Sunday, November 24, 2013

Pav-Saver Corporation v. Vasso Corporation case brief

Pav-Saver Corporation v. Vasso Corporation case brief summary
493 N.E.2d 423 (1986)


CASE SYNOPSIS
Plaintiff corporation filed an action against defendant attorney for dissolution of a partnership agreement and return of its patents and trademark. The attorney counterclaimed for wrongful termination. The corporation and the attorney sought review of the order of the Circuit Court of Rock Island County (Illinois), which awarded the corporation its interest in the partnership and awarded the attorney liquidated damages for wrongful termination.

CASE FACTS
Corporation was the owner of a trademark and patents for the design and marketing of concrete paving machines. The corporation formed a partnership with an attorney for the manufacture and sale of the machines. The corporation sought to terminate the partnership and filed an action for a court-ordered dissolution, return of its patents and trademark, and an accounting.

DISCUSSION and HOLDING

  • The court held: 
  • 1) that the partnership agreement contemplated a permanent partnership, terminable only upon mutual approval; 
  • 2) that the corporation's unilateral termination violated the agreement; 
  • 3) upon the corporation's notice terminating the partnership, the attorney was entitled to continue the business pursuant to Ill. Rev. Stat. ch. 106 1/2, para. 38(2)(b); 
  • 4) that the trial court did not err in refusing to return the patents and trademark to the corporation or assigning a good-will value; 
  • 5) that the amount of the liquidated damages was not unreasonable and was a legitimate matter bargained for between the parties; and 
  • 6) that the liquidated damages payout formula was enforceable and the doctrine of equitable setoff did not apply.

CONCLUSION
The court affirmed the judgment of the trial court, which awarded the corporation its interest in the partnership and awarded the attorney liquidated damages.

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