Kania v. Airborne Freight Corp.

Decision Date06 January 1981
Docket NumberNo. 79-1022,79-1022
Citation99 Wis.2d 746,300 N.W.2d 63
PartiesGlenn KANIA, d/b/a Glenn's Air Freight, Plaintiff-Appellant-Petitioner, v. AIRBORNE FREIGHT CORPORATION, Defendant-Respondent.
CourtWisconsin Supreme Court

Timothy J. Aiken (argued), Mark A. Swartz and Samster, Aiken, Peckerman & Swartz, S. C., Milwaukee, on brief, for plaintiff-appellant-petitioner.

John R. Dawson, Michael A. Bowen (argued), and Foley & Lardner, Milwaukee, on brief, for defendant-respondent.

COFFEY, Justice.

This is a review of an appellate court decision affirming a summary judgment and orders entered in the Milwaukee County Circuit Court, the Hon. William A. Jennaro, presiding, against Glenn A. Kania, d/b/a Glenn's Air Freight (plaintiff-petitioner). The circuit court denied Kania's motion for a temporary injunction and dismissed his request for a permanent injunction, both asserting that Airborne sought to terminate an alleged dealership contract in violation of the Wisconsin Fair Dealership Law (WFDL), ch. 135, Stats.

The plaintiff in his request for a permanent injunction alleged that on March 19, 1979, the defendant gave a thirty-day written notice of termination of a written contract without reciting good cause in violation of sec. 135.03, Stats., 1 and failing to comply with the 90-day notice requirement and 60-day deficiency rectification provision in sec. 135.04, Stats. 2 In its answer, the defendant admitted the execution of a written contract, but denied that the contract created a dealership arrangement and alleged that the notice of termination was in compliance with the contract. An evidentiary hearing was conducted in support of the plaintiff's temporary injunction motion with Michael Locke testifying as Milwaukee district manager for Airborne and Kania testifying on his own behalf with supporting affidavits that established the following:

I. Airborne is an air freight forwarder engaged in the business of rapid air transport of shipments between distant cities. In order to meet the competition of other air freight forwarders, Airborne arranged with Kania for the pick up and delivery of their customer's packages at the airport, their homes or businesses and transfer them to or from a nearby airport.

II. The plaintiff is engaged in the business of "over-the-road" transportation of freight in the metropolitan Milwaukee area.

III. In July of 1975, Airborne's Milwaukee representative and Kania entered into an agreement with the plaintiff being given the right of first refusal with regard to Airborne's delivery service needs in the metro Milwaukee area and with the further right to deliver freight privately for anyone not in competition with Airborne. 3 However, it was expressly agreed that this right (first refusal) did not import a grant of an exclusive territory to Kania. 4 Additionally it was stated that since "Airborne has developed customer good will through advertising and good reputation which will benefit the Contractor (Kania)", Kania would be granted the right to use this good will and advertising, if he so elected, in the conduct of his business provided he disclosed that he was acting as an independent agent transporting cartage for himself and for Airborne.

"2. Contractor, if it so elects, shall have the right to use the Airborne name and logotype on Contractor's vehicle(s). Contractor, if it so elects, may use Airborne's goodwill and name in Contractor's business, including advertising materials and sales aids, and Airborne agrees to furnish and allow use of said advertising materials and sales aids at no cost to Contractor. If Contractor elects to use Airborne's name or logotype in connection with its business, Contractor shall in each instance of the use of said name or logotype disclose that it is acting as an independent cartage agent for Airborne."

IV. The agreement also specifically provided that Kania was not an employee 5 but an independent contractor (non-agent), 6 and the agreement did not purport to create a "franchise" or "dealership." Further, the contract provided that either party could cancel the contract with 30 days' written notice to the other party and without cause. 7

V. Following the execution of the contract, the plaintiff, at Airborne's request, elected to use Airborne's trade name on his vehicles. Accordingly, Kania's trucks were painted with Airborne's logotype and corporate colors. The cost of painting the plaintiff's vehicles was shared by the defendant and Kania, but the costs of inscribing the logo on the trucks was assumed exclusively by Airborne. Mr. Locke testified that Airborne's purpose in having its name on Kania's trucks was to advertise and promote business. Although Kania's vehicles bore Airborne's name, they as well advertised and were known as Glenn's Cartage Service/Glenn's Air Freight (GCS/GAF) with his name and address (Kania's) appearing on the cab door of each truck.

