Ford Motor Co. v. Office of Com'r of Transp., MAR-REN

• Decision Date: 23 April 1987
• Docket Number: MAR-REN
• Citation: 139 Wis.2d 855,407 N.W.2d 566
• Parties: NOTICE: UNPUBLISHED OPINION. RULE 809.23(3), RULES OF CIVIL PROCEDURE, PROVIDE THAT UNPUBLISHED OPINIONS ARE OF NO PRECEDENTIAL VALUE AND MAY NOT BE CITED EXCEPT IN LIMITED INSTANCES. FORD MOTOR COMPANY, a Delaware corporation, Petitioner-Respondent, v. THE OFFICE OF THE COMMISSIONER OF TRANSPORTATION, STATE OF WISCONSIN, Respondent (in Trial court),LTD., Intervenor-Appellant. 85-1999.
• Court: Wisconsin Court of Appeals

Page 566

407 N.W.2d 566

139 Wis.2d 855

NOTICE: UNPUBLISHED OPINION. RULE 809.23(3), RULES OF CIVIL PROCEDURE, PROVIDE THAT UNPUBLISHED OPINIONS ARE OF NO PRECEDENTIAL VALUE AND MAY NOT BE CITED EXCEPT IN LIMITED INSTANCES.

FORD MOTOR COMPANY, a Delaware corporation, Petitioner-Respondent, v. THE OFFICE OF THE COMMISSIONER OF TRANSPORTATION, STATE OF WISCONSIN, Respondent (in Trial court) MAR-REN LTD., Intervenor-Appellant.

85-1999.

Court of Appeals of Wisconsin.

April 23, 1987.

Circuit Court, Dane County

Appeal dismissed

Appeal from an order of the circuit court for Dane county: Richard W. Bardwell, Judge.

Before DYKMAN, J., EICH, J. and SUNDBY, J.

DYKMAN, Judge.

Mar-Ren, Ltd. an automobile dealership, appeals from an order reversing an order of the Office of the Commissioner of Transportation directing Ford Motor Company to rescind its notice terminating Mar-Ren's Ford dealership. Ford has moved to dismiss Mar-Ren's appeal as moot because Mar-Ren has ceased operations and would not benefit from the injunctive relief granted by the Commissioner. Because the appeal is moot, we grant Ford's motion.

In May, 1983, Ford notified Mar-Ren that it would terminate its Ford dealership agreements. Mar-Ren complained to the Commissioner under sec. 218.01(2)(bd)(2), Stats., alleging that Ford's termination was unfair and without provocation. ¹ In February, 1985, Mar-Ren filed a Chapter 11 petition in bankruptcy. In March, 1985, the Commissioner ruled that Ford's termination of the dealer agreements had violated sec. 218.01(3)(a)(17) ² and directed Ford to rescind its termination notice. The circuit court reversed the Commissioner's order and remanded for further proceedings in September, 1985. Mar-Ren appealed from the circuit court's order. In March, 1986, the bankruptcy court granted Ford's application to convert Mar-Ren's Chapter 11 bankruptcy to a Chapter 7 liquidation.

In September, 1986, the Bankruptcy court ordered Valley Bank Menomonie, a secured creditor of Mar-Ren, to litigate all of Mar-Ren's claims against Ford and turn over the proceeds from the tort claims to the trustee in bankruptcy, less litigation costs. The bank was permitted to retain any proceeds of Mar-Ren's breach of contract claim. ³

In October, 1986, Ford moved to dismiss this appeal as moot because Mar-Ren was no longer an operating dealership and had been ordered liquidated in bankruptcy. Ford contends that rescinding its termination notice would have no practical legal effect because Mar-Ren was no longer doing business.

'An issue is moot when a determination is sought which can have no practical effect on a controversy.' St. ex rel. Jones v. Gerhardstein, 135 Wis.2d 161, 169, 400 N.W.2d 1, 4 (Ct.App. 1986). A dismissal for mootness prevents an unnecessary expenditure of time by the court and the parties. Wis. Environmental Decade v. Public Service Comm., 79 Wis.2d 161, 171, 255 N.W.2d 917, 924 (1977). An action seeking injunctive relief may become moot. In Racine v. J-T Enterprises of America, Inc., 64 Wis.2d 691, 700-01, 221 N.W.2d 869, 874-75 (1974), the City of Racine sought to enjoin defendant's alleged illegal use of its building. The supreme court dismissed the appeal as moot because the building's use had changed and the defendant no longer occupied the building. Therefore, requiring the issuance of an injunction would have had no practical effect upon an existing controversy.

Here, the Commissioner's order directed Ford to rescind its termination notice. Mar-Ren has been ordered liquidated under Chapter 7 of the Bankruptcy Code. A successful appeal by Mar-Ren of the Commissioner's order would have no practical legal effect because Mar-Ren would be incapable of resuming its Ford dealership were the order reinstated.

Mar-Ren argues that its appeal should not be dismissed because Valley Bank is litigating its claims against Ford pursuant to a bankruptcy court order. Only Mar-Ren and Ford are before us on this appeal. Valley Bank could have petitioned to intervene in this appeal as provided for in Rule 809.13, Stats., which states:

A person not a party to an appeal may file in the court a petition to intervene in the appeal. A party may file a response to the petition within seven (7) days after service of the petition. The court may grant the petition upon a showing that the petitioner's interest meets the requirements of s. 803.09(1) or (2).

