Glass v. Kemper Corp., 95 C 3178.
| Decision Date | 16 January 1997 |
| Docket Number | No. 95 C 3178.,95 C 3178. |
| Citation | 949 F.Supp. 1341 |
| Parties | Gregory GLASS, Plaintiff, v. KEMPER CORPORATION, The Prime Group, Inc., Prime International, Inc., Steven Timbers, John Neal, Michael Oberst, Defendants. |
| Court | U.S. District Court — Northern District of Illinois |
Alan Jay Mandel, Chicago, IL, for Gregory Glass.
Bennett L. Epstein, John Friedrich Zabriskie, Diane E. Gianos, Hopkins & Sutter, P.C., Chicago, IL, for Kemper Corp., Steven Timbers and John Neal.
Robert N. Hermes, Butler, Rubin, Saltarelli & Boyd, Chicago, IL, for Prime Group, Inc. and Prime Intern., Inc.
Before the court are three motions for summary judgment by defendants in this case: one by defendant Michael Oberst ("Oberst"); one by defendant Kemper Corporation ("Kemper"); and one by defendants Prime Group, Inc. ("Prime Group"), and Prime International, Inc. ("PII") (collectively "Prime defendants"), who also adopt Kemper's motion. For the reasons that follow, the court strikes Oberst's motion as moot and grants the remaining defendants' motions.
In November 1992, plaintiff Gregory Glass ("Glass") began working for Kepro, S.A. ("Kepro"), and defendant Prime Group in Barcelona, Spain, on the development of a shopping mall to be known as Diagonal Mar. At that time, defendant PII, an affiliate of Prime Group, owned 85 percent of the stock of a holding company that owned 100 percent of Kepro. Defendant Kemper had an option to purchase controlling shares in the holding company. Kemper also provided funding for the Diagonal Mar project.
In May 1994, Kemper entered into agreements with Prime Group and PII by which Kemper took primary control of the Diagonal Mar project. Defendant Michael Oberst, a vice president of Kemper, became managing director of Kepro and assumed responsibility for managing the overall development of Diagonal Mar.
Also in May 1994, Oberst began negotiations with Glass and four other Kepro/Prime Group expatriate employees for new employment agreements. In various memos between Glass and Oberst, Oberst wrote that any new employment terms would have to be approved by Kemper and the Kepro board of directors. In September 1994, it appeared that Oberst and the expatriates had reached agreement on the expatriates' revised employment terms. However, the terms were never approved by the Kepro board. The employment negotiations continued, but on October 20, 1994, Oberst fired Glass.
Glass filed a lawsuit in this court,2 alleging various counts against various defendants. In its prior opinions, see Glass v. Kemper, 920 F.Supp. 928 (N.D.Ill.1996); Glass v. Kemper, 930 F.Supp. 332 (N.D.Ill.1996), the court dismissed the individual defendants and dismissed Count VI against all defendants. In addition, Glass has waived his claim in Count V for unjust enrichment. (See Final Pretrial Order at 17.) Therefore, only Counts I (promissory fraud), II (breach of contract), III (promissory estoppel), and IV (equitable estoppel) remain pending against Prime Group, PII, and Kemper.
Oberst, Kemper, and the Prime defendants move for summary judgment against Glass, but for different reasons. Therefore, the court will address each motion separately.
A motion for summary judgment must be granted if "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show 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." FED. R. CIV. P. 56(c). The burden is on the moving party to show that no genuine issues of material fact exist. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 256, 106 S.Ct. 2505, 2514, 91 L.Ed.2d 202 (1986); Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 2553, 91 L.Ed.2d 265 (1986).
Once the moving party presents a prima facie showing that he is entitled to judgment as a matter of law, the party opposing the motion may not rest upon the mere allegations or denials in its pleadings but must set forth specific facts showing that a genuine issue for trial exists. Anderson, 477 U.S. at 256-57, 106 S.Ct. at 2514; Celotex, 477 U.S. at 324, 106 S.Ct. at 2553; Schroeder v. Lufthansa German Airlines, 875 F.2d 613, 620 (7th Cir.1989). All reasonable factual inferences must be viewed in favor of the nonmoving party. Holland v. Jefferson Nat'l Life Ins. Co., 883 F.2d 1307, 1312 (7th Cir. 1989).
On June 25, 1996, a week after Oberst filed his motion for summary judgment, the court granted Oberst's earlier filed motion to dismiss for lack of personal jurisdiction and dismissed Oberst as a party defendant. Since Oberst is no longer a party in this case, his motion for summary judgment is moot, and therefore is stricken.
