delivered the opinion of the Court.
This appeal from judgments in the Circuit Court for Baltimore County (Raine, C.J. presiding with a jury) involves claims under the Maryland Antitrust Act and for breach of contract. Cavalier Mobile Homes, Inc. ("Cavalier”),
1
a retail seller of mobile homes, charged Liberty Homes, Inc. ("Liberty”), a manufacturer of mobile homes, with participating in a conspiracy, the effect of which was to tie the leasing of mobile home parking spaces to the purchase of mobile homes sold by an alleged co-conspiring retail
I. The Antitrust Claim
Appellant raises five issues on appeal. For reasons which will become apparent, we need only decide one of these questions, namely:
3. Did the circuit court err in ruling that there was no evidence from which the jury could infer that Liberty had knowledge of the contracts, combinations and conspiracies between the mobile home park and the mobile home dealer and that Liberty took actions in furtherance of those contracts, combinations and conspiracies?
Inasmuch as our decision on this issue renders moot the remaining issues, we need not and therefore do not reach them. 2
The mobile homes in which the parties to this action deal, are factory built residences designed to be towed by truck to a lot and set up on large cinder blocks. If the homeowner wishes to move thereafter, he may take his mobile home with him by removing the cinder blocks and attaching the mobile home to a truck. The home may then be towed on its own wheels to a new location.
The record indicates that because of zoning restrictions, consumers in the Baltimore metropolitan area may place their mobile homes only in specially zoned mobile home parks. Additionally, since it has been very difficult to obtain zoning to establish mobile home parks, there is a shortage of available parking spaces. This limitation directly affects the quantity of sales made by retail mobile home dealers since without a properly zoned space to park the mobile home, there generally is no possibility of a sale.
From 1973 through 1976 Liberty entered into annual agreements authorizing Cavalier to sell Liberty homes. The agreement provided that the authorization could be terminated for any reason by either party following 30 days notice. Cavalier asserts that although it was not contained in the written agreement, Liberty granted Cavalier the Baltimore metropolitan area as an "exclusive territory”.
In September of 1976, Liberty gave Cavalier notice that it was terminating Cavalier as a Liberty dealer. During the
The appellant argued that Liberty terminated it as an authorized dealer in order to further a conspiracy to restrain trade in violation of the Maryland antitrust laws. The primary participants in the alleged conspiracy were Chesapeake and the owners of Harford Mobile Village ("Harford”). Harford was a highly desirable mobile home park which first opened in the early 1970’s and continued developing in sections through 1977. Harford leased several acres of land in front of the park to Chesapeake for use as a mobile home sales lot. They also entered into agreements wherein a fee plus monthly "rent” was paid by Chesapeake to Harford to reserve vacant lots in the park for Chesapeake’s customers. The same deal was offered to other mobile home dealers, several of whom paid to reserve spaces for their customers. In 1975, Harford offered Cavalier 20 lots at the then standard rate, but Cavalier refused to pay the reservation fee. Throughout this period, the record indicates that although Chesapeake had the lion’s share of placements within Harford, Cavalier managed to place 47 homes in the park without paying to reserve those spaces, and that a host of other dealers, some of whom paid the reservation fee, also placed homes in not insubstantial numbers.
Cavalier attributes its termination as a Liberty dealer to the realization by Liberty that Chesapeake had valuable unlawful access to Harford which Cavalier maintained was facilitated by an illegal conspiracy. Appellant argued that evidence of meetings in 1976 betwen Chesapeake and Liberty’s sales representative indicate that Liberty joined the conspiracy and withdrew from its dealership agreement, thereby damaging Cavalier in two ways: First, by denying it the sales of Liberty mobile homes, and; Second, by participating in the conspiracy to keep Harford a "closed-park.” 3
Counts IV, V, VII and VIII of Cavalier’s second amended complaint charge Liberty with conspiracy and unfair competition violative of Md. Com. Law Code Ann. § 11-204 (a) (1) and (6) which provide
(а) Prohibited conduct. — A person may not:
(1) By contract, combination, or conspiracy with one or more other persons, unreasonably restrain trade or commerce;
(б) Lease or make a sale or contract for the sale of a patented or unpatented commodity or service for use, consumption, enjoyment, or resale, or set a price charged for the commodity or service or discount from or rebate on the price, on the condition, agreement, or understanding that the lessee or purchaser will not use or deal in the commodity or service of a competitor of the lessor or seller, if the effect of the lease, sale, or contract for sale or the condition, agreement, or understanding may:
(i) Substantially lessen competition; or
(ii) Tend to create a monoply in any line of trade or commerce.
