then being operated in Jonesboro, Louisiana, under the trade name of Templeton Dixie Auto Lee Store, in order that the companies might sell the Hearnes new stock and fixtures, seeks to recover damages against the four in solido in the sum of $2,571.85.

The Hearnes denied the alleged scheme or collusion or that they were liable to the plaintiff, averring specifically that Dr. M. M. Hearne had no interest in the transaction other than to finance his son in the event the deal was consummated, and that inasmuch as it was never consummated, due to the plaintiff’s inability to comply with his agreement to secure the approval of the companies to the transfer of the franchise to use the name “Dixie Auto Lee Stores” to Marshall Hearne, neither was liable. The two companies likewise denied there was any scheme or collusion entered into for the purpose of inducing the Hearnes to breach their contract with the plaintiff, they averring they declined to transfer Templeton’s franchise to Hearne in the exercise of the discretion they had retained in the contract with Templeton and for good cause, i. e., the unpleasant and unsatisfactory business relations with him due to the small amount of merchandise he ordered, his purchase of merchandise from other sources, and his failure to promptly settle his account. They admitted the issuance of an independent franchise to Hearne. In reconvention, the Interstate Electric Company sought to recover from the plaintiff the sum of $707.25, with 8% interest from October 11, 1940, until paid.

From a judgment dismissing the plaintiff’s suit and the reconventional demand, the plaintiff has appealed.

It appears that the Dixie Auto Lee Stores, Inc., a Mississippi corporation, having acquired from the United States Patent Office the exclusive right to use the trade name of Dixie Auto Lee Store, and from the Interstate Electric Company, a Louisiana corporation domiciled in New Orleans, an exclusive sales agency, entered into a contract on May 21, 1940, granting the plaintiff, Templeton, a franchise authorizing him to use this trade name in connection with his business in Jonesboro, Louisiana, Templeton obligating himself under this contract to use Interstate merchandise in his store exclusively. In the early part of February; 1941, desiring to avail himself of an offer by Dr. M. M. Hearne to finance -the purchase of the business by his son Marshall, Templeton called on D. C. Whittle, the sales representative of Interstate at Alexandria, Louisiana, through whom he had obtained his franchise, since it was necessary, in order to consummate the transaction, to be sure that the franchise could be secured for *339 Marshall. Accordingly, Whittle went to Jonesboro and met with the Hearnes and Templeton and assured them that once they had agreed upon the price to 'be paid the matter of securing the approval of the transfer of the franchise to Marshall would be a mere formality. The price having been agreed upon, the place of business was closed so that the inventory could be taken with the assistance of Whittle, and the keys were thereafter turned over to Marshall Hearne. A week and a half later, after Marshall, accompanied by his father and brother, had met in New Orleans with Leon Mattes, sales manager of the Interstate Electric Company and supervisor of the Dixie Auto Lee Stores, Inc., and O. G. H. Rasch, secretary-treasurer of both companies, Hearne attempted to return the keys to Templeton with the explanation that he had not been able to secure the franchise, but Templeton refused to accept- them. Subsequently, within four weeks of the time the Hearnes i interviewed the company officials in New Orleans, Mattes and Whittle called on Marshall in Jonesboro and delivered a-franchise to him. Under this franchise Hearne, some time during the middle of April, began doing business in a new location equipped with new fixtures and stock. At about the same time several suits were filed against the plaintiff, two by the attorney who is representing the defendants here. One of these suits, by the Interstate Electric Company on an open account to recover $707.25, was dismissed shortly after the plaintiff reconvened to recover the amount being claimed by him in this suit. In another, the goods of the plaintiff were seized and sold and the proceeds thereof distributed. In the meanwhile, on March 18, the plaintiff was notified by registered mail to desist from using the trade name Auto Lee Store since his franchise to use this trade name had been cancelled.

Under the terms of the contract entered into by the plaintiff with the Dixie Auto Lee Stores, Inc., the licensee, Templeton,is authorized to negotiate the transfer of his franchise, subject to the approval of the licensor, Dixie Auto Lee Stores, Inc., in which event the licensor is empowered to complete the negotiations; the franchise is not subject to cancellation by the licensor for the causes set out in the answer of the companies filed here without the licensee being given 30 days prior written notice by the licensor. The only causes for which the contract could be cancelled without this notice ar-e set out in Section 13 (failure to observe certain required trade practices) and in Section 17 (where both parties are given the right to cancel in the event of the insolvency, bankruptcy, etc.,of the other). 'Neither of these causes is pertinent here.

The record shows that soon after the meeting between the Hearnes and the representatives of the two companies, these companies, through Mr. Mattes, addressed a letter to the plaintiff on February 26 advising him of the meeting in *341 New Orleans and its purpose. He stated the companies were unwilling to complete the negotiations for the transfer (1) until Templeton had liquidated his account with them, and (2) unless steel fixtures were used by the purchaser. On March 5 the plaintiff addressed a letter to Mattes advising him that while the Hearnes were willing to invest some $3,000 in the business, most of that was for new stock and they were unwilling to incur the additional expense of acquiring new fixtures. He implored Mattes to assist the Hearnes in-securing this franchise since all parties concerned had entered into the contract in good faith and upon the assurance of Whittle that securing the franchise would be a mere formality; he particularly urged this since at that time his store had been closed for nearly three weeks. He further assured Mattes that upon the completion of the transaction, in accordance with his agreement with the Hearnes, the balance due Interstate would be paid in full.

Mattes promptly answered this letter on March 7 advising Templeton there was nothing that could be done for him; that his account was being placed in the hands of an attorney with instructions that suit be filed against him and his merchandise seized. In this letter Mattes states he thinks "it would be the best way out for everyone concerned if you were to see Dr.

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Bluebook (online)
37 So. 2d 809, 214 La. 334, 1948 La. LEXIS 965, Counsel Stack Legal Research, https://law.counselstack.com/opinion/templeton-v-interstate-electric-co-la-1948.