Toll Processing Services, LLC v. Kastalon, Inc. , 880 F.3d 820 ( 2018 )

In the
United States Court of Appeals
For the Seventh Circuit
____________________
No. 15-3187
TOLL PROCESSING SERVICES, LLC,
Plaintiff-Appellant,
v.
KASTALON, INC., and KASTALON
POLYURETHANE PRODUCTS,
Defendants-Appellees.
____________________
Appeal from the United States District Court for the
Northern District of Illinois, Eastern Division.
No. 12-cv-10058 — Sharon Johnson Coleman, Judge.
____________________
ARGUED MARCH 31, 2016 — DECIDED JANUARY 23, 2018
____________________
Before MANION and KANNE, Circuit Judges, and PEPPER,
District Judge. *
PEPPER, District Judge. Toll Processing Services, LLC (“Toll
Processing”) appeals from the district court’s order granting
summary judgment in favor of Kastalon, Inc. and Kastalon
* The Honorable Pamela Pepper, United States District Court for the
Eastern District of Wisconsin, sitting by designation.
2 No. 15-3187
Polyurethane Products (collectively, “Kastalon”) on Toll
Processing’s conversion and negligence claims. We reverse
the district court’s order as to those claims, and remand the
case for further proceedings.
I. Background
This is a diversity case, governed by Illinois law, involv-
ing state law contract and tort claims. Appellant Toll Pro-
cessing is a subsidiary of International Steel Services, Inc.; it
was formed in 2006 for the purpose of owning and operating
a pickle line. 1 Appellee Kastalon provides equipment and
repairs for the steel industry. In 2006, Toll Processing pur-
chased a used pickle line from Joseph T. Ryerson & Sons,
Inc.; the line included fifty-seven pickle line rolls, some of
which were in need of repair. Kastalon had serviced the rolls
during the time Ryerson owned the line.
Toll Processing planned to reinstall the Ryerson pickle
line somewhere else, but as of the spring of 2007, did not
have a facility in which to put it, or anywhere to store the
rolls. In April 2007, Toll Processing began to disassemble the
used pickle line at Ryerson’s facility in Chicago. Early in
2008, Kastalon agreed that it would move the rolls to its
facility and store them, at no cost, until Toll Processing could
issue a purchase order to Kastalon to recondition the rolls. In
January of that year, Paula Dent—a former Ryerson employ-
1 A pickle line is a machine used in the steel industry to process hot
rolled steel coil through acid tanks (to remove rust and impurities)
before the steel coil is rinsed, dried, sheared, trimmed and recoiled at the
end of the line. The steel moves through the line on a series of pickle
rolls. Pickle rolls belonging to the appellant—first their storage, then
their loss—are the subject of this appeal.
No. 15-3187 3
ee, and a plant and project manager for Toll Processing—
orally contacted Kastalon’s vice president and half owner
Michael DeMent to make the arrangements. Dent was
Kastalon’s main contact regarding the pickle line.
Both parties initially believed that Toll Processing would
complete its plan to re-install the pickle line within months,
but they did not discuss a specific timeframe during which
Kastalon would store the rolls. Kastalon appears to have
assumed that it would be storing the rolls for a few months
only; both parties expected Toll Processing to find a new
facility shortly. Regardless of timing, the parties agree that
Kastalon was storing the rolls while it waited for Toll Pro-
cessing to issue it a purchase order for the repair and recon-
ditioning of those rolls that needed it.
Malvin Sander, vice president and general counsel for
Toll Processing, represented Toll Processing in negotiating
its purchase of the pickle line. Later, at his deposition, Sand-
er testified that he agreed it would not have been reasonable
for Toll Processing to expect Kastalon to store the rolls
forever. Gus Schempp, a consultant hired to assist in disas-
sembling the line and reinstalling it at its new location,
testified at his deposition that he did not know what
Kastalon's storage obligation would be if Toll Processing
never issued the expected reconditioning purchase order.