Section 11-204 (a) (1) is the Maryland analogue to section 1 of the Sherman Antitrust Act, 15 U.S.C. § 1.
Quality Discount Tires, Inc. v. Firestone Tire & Rubber Co.,
We note that § 11-202 (a) (2) provides that when
Application of the Law
Turning to the facts of the case at bar, we find that the appellant appeals from a directed verdict as to the antitrust claims. A directed verdict is inappropriate where there is any legally relevant and competent evidence, however slight, from which a rational mind could infer a fact which if found to exist would prevent judgment for the moving party.
Impala Platinum, Ltd. v. Impala Sales (U.S.A.), Inc.,
The trial judge concluded that in order to make out its case under the Maryland Antitrust Act, Cavalier had to establish two essential facts. First, Cavalier would have to put forward proof of a conspiracy or combination between Harford and Chesapeake to "tie” illegally their products. Second, Cavalier would have to establish some participation in the conspiracy by Liberty.
To establish knowlege of or participation in the conspiracy by Liberty, Cavalier need not show a contract expressly imposing a legal obligation on the part of Liberty to participate or facilitate the conspiracy. The illegal condition, agreement, or understanding (to use § 11-204 (a) (6) language) or the contract, combination or conspiracy (to use § 11-204 (a) (1) terminology) can be implied from the course of dealing between the parties or it may be inferred from all the circumstances. A plaintiff must establish "a unity of purpose or a common design and understanding, or a meeting of the minds in an unlawful arrangement.”
American Tobacco Co. v. United States,
In
Overseas Motors, Inc. v. Import Motors Limited, Inc.,
Chief Judge Raine’s oral opinion indicates to this court that he followed this standard. His review of all the evidence in the appellant’s case disclosed a dearth of facts relating to knowledge or participation by Liberty in the alleged conspiracy. The appellant showed that in 1976 Liberty, through its sales representative, had frequent meetings with Chesapeake. The testimony indicates only that Liberty’s sales representative concluded that Chesapeake could place its customers into Harford. There was no evidence offered from which a rational inference could be drawn which tended to establish the required "meeting of the minds in an unlawful purpose.” Neither the court nor the jury can be permitted to speculate as to what transpired at those meetings without some basis in the evidence.
5
The only
Inasmuch as we agree with the trial court that Liberty was not shown to be a participant in the conspiracy, it is irrelevant to this decision and therefore we do not reach the
It follows from our conclusions above that Cavalier has also failed to produce sufficient evidence in support of its claims based on unfair competition and civil conspiracy. Unfair competition is generally defined in Maryland as, "damaging or jeopardizing another’s business by fraud, deceit, trickery or unfair methods. . . . What constitutes unfair competition in a given case is governed by its own particular facts and circumstances.”
Baltimore Bedding Corp. v. Moses,
Since common law conspiracy requires collusive conduct to accomplish an unlawful act which injures the plaintiff,
Green v. Washington Suburban Sanitary Commission,
II. The Breach of Contract Claim
Liberty, as cross-appellant, raises three issues:
1. Whether a dealer’s claims for breach of an alleged contract for the sale of mobile homes are barred by the statute of frauds, where no evidence was introduced of a writing conforming to U.C.C. § 2-201.