VI. Kania serviced his own customers as well as fulfilling substantially all of Airborne's metropolitan Milwaukee service needs. The plaintiff would bill Airborne for its services and Airborne would in turn send a separate statement to its customers. Airborne's delivery charge to its customers was based on the national tariff rate and was independent and separate from the amount Airborne paid Kania under the terms of their contract. Kania was neither allowed to bill nor receive direct payment for the delivery service provided except when collecting monies for C.O.D. shipments. 8 Further, Kania did not share in Airborne's net business profits or losses. The plaintiff was paid at a set rate for deliveries within a prescribed area. Kania received weekly reimbursement from Airborne for the delivery services performed regardless of whether or not Airborne had received payment from its customers. 9

VII. While handling the defendant's local delivery service, Kania's employees wore Airborne uniforms and would often deliver Airborne's various business forms and promotional materials to the defendant's customers for their use in obtaining Airborne's services if they so desired. Additionally, Kania offered testimony that he instructed his employees to look for commercial enterprises that would be interested in Airborne's services and they, on occasion, informed the defendant's sales people of potential customers, but he failed to offer any proof that Airborne's business was increased as a result of this activity.

VIII. In the years following the execution of the agreement, the gross receipts from Kania's cartage service for Airborne and others increased from $79,000 in 1975 to $330,000 therefrom in 1978. Kania estimated that his gross receipts for his 1979 fiscal year, including his own independent cartage service, would be approximately $450,000. This growth in the plaintiff's business was attributable to Airborne as 80 to 85% of his gross receipts in 1978 and 1979 were derived from services performed for the defendant, pursuant to the agreement.

At the conclusion of the evidentiary hearing, the trial court ruled from the bench that the cartage agreement did not create a "dealership" within the purview of ch. 135, Stats., as a matter of law, for it failed to fulfill the requirement of a community of interest, and denied Kania's motion for injunctive relief under sec. 135.06, Stats. The defendant thereupon moved for an order dismissing the plaintiff's complaint and the court granted the motion reaffirming its prior ruling that the cartage agreement failed to create a community of interest relationship within the definition of a dealership. Written orders consistent with the court's oral rulings and a judgment dismissing the plaintiff's complaint were entered. The plaintiff appealed from the judgment and orders, and the court of appeals affirmed the trial court.

Issues

1. Did the trial court abuse its discretion in denying the plaintiff's motion for a temporary injunction under sec. 135.06, Stats.?

2. Did the trial court err in dismissing the plaintiff's complaint and granting judgment as a matter of law in favor of the defendant?

I. Abuse of Discretion.

Kania contends that the circuit court's failure to grant him a temporary injunction under sec. 135.06, Stats., was an abuse of discretion. He, in essence, argues that although the trial court determined ch. 135, Stats., and the relief afforded thereunder was not available to him, the court, nevertheless, should have considered whether the facts presented a proper case for the granting of a temporary injunction. The plaintiff further contends that the failure of the court to address the question of whether or not to grant a temporary injunction pursuant to sec. 135.06, Stats., was an abuse of discretion stating that "... the trial court abused its discretion by failing to exercise its discretion when it determined that ch. 135 did not apply." 10

We conclude that the plaintiff's argument is without merit because the trial court's denial of the temporary injunction was not premised upon a discretionary act, but rather, the court ruled it was a question of law relating to the construction and application of the dealership definition recited in ch. 135, Stats.

The language contained in sec. 135.06, Stats., clearly demonstrates that the injunctive relief afforded thereunder is available to "dealers" only, for it reads:

"If any grantor violates this chapter, a dealer may bring an action against such grantor ... and the dealer also may be granted injunctive relief...." (emphasis supplied). Sec. 135.06, Stats.

Black's Law Dictionary defines a dealer as:

"In the popular sense, one who buys to sell; not one who buys to keep, or makes to sell.... (359, 5th ed. 1979) The term includes one who carried on the business of selling goods, wares, and merchandise, manufactured by him ..." Id. at 521 (3rd ed. 1933).

The Wisconsin Statutes define a dealer as:

"... a person who is the grantee 11 of a...

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