Kastalon moved fifty-seven pickle rolls to its facility in
Alsip, Illinois, over the first three months of 2008. After
March 2008, however, Dent had no further contact with
Kastalon about the rolls. In fact, Toll Processing laid Dent off
in April 2008, but did not inform Kastalon that Dent had
been let go. In October 2008, DeMent called Gus Schempp at
Toll Processing regarding the disassembling/reinstallation
4 No. 15-3187
project. Schempp did not tell DeMent that the project to
reinstall the line had been delayed (although it appears that
it had been). DeMent also sent Schempp an email asking to
be kept informed as to the progress of the reinstallation
project; Schempp did not respond.
Over the next two years, Toll Processing negotiated with
various companies, either to set up and run the pickle line,
or to sell it. It was not in communication with Kastalon
about the line during that period. Kastalon stored the rolls
indoors for about two years. At some point, though,
Kastalon used a crane to move the rolls from their original
location inside the facility to another location inside the
facility, which took four to five hours of labor. Later,
Kastalon greased and wrapped the rolls before moving them
to be stored outside under tarps, which took about ten hours
of labor. Kastalon’s plant manager testified at his deposition
that the condition of the rolls did not change while they
were in Kastalon’s possession.
In November or December 2010—some two years after
the last contact between the two companies—DeMent
contacted Dent and Carlos Monzon (a former Ryerson
employee, who was hired by Toll Processing and later laid
off). Dent and Monzon informed DeMent that they were
unemployed. DeMent did not specifically enquire into the
status of the rolls, or inform Dent or Monzon that Kastalon
planned to dispose of the rolls. He testified at his deposition
that after this conversation, he thought that Toll Processing
had gone out of business. He also indicated that he believed
that the pickle rolls were in poor condition and had little
value.
No. 15-3187 5
Subsequent to the conversation between DeMent, Dent
and Monzon, Kastalon concluded that the rolls had been
abandoned, had them scrapped by a local recyler and re-
ceived $6,380.80. Before scrapping the rolls, Kastalon did not
inspect them to determine their condition.
In June 2011, Toll Processing believed that it was close to
finalizing arrangements to reinstall the pickle line, which
would call for repair and refurbishment of the rolls.
Schempp called DeMent to request a price quote for recondi-
tioning the rolls so they could be put into service. DeMent
informed Schempp that the rolls had been scrapped. Toll
Processing obtained quotes for replacement rolls, the lowest
of which was $311,750, plus $104,905 for roll covers (appar-
ently a quote from Kastalon), for a total replacement cost of
$416,695. Toll Processing never issued a purchase order to
Kastalon to refurbish the rolls.
Toll Processing filed a three-count complaint pleading
claims for conversion, negligence and breach of contract. The
parties each moved for summary judgment. The district
court granted summary judgment in favor of Kastalon and
against Toll Processing as to each of Toll Processing’s claims.
II. Analysis
We review the district court’s grant of summary judg-
ment de novo. Boss v. Castro, 816 F.3d 910, 916 (7th Cir. 2016).
Summary judgment is appropriate “if the movant shows
that there is no genuine dispute as to any material fact and
the movant is entitled to judgment as a matter of law.” Fed.
R. Civ. P. 56(a); see also, Celotex Corp. v. Catrett, 477 U.S. 317,
322–23 (1986). The parties agree that Illinois substantive law
applies to the state law claims.
6 No. 15-3187
A. Conversion
The district court granted summary judgment to
Kastalon on Toll Processing’s conversion claim, finding that
the defense of abandonment precluded the claim.
To state a claim for conversion under Illinois law, a plain-
tiff must allege: “(1) an unauthorized and wrongful assump-
tion of control, dominion, or ownership by defendant over
plaintiff's personalty; (2) plaintiff's right in the property;
(3) plaintiff's right to the immediate possession of the prop-
erty, absolutely and unconditionally; and (4) a demand for
possession of the property.” Gen. Motors Corp. v. Douglass,
565 N.E.2d 93, 96–97 (Ill. App. Ct. 1990). The parties do not
appear to dispute that Toll Processing proved the elements
of conversion under Illinois law. Rather, the parties dispute
whether Kastalon has a viable affirmative defense to the
conversion.
Abandonment of property is a defense to conversion.
