Central Distributors, Inc. v. MET, INC., 24310.
| Decision Date | 27 November 1968 |
| Docket Number | No. 24310.,24310. |
| Citation | 403 F.2d 943 |
| Parties | CENTRAL DISTRIBUTORS, INC., Appellant, v. M. E. T., INC., and Joseph Nellis, Appellees. |
| Court | U.S. Court of Appeals — Fifth Circuit |
Carl K. Hoffman, Miami, Fla., for appellant.
Joseph Nellis, pro se.
Before JOHN R. BROWN, Chief Judge, and COLEMAN and SIMPSON, Circuit Judges.
We review on appeal and reverse an order of the district court dismissing with prejudice a complaint filed by the appellant, Central Distributors, Inc., (Central hereinafter). The suit was brought under the district court's diversity jurisdiction. The complaint was based upon a license agreement between Central and the appellee (MET hereinafter), whereby Central agreed to lease space and establish a hardware store in a Hialeah, Florida, shopping center developed by MET. The agreement provided that the initial lease would extend from November 15, 1963, through November 30, 1966, with Central reserving the option to terminate the agreement at the end of the first year's operation if the store's gross retail sales amounted to less than $350,000. It also provided that MET would purchase, at Central's option, the store's fixtures and stock-in-trade should Central elect to terminate on this basis. The appellee Joseph Nellis executed a guaranty insuring MET's performance with respect to the purchases.
The store's total gross retail sales for the first year's operation amounted to less than $350,000 and Central elected to terminate the agreement and to sell the stock-in-trade to MET. On December 10, 1964, Central gave written notice of its plans to MET and Joseph Nellis. Both MET and Nellis ignored the notice, and Central thereafter filed this action for damages in the district court. The complaint alleged that MET had refused to make the promised purchases and that Joseph Nellis had ignored the demands made upon him as MET's guarantor.
Our attention is focused on paragraphs 23 and 42 of the license agreement, as these paragraphs set forth the conditions and procedures relevant to the disposition of the stock-in-trade and fixtures. Paragraph 42 requires Central to give MET thirty days notice in writing if the license agreement is to be terminated on the basis that the first year's sales amounted to less than $350,000. Incorporated within this paragraph are the terms of paragraph 40 which direct Central and MET to mutually inspect and inventory the stock-in-trade prior to MET's purchasing it at a price to be based upon and determined from this inventory. Paragraph 23 obligates MET to purchase the display cases and other fixtures used in the operation of the store, paying an amount equal to Central's investment in the fixtures, less the amount of any reserve claimed thereon for depreciation and amortization purposes.
Prior to trial the attorneys for the respective parties were ordered to appear for a pre-trial conference. They were also directed to meet prior to the scheduled pre-trial conference to examine all exhibits and documents proposed to be used (for other than impeachment purposes) at trial. A pre-trial stipulation was filed with the court, was approved and incorporated into a pre-trial order. On May 24, 1966, the case was heard by the district judge sitting without a jury.
During the course of the trial Central's attorney offered into evidence certain invoices and inventory lists that had not been exhibited at pre-trial nor listed as exhibits in the pre-trial stipulation. The invoices represented charges for the fixtures installed by Central. The court sustained MET's objection to the introduction of these invoices on the basis that the invoices had not been included in the pre-trial stipulation and thus could not be introduced as evidence. Central's general manager testified that the value of the fixtures was approximately $20,000 but this testimony was excluded on the basis that this valuation was founded on records neither in evidence nor listed on the pre-trial stipulation, rather than on the witness' own recollection. Central's attorney then informed the court that he had the...
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