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REA v. FORD MOTOR CO.

December 26, 1972

Edward C. REA and 22 Ford, Inc., a corporation
v.
FORD MOTOR COMPANY



The opinion of the court was delivered by: KNOX

 DEFENDANT'S POST-TRIAL MOTIONS

 This complex and protracted piece of litigation has been pending since March 6, 1967, when plaintiffs, a Corporate Ford Dealer and its major stockholder, filed a complaint against defendant, Ford Motor Company, setting forth seven causes of action:

 
(1) Breach of contract as to purchase of real estate and erection of a dealership facility in Monroeville, Allegheny County, Pennsylvania.
 
(2) An action for specific performance to require conveyance of the property mentioned in the first cause of action.
 
(3) An action for violation of the Robinson Patman Act, 15 U.S.C. § 13(e).
 
(4) An action for violation of the Automobile Dealers Act, 15 U.S.C. § 1221 et seq.
 
(5) An action based upon alleged monopolistic practices and restraints of trade under Sections 1 and 2 of the Sherman Act (15 U.S.C. §§ 1 and 2).
 
(6) An action also based upon Sherman Sections 1 and 2, resulting from a requirement that plaintiffs not deal in vehicles, parts and equipment of a competitor of defendant, viz: General Motors Corporation.
 
(7) An action for an order to the Prothonotary of Allegheny County to index a lis pendens during the pendency of the second cause of action for specific performance.

 There ensued lengthy discovery proceedings and numerous motions and arguments with respect to these suits before two other judges of this court to whom the case was assigned before final assignment to the undersigned. There were also various proceedings in the United States District Court for the Eastern District of Michigan resulting from attempts by plaintiffs to take the depositions of Lee A. Iacocca, President of defendant, and other officials of the Ford Motor Company at its principal offices in Dearborn, Michigan, which proceedings as well as other discovery proceedings were vigorously resisted by the defendant.

 After more than three years of discovery, defendant filed a motion for partial summary judgment with respect to the second and seventh causes of action and this court, by opinion and order dated May 5, 1971, ( Rea v. Ford Motor Co., 326 F. Supp. 627 (W.D.Pa.1971), granted this motion for partial summary judgment with respect to these causes of action holding there was no sufficient memorandum in writing to satisfy the Pennsylvania Statute of Frauds (33 Purdon's Pa.Stat. § 1 et seq.) and also with respect to certain letters and other writings upon which plaintiff relied the authority of the person signing the same was not expressed in writing as also required by the Statute of Frauds. The Court of Appeals for the Third Circuit, by order dated September 15, 1972, dismissed an appeal from this order since, in the light of other developments in the case, it appeared that the appeal was improvidently certified. The court pointed out that subsequent to the lodging of the appeal, trial of the remainder of the case had been held at which plaintiffs (appellants) had pursued an alternative remedy, viz: a claim for damages for breach of oral contract for the sale of real estate. Since post-trial motions were pending with respect to the jury's verdict hereinafter referred to awarding damages for breach of said oral contract, the appeal was dismissed with leave to the appellants to file a fresh appeal covering the subject matter in question, after the effective date of a final judgment in the District Court upon the remaining claims.

 We adhere to our former decision on these matters reported in 326 F. Supp. 627 and hold that regardless of the finding of the jury that there was an oral contract for conveyance of real estate for breach of which damages were awarded, there is still insufficient evidence in writing of the existence and terms of such contract to justify an order of specific performance; that to allow specific performance under the second and seventh causes of action would be prohibited by the Pennsylvania Statute of Frauds, supra; that there is insufficient evidence of a written memorandum with respect to said contract; and the authority of persons to sign certain documents and letters in behalf of Ford Motor Company was not expressed in writing as required by the statute. We will deal with the question as to whether there was sufficient evidence to go to the jury to justify their finding of an oral contract to convey real estate and their award of damages for breach thereof later in this opinion.

 Meanwhile, the remainder of the case was proceeding to trial. The following issues were left:

 
(1) Breach of oral contract to convey real estate.
 
(2) Violation of the Robinson-Patman Act.
 
(3) Violation of the Automobile Dealers Act.
 
(4) Violation of Section 1 of the Sherman Act.
 
