Court Opinion

ID: 9532585
Source: CourtListenerOpinion
Date Created: 2023-08-07 04:22:51.076603+00
Date Added: 2024-06-11T13:28:47.227939
License: Public Domain

FRIEND, J., dissenting: This is an interlocutory appeal from two orders: one granting a temporary injunction, the second denying defendant’s motion to dissolve it. I think the temporary injunction was improvidently granted because it violated the established rules pertaining to the issuance of temporary restraining orders and failed to maintain the status quo which is one of the principal functions and limitations of this extraordinary remedy. At the time the injunction was granted, Vee Jay had on file a pleading which controverted the material allegations of the complaint. It was captioned “Motion to Strike,” and the chancellor, so regarding it, took all the allegations of the complaint as true and disregarded the controverted material allegations in the pleading. The pivotal issue of fact upon which this entire controversy rests is whether Vee Jay’s contract to make, advertise, and distribute Beatle records in the United States is paramount to that of Capitol. The affidavit of Jay Lasker, vice president of Vee Jay Records, subscribed and sworn to, sets forth in detail the factual controversy between the parties. It is undisputed that Vee Jay’s contract with Transglobal to make and distribute the Beatle records in the United States dates back to January 10, 1963. This contract gave Vee Jay exclusive rights for a period of five years; Capitol did not come into the picture until some nine months later. It contends that Vee Jay’s contract was terminated and that plaintiff,’s rights to make and distribute Beatle records succeeded those of Vee Jay. Transglobal claimed that the contract between it and Vee Jay had been terminated, alleging that Yee Jay-had not made páyments of royalties for the records sold. In his affidavit Lasker denies this allegation of the complaint, and alleges that Yee Jay made payments to Transglobal and that such royalties were accepted by it; that some of the royalties were paid directly to Transglobal’s licensor Electric and Musical Industries, Ltd. (EMI), for the reason that EMI claimed that Transglobal was not its representative and directed that all payments be made directly to EMI; that for many months following this situation correspondence between Yee Jay, Trans-global, and EMI continued in an attempt to adjust the internal conflict of Transglobal with its licensor EMI; and that during such period of time Vee Jay attempted to continue arrangements with Transglobal but that Transglobal refused to comply with the contract in existence. This highly controverted pivotal question of fact should have been resolved before a temporary injunction was issued, and in view of the sworn denial, of the material allegations of Capitol’s complaint, plaintiff had the burden of proving its alleged claim to the right of distribution of the Beatle records as against Yee Jay’s claim, and of establishing the probability of ultimate success and a clear and an affirmative right to relief. McFetridge v. First Commercial Bank, 28 Ill App2d 512, 171 NE2d 791 (1961). The difficulty arose over the function of the pleading filed by Yee Jay designated as “Motion to Strike”; the chancellor treated it as such and completely disregarded the verified affidavit of Lasker which was incorporated in and made a part of the motion, and to all intents and purposes served as an answer to make up issues of fact which should have been heard before any injunction was issued. Here again the McFetridge case is in point, as is Lipkin v. Burnstine, 18 Ill App2d 509, 152 NE2d 745 (1958). In other words, this so-called “Motion to Strike” contains sworn allegations of fact which, could have defeated Capitol’s allegations had Vee Jay’s pleading been called an answer. The courts of this state have repeatedly recognized the provisions of subsection (3) of section 33 of the Civil Practice Act (Ill Rev Stats 1963, c 110, § 33) that “pleadings shall be liberally construed with a view to doing substantial justice between the parties” (Crosby v. Weil, 382 Ill 538, 48 NE2d 386 (1943); Wohl v. Yelen, 22 Ill App2d 455, 161 NE2d 339 (1959); Burr v. State Bank, 344 Ill App 332, 100 NE2d 773 (1951)), as well as of subsection (2) of section 42 of the Civil Practice Act (§42) that “no pleading is bad in substance which contains such information as reasonably informs the opposite party of the nature of the claim or defense which he is called upon to meet.” And the rule is well recognized in Illinois that equity should look to the substance of the pleading rather than to the form. Grove v. Chicago Title & Trust Co., 25 Ill App2d 402, 166 NE2d 630 (1960); Evangelical Slovak Women’s Union v. Papanek, 8 Ill App2d 298, 132 NE2d 20 (1956); Barrett v. Continental Illinois Nat. Bank & Trust Co., 2 Ill App2d 70, 118 NE2d 631 (1954). It seems to me that the substance and wording of Vee Jay’s pleading, its motion to strike, joined the issues in that it raised specific defenses, controverted the material issues of fact alleged in the complaint, and factually questioned whether Capitol was entitled to the relief sought on the merits. The pleading begins by stating: “Defendant, . . . answering the complaint. . . .” This opening, plus the fact that the motion itself contained only affirmative allegations of fact and attached as exhibits copies of the verified complaint and affidavit filed in New York, should have put the chancellor and Capitol