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BELLEVILLE TOYOTA, INC., Plaintiff-Appellee, v. TOYOTA MOTOR SALES, U.S.A., INC., Defendants-Appellants. | ) ) ) ) ) ) ) ) ) ) ) | Appeal from the Circuit Court of St. Clair County. No. 94-L-13 Honorable James M. Radcliffe, III, Judge, presiding. |
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JUSTICE CHAPMAN delivered the opinion of the court:
This case involves a claim by a Toyota dealership against the defendants, Toyota Motor Sales, U.S.A., theauthorized importer of new Toyota vehicles into the United States, and Toyota Motor Distributors, the wholesaledistributor of those vehicles (collectively, defendants). Since 1973, the plaintiff, Belleville Toyota, Inc., doing businessas Bill Newbold Toyota (plaintiff), has been selling Toyotas in Belleville, Illinois. In 1989 plaintiff filed a lawsuitagainst defendants for an injunction to prevent the opening of a new Toyota dealership in nearby Collinsville, Illinois. The 1989 action was voluntarily dismissed, but on January 30, 1991, plaintiff filed an amended complaint fordefendants' breach of 1975 and 1980 dealer agreements. The amended complaint claimed that defendants did notallocate to plaintiff all of the vehicles it should have. On July 20, 1992, plaintiff filed a second amended complaint inwhich it claimed that defendants' allocation of vehicles violated section 4(d) of the Motor Vehicle Franchise Act (theAct) (815 ILCS 710/4(d) (West 1998)). Plaintiff's claim of the misallocation of vehicles by defendants was the thrustof the evidence produced in a jury trial, which resulted in a verdict for plaintiff in 1997 and a special-interrogatoryresponse that defendants' conduct was willful and wanton. After the jury's verdict, the trial judge trebled the damagespursuant to the provisions of the Act. Defendants perfected a timely appeal and raise the following claims for review:
1. Defendants are entitled to a judgment notwithstanding the verdict or, alternatively, a new trial onplaintiff's breach-of-contract claim because defendants complied with the terms of the contracts.
2. Plaintiff released any claims it had prior to September 6, 1988, because it entered into a dealeragreement on that date that contained a general release.
3. Plaintiff failed to prove proximate cause or damages with respect to any of its claims.
4. Plaintiff is not entitled to recover under the Act for several reasons.
5. The claims are barred by the statutes of limitation.
6. The court erred in denying defendants' instructions on the statutes of limitation.
7. Defendants are entitled to a new trial because the jury's verdicts are irreconcilably inconsistent.
Defendants claim that they are entitled to a judgment n.o.v. or a new trial because they complied with all theterms of the contracts. The disputed contractual terms involved in this case relate to the defendants' method for theallocation of vehicles. Plaintiff contended that defendants breached either or both of the following sections of thecontracts. If there was no shortage of vehicles, then the following 1980 contract language applied:
"Dealer shall submit orders for TOYOTA products to DISTRIBUTOR upon order forms supplied byDISTRIBUTOR. DISTRIBUTOR may accept such orders in whole or in part by notice in writing to DEALERor by actual delivery to DEALER.
DISTRIBUTOR agrees to provide TOYOTA products to DEALER in such quantities and types as are orderedby DEALER, subject to available supply from IMPORTER and subject to change or discontinuance at any timewith respect to any TOYOTA product."
The 1986-1988 dealer agreements contain different language for the nonshortage situation:
"DISTRIBUTOR agrees to use its best efforts to provide Toyota Products to DEALER in such quantities andtypes as may be required by DEALER to fulfill its obligations with respect to the sale and serving of ToyotaProducts under this Agreement, subject to available supply from IMPORTER, DISTRIBUTORS, marketingrequirements, and any change or discontinuance with respect to any Toyota Product."
Plaintiff contends that the above provisions required defendants to furnish all the cars that plaintiff ordered. Defendants adamantly argue that no such duty can be gleaned from the language of any of the agreements, especiallyfrom the language of the 1986-1988 agreements. Although we might agree with defendants' interpretation of theagreements on this point, we do not need to rule on this issue in view of our resolution of the contractual requirementsfor times in which there was a shortage of available vehicles.
Plaintiff certainly does not concede that defendants' position is correct on the order provision, but it doescontend on appeal, as it did at the trial, that the main thrust of its action is that there was a shortage of vehicles duringthe period involved and that defendants did not allocate vehicles as they were supposed to during this period of shortage. The contractual provisions that governed vehicle allocation during times of shortage are as follows:
"1980 Dealer Agreement-DISTRIBUTOR and DEALER recognize that TOYOTA motor vehicles may notbe available in sufficient supply from time to time because of production limitations or other factors. Wheresuch shortage is expected to exist for a significant period, it is understood and agreed that such vehicles willbe allocated by DISTRIBUTOR to DEALER principally on the basis of sales performance during the mostrecent representative period of adequate supply ***."
1986-1988 Dealer Agreements. Where such a shortage is determined by DISTRIBUTOR to exist,DISTRIBUTOR will endeavor to allocate the affected Toyota Product(s) among its dealers in a fair andequitable manner, which it shall determine in its sole discretion." (Emphasis added.)
Defendants contended throughout the trial, from the time of their opening statement and through their closingargument, that there was absolutely no evidence of a shortage of Toyota vehicles during the 1980s. This position wassimply not supported by the evidence.
Plaintiff's principals, Bill and Kent Newbold, testified that there was a shortage for two reasons:
1. The oil crisis of the 1970s created a demand for small, fuel-efficient cars that American manufacturerswere not as well prepared to fill as were foreign manufacturers, including Toyota.