(5) Violation of Section 2 of the Sherman Act.

 The court likewise held that there was insufficient evidence of monopolization under Section 2 of the Sherman Act but permitted the case to go to the jury to determine if there was an attempt to monopolize under Section 2.

 The jury was instructed by the court to return a special verdict which they did after lengthy deliberations, the material portions of which are set forth in Appendix I to this opinion.

 The court thereupon entered judgments in accordance with the terms of the special verdict, trebling the damages found by the jury in answer to Question No. 9 in the amount of $ 1,750,000.00, pursuant to the provisions of 15 U.S.C. § 15, whereby they were increased to $ 5,250,000 thus resulting in a total award against defendant of $ 5,629,683. The defendants have now filed post-trial motions as follows:

 
(1) Motion for Judgment in Accordance with Motions for Directed Verdict with respect to all causes of action submitted to the jury (hereinafter referred to as Motion for Judgment NOV).
 
(2) In the Alternative, a Motion for New Trial alleging 35 reasons therefor.
 
(3) Motion to Amend the Judgment claiming that judgment had been entered in favor of the wrong persons.

 We have received voluminous briefs from the parties (approximately 350 pages from the defendant and approximately 125 from the plaintiff) and have heard extensive oral arguments with respect to the same and will dispose of these motions in the following opinion.

 In approaching this task, we bear in mind the elementary rule that a verdict winner is entitled to the benefit of all evidence in his favor regardless of who produced such evidence and all inferences deducible therefrom: Bruce Lincoln-Mercury v. Universal CIT Credit Corp., 325 F.2d 2 (3d Cir. 1963); Globe Motors v. Studebaker-Packard Corp., 328 F.2d 645 (3d Cir. 1964); Walsh v. Miehle-Goss-Dexter, Inc. v. Stern, 378 F.2d 409 (3d Cir. 1966); United States v. Evers, 448 F.2d 863 (3d Cir. 1971); Neville Chemical Co. v. Union Carbide, 422 F.2d 1205 (3d Cir. 1970).

 We will deal with the motions with respect to each cause of action in the order in which they were presented.

 (I) Breach of Contract for Conveyance of Real Estate.

 Plaintiff's first cause of action alleges a contract to convey real estate generally known as the Balison tract in Monroeville, Allegheny County, Pennsylvania and asks for damages for the breach of the same including loss of bargain. As previously discussed, partial summary judgment was entered for defendant with respect to the second and seventh causes of action seeking specific performance of this contract and lis pendens.

 (a) The existence of an oral contract.

 At the trial of this case, plaintiffs presented evidence as to the first cause of action and claimed damages for breach of an oral contract to convey real estate. This was proper under Pennsylvania law since the Statute of Frauds applies only to an action for specific performance and not to a suit for damages for breach of an oral contract respecting real estate. Polka v. May, 383 Pa. 80, 118 A.2d 154 (1955); see also Thompson v. Sheplar, 72 Pa. 160; McDowell v. Oyer, 21 Pa. 417. In such case, however, the vendee's right to damages is restricted to monies laid out and expenses incurred on the faith of the oral contract to convey: he cannot secure damages for the loss of his bargain, i.e., the difference between the contract price and the actual market price of the real estate or any loss of profits from the transaction or loss of any appreciation in value of the real estate.

 Plaintiff Rea recognized this rule and submitted evidence as to his expenditures on the faith of the contract, viz: $ 1.00 in option money which he says he paid to bind the bargain during negotiations plus expenses incurred by him in connection with the construction of the dealership facility on the property. During the course of construction, it was necessary to install hoists for servicing vehicles, conduits for electric cables and certain partitions. These were not in the original plans and the Ford Motor Company which paid the other costs of construction of the facility refused to pay for them and hence plaintiff paid the contractor for these items totalling $ 29,683. Payment was actually made by plaintiff Rea's controlled corporation, 22 Ford Inc., (as to which more hereafter) although it is clear that the original contract as found by the jury was between the individual plaintiff Rea and defendant Ford.

