More-Way operates a discount department store in Milwaukee, Wisconsin. On May 26, 1960, More-Way as licensor and one David Gold as licensee entered into a “license agreement,” the pertinent portions of which are as follows:
“Whereas, licensee desires to exclusively operate in said building a department devoted solely to the sale, at retail, of merchandise classified as cosmetics, toiletries, stationery and school supplies, notions, health aids, beauty aids, sun glasses, gift wrap and gift ties (excluding, however, any and all Christmas gift wrap and ties) and candies, and paper goods and sundries, hereinafter called ‘department goodsand . . .
“Whereas, the parties recognize that the success of li-censor will be effected by licensee’s observance of such merchandising policies, standards and practices as licensor shall formulate from time to time and that any deviation therefrom by licensee will adversely affect the operators of all other departments in said building and expose them to the risk of damage and injury;
“Now, therefore, in consideration of the premises, licensor hereby grants licensee a license to exclusively operate such a department in said building during the term hereof, . . . subject to and upon the following covenants and conditions, to wit:
“1. The term shall be for 3 years, . . .
“6. Licensee agrees at its own cost and expense to conduct a first-class, up-to-date department ... to stock the same continually with a complete line and saleable inventory of current department goods in suitable price ranges, to display its goods attractively ... to offer its department goods at prices which are at all times competitive with the prices at which such goods are offered for retail sale elsewhere in the Greater Milwaukee Area, to conduct sales thereof only when and in such manner as licensor shall approve, . . .
“As an addendum to paragraph 1, the parties agree that the term of this license shall be extended for a further term of S years, provided however, that the licensee herein has gross sales of $400,000 for the 12 calendar months next preceding the time which said licensee shall exercise his notice of option; and further, that said notice shall be given by the licensee to the licensor not less than 60 days before the expiration of the original term.”
Gold assigned the license to Codept on June 7, 1960, and the validity of the assignment is not questioned. Gold is the president of Codept, Inc.
Codept, Inc., commenced the action by service of a summons on August 8, 1962, approximately nine months before the expiration of the primary three-year term of the license agreement. Codept’s complaint was not served until April 25, 1963, approximately one month prior to expiration of the
More-Way’s answer denied that it had breached the license agreement; alleged that Codept’s failure to earn the $400,000 required for exercise of the option was not excusable; and alleged that the agreement did not give Codept the exclusive right to sell certain items, but only the exclusive right to deal in the entire general category of goods. More-Way counterclaimed against Codept, claiming that Codept breached the license agreement in that it failed to conduct an up-to-date department; failed to keep the department open during the times designated by More-Way; failed to stock the department with a complete line of goods; failed to display the goods attractively; and failed to offer the goods at competitive prices. More-Way’s counterclaim prayed for judgment dismissing the complaint and for damages on the counterclaim in the sum of $300,000.
Prior to expiration of the primary three-year term, Codept moved the trial court for injunction temporarily restraining
Respondent Silberman filed an affidavit in opposition to Codept’s motion in which he stated that Gold, the original licensee, inspected the store prior to signing the agreement and was aware of the various items sold by other departments ; that Codept had breached the terms of the agreement relating to maintenance of a complete line of goods, maintenance of competitive price scales, and that Codept has never had annual gross sales of $400,000. Attached to Silberman’s affidavit are several letters to Codept, written on several different dates, and advising Codept that it was stocking, displaying, and pricing goods in a manner contrary to the terms of the licensing agreement.
The trial court denied Codept’s motion for a temporary injunction by its order dated May 10, 1963. The trial court, in its memorandum decision, stated that it was not making any determination of the merits of the action, but was only deciding the question of whether a temporary injunction was necessary in order to maintain the status quo.
More-Way then moved the trial court for leave to amend its answer and counterclaim, and for a temporary injunction enjoining Codept from occupying any portion of the store premises during the pendency of the action. Morry Silber-man stated in an affidavit in support of the motion that More-Way had negotiated an agreement with another party for operation of the department, and that Codept was in substantial default in the performance of its obligations under the license agreement. Codept moved to dismiss More-Way’s motion for a temporary injunction, and submitted affidavits relating to the manner in which Codept was stocking its department. Codept also offered to continue paying the $1,000 per month rental during the pendency of the action.
The trial court denied Codept’s motion to dismiss and granted More-Way’s motions, and on July 2, 1963, entered an order temporarily enjoining Codept from occupying any portion of the store premises, and requiring More-Way to post a bond to secure payment of any damages caused to Codept by the temporary injunction, not to exceed $10,000. The trial court in its oral decision from the bench stated that the denial of Codept’s motion for a temporary injunction on May 10, 1963, was intended to have the effect of retaining the
status quo
until May 31st, the date the primary term of the license agreement expired, and then have compliance with the agreement to vacate and move out at that time. The temporary injunction provided for in the order of July 2d was made effective on July IS, 1963, one and one-half
Codept has appealed from the whole of the order of May 10, 1963, denying its motion for temporary injunction; and from the whole of the order of July 2, 1963, granting More-Way’s motion for a temporary injunction.
It is an elementary rule of law that the granting or refusal of a temporary injunction is a matter lying within the discretion of the trial court, and its determination in regard thereto will not be upset on appeal unless an abuse of discretion is shown.
Fassbender v. Peters
(1923),
Codept, Inc., contends that the trial court’s order of May 10, 1963, which denied its motion for a temporary injunction to restrain More-Way from instituting proceedings to remove Codept from the premises constituted an abuse of discretion. Sec. 268.02 (1), Stats., sets forth the reasons for which a temporary injunction may be granted:
“(1) When it appears from his pleading that a party is entitled to judgment and any part thereof consists in restraining some act, the commission or continuance of which during the litigation would injure him, or when during the litigation it shall appear that a party is doing or threatens or is about to do, or is procuring or suffering some act to be done in violation of the rights of another party and tending to render the judgment ineffectual, a temporary injunction may be granted to restrain such act.”
Codept argues in support of its contention that under the terms of the agreement, it has the exclusive right to sell
Codept also claims that the trial court erred in finding that Codept had an adequate remedy at law. The argument on this point is that Codept has gone to great expense in equipping and developing its department, and in creating goodwill
1
—all of which will be lost forever if it is not
Under the facts presented by the record in the instant action, the trial court did not abuse its discretion in denying Codept’s motion for a temporary injunction, and therefore the order of May 10, 1963, is affirmed.
Codept, Inc., contends that the trial court’s order of July 2, 1963, granting injunctional relief to More-Way constitutes an abuse of discretion in that it has the effect of requiring them to move out, and thus upsets the
status quo.
The function of a temporary injunction is to maintain the
status quo,
not to change the position of the parties or compel the doing of acts which constitute all or part of the ultimate relief sought.
State ex rel. Attorney General v. Manske
(1939),
Codept also contends that where right of possession is in dispute between two parties, one of whom is in actual possession under color of right, a temporary injunction will not lie to transfer possession to the other party, citing
Lipinski v. Lipinski
(1952),
We determine that the trial court did not abuse its discretion in granting More-Way’s motion for a temporary injunction by the order dated July 2, 1963.
The orders of the circuit court dated May 10, 1963, and July 2, 1963, are affirmed.
By the Court. — Orders affirmed.
Notes
As to the item of goodwill, it is difficult to see how Codept could have any “goodwill” in the operation of its department in the More-Way store. The contract provides that all sales slips, price markings, wrappings, etc., are to be furnished by More-Way, presumably with the More-Way name imprinted thereon, and although the affidavits do not so reveal, we take judicial notice of the fact that the general public is not aware of the fact that the various departments in the store are operated by licensees.