“[P]roperty is considered to be abandoned when the owner,
intending to relinquish all rights to the property, leaves it
free to be appropriated by any other person.” Bell Leasing
Brokerage, LLC v. Roger Auto Serv., Inc., 865 N.E.2d 558, 564
(Ill. App. Ct. 2007). Whether a party has abandoned property
is a question of fact, unless the party’s conduct is so decisive
and unambiguous that the question can be decided on
summary judgment as a matter of law. E.g., People v. London,
831 N.E.2d 1135, 1140–41 (Ill. App. Ct. 2005) (“Abandonment
is primarily a question of intent, inferred from words, objec-
tive facts, and other conduct.”); People ex rel. NBD Tr. Co. of
Ill. v. Village of Hoffman Estates, 600 N.E.2d 58, 61-62 (Ill. App.
Ct. 1992) (“A party may be found to have abandoned a
contract when the circumstances or his conduct clearly
No. 15-3187 7
evidences an abandonment and the acts relied upon must be
positive, unequivocal, and inconsistent with the existence of
the contract.”).
Toll Processing argues that the district court “made an
error of law in determining that Toll Processing abandoned
the” rolls, because “Kastalon did not put forth any record
evidence of an intent to abandon by Toll Processing.” Appel-
lant’s Br. at 20, ECF No. 18. According to Toll Processing,
Kastalon’s only evidence of abandonment “was the mere
fact that the parties did not communicate about the [r]olls
between October 2008 and December 2010.” Id. Toll Pro-
cessing asserts that the following undisputed facts “negate
an intent to abandon:” Toll Processing was “engaged in
ongoing negotiations for a joint venture to operate the pickle
line and that those negotiations were active as late as Sep-
tember 2013,” and Schempp called DeMent “in June 2011
because Toll Processing was very close to finalizing an
agreement to re-install the pickle line, and Mr. Schempp
wanted to get a quote for reconditioning the [r]olls.” Id. at
20–21.
Intent to abandon property rights is a question of fact,
and we conclude that the evidence was not sufficient to
allow the district court to decide on summary judgment that
Toll Processing intended to abandon the rolls. The fact that
approximately thirty months passed before Toll Processing
initiated contact with Kastalon about the rolls did not consti-
tute abandonment as a matter of law. The district court
concluded to the contrary, relying on three cases involving
oil and gas leases, in which Illinois courts found that a
prolonged cessation of drilling operations could amount to
8 No. 15-3187
abandonment of a lease. 2 While those cases involved periods
similar to the thirty-month period here, each was decided
after a trial on the merits, not on summary judgment.
Moreover, the rationale underlying those decisions is in-
applicable here. The Illinois courts reasoned that the purpose
of an oil or gas lease is to obtain production from the land; a
lessor cannot receive the royalties (the consideration) con-
templated under the lease unless the lessee takes consistent
affirmative actions to produce oil or gas. Pieszchalski v.
Oslager, 470 N.E.2d 1083, 1089–90 (Ill. App. Ct. 1984). In light
of the commercial purpose of the lease, the courts held that a
prolonged cessation of drilling operations could establish
that the lessee has abandoned the lease, and courts will
declare leases terminated in order to promote development
of the land. Id. at 1090 (citing Belden v. Tri-Star Producing Co.,
Inc., 435 N.E.2d 927, 933 (Ill. App. Ct. 1982)). The agreement
between Toll Processing and Kastalon did not provide for
payments to Kastalon out of funds received from some
activity conducted by Toll Processing. The agreement was
only that Kastalon would store the rolls until it received a
purchase order from Toll Processing to repair or refurbish
them. Comparing oil and gas leases to the agreement be-
tween these two parties is inapposite.
The answer to the question of whether Toll Processing
abandoned the rolls depends on whether Toll Processing’s
delay in contacting Kastalon constituted decisive and unam-
biguous evidence that Toll Processing intended to relinquish
2Spies v. DeMayo, 72 N.E.2d 316 (Ill. 1947); Shannon v. Stookey, 375
N.E.2d 881 (Ill. App. Ct. 1978); Pieszchalski v. Oslager, 470 N.E.2d 1083 (Ill.
App. Ct. 1984).
No. 15-3187 9
its rights to them. It is conceivable that a reasonable jury
could determine that the duration of Toll Processing’s
prolonged silence evidenced its intent to abandon the rolls.