 In our opinion at 326 F. Supp. 627 at 631, it was noted there had been a discussion between plaintiff Rea and the representatives of Ford Motor Company looking to Rea opening a Ford dealership at this new point for Ford sales in Monroeville. The discussions concerned a so-called direct-lease transaction whereby Rea or a corporation formed by him would acquire title to the land and then lease it under a long-term lease to Ford Motor Company whose payments of rents would be used to finance the transaction. Ford would then lease the facility back to the dealership. With Ford's name on the underlying lease which would be assigned to the financier, this would make a very desirable transaction. The evidence indicates that at some time this transaction was changed because the seller, which was a corporation, wanted to sell stock and not assets, and Ford could not see any reason for paying financing charges to an outside party when it had ample resources to purchase this land and put up the buildings out of its own funds. The transaction was therefore modified so that Ford acquired the stock in the seller corporation and then dissolved this entity thus obtaining title to the real estate. At this time there were indications that Ford was willing to enter into some arrangement known as the "buy-out plan" whereby it would sell the property to Rea over a term of years. Some of the elements of this plan were embodied in the so called option which Ford sent to Rea on December 29, 1966, and which Rea refused to sign claiming it was not in accordance with the original understanding between the parties and that it gave him only an illusion of an interest in the property since Ford could reacquire it at any time at cost if Rea ever ceased to be a Ford dealer.

  In our opinion at 326 F. Supp. 627 at 631, we indicated that all the documents showed was some evidence of negotiations looking eventually to working out an arrangement between Ford and plaintiff. When the case went to trial, we were not limited to written documents and communications but the entire nature of the understanding between Rea and Ford was introduced in evidence through the testimony of plaintiff Rea and his corroborating witnesses who were aware of the elements of the transaction. This evidence showed that in 1963 Rea, who was known as a highly successful Oldsmobile dealer in nearby Wilkinsburg, was approached as a dealer prospect by various representatives of Ford with a view to opening up a new Ford dealership in Monroeville. Discussions were had not only with representatives from the Pittsburgh District Office of Ford but also representatives from defendant's general offices in Dearborn, Michigan. A transaction was worked out according to plaintiffs' testimony whereby Rea was to enter into the so-called direct-lease deal for the Monroeville property. It appears that as part of the transaction in order to raise capital he at that time planned to give up his Oldsmobile franchise. It was stated to him that the transaction would be similar to that of the Rossi-Downtown Ford direct-lease in Detroit, the Chase-Morsey transaction for Paradise Ford in Scottsdale, Arizona, and other direct-lease dealer transactions which were mentioned in the testimony to show the manner in which the transaction was to be accomplished. The mortgage to the financier was to be amortized over a twenty-year period to cover the cost of land and improvements and the property then was to be sublet by Ford back to Rea's dealership. The rental factor was to be at the rate of 7-1/2% of the cost of the land and facilities, plus amounts equal to taxes, insurance and maintenance. This would amortize the mortgage over a twenty-year period so that at the end of this time Rea would own the property free of encumbrances. Various communications in defendant's files confirmed that such a transaction was the plan.

 The case was submitted to the jury to determine first whether there was any binding contract at all to which the jury answered "yes" and secondly whether the terms were those of the so-called direct-lease plan (Question 2(a) or the so-called buy-out plan (Question 2(b)). The jury answered that the contract consisted of the so-called direct-lease plan (Interrogatory 2a) and answered Interrogatory No. 3 that there had been a breach of contract by Ford and Interrogatory No. 4 awarded damages in the amount of $ 29,683 to plaintiff Rea.

 There was ample evidence to support the jury's verdict with respect to the making of this contract notwithstanding defendant's contention that the evidence was too vague and indefinite to justify any finding for plaintiff.

 It is true that the burden is upon the plaintiff to establish the terms of the contract on which he bases his claim: Kassab v. Ragnar-Benson, Inc., 254 F. Supp. 830 (W.D.Pa.1966). This was a non-jury case in which the judge held that the terms of an employment contract were too vague to be enforceable. The basic Pennsylvania case *fn1" is Beachler v. Mellon-Stuart Co., 354 Pa. 341, 47 A.2d 147 (1946) which, like this case, was tried by a jury and the court held that there was insufficient evidence to support the jury's verdict that there was a binding and enforceable contract. The court held that there was no meeting of the minds as to any terms and the terms were most inadequate and indefinite and could not in any sense constitute a contract. In the instant case, the jury was carefully instructed on this and as to the necessity for finding a meeting of the minds. See Tr. 5070 et seq.