Prime Group and PII argue that Glass's complaint seeks to hold them liable for Kemper's alleged promises of a new employment agreement on principles of agency and joint venture liability. They contend that they are entitled to summary judgment for two reasons: Glass has admitted that he does not believe that Prime and PII are responsible for unsatisfied obligations of the purported agreement between Glass and Kemper; and the record does not sustain a theory of agency or joint venture liability as a matter of law.
Prime and PII first argue that in his deposition testimony, Glass has acknowledged that no obligation in the employment contract between Glass and Prime Group remains unsatisfied, and that neither Prime nor PII is responsible for any unsatisfied obligation of the new agreement that Glass believes he had with Kemper. The Prime defendants' argument ignores the fact that Glass cannot testify as to legal conclusions, such as the relationship between the Prime defendants and Kemper.
In his deposition, Glass himself stated that he did not know how the Glass/Prime agreement related to the Glass/Kemper agreement, but simply that he believed he had an agreement with Kemper. (App. to the Prime Defs.' Mot. for Summ. J. Ex. 1 at 206.) He also stated that he was not privy to any or all of the agreements that Kemper may have had with Prime Group or PII that may have affected the agreement he believes he had with Kemper. (Id. at 207.) In Glass's deposition, counsel for the Prime defendants asked Glass to give legal conclusions that he was neither qualified nor entitled to give. These inappropriate conclusions can serve neither to support nor defeat the Prime defendants' motion for summary judgment. Rather, the key to the motion is the legal relationship between the Prime defendants and Kemper.
The Prime defendants next argue that Glass has not established a joint venture relationship between them and Kemper, and therefore that they cannot be held liable for any acts of Kemper.
A joint venture is
an association of two or more persons [or entities] to carry out a single enterprise for profit. A formal agreement is not essential to establish a joint venture. Rather, the existence of a joint venture may be inferred from the facts and circumstances demonstrating that the parties in fact entered into a joint venture. In determining whether a joint venture exists, the intent of the parties is the most significant element.
O'Brien v. Cacciatore, 227 Ill.App.3d 836, 843, 169 Ill.Dec. 506, 510, 591 N.E.2d 1384, 1388-89 (1st Dist.1992) (citations omitted).
The following elements must be present for a joint venture to exist: (1) an agreement to carry on a single enterprise with a legitimate purpose; (2) a community of interest in the purpose; (3) expectation of profits; (4) duty to share profits and losses; and (5) the right of each person to direct and govern the conduct of the other members of the venture. See Pinkowski v. Coglay, 347 F.2d 411, 413 (7th Cir.1965), cert. denied, 386 U.S. 1036, 87 S.Ct. 1473, 18 L.Ed.2d 599 (1967); O'Brien, 227 Ill.App.3d at 843, 169 Ill.Dec. at 511, 591 N.E.2d at 1389; Baker v. Walker, 173 Ill.App.3d 836, 839, 123 Ill.Dec. 621, 623, 528 N.E.2d 5, 7 (1st Dist.1988) (citations omitted). The burden of proving that a joint venture exists is on the party claiming that such a relationship exists, and whether or not a joint venture exists typically is a question of fact for the trier of fact. O'Brien, 227 Ill.App.3d at 843, 169 Ill.Dec. at 511, 591 N.E.2d at 1389 (citations omitted).
If a joint venture exists, the rights and liabilities of its members are governed by the principles of partnerships. Smith v. Metropolitan Sanitary Dist. of Greater Chicago, 77 Ill.2d 313, 318, 33 Ill.Dec. 135, 138, 396 N.E.2d 524, 527 (1979). Thus, every member of the joint venture is considered an agent of the joint venture for purpose of carrying on its usual course of business, id., and "can be held liable to a third party for the acts of the other joint venturers done in the course of the enterprise." Fentress v. Triple Mining, Inc., 261 Ill.App.3d 930, 940, 200 Ill.Dec. 1, 7, 635 N.E.2d 102, 108 (4th Dist.1994) (citing Tassan v. United Devel. Co., 88 Ill.App.3d 581, 588, 43 Ill.Dec. 769, 775, 410 N.E.2d 902, 908 (1st Dist.1980)).
The Prime defendants contend that with respect to Diagonal Mar, no evidence exists to suggest an agreement between the Prime defendants and Kemper to share profits and losses. They also argue that after May 1994, Kemper took control of Diagonal Mar, and Prime Group essentially was not involved in the project and had no control over Kemper with respect to Diagonal Mar. Therefore, they argue, two critical elements of a joint venture are missing.
Glass counters that Kemper and Prime Group called themselves joint venturers in business agreements; carried on Diagonal Mar as a single...
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