A reasonable jury also could conclude, however, that Toll
Processing’s prolonged silence, standing alone, did not
constitute that decisive and unambiguous evidence of intent
to abandon.
There is no evidence in the record that Toll Processing
acted inconsistently with the parties’ oral agreement that
Kastalon would store the rolls until Toll Processing submit-
ted a purchase order for their reconditioning. The record
contains no evidence that anyone from Toll Processing told
anyone from Kastalon that Toll Processing no longer wanted
the rolls, or did not plan to use them or sell them. A jury
could conclude that the work Kastalon voluntarily under-
took to wrap and move the rolls—which required Kastalon
to commit its manpower, if not financial resources—was
evidence that Kastalon did not think that Toll Processing
had abandoned the rolls at the time Kastalon performed that
work. These are issues of fact for a jury to decide at trial, not
for the court to decide on summary judgment. We conclude
that there was a genuine dispute of material fact as to
whether Toll Processing abandoned the rolls, such that it
could not prove a conversion claim.
The district court stated that, even had it not determined
that Toll Processing abandoned the rolls, the economic loss
doctrine, known as the Moorman doctrine 3 in the Illinois
courts, barred Toll Processing’s conversion claim. The
district court acknowledged that there was little law apply-
3 See Moorman Mfg. Co. v. Nat’l Tank Co., 435 N.E.2d 443 (Ill. 1982).
10 No. 15-3187
ing the Moorman doctrine to conversion claims. It cited to
one federal district court case, Lansing v. Carroll, No. 11 C
4153, 2012 WL 4759241 (N.D. Ill. Oct. 5, 2012), in which the
court had applied the economic loss doctrine to bar an ersatz
conversion claim on summary judgment. The district court
relied on the Lansing decision to conclude that the Moorman
doctrine barred Toll Processing’s conversion claim in this
case.
Toll Processing asserts that the district court erred in ap-
plying the Moorman doctrine. It argues that the district court
did not cite to any cases in which an Illinois court had
applied the Moorman doctrine to bar a conversion claim.
Appellant’s Br. at 22. It argues that the district court did not
analyze Moorman, or “address whether Toll Processing’s
damages constitute purely ‘economic losses’ as defined by
the Moorman case.” Id. at 25. Toll Processing also argued that
Kastalon’s duty not to convert the rolls arose from some-
thing other than the oral contract between the parties. Id. at
25-26. In its reply brief, Toll Processing asserted that the non-
contractual duty not to convert was a common law duty.
Appellant’s Reply Br. at 7-10, ECF No. 26.
Toll Processing is correct that the district court did not
cite any Illinois case that had applied the Moorman doctrine
to bar a conversion claim. The federal case the district court
cited, Lansing, is not clearly dispositive. The district court in
Lansing determined that the defendants’ counterclaim for
“conversion” really was a quasi-contract claim. The plaintiffs
had argued that they were entitled to buy and close on the
defendants’ property interest under provisions of share-
holder and operating agreements. Lansing, 2012 WL 4759241
at *3. The defendants counterclaimed, arguing that the
No. 15-3187 11
plaintiffs’ interpretation of those provisions was insupporta-
ble. Id. The Lansing court concluded that the defendants’
counterclaim for conversion was not really a tort claim; it
was an iteration of the parties’ dispute over the contract. The
court was not able to identify any non-contractual duty by
the plaintiffs not to convert. Id. Because the defendants were
seeking purely economic damages for harm based on “a
contract-like interest,” the Lansing court applied the Moor-
man doctrine and barred the defendants’ conversion counter-
claim. Id.
As Toll Processing argues, the district court here did not
consider whether Kastalon had an extra-contractual duty not
to dispose of the rolls. The Moorman doctrine “limits the
claims of parties who allege breach of a contract to contrac-
tual remedies, rather than tort remedies. Put another way, if
a plaintiff claims that a defendant breached an obligation
other than a contractual obligation, the Moorman doctrine
does not apply.” Trade Solutions Inc. v. Eurovictory Sports,
Inc., No. 97 CV 1153, 1998 WL 111639 at *4 (N.D. Ill. March 9,
1998). If Kastalon had a common-law duty not to dispose of
the rolls that arose from a source other than the contract, the
Moorman doctrine would not bar Toll Processing’s conver-
sion claim.