on notice as to the substance of the pleading. If this procedure had been employed, as it should have been, there could have been no ternporary injunction without a hearing and a determination of the facts. The Barrett case is in point on this issue; we said there (76): “We think the liberal spirit of the Practice Act justifies the conclusion we are about to draw. The Act provides, that pleadings shall be liberally construed with a view to substantial justice . . . .” In that case the court concluded (77) that it was “required” to treat the. plaintiff’s motion as a reply. The parties here have now been in litigation for more than two months — since January 13, 1964 — and all this subsequent review litigation could have been averted if the established rule of procedure on. the merits of this case had been followed. A hearing and determination of . the controverted issues of fact could have been had within a comparatively short time. I think the chancellor erred in granting the temporary injunction, and on this interlocutory appeal that order should have been reversed. After defendant filed a sworn answer to the complaint and after the temporary injunction was issued, the case was set on defendant’s motion to dissolve the injunction, but still no hearing was had, and the motion to dissolve was denied, after which the case was referred to a master under a general reference to be heard on the merits — and there it now rests. Capitol’s counsel argue, and the majority opinion adopts the view, that the temporary injunction “maintained the last actual, peaceable, uncontested, status quo which preceded the controversy as contemplated by Capitol Records’ complaint.” This theory, melodiously phrased in an attempt to assuage the result of the rejection of Vee Jay’s rights in this controversy without a hearing, is in my opinion not applicable to this proceeding. The effect of the temporary injunction is to take all the allegations in Capitol’s complaint as true and grant it substantially all the relief that it could have had on a final determination of the case, if it should prevail in its claim as to the facts, without a hearing and without requiring Capitol to demonstrate by the evidence the probability of ultimate success and a clear and an affirmative right to the relief sought, and at the same time bypassing or disregarding Vee Jay’s version of the facts, and without any hearing as to the facts denying its right to make and distribute the Beatle records in the United States under a five-year contract obtained long before Capitol came into the picture, the termination of which Vee Jay denied specifically and at length in Lasker’s affidavit. The established rule with respect to temporary injunctions is reiterated and set forth in the recent opinion of this division in the Lipkin case, as follows (517-18): “Plaintiff was required to establish that he was probably entitled to succeed ultimately on the merits as a prerequisite to obtaining a preliminary injunction. [Citing cases.] The injunction was granted on the pleadings. In the answer the defendants denied the material averments of the complaint and set up complete defenses. Also before the court was the verified petition for a temporary injunction, the factual allegations of which repeated the allegations of the complaint. No evidence was offered and no affidavits were presented. A temporary injunction cannot be predicated solely upon the pleadings where the material factual issues are controverted and the answer raises a complete defense. [Citing cases.]” After the temporary injunction had been issued and the court had denied defendant’s motion to dissolve it, we heard arguments aggregating some three hours on defendant’s motion to stay the force and effect of the injunction and entered such an order. The status quo in this proceeding is maintained not by the temporary injunction granted by the chancellor but by the stay order entered by this court on February 5, 1964 after these protracted arguments. Since, as I view the status of this case, the temporary injunction does not maintain the status quo, the only equitable arangement at this juncture would be to . permit both Yee Jay and Capitol to manufacture and sell the Beatle records. Such status should persist until material issues of fact can be determined on evidence presented before the chancellor. To hold otherwise and continue the temporary injunction in full force and effect pending the ultimate outcome of this case is to penalize defendant, since it would be difficult, if not impossible, for Yee Jay, if it should be successful in this litigation, to show damages by ultimately proving the number of records it could have sold if it had not been enjoined from doing so. As this matter has been handled, Yee Jay still has not been heard as to the pivotal facts which make up the determining issues; its rights have been adversely decided without a hearing — and this, I think, amounts to a denial of justice. If the order granting the temporary injunction is not to be reversed, as the majority of this division hold, I certainly think that the stay order, which they have vacated, should remain in full force and effect. The majority hold that the order denying defendant’s motion to dissolve the injunction should be reversed and “is now left undisposed of.” I am not clear as to what this means, but in the light of what has been said in this dissent I think there should be no qualification; the order denying the motion to dissolve should have been reversed.