2. Whether, as a matter of law, a seller has reasonable grounds for insecurity under U.C.C. § 2-609, where the buyer has repeatedly made late payments in the past, has failed to improve its payment record after being warned to do so, has been given a 30-day notice of termination, and is in failing financial condition.
3. Whether the jury’s verdict (a) that Liberty breached an alleged contract with Cavalier, and (b) that Cavalier suffered damages due to the alleged breach of contract was clearly erroneous, contrary to the great weight of the evidence, and unsupported by the record.
The breach of contract aspect of this controversy arose following- Liberty’s September 17, 1976 notice to Cavalier that it was being terminated as an authorized dealer. The distributorship agreement provided for a 30 day "wrapping-up” period which began to run on the date Cavalier was notified of the termination.
What transpired during those 30 days is somewhat murky. Viewed in the light most favorable to the plaintiff/cross-appellee, it appears that Cavalier called Liberty late in September and attempted to order 14 mobile homes. Cavalier’s president, Chester Foreman, testified that these homes were for stock and inventory, as well as for prospective customers. He further testified that Liberty
Liberty did, in fact, ship three homes after the termination date which were sold by Cavalier prior to that date. Of the 14 additional homes which Cavalier contends that it attempted to order, it is clear that 13 of them were not under contract. There is apparently a question as to whether one of the fourteen was under such contract. 7 In any event, none of the 14 homes was ever shipped. This failure is the basis for Cavalier’s claim that Liberty breached its contract and caused damage to Cavalier in the amount of the lost profits on the 14 homes.
The trial judge overruled Liberty’s motion for a directed verdict on this issue and submitted it to the jury. The jury found in Cavalier’s favor and judgment was entered against Liberty in the amount of $30,386.
In support of its contention that Liberty was obligated to supply homes to Cavalier, Cavalier produced what it termed a "franchise letter”. This letter provided:
To Whom it May Concern:
Cavalier Mobile Homes, Inc., P.O. Box 887, Glen Burnie, Maryland 21061, is an authorized Liberty dealer for the year of 1976.
They are authorized to sell Liberty products from Liberty Homes, Inc., Leola, Pennsylvania.
This authorization may be terminated by either party given thirty days notice.
Cavalier contends that Liberty failed to raise the Statute of Frauds issue before the trial court and that consequently the issue was not decided by the court below. As a result, Cavalier urges that Liberty should not be permitted to raise this issue on appeal.
In
Lewis v. Hughes,
... Considering at the outset appellee’s Rule 885 contention, it is true that in Laporte Corp. v. Cement Corp.,164 Md. 642 , 645-46,165 A. 195 (1933) our predecessors held that when a defendant pleads the general issue and asks for a directed verdict on the grounds of legally insufficient evidence, without pleading the Statute of Frauds below or objecting to the alleged contract on the basis of it, the statute may not be raised for the first time on appeal. On a motion for reargument in Laporte,164 Md. at 651-53 , which is also reported in168 A. 844 (1933), the Court reaffirmed its decision, declining to follow the rule of prior cases, e.g., Morgart v. Smouse,103 Md. 463 , 467,63 A. 1070 (1906); Hamilton v. Thirston, 93 Md. 213 , 220,48 A. 709 (1901); Semmes v. Worthington,38 Md. 298 , 317 (1873); Billingslea v. Ward,33 Md. 48 , 51 (1870), that the filing of a general issue plea preserves for appeal the question of whether the Statute of Frauds has been satisfied. The decision in Laporte was later adhered to by this Court in Friedman v. Clark,252 Md. 26 , 31,248 A.2d 867 (1969) and Dove v. White,211 Md. 228 , 234-37,126 A.2d 835 (1956). But see Smith v. Biddle,188 Md. 315 , 318,52 A.2d 473 (1947).
Neither Lewis nor the cases cited therein preclude raising the Statute of Frauds on appeal where the statute has been specifically pleaded as in the instant case.