Further, there are exceptions to the Moorman doctrine.
See, e.g., Fireman’s Fund Ins. Co. v. SEC Donohue, Inc., 679
N.E.2d 1197, 1199-1200 (Ill. 1997). On appeal, Toll Processing
argued that it was seeking damages “for property loss
resulting from a sudden occurrence, namely, the unilateral
and unauthorized disposal of the [r]olls.” Appellant’s Brief
at 25-26. One of the exceptions to the Moorman doctrine
occurs “where the plaintiff sustained personal injury or
12 No. 15-3187
property damage resulting from a tortious event, i.e., a
sudden or dangerous occurrence … .” Fireman’s Fund Ins.
Co., 679 N.E.2d at 1199. The district court did not discuss
whether any exception to the Moorman doctrine applied
here.
We will reverse the district court’s grant of summary
judgment in favor of Kastalon based on the affirmative
defense of abandonment; there are genuine issues of materi-
al fact on that defense, such that neither party is entitled to
summary judgment on that basis. We remand to the district
court for further proceedings on the conversion claim.
B. Negligence
The district court granted summary judgment to
Kastalon on Toll Processing’s negligence claim, finding that
Kastalon had met its duty to act reasonably with regard to
the rolls.
In its motion for summary judgment, Toll Processing ar-
gued that it was entitled to a presumption that Kastalon was
negligent in caring for the rolls, because Toll Processing had
proven a prima facie case of bailment. R. 85 at 7-8. Under
Illinois law, a “bailment is the delivery of property for some
purpose upon a contract, express or implied, that after the
purpose has been fulfilled, the property shall be redelivered
to the bailor, or otherwise dealt with according to his direc-
tions, or kept until he reclaims it.” Wausau Ins. Co. v. All
Chicagoland Moving & Storage Co., 777 N.E.2d 1062, 1067 (Ill.
App. Ct. 2002) (quoting Am. Ambassador Cas. Co. v. Jackson,
692 N.E.2d 717 (Ill. App. Ct. 1998)). “To recover under a
bailment theory, a plaintiff must establish (1) an express or
implied agreement to create a bailment; (2) a delivery of the
No. 15-3187 13
property in good condition; (3) the bailee’s acceptance of the
property; and (4) the bailee’s failure to return the property or
the bailee’s redelivery of the property in a damaged condi-
tion.” Id. at 1068.
“Establishing a prima facie case of bailment raises a pre-
sumption of negligence by the defendant … .” Magee v.
Walbro, Inc., 525 N.E.2d 975, 977 (Ill. App. Ct. 1988). To rebut
the presumption that the defendant acted negligently, the
defendant must present evidence “sufficient to support a
finding of the nonexistence of the presumed fact.” Id., quot-
ing Wright v. Autohaus Fortense, Inc., 472 N.E.2d 593, 596 (Ill.
App. Ct. 1984).
In responding to the motion for summary judgment,
Kastalon argued that Toll Processing never had properly
asserted a separate cause of action for bailment, and that it
had “filed an amended pleading that specifically excluded
bailment.” R. 93 at 8. Kastalon further argued that, even had
Toll Processing specifically pled bailment, Toll Processing
could not establish a prima facie case of bailment because
there was no express contract between the parties, the
parties contemplated only short-term storage of the rolls,
some of the rolls were in bad shape when Kastalon received
them and Toll Processing had abandoned the rolls. Id. at p.
10.
The district court did not address these arguments. Ra-
ther, after recounting Illinois law on bailment, the district
court stated that, “[f]rom the undisputed facts there seems to
be an implied bailment, the rolls were delivered, and not
returned.” Toll Processing Services, LLC v. Kastalon, Inc. and
Kastalon Polyurethane Products, 2015 WL 5179685, at *5 (N.D.
Ill. Sept. 4, 2015). Apparently concluding that Toll Processing
14 No. 15-3187
was entitled to a rebuttable presumption of negligence, the
court turned to the proposition that Illinois law requires a
bailee to “exercise reasonable care under the circumstances.”