 Beachler, supra, teaches us that in such a case to determine if there was sufficient evidence to go to the jury, we must look for the following:

 
(1) Was there a meeting of the minds?
 
(2) When does the contract commence?
 
(3) For what period is it to run?
 
(4) What was the price to be paid?
 
(5) What were the terms of payment?

 There is no question in a disputed issue as to whether a contract existed at all or where it is partly oral and partly written the case must go to the jury. Agger v. Frank Donatelli & Co., Inc., 171 Pa. Super. 631, 91 A.2d 303 (1952).

 Applying the tests in Beachler to this case, we find that there was sufficient oral and written testimony to enable the jury to arrive at the conclusions which it did. There was evidence as to a meeting of the minds on the terms between Rea and the representatives of Ford Motor Company. The contract was to commence when the dealership facility to be erected on the land had been completed. It was to run for a period of twenty years. The amount to be paid was to be the total cost of the land and buildings which could easily be ascertained when the structure was completed. The terms of payment were an annual payment of 7 1/2% of cost plus taxes, insurance and maintenance. Other details of the transaction were as set forth in the arrangements made with Rossi-Downtown Ford and Chase-Morsey Dealership in Scottsdale. This is a typical case for application of the maxim id certum est quod certum reddi potest (that is certain which can be made certain). When all the terms of a transaction have been agreed upon and all that remains is putting it in the form of a final formal writing, this will not prevent the Pennsylvania courts from treating it as an enforceable agreement and not mere negotiations. Moudy v. W. Va. Pulp & Paper Co., 385 Pa. 39, 121 A.2d 881 (1956); Emerman v. Baldwin, 186 Pa. Super. 561, 142 A.2d 440 (1958).

 The foregoing discussion also disposes of defendant's reason (aa) of its motion for new trial.

 (b) The Parole Evidence Rule.

 Defendant next claims that the parol evidence rule was violated by allowing testimony as to the existence of an oral contract and therefore the matter was improperly sent to the jury. The court at page 4881 refused to instruct on the parol evidence rule for the reason that there was nothing in the contracts with respect to purchase of the property. The two written instruments to which defendant is apparently referring as the basis for applying the parol evidence rule to this case are (1) the dealership agreement (plaintiff's exhibit 118) and (2) the lease agreement covering the facility (plaintiff's exhibit 65). Neither one of these agreements says anything about plaintiff's right to purchase the property. The dealership agreement is the standard Ford Dealer's agreement and has nothing whatsoever to do with the facility to be occupied by the dealer. The lease agreement is also a standard lease from Ford Motor Company to a dealer for certain facilities for a dealership and it likewise says nothing about the purchase of the premises by the dealer. As the court pointed out at page 4881, if the lease agreement, as many leases do, had an option to purchase clause in it, the plaintiff would be bound by it and we would not permit the introduction of any parol testimony to vary its terms, but it does not.

 While Pennsylvania is very strict in applying its parol evidence rule and has been since the landmark case of Gianni v. Russell & Co., 281 Pa. 320, 126 A. 791 (1924) nevertheless this rule only forbids oral testimony on a subject covered by the contract. As a matter of fact, Gianni says:

 
"In cases of this kind, where the cause of action rests entirely on an alleged oral understanding concerning a subject which is dealt with in a written contract it is presumed that the writing was intended to set forth the entire agreement as to that particular subject."

 Further cases dealing with the subject hold that the question is whether or not a matter is dealt with at all in the writing. Bardwell v. Willis Co., 375 Pa. 503, 100 A.2d 102 (1953); Grubb v. Rockey, 366 Pa. 592, 79 A.2d 255 (1951); Tara Ann Inc. v. Sun Ray Drug Co., 383 Pa. 521, 119 A.2d 91 (1956).

 For these reasons, the court refused to apply the parol evidence rule and let the question of an oral contract go to the jury.

 (c) Apparent Authority of Ford Representatives.

