Fortunately, the parties were able to agree on a few basic facts which were formalized by a Stipulation. Under date of August 8, 1940 the parties entered into an agreement captioned 'Ford Sales Agreement.' The obvious purpose of this agreement was to constitute the defendant a dealer of Ford cars and parts at Highspire, Pennsylvania. Plaintiff by due and proper notice dated February 9, 1953 terminated the said agreement as of April 16, 1953.
During the term of the agreement and in accordance with the provisions thereof, defendant purchased for $ 300., at its own expense, and erected at its place of business, an approved Ford Dealer Sign. Furthermore, during the term of the agreement, defendant acquired a large stock of parts which are the bone of contention that gives us this action.
Under the provisions of this agreement, which while bilateral in form certainly has definite unilateral overtones in favor of the plaintiff, plaintiff had the right to terminate the agreement as it did and to enter another dealership agreement, which it did, for the small community of Highspire.
I find nothing in the agreement which would indicate that Ford was under any obligation to purchase from Plasterer the sign on termination of the agreement. On the other hand, the agreement does specifically provide on termination of the agreement that 'Company (Ford) shall repurchase immediately from Dealer (Plasterer) and Dealer agrees to sell to Company all new and undamaged genuine Ford, Mercury, Lincoln and Lincoln-Zephyr parts and approved accessories purchased from Company by Dealer after the sixtieth day prior to date of giving notice of intention to terminate this agreement at the prices paid for such parts by Dealer less ten per cent (10%) and less transportation charges thereon * * *.'
Reminiscent of recent Congressional hearings in which the relations between the automobile manufacturers and their dealers were given wide publicity, there is in this case enough undisputed testimony to convince me of the existence here of a substantial amount of pressure salesmanship which did result in a heavily overstocked inventory of parts.
There was testimony in relation to the erection by dealer of a new garage and of dealer meetings in which assigned quotas of cars and parts were impressed on the dealers. This testimony was in part, at least, contradicted. However, the agreement did specifically require the Company to repurchase immediately all genuine parts and accessories purchased from Company by dealer after the sixtieth day prior to date of giving notice of intention to terminate the agreement. By the same provision of the agreement the dealer obligated itself to sell the said parts and accessories. Yet the Stipulation indicates that it was not until May 4, 1956 that the Company, through its counsel, offered to purchase from dealer all new and undamaged genuine Ford parts and approved accessories purchased from Company by dealer after December 2, 1952 and prior to April 16, 1953, provided such parts are identifiable in accordance with the terms of the agreement. It is significant in this connection that this action was instituted January 6, 1956, and the offer was not made by Company through its counsel until four months thereafter and less than one month short of three full years from the termination of the agreement.
As indicated above, regardless of the apparent imbalance in the content of the agreement in relation to the contracting parties, the fact remains that the defendant, as such dealer, did obligate itself to do certain things on the termination of the agreement. If with full knowledge of the existence in the agreement of the sort of sword of Damocles termination clause it acquired a large stock of parts and accessories, it did it knowing that when the sword fell it could only expect help from the Company for those parts and accessories purchased within the sixty day period prior to date of the notice of termination.
The Company had a perfect right to terminate the agreement and to designate a new dealer. The existence of two signs giving the unmistakeable impression of two authorized Ford dealers tends only to confusion and is unfair not only to the parties involved but to the public as well.
Plaintiff is seeking equity, -- it must do equity. I am of the opinion that the plaintiff fell far short of meeting its patent responsibility at the time of the termination of the agreement. After a lapse of four years it will be much more difficult to determine the value of parts and accessories purchased by defendant which under the agreement plaintiff is obliged to repurchase but I feel that the failure of plaintiff to move immediately, as the agreement provided, is the primary cause in the creation of whatever difficulty presently exists. Defendant has a right to expect the plaintiff to repurchase those parts and accessories designated in the agreement. When that has been accomplished, defendant will be required to remove the sign.
Because of the conflicting equities final judgment in this matter will be deferred for a period of sixty days. During this period the parties will be expected to proceed according to the terms of the agreement and in line with the views herein expressed.
Conclusions of Law
1. The Court has jurisdiction of the parties and of this action.
2. Final judgment in this matter will be deferred for a period of sixty days.