In
Smith v. Biddle,
Appellee seems to think that Rule 9 of this Court, relating to appeals generally, and Section 40 of Article 5, Code, 1939, bar the appellants from raising in this court matters not presented and argued before the chancellor, but we will pass the matter with the comment that this court will always inquire into the question of whether a contract sought to be specifically enforced is in form that the law requires. Certainly our rule, and the provisions of the code cited, would not bar this court in an inquiry as to whether a contract for the sale of land was violative of the Statute of Frauds, or whether a third party had authority to sign a contract on behalf of the vendor; or whether the contract was so uncertain and duplicitous as to be unenforceable.
Cavalier relies on
Gadekar v. Phillips,
The record indicates that the Statute of Frauds issue was presented to the court through the Special Plea and was necessarily decided by the trial court when it denied Liberty’s Motion for a Directed Verdict. Assuming arguendo that the issue was not decided below, this court could still consider it under the circumstances of the instant case.
See, Smith v. Biddle, supra,
and also
Tuxedo Cheverly Vol. Fire v. Prince George’s County,
The Maryland Uniform Commercial Code, Md. Com. Law Code Ann. § 2-106 (1975) defines "contract for sale” to include both a "present sale of goods and a contract to sell goods at a future time.” It follows therefrom that dealership or distributorship contracts fall within the sales provisions of the U.C.C.
Artman
v.
International Harvester Co.,
[A] contract for the sale of goods for the price of $500 or more is not enforceable by way of action or defense unless there is some writing sufficient to indicate that a contract for sale has been made between the parties and signed by the party against whom enforcement is sought or by his authorized agent or broker. A writing is not insufficient because it omits or incorrectly states a term agreed upon but the contract is not enforceable under this paragraph beyond the quantity of goods shown in such writing.
There are three writings in evidence which Cavalier asserts are memoranda of the purported agreement: the dealership letter; the invoices generally; and the termination letter. Each of these, however, fails to overcome the Statute of Frauds and may not be enforced against Liberty with regard to a failure to provide a certain number of homes.
The dealership letter lacks terms as to price and delivery conditions, as well as quantity, which would indicate no contractual obligation on the part of Liberty to supply Cavalier with mobile homes. The arrangement was clearly not a requirements contract. The Statute of Frauds requires that even where the quantity term is not numerically stated, there must be some writing which indicates that the quantity to be delivered under the contract is a party’s requirements.
Cox Caulking & Insulating Co. v. Brockett Distributing Co.,
The invoices in evidence indicate a course of dealings between the parties. Our view of this distributorship is that each time Cavalier ordered a home from Liberty, a separate contract of sale was entered into by the parties. This series of contracts, evidenced by invoices, does not indicate that a requirements contract existed,
i.e.,
that there was a contract to fill Cavalier’s requirements. Each invoice solely reflects the terms and quantity of individual transactions. There is no indication that quantity is to be measured by
Finally, for the same reasons, the termination letter is not evidence of an agreement between the parties as to quantity. Since Cavalier put forward no competent evidence of a contract for the sale of the 14 disputed mobile homes, the trial court should have held as a matter of law that there was no contract and therefore nothing to go to the jury. Md. Rule 552. It was error for the trial court to deny the motion for directed verdict.
Cavalier asserted that a statement made by Liberty’s attorney had the effect of admitting that there was sufficient evidence to go to the jury with regard to the 30 day "winding up” period. We agree with the trial judge’s analysis of the statement at issue to the effect that Liberty was "not conceding anything.” Additionally, Liberty’s attorney renewed its motion for directed verdict at the end of the case, clearly indicating that Liberty was not conceding its right to have the trial judge decide the sufficiency of the evidence.
In conclusion, we shall reverse the trial judge’s denial of a directed verdict.
Judgments on Counts IV, V, VII and VIII affirmed; judgment on Count I reversed; case remanded to the Circuit Court for Baltimore County with instructions to enter judgment for cross-appellant (Liberty); costs to be paid by appellant-cross appellee (Cavalier).