Because Valley Bank did not intervene, it is not a party to this appeal. Mar-R en's claims against Ford became property of the estate in bankruptcy. 11 U.S.C. sec. 541(a)(1) (1982). The bankruptcy court ordered the trustee to abandon t hese claims to Valley Bank. 11 U.S.C. sec. 554(b) (Supp. III 1985). Because th e bank will pursue Mar-Ren's claims and turn over the proceeds from any tort cl aim to the trustee in bankruptcy, the matter is moot as to Mar-Ren. ⁴

Mar-Ren contends that declaring its appeal moot would deny its cause of action for attorney's fees under sec. 218.01(2)(bd)(2), Stats. It asserts that if we grant Ford's motion, it will not be finally determined whether Ford unreasonably terminated Mar-Ren's dealership. We disagree. Mar-Ren's damages may be pursued in the federal court action Mar-Ren filed in May, 1985, alleging that Ford violated provisions of ch. 218. ⁵ Any claim for damages or attorney's fees is now owned by either Mar-Ren's trustee in bankruptcy, 11 U.S.C. sec. 541(a)(1) (1982), or Valley Bank. 11 U.S.C. sec. 554(b) (Supp. III 1985). Mar-Ren appeals from the trial court's reversal of the Commissioner's order which granted injunctive relief. Mar-Ren and Ford agree that the Commissioner cannot award expenses and attorney's fees. Therefore, the injunctive relief ordered by the Commissioner has no practical legal effect where Mar-Ren is incapable of resuming its dealership. If the federal court action is successful, Ford will not have avoided a determination that it unreasonably terminated Mar-Ren's dealership. ⁶

We may review a moot case if the issues are of great public importance, if a statute's constitutionality is challenged or if the situation arises so frequently that a decision will aid trial courts. Racine Ed. Ass'n v. Racine Bd. of Ed., 129 Wis.2d 319, 324, 385 N.W.2d 510, 511 (Ct.App. 1986). None of these exceptions apply here.

No action taken by this court could have any practical legal effect upon this controversy. We therefore conclude that Mar-Ren's appeal is moot and the appeal should be dismissed.

By the Court.--Appeal dismissed.

Inclusion in the official reports is not recommended.

SUNDBY, Judge (dissenting).

The commissioner of transportation found that Ford had been 'arbitrary and vengeful' in its refusal to approve Mar-Ren's relocation to a suitable facility. The commissioner found that Ford refused to give Mar-Ren any advice as to facility planning. The commissioner found that Mar-Ren's 'anemic financial condition is at least arguably due, in part, to Ford's harassment of the dealership.' Upon Ford's motion, Mar-Ren's chapter 11 bankruptcy was converted into a chapter 7 liquidation. We reward Ford by granting its motion to dismiss Mar-Ren's appeal because Mar-Ren has gone out of business. Our supreme Court has observed that law and justice are not necessarily synonymous. Bielski v. Schulze, 16 Wis.2d 1, 10, 114 N.W.2d 105, 109 (1962). Because I believe that in this case both law and justice require us to deny Ford's motion, I dissent.

I. PUBLIC POLICY

(a) Publici Juris Exception Applies.

What the majority overlooks is that a proceeding by a dealer against a manufacturer under sec. 218.01(2)(bd)2, Stats., involves more than the private interest of the particular dealer in regaining its dealership. The public interest is affected. 'The state has thus [in the provisions of sec. 218.01] made it crystal clear that the unfair cancellation of a dealer's franchise without provocation and without considering the dealer's equities is against the public policy of this state.' Kuhl Motor Co. v. Ford Motor Co., 270 Wis. 488, 498, 71 N.W.2d 420, 425 (1955). ¹

The Kuhl court also stated:

It would seem reasonably clear that one of the chief objectives of the legislature in enacting sec. 218.01, Stats., in so far as it seeks to regulate the dealings between automobile manufacturers and dealers, is to promote fair dealing, which, of course, is a legitimate exercise of police power.

. . . .

A convincing argument in favor of a legislature exercising the state's police power to protect automobile dealers against unfair dealing on the part of automobiles manufacturers is provided in the following statement by Mr. Justice Black in his dissenting opinion in Ford Motor Co. v. United States (1948), 335 U.S. 303, 232, 69 Sup. Ct. 93, 93 L.Ed. 24:

'At the time the decrees were entered, Ford made and sold about 25 per cent of all cars in the United States, Chrysler 25 per cent and General Motors 44 per cent. Ford and the others sell to dealers about four billion dollars' worth of cars yearly, requiring cash on delivery. The dealers then sell to retail customers. About 60 per cent of the retail sales are on credit. Dealers not permitted to sell other makes of cars are wholly dependent upon Ford's, G.M.'s, or Chrysler's favorable treatment for their business lives. The dealer agencies are for one year, but the agency contracts can be canceled on short notice and without cause. The dealers are thus economic dependents of the company whose cars they sell.' [Emphasis added.]

Id. at 502, 503-503a, 71 N.W.2d at 427, 428.

Proof of the truth of Justice Black's statement is in the pudding of this case--the commissioner concluded that 'Mar-Ren's anemic financial condition is at least arguably due, in part, to Ford's harassment of the dealership.' It was pursuant to Ford's motion that Mar-Ren's ch. 11 bankruptcy was converted into a ch. 7 liquidation. It is contrary to public policy to permit Ford to avoid accountability under sec. 218.01(2)(bd)2, Stats., when, at...