Wausau Ins. Co., 777 N.E.2d at 1068 (citing Ortiz v. Warren
Chevrolet, Inc., 321 N.E.2d 77, 79 (Ill. App. Ct. 1974). Citing
Wausau Ins. Co., the court stated, “[w]hether a bailee exer-
cised reasonable care under the circumstances is ordinarily a
question of fact, but may be decided as a matter of law on
summary judgment if the undisputed facts conclusively
demonstrate that the bailee has exercised its duty.” Toll
Processing Services, LLC, 2015 WL 5179685, at *5. The district
court concluded that because the parties had not agreed on
how long Kastalon was obligated to store the rolls, “it was
reasonable for Kastalon, which is not a storage facility, to
conclude that Toll Processing had abandoned the rolls after
thirty-two months with no contact.” Id. Having decided that
Kastalon had met its duty of care, the court found against
Toll Processing and in favor of Kastalon on the negligence
claim.
The district court paraphrased Ortiz’s discussion of when
it is appropriate for a trial court to decide the factual ques-
tion of reasonable care on summary judgment. The Ortiz
court said,
The defendant is correct in pointing out that
the presumption of negligence which arises on
proof of delivery of property to a bailee in
good condition and its redelivery in damaged
condition merely shifts the burden of going
forward with the evidence, and disappears up-
on the production of any evidence of the bail-
ee’s having exercised due care. The defendant
No. 15-3187 15
correctly observes, further, that a bailee for hire
is not an insurer of the bailed property, alt-
hough obligated to exercise reasonable care
under the circumstances. However, whether a
bailee has met the burden of showing that
damage to the bailed property occurred with-
out the bailee’s fault is ordinarily a question of
fact for the trier of fact.
Ortiz, 321 N.E.2d at 79-80 (citations omitted).
The district court appears to have concluded that Toll
Processing put forth a prima facie case of bailment, and that
as a result, the burden of proof on negligence shifted from
Toll Processing to Kastalon. The court did not, however,
discuss what evidence, if any, Kastalon had produced to
demonstrate that the loss of the rolls was not due to
Kastalon’s failure to exercise reasonable care. Rather, the
court concluded—as it had in the context of the conversion
claim—that the lapse of over thirty months without commu-
nication from Toll Processing, coupled with the fact that
Kastalon was not a storage facility, proved that Kastalon had
acted reasonably in disposing of the rolls. We disagree, and
reverse the district court’s grant of summary judgment in
favor of Kastalon on the negligence claim. Given the sparse
analysis of the bailment issue, we cannot conclude that the
district court should have granted summary judgment in
favor of Toll Processing on this claim.
C. Breach of Contract
The district court granted summary judgment in favor of
Kastalon on Toll Processing’s breach of contract claim,
16 No. 15-3187
because it found that the oral agreement between the parties
did not have a specific duration, and lacked consideration.
Under Illinois law, oral agreements are enforceable “so
long as there is an offer, an acceptance, and a meeting of the
minds as to the terms of the agreement.” Bruzas v. Richard-
son, 945 N.E.2d 1208, 1215 (Ill. App. Ct. 2011). To be enforce-
able, such an oral agreement must be sufficiently definite as
to its material terms. Wait v. First Midwest Bank/Danville, 491
N.E.2d 795, 801 (Ill. App. Ct. 1986). The parties do not dis-
pute that the duration of Kastalon’s obligation to store the
rolls was a material term of their agreement; their dispute
relates to the length of the duration.
The district court found that there was no meeting of the
minds as to how long Kastalon agreed to store the rolls. Toll
Processing argued that Kastalon agreed to store the rolls
until Toll Processing issued a purchase order for Kastalon to
refurbish the rolls—whenever that might be. Kastalon
confirmed that it had agreed to store the rolls until Toll
Processing found a location for the pickle line and issued the
purchase order for the refurbishment of the rolls, but insist-
ed that this was to be for a short time—a period of three or
four months. This discrepancy, the district court found,
showed that the parties did not have a mutual understand-
ing as to the duration of the storage agreement.
