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Karl Wendt Farm Equipment Co. v. International Harvester Co.

United States Court of Appeals for the Sixth Circuit
931 F.2d 1112 (1991)


Facts

Karl Wendt Farm Equipment Co. (Wendt) (plaintiff) entered a dealer-franchise agreement with International Harvester Co. (International) (defendant). The contract provided for termination for cause. The agreement also allowed International to make changes in product lines. International had similar agreements across the country. Due to an economic downturn, International was facing bankruptcy. International lost almost $2,000,000 per day under its dealer agreements. To avoid this, International sold part of the company, resulting in International breaching its agreement with Wendt. Wendt sued. International raised the defenses of impracticability and frustration of purpose. International also alleged that the contract allowed its termination under the circumstances and that there was an implied termination clause. Wendt moved for a directed verdict. The impracticability defense went to trial. The jury found in International’s favor. Wendt moved for judgment notwithstanding the verdict, which was denied. Wendt appealed, and International cross-appealed to the United States Court of Appeals for the Sixth Circuit.

Rule of Law

Issue

Holding and Reasoning (Jones, J.)

Dissent (Ryan, J.)

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