 Defendant next contends that the Ford representatives who negotiated the transaction acted without authority, and seeks to rely upon certain evidence by Mr. Iacocca and others, that these representatives could only recommend real estate transactions to the home office and had no authority to bind the company.

 The negotiations with respect to the so-called direct-lease transaction, which was found by the jury to be a binding contract, were conducted largely by Mr. McClanathan, Pittsburgh District Sales Manager, and Mr. Chase, Market Representation Coordinator of Ford, who was sent out from the home office in connection with the transaction. Plaintiff offered the depositions of these persons and in these depositions were various statements indicating they did have authority to enter into the arrangement with Mr. Rea. It is elementary, of course, that an agent's judicial statements as to his authority are admissible to show the same, but not his extra-judicial hearsay statements.

 The evidence indicates that Mr. McClanathan, District Sales Manager, was authorized and empowered to prospect for new Ford dealers and had conducted negotiations with Mr. Rea and that Mr. Chase was authorized by the market representation department to deal with Rea concerning the acquisition of a suitable site for the new dealership to be set up in Monroeville. The Ford General Sales Bulletin No. 5512 (Exhibit Px 82) set up authority of the market representation manager to enter into negotiations concerning dealership sites and Mr. Chase, Market Representation Coordinator, was sent to Pittsburgh for this purpose.

 In addition to the above, we have the fact that certain letters from the Ford files which were offered in evidence by plaintiff indicated that Ford recognized it had made certain arrangements with Mr. Rea with respect to the facility in question and owed him some duty to honor them.

 The court let the jury determine whether the plaintiff Rea was justified in relying on the apparent authority of the Ford representatives, this being a matter to be determined in deciding whether there was a valid contract. (See Tr. 5065, 5066). The jury found against Ford on this score and it is the opinion of the court there was sufficient evidence for them so to find.

 In view of the fact that the construction of an operation of this facility at this new point by Rea was intimately connected with his opening up the new Ford Dealership, negotiations for which were in charge of the Pittsburgh District Sales Manager, and in view of the fact that when matters reached a critical point, Mr. Chase, the Market Representation Coordinator, was specifically sent out from Dearborn to handle the transaction, would be enough for Mr. Rea to conclude that they had apparent authority to act. It would not be appropriate for him to meet Mr. Chase at the airport and demand that he produce a resolution from the Ford Motor Company Board of Directors before he discussed the matter further with him.

 The court concludes that under Pennsylvania law Mr. Rea was entitled to rely on this apparent authority despite the alleged secret restrictions which Ford claimed it had imposed upon these agents. See Revere Press, Inc. v. Blumberg, 431 Pa. 370, 246 A.2d 407. See also Restatement of Agency 2d, Sections 8, 27 and 50. *fn2"

 Our Court of Appeals has recently discussed apparent authority in Reading Co. v. Dredge Delaware Valley, 468 F.2d 1161 (3d Cir. 1972), as follows:

 
"Apparent authority is the power to bind the principal where the principal has not actually granted authority but which he leads persons with whom his agent deals to believe that he has granted. Persons with whom the agent deals can reasonably believe that the agent has power to bind his principal if the principal knowingly permits the agent to exercise such power: Revere Press, Inc. v. Blumberg, 431 Pa. 370, 246 A.2d 407 (1968)."
 
* * *
 
"It is sufficient to create apparent authority if the principal should realize that his conduct is likely to create a belief that the agent is authorized to act for him. Restatement of Agency, 2d, § 27. Comment a, p. 104. See Revere Press, Inc. v. Blumberg, et al, 431 Pa. 370, 246 A.2d 407 (1968)."

 There is no evidence that Mr. Rea was aware of any limitations on the authority of the Ford representatives if they existed. For this reason, we hold that the question of apparent authority was for the jury to decide.

 (d) Damages -- Expenditures by 22 Ford, Inc.

 The contract with respect to the real estate was originally entered into between the individual plaintiff, Edward C. Rea, and the Ford Motor Company. The land was to have been bought and the facility constructed by Rea and then leased to Ford Motor Company and subleased back to the Dealership to be formed by Rea which is now 22 Ford, Inc. one of the two plaintiffs in this case. As previously noted, under Pennsylvania law, the purchaser under an oral contract for sale of real estate can recover any such expenditures made by him upon the faith of the contract. Therefore, the jury was told that Rea was entitled to recover any such expenditures made by him if they found the contract existed (Tr. 2154) but was further told they could not include expenditures for movable personal property and equipment which a tenant would remove at the end of the lease.