The district court also found that Kastalon received no
consideration for assuming the risk that Toll Processing
might never issue a purchase order, and concluded that this
lack of consideration rendered the agreement illusory and
unenforceable. Because “there was nothing to bind Toll
Processing,” the district court granted summary judgment in
No. 15-3187 17
Kastalon’s favor as to Toll Processing’s breach of contract
claim. Toll Processing Services, LLC, 2015 WL 5179685, at *5.
On appeal, Toll Processing argues that “the parties’ con-
duct established an agreement on the material terms, and the
undisputed facts of record established that there was consid-
eration to support the agreement.” Appellant’s Brief at 28.
Toll Processing also argues that the district court erred
because the duration of the contract either was tied to the
reinstallation of the pickle line, or presented a genuine
dispute of material fact regarding the parties’ mutual intent.
Kastalon responded that Sander—Toll Processing’s in-
side counsel—admitted that the parties did not reach an
agreement that Kastalon was to hold the rolls indefinitely,
and that he admitted that the alleged oral agreement placed
no obligations on Toll Processing other than to advise
Kastalon that it had received a purchase order for the pickle
line and was ready to proceed with work involving the rolls.
According to Kastalon, the spare and vague terms of this
oral agreement were too indefinite to be enforced under
Illinois law.
Kastalon’s expectation that Toll Processing would hire it
to repair and refurbish the rolls constitutes consideration.
But we conclude that the district court correctly entered
judgment in Kastalon’s favor as to Toll Processing’s breach
of contract claim, because the evidence shows that the
parties did not have a mutual understanding that Kastalon
would store the rolls indefinitely.
The duration of the agreement was to be determined by
the date on which Toll Processing issued a purchase order to
Kastalon to repair and refurbish the rolls for use in the
18 No. 15-3187
newly installed pickle line. 4 When Kastalon agreed to store
the rolls, however, Toll Processing did not know when—or
even if—it would issue that purchase order. The parties
hoped and anticipated that Toll Processing would issue the
purchase order within months, but Toll Processing conceded
that it was possible it might never have issued a purchase
order. Even Sander agreed that it would not have been
reasonable to expect Kastalon to store the rolls forever. And
Schempp (the consultant on the pickle line project) could not
explain what would have happened to Kastalon’s obligation
to store the rolls if Toll Processing never had issued a pur-
chase order.
The district court correctly determined that the undisput-
ed facts showed that the parties “perhaps … attempt[ed] to
formulate a contract,” but that they did not reach a mutual
understanding that Kastalon would store the rolls for any
certain period of time, let alone indefinitely. Id. Perhaps due
to the parties’ belief that the pickle line would be re-installed
within a period of months, the storage agreement was not
reduced to writing. Even though “the plaintiff might have
been comfortable with proceeding somewhat informally in
its dealings with defendant, it cannot later expect the court
to complete the negotiation process and arrive at terms on its
behalf.” Doyle’s Const. & Remodeling, Inc. v. Wendy’s Int’l, Inc.,
144 F. Supp. 2d 969, 974 (N.D. Ill. 2001) (citing J.F. McKinney
4 The Illinois Supreme Court has held that “the duration of an
agreement may be determined from a consideration of the agreement as
a whole,” or can be “inferred based on custom in the area … .” Wait, 491
N.E.2d at 801 (citations omitted). The agreement here is too sparse for
that remedy, and given the unique circumstances, there is no evidence in
the record of “custom.”
No. 15-3187 19
& Assocs., Ltd. v. Gen. Elec. Inv. Corp., 183 F.3d 619, 622 (7th
Cir. 1999)). We affirm the district court’s grant of summary
judgment in Kastalon’s favor (and denial of summary judg-
ment to Toll Processing) on Toll Processing’s contract claim,
because the parties’ oral storage agreement was not suffi-
ciently definite as to duration, a material term of the oral
agreement.
III. Conclusion
We reverse the district court’s grant of summary judg-
ment in favor of Kastalon on Toll Processing’s conversion
claim, reverse the grant of summary judgment in favor of
Kastalon on the negligence claim, and affirm the district
court’s grant of summary judgment as to Toll Processing’s
breach of contract claim. We remand to the district court for
further proceedings consistent with this decision.
AFFIRMED IN PART, REVERSED IN PART, AND REMANDED.