D.W. Trowbridge Ford, Inc. v. Galyen

262 N.W.2d 442 (1978)

Purchase the Printed Copy at bsmsphd.com

Nature of the Case

To access this section all you need to do is click here and register.

Facts

On June 1, 1967, Galyen and Robertson (Ds) entered into an agreement to sell the corporate stock of the Robertson Motor Co., Inc., to P. D owned over 80 percent of the stock of the Robertson Motor Co. and Robertson (D) owned the balance. D also owned Galyen Motor Co., Inc. Both companies owned by D were franchised by the Ford Motor Company. Under the contract Galyen Motor Co., Inc., would immediately cancel its franchise with the Ford Motor Company and hold no other franchise for the sale of new automobiles in Holt County, Nebraska, for a period of 15 years. Also, Galyen Motor Co., Inc., and D had the right to continue to sell new cars for a period of not to exceed 3 years after July 1, 1967, but all new automobiles and trucks were to be purchased from P at net invoice cost plus $25 for pick-up trucks and net invoice cost plus $50 for new automobiles and trucks of F500 rating and larger. At a date not later than July 1, 1970, D and Galyen Motor Co., Inc., were to discontinue the sale and distribution of new automobiles and trucks in Holt County, Nebraska, for a period of 15 years from the date of the contract. P sued D and Galyen Motor Co., Inc alleging they had breached the contract by selling new automobiles and trucks that had not been purchased from P as required by the contract. P asked for damages and injunctive relief. Ds denied the allegations and by cross-petition alleged that P had breached the contract and Ds were entitled to damages. The trial court found P had been damaged in the amount of $14,814.12. It held that P was entitled to injunctive relief to enforce the covenant not to compete, but, because of the probability of further and extensive litigation between the parties and the difficulties of enforcing the covenant, it should be canceled and P awarded damages in the amount of $5,000 in lieu of injunctive relief. Everyone sought a new trial and both parties cross-appealed.