 Defendant claims that plaintiff should not be allowed to recover anything for breach of this oral contract for the reason that all expenditures appear to have been made out of the funds of 22 Ford, Inc. and not those of plaintiff Rea. The evidence shows that Rea was the owner of 91.3% of the capital stock of 22 Ford, Inc. (See plaintiff's Exhibit 118) and, of course, had overwhelming control of the same.

 While the facility was being constructed, it appeared that electrical conduits had to be installed in the ground and that hoists also had to be installed for servicing cars. These items were not included in the construction price and this installation was very costly because the mechanism had to be installed in solid rock. In order to get the facility operating and, as believed by the jury, in reliance upon Ford commitments that eventually he would own the facility, Rea authorized the contractor to go ahead and make the installations and agreed to pay for them out of his own pocket. Instead of paying for them himself, however, he took the funds to pay the contractor out of the assets of 22 Ford, Inc. which he controlled.

 It is the opinion of the court that it does not lie in the defendant's mouth to criticize or raise a question as to where Rea got the funds to which he had committed himself for payment to the contractor. The invoices showing payment of these amounts by 22 Ford, Inc. were introduced without objection by the defendant (plaintiff's Exhibit 11). Rea could have borrowed the money from a bank and had the bank pay the contractor out of a construction fund and the defendant could not raise any question about Rea's right to recover. We do not know what the arrangements between Rea and 22 Ford, Inc. are for repayment of these amounts. They may be considered loans to Rea by the corporation or dividends to him or he may be trustee of these amounts to repay them to 22 Ford, Inc. in the event of recovery. In any event, we do not see that this is any concern of the defendant or in any way militates against Rea's recovery.

 Defendant also asserts that Rea is not the real party in interest with respect to this claim and therefore would not be entitled to any judgment. There are two answers to this argument:

 (1) Failure to timely object constitutes a waiver of that defense. See McLouth Steel Corp. v. Mesta Machine Corp., 116 F. Supp. 689 (E.D.Pa.1953) aff'd 214 F.2d 608 (3d Cir. 1954) cert. den. Hartford Acc. & Indemnity Co. v. Foster, 348 U.S. 873, 75 S. Ct. 109, 99 L. Ed. 687 (1954).

 (2) Rule 17(b) of the Federal Rules of Civil Procedure states: "The capacity of an individual, other than one acting in a representative capacity, to sue or to be sued shall be determined by the law of his domicile" in this case, Pennsylvania. Pennsylvania law is clear that a plaintiff may sue in his own name without joining as plaintiff any person beneficially interested, when such plaintiff is acting in a fiduciary or representative capacity, or is a person with whom or in whose name a contract has been made for the benefit of another. See Pennsylvania Rules of Civil Procedure, rule 2002, 12 P.S. Appendix.

 Defendant also argues that these items were trade fixtures which could be removed by the tenant at the end of the lease. The court admonished the jury that Rea was not entitled to recover for any movable equipment but only what he had contributed by way of permanent installation. The hoists and electrical conduits obviously could not, as a practical matter, be removed without seriously damaging the same and the building in which they were installed. For all practical purposes, the monies for these items represented contribution to the permanent overall cost of the building and since Rea is not getting the building, he is entitled to recover these items from the defendant.

 The above discussion covers the grounds for new trial pertaining to this cause of action. The motions for Judgment NOV or new trial as to this cause of action will be denied.

 (II) Automobile Dealers Franchise Act.

 The jury has found that defendant Ford breached its duty to act in good faith in performance or in complying with the terms of the franchise or sales agreement between 22 Ford, Inc. and Ford Motor Company as required by the Automobile Dealers Act sometimes known as the Automobile Dealers Franchise Act or the Automobile Dealers Day in Court Act (15 U.S.C. § 1221 et seq.). The jury awarded $ 350,000 damages for this breach of duty.

