Contracts Keyed to Fuller
Johnson v. Coss
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On January 7, 2000, George Johnson (Plaintiff) entered into an Asset Purchase Agreement (Agreement) with Lawrence Coss (Defendant), by which Plaintiff agreed to sell Defendant his Ford Motor Company (Ford) auto dealership. The Agreement included an express condition, which provided that the Agreement would be nullified if Defendant was unable to secure the consent and approval of Ford. Before granting consent and approval, Ford required Defendant to find an on-site manager that Ford considered capable of operating a dealership. The manager was to own a substantial interest in the dealership. Defendant found Mark Goodrich, who would serve as manager of the dealership with a 50 percent ownership interest. Defendant and Goodrich were to jointly capitalize the dealership with $1 million. However, Ford advised Defendant that it would not approve the plan unless there was a majority owner and the dealership was capitalized with $1.476 million. Defendant revised the arrangement to give himself a 50.1 percent ownership of the dealership. Defendant was ultimately unable to meet all the requirements set forth by Ford, and Defendant’s attorney for the transaction averred that conversations between Ford and Defendant made clear that Ford would not approve the sale of the dealership to Defendant. Defendant informed Plaintiff that because he could not secure Ford’s approval, the Agreement was null and void. Plaintiff sued Defendant for breach of contract and breach of the covenant of good faith and fair dealing. The circuit court found that Defendant was responsible for preventing Ford from granting approval and granted Plaintiff summary judgment.
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