Breach of Contract – Commission Agreements

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7^th Circuit Court of Appeals

Case Name: R3 Composites Corp., v. G&S Sales Corp

Case No.: 19-2290

Officials: WOOD, Chief Judge, and SYKES and HAMILTON, Circuit Judges.

Focus: Breach of Contract – Commission Agreements

The central issue in this case is whether R3 Composites Corporation owes G&S Sales Corporation any additional sales commissions for work G&S did as a representative for R3. The parties agreed on a written contract. The critical term dealing with sales commissions did not show any agreement on commission rates. It said instead that the parties would try to agree on commission rates on a job-by-job, customer-by-customer basis. Everyone agrees that the original “agreement to agree” would not have been enforceable by itself, but the parties did in fact later agree on commission rates for each customer and went forward with their business.

The district court granted summary judgment for manufacturer R3, relying primarily on the original failure to agree on commission rates. We reverse. A reasonable jury could find that the later job-by-job commission agreements were governed by the broader terms of the original written contract. The rest of the case is rife with factual disputes that cannot be resolved on summary judgment.

Reversed and remanded

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Derek A Hawkins is trademark corporate counsel for Harley-Davidson. Hawkins oversees the prosecution and maintenance of the Harley-Davidson’s international trademark portfolio in emerging markets.