Fitzsimmons v. Best, s. 75--1519 and 75--1520

• Decision Date: 22 January 1976
• Docket Number: Nos. 75--1519 and 75--1520,s. 75--1519 and 75--1520
• Citation: 528 F.2d 692
• Parties: Robert FITZSIMMONS et al., Plaintiffs-Appellees, v. Robert BEST et al., Defendants-Appellants. Robert FITZSIMMONS et al., Plaintiffs-Appellants, v. JERSEY STATE BANK and Godfrey State Bank, Defendants-Appellees.
• Court: U.S. Court of Appeals — Seventh Circuit

Page 692

528 F.2d 692

Robert FITZSIMMONS et al., Plaintiffs-Appellees, v. Robert BEST et al., Defendants-Appellants.

Robert FITZSIMMONS et al., Plaintiffs-Appellants, v. JERSEY STATE BANK and Godfrey State Bank, Defendants-Appellees.

Nos. 75--1519 and 75--1520.

United States Court of Appeals,

Seventh Circuit.

Argued Oct. 31, 1975.

Decided Jan. 22, 1976.

James K. Almeter, Alton, Ill., Robert A. Schnur, Milwaukee, Wis., Alfred B. La Barre, Springfield, Ill., for Best, Fitzsimmons.

Thomas F. Bernardi, Springfield, Ill., for Jersey State Bank.

Before STEVENS, Circuit Justice, ^* TONE, Circuit Judge, and HOFFMAN, Senior District Judge. ^**

PER CURIAM.

This case is an appeal from the order of the trial court dated April 16, 1975, ¹ granting summary judgment to Defendants Godfrey State Bank and Jersey State Bank. At issue is the possible liability of the defendant banks for prize money which was allegedly 'guaranteed' for a bowling tournament which was to have taken place in 1970.

There appears to be no dispute as to the course the tournament was to have taken. The tournament, organized by Greater St. Louis Sports Enterprises, Inc. (Sports Enterprises), was to have had three stages. First, there were to be competitions at local bowling alleys. A certain number of high scorers at these local tournaments were then to advance to sectional competitions held at various locations across the United States. The winners of these sectional tournaments, in turn, were to advance to the finals in St. Louis. Only the local tournaments were actually held. Plaintiffs in this action are the class of local tournament winners who were denied their chance to compete in the sectionals and--for some of them ²--the finals. In the advertising for the tournament and on the entry forms it stated that there were prizes guaranteed of $135,000, including a guaranteed first prize of $25,000 in each of the two divisions, men's and women's. Nothing was said as to any possibility that the tournament might not be completed.

Apparently the tournament could not have been held without the 'sanctions' of the American Bowling Congress (ABC) and the Women's International Bowling Congress (WIBC). ³ In any case, such sanctions were sought by Sports Enterprises. Although the correspondence between the associations and Sports Enterprises does not appear in the record, it is inferable from later correspondence between the Jersey State Bank, the Godfrey State Bank, the Illinois State Bank of East Alton and the American Bowling Congress that the ABC, at least, required as a condition of granting its sanction that some arrangement be made to ensure that the 'guaranteed' prize money would in fact be available for the bowlers. ⁴

Sports Enterprises appears to have entered into three arrangements with relation to this prize money. First, there was an arrangement with the Illinois State Bank of East Alton by which Sports Enterprises would place $1.00 from each $10.00 entry fee into an escrow account. It is undisputed that only a single $1.00 deposit was ever made to that account. Arrangements were also made with the Jersey State Bank and the Godfrey State Bank by which funds were, or were to be, borrowed from those banks to cover the prize money. It is the exact nature of these last two arrangements which is involved in this appeal.

In this diversity case, ⁵ Illinois law controls the substantive issues. However, the standards for deciding whether summary judgment was appropriate are a matter of federal law. Lighting Fixture & Electrical Supply Co. v. Continental Insurance Company, 420 F.2d 1211 (5th Cir. 1969). Thus, summary judgment is appropriate only if it appears that 'there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.' F.R.Civ.P. 56(c); Poller v. Columbia Broadcasting System, 368 U.S. 464, 82 S.Ct. 486, 7 L.Ed.2d 458 (1962). For the purpose of determining whether any material fact remains disputed, 'the inferences to be drawn from the underlying facts . . . must be viewed in the light most favorable to the party opposing the motion.' United States v. Diebold, Inc., 369 U.S. 654, 655, 82 S.Ct. 993, 994, 8 L.Ed.2d 176 (1962). The question, then, is whether on the facts in the record (as shown in the affidavits, exhibits, depositions and answers to interrogatories) both banks are entitled to judgment ⁶ as a matter of law. The District Court held that they were, concluding as a matter of 'the traditional rules of contract construction' that '(t)he purpose of the arrangements was that the bowlers could look to the credit of the banks rather than that of (Sports) Enterprises for prize money after the contest was completed.' Memorandum and Order of May 7, 1974, at 3--4. We disagree with the District Court's conclusion that this contract can properly be interpreted on summary judgment, without a trial.

The interpretation of an integrated written contract is treated as a matter of law, to be decided by the judge whether or not he is the trier of fact in a particular case. What we have here, however, is a contract the meaning of which must be drawn from various letters, reports of conversations, and actions by the parties, all considered in the light of the circumstances surrounding the parties' actions. The interpretation of a contract, the terms of which are disputed, is very much a matter of the intent of the parties who entered into that contract. Questions of intent are particularly inappropriate for summary judgment. Conrad v. Delta Air Lines, 494 F.2d 914, 918 (7 Cir., 1974).

According to the deposition of Mr. A. R. Major, Vice-President of the Jersey State Bank, Sports Enterprises negotiated a loan of $60,000 from them on October 27, 1970. In return for the loan, Sports Enterprises gave the Bank a $60,000 demand note which was guaranteed by the individual shareholders of the corporation. The proceeds of the loan were deposited in a checking account; no deposits in or withdrawals from that account were to be made without Mr. Major's approval. Mr. Major knew that the purpose of the funds was to provide prize money for the tournament. On the day the loan was made, Mr. Major sent a letter to the American Bowling Congress verifying that the $60,000 was on deposit to cover the payment of the prize money, and stating '(i)t is our understanding and agreement that this money cannot be released to the winners until a letter of authorization to that effect shall have been received from your organization.' ⁷ However, on December 4, 1970, without obtaining Mr. Major's approval, an unnamed note teller allowed Sports Enterprises to withdraw the funds from the account. The money was then used to pay off the note. On December 9, Mr. Baker, of the ABC, wrote to the Bank to 'confirm the understanding and agreement that the moneys you hold with respect to prizes for the Second Annual Handicap Bowling Tournament are not to be released until a letter of authorization has been received from our organization.' In response, Mr. Major wrote to the ABC 'to advise your office that this money will be available when the tournament finals are held.' The letter also stated that the bank had 'agreed with Greater St. Louis Sports Enterprises to make arrangements for the money to cover the prizes.' According to the deposition, at some time after December 4 Mr. Major also had a telephone conversation with Mr. Baker in which Mr. Major explained that the money had been withdrawn from the account to stop the interest on the note, and that it was to be renegotiated at a later date.

Greater St. Louis Sports Enterprises, Inc. has made arrangements with the Godfrey State...