 The relevant sections of this statute are set out in Appendix II hereto.

 The complaint in this case, filed March 6, 1967, sets forth under the first cause of action in paragraph 5 that defendant knew that plaintiff was operating a successful Oldsmobile Dealership known as Rea Oldsmobile, Inc., under the General Motors Franchise in Wilkinsburg and in paragraph 8, it was averred that plaintiff was required to give up the General Motors Franchise in order to take over the Ford Dealership and that plaintiff did terminate his Oldsmobile Dealership. In the fourth cause of action, paragraph 35, it is averred that defendant failed to act in good faith in performing or complying with the terms of its franchise agreement with plaintiff and threatened and coerced and intimidated him to enter into a lease agreement and that the defendant's bad faith was further evidenced by failure to formalize the agreement to convey the dealership property to Rea and in paragraph 37, it is averred that these actions of the defendant were in violation of the Automobile Dealers Act, supra. Again, in the sixth cause of action, under the antitrust laws, it was alleged that defendant required plaintiff not to use or deal in the motor vehicles, parts and equipment of General Motors Corporation. This was alleged to be in violation of Section 3 of the Clayton Act and of the Sherman Act. It will be observed that under Section 4 of the Automobile Dealers Act, 15 U.S.C. § 1224, it is provided that this Act shall not repeal, modify or supersede directly or indirectly any provision of the antitrust laws and it has been held that it was intended to supplement the antitrust laws as a part of the antitrust program of the government. Schnabel v. Volkswagen of America, Inc., 185 F. Supp. 122 (N.D.Iowa 1960).

 The court instructed the jury that under the Automobile Dealers Act, plaintiffs could not recover for lack of good faith with respect to the failure of Ford to carry out the terms of the alleged contract for conveyance of real estate nor could plaintiffs recover for being required by alleged threats and intimidation to enter into the lease agreement for the use of the facility by the dealership because the Act in question covers only the written agreements contained in the dealership franchise agreement and nothing was said therein (Plaintiff's Exhibit 118) relative to lease of any facilities or any undertaking to convey real estate to the plaintiffs. The court did, however, instruct the jury that they could find a cause of action under the Automobile Dealers Act if they found that the defendant, by coercion, threats and intimidation, had required plaintiff to give up the Oldsmobile Franchise with General Motors because it was specified in the franchise agreement that nothing was to be construed to prevent the dealer from dealing in the products of other manufacturers. (see Tr. 5079, 5083, 5087, 5122 and 5124, Paragraph 3 of Standard Provisions, Plaintiff's Exhibit 118).

 There was ample evidence from which the jury could have found such coercion and intimidation as would justify a conclusion that this act was violated. The testimony is to the effect that Mr. Rea had indicated to Ford originally that he intended, if he took over the Ford agency, to sell his Oldsmobile Dealership so as to raise capital to open up the Ford Dealership. Notwithstanding the fact that the franchise agreement (Plaintiff's Exhibit 118) clearly provided that the dealer had the right to make purchases from others, he testified that when he was ready to go into the new facility he asked the Ford District Sales Manager what would happen if he decided to keep his Oldsmobile Dealership and he was told that he had to give it up in order to continue as a Ford Dealer. He apparently thought at that time that he would be able to get sufficient capital without selling the Oldsmobile Dealership and he protested that there was nothing in the Ford Franchise Agreement which required him to give up the Oldsmobile agency. He was then told: "Well, that may be so, but the Ford Sales Agreement doesn't ship cars and the Ford District Office does and if you don't get rid of Oldsmobile, you won't get a new Ford in that new building." (Tr. 145-148). He was also told, "We are selling you these Fords on condition that you are not going to sell Oldsmobiles when the new building is ready." (Tr. 149) and again, "If you don't get rid of your Oldsmobile Franchise, you won't get a Ford in that new building." (Tr. 835). One can hardly imagine a more devastating threat or intimidation of an automobile dealer than to have the manufacturer tell him that it would not give him any cars to sell unless he complied with illegal requirements contrary to the terms of the dealership franchise.

 It will be observed that we do not have here a dealership franchise cancellation case as are most of the cases arising under this Act. Instead, we have a case involving ...


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