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Midwest Energy, Inc. v. Orion Food Systems, Inc.
Citation:
14 S.W.3d 154 (E.D. Mo. 2000)Facts
Plaintiff operated a chain of service station convenience stores in Southeast Missouri. Defendant had developed recipes and equipment for several fast food systems for which it issued franchises to local outlets. Defendant Ted Ries was the district sales manager for Defendant in the area in which Plaintiff had facilities. Plaintiff inquired about a possible franchise for products from Defendant for its new convenience store. Defendant Ries gave Laura Younghouse, Plaintiff’s president and sole stockholder, a form document that warned against taking any action until there was a written franchise agreement in place. Ries told Younghouse that the other franchisees in the area did not pose an issue to a franchise with Plaintiff and that they could move ahead with the franchise. Plaintiff changed its building plans to incorporate a larger store design provided by Defendant, although Younghouse later acknowledged that Plaintiff probably would not have built a smaller building regardless. Defendant sent Younghouse a franchise agreement, and Ries told Younghouse he would pick up the signed agreement from her. No contract was ever signed. Defendant later informed Plaintiff that it would not issue the franchise to Plaintiff. Plaintiff brought an action against Defendants based on breach of contract by Defendant in failing to grant a franchise to Plaintiff; promissory estoppel against Defendant; and fraud and deceit against Defendant’s agent for willfully misstating the extent of his authority. The trial court granted summary judgment to Defendants on all three counts. Plaintiff appealed.
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Topic Resources
Topic Outline
Formation of ContractsTopic Refresher Course
Consideration and Promissory Estoppel