Notes
. Suit was brought in the names of three corporations: Cavalier Mobile Homes, Inc.; Cavalier Mobile Homes East, Inc.; and Cavalier Mobile Homes North, Inc. Noting that Chester Foreman was the sole stockholder and president of all three corporations and that the defendant/appellee treated the three corporations as one entity maintaining three sales locations, the trial judge ruled as a matter of law that they are all one corporation and granted a motion for a directed verdict with respect to counts II and III which were identical to count I except that they were brought in a different corporate name.
. The questions presented but not reached are:
1. Did the circuit court err in ruling that there was no evidence from which the jury could infer that contracts, combinations and conspiracies that limited the leasing of vacant mobile home parking spaces in a mobile home park to consumers who purchased mobile homes from a particular dealer constituted unreasonable restraints of trade and illegal tying arrangements in violation of the Maryland Antitrust Act?
2. Did the circuit court err in ruling as a matter of law that Cavalier could not prevail on its antitrust claims because
4. Did the circuit court err in ruling that there was no evidence from which the jury could infer that Liberty’s unjustified termination of one of its top dealers and giving a franchise to a competitor who had tied up scarce mobile home lots constituted unfair competition?
5. Did the circuit court err in ruling that there was no evidence from which the jury could infer that Liberty participated in and is liable for civil conspiracy?
. A "closed-park” was defined as a park which entered into arrangements in which vacant spaces in the parks are reserved for consumers who
. Judge Raine relied on McElhenney Co. v. Western Auto Supply Company,
The gravamen of a Section 3 violation is the forbidden condition, agreement or understanding of exclusivity, and a proper pleading should assert this ultimate fact. It makes no difference whether this is voluntary or is imposed by coercion, but without such agreement, condition or understanding, there can be no statutory infraction.269 F.2d at 338 .
. Appellant argues that "the jury could infer that Liberty stopped selling to Cavalier and began selling to Chesapeake so that Liberty could utilize Chesapeake’s control of mobile home parking spaces to its own advantage.” Liberty unilaterally elected not to do business with Cavalier. This is permissible under the antitrust laws unless it has the proscribed effect on competition, that is, the substantial lessening of competition, or is for the purpose of creating or maintaining a monopoly. U.S. v. Colgate & Co.,
The fact that a refusal to deal with a particular buyer without more, may have an adverse effect upon the buyer’s business does not make the refusal to deal a violation of the Sherman Act. Damage alone does not constitute liability under the Act.
Unless it can be said that the refusal to deal with ... [the distributor] had the result of suppressing competition and thus constituted "restraint of trade” within the meaning of Section 1 of the Sherman Act, there is no violation of the Act.318 F.2d at 287 . In Richardson v. Chrysler Motors Corp.,257 F. Supp. 547 (S.D.Tex. 1966), the court after reviewing the case law held that the substitution of one distributor for another is not an unreasonable restraint of trade. Consequently, as there was no evidence of a substantial lessening of competition or that Liberty had "a purpose to create or maintain a monopoly,” its refusal to sell to Cavalier was not an act in restraint of trade.
. The case of Suburban Mobile Homes, Inc. v. AMFAC Communities, Inc.,
For tying cases generally,
see
Greenbelt Homes, Inc. v. Nyman Realty, Inc.,
. Although there was no specific argument before this Court as to the Statute of Frauds implications of the disputed "Skalski home” we believe this issue merits comment. There is a memo in evidence from Liberty to Cavalier in which Liberty indicates that it will not supply Cavalier with this particular mobile home allegedly ordered during the 30-day close out period, because "To do so would be forfeiting our agreement with the new
The writing in question does not evidence a contract for the sale of goods. When Cavalier phoned in the order to Liberty, that action constituted an offer. Liberty responded not with an acceptance but instead with a counter-offer containing two required conditions. Cavalier responded by meeting only one of the two conditions. That response constituted a new offer which revoked all prior offers. Liberty’s memo rejected the new offer. Thus, there was no contract for the sale of the "Skalski home.”