2. In 1981 the Voluntary Restraint Agreement entered into between the Japanese and the United Statesgovernments restricted the number of Toyota vehicles that could be imported into the United States.
Other dealers supported the plaintiffs on these points. In addition, when pushed on cross-examination,representatives of defendants conceded that if the word "shortage" was defined as an excess of demand for cars overthe number of cars available, then indeed there was a shortage of vehicles. Therefore, although the presence or absenceof a shortage of vehicles was a contested fact issue, there was certainly sufficient evidence presented to establish ashortage.
Once evidence of a shortage was presented, the allocation language quoted above became material, and thislanguage, particularly that contained in the 1980 dealer agreement, was the primary focus of most of the testimony inthe case. The allocation methods at issue used both computer programs to determine the appropriate number of vehiclesto be allocated to dealers under normal circumstances of shortage and a discretionary source called the regionalmanagers pool, which gave regional managers discretion over approximately 10% of the vehicles within a region. Plaintiff was in defendants' Chicago region.
Plaintiff attacked both of defendants' allocation methods. First, plaintiff contended and presented evidenceto support its contention that defendants' allocation of vehicles was by neither the method set out in the dealeragreements-the "last-period-of-adequate-supply" method-nor the method that defendants' representatives told theplaintiffs it was using-the "turn-and-earn" method-but was instead a third method called the "balanced-day-supply"method. Defendants' witnesses admitted that its actual allocation method was not the one that it told dealers it used. In addition, plaintiff presented a Toyota internal memorandum, authored by the general manager of defendants' Chicagoregion, which stated the following:
"The present system is very complex and lacks credibility with our dealers. Although it can be explained asa 'turn[-]and[-]earn' system, the projected result of any factor or series of factors cannot be easily simulated.
Present dealer understanding of our allocation system is essentially that 'turn[-]and[-]earn' is a must. A fullunderstanding of how various factors work within the system is limited to only a few dealers. The complexityof each of the various increments is the most difficult to develop and maintain a clear understanding ***."
Second, plaintiff contended that defendants' Chicago regional managers did not stay within the 10%discretionary range when distributing cars from the regional manager's pool but that they routinely went beyond thatrange and that they did it without written approval, which was in violation of defendants' own requirements. Plaintiffcontended that these activities resulted in its receiving significantly fewer vehicles than it was entitled to and that, inview of the excess demand for Toyotas during this period, plaintiff could have easily sold those additional vehicles thatit should have received.
Plaintiff called two experts, Robert Benson and Dr. Ostlund, to support its claim. Benson testified that hisexamination of defendants' computer program for the allocation of vehicles revealed that it had a great many parametersbuilt into it that gave defendants a significant amount of discretion in its allocation decisions. Benson did not testifythat defendants used the flexible system in any deleterious way, only that the system gave defendants the capability ofmanipulating the numbers of vehicles allocated.
Dr. Ostlund presented his calculation of the losses plaintiff incurred based on the number of vehicles allocatedto plaintiff under the balanced-day-supply method as compared to the number of vehicles plaintiff would have receivedunder both the last-period-of-adequate-supply or dealer-agreement method and the turn-and-earn or Toyota-representative method. In Ostlund's opinion, plaintiff lost approximately $5 million over the time period involved.
Plaintiff's evidence did not go unchallenged. Both through vigorous cross-examination and through the useof its own witnesses, defendants countered plaintiff's theory. The question before us on this issue, however, is notwhich side should prevail. Instead, the question is whether all of the evidence, when viewed in its aspect most favorableto plaintiff, so overwhelmingly favors defendant that a contrary verdict could never stand. Pedrick v. Peoria & EasternR.R. Co., 37 Ill. 2d 494, 510, 229 N.E.2d 504, 513-14 (1967).
On the basis of this record, we conclude that the trial court did not err in denying defendants' motion forjudgment n.o.v. We also conclude that there was no error in the court's denial of defendants' motion for a new trial. Although the standard of review for the ruling on the new-trial motion is different than the Pedrick standard, weconclude that the trial court properly resolved this issue in plaintiff's favor, since such a finding was not against themanifest weight of the evidence. See Maple v. Gustafson, 151 Ill. 2d 445, 603 N.E.2d 508 (1992).
Turning to defendants' second argument, that the trial court erred in denying its summary judgment motionbased on release language contained in the 1986-1988 dealer agreements, we note that the release language providesas follows:
"[Each party] releases the other from any and all claims, causes of action, or otherwise that it may have againstthe other for money damages arising from any event occurring prior to the date of execution of thisAgreement."
Defendants contend that this language clearly releases it from all claims prior to the 1986 agreement.
Plaintiff responds that defendants waived any issue regarding the release by failing to tender any instructionson the issue. We agree with plaintiff that it was incumbent upon defendants to tender instructions on this issue topreserve for appeal its claim of error. See Deal v. Byford, 127 Ill. 2d 192, 537 N.E.2d 267 (1989).
Defendants next contend that it was unnecessary for them to tender an instruction on the release issue, becausethe trial court erred as a matter of law in denying its motion for summary judgment on this point. In most cases, an orderdenying a motion for summary judgment merges with the judgment entered on the verdict and is not appealable. Labatev. Data Forms, Inc., 288 Ill. App. 3d 738, 682 N.E.2d 91 (1997). In some cases, however, it has been held that if theissue raised in the summary judgment motion is one of law and should not have been given to the jury for resolution,the order denying the summary judgment motion does not merge. Walters v. Yellow Cab Co., 273 Ill. App. 3d 729, 653N.E.2d 785 (1995). The release issue in this case involved factual disputes. First, Kent Newbold's affidavit inopposition to the summary judgment motion stated that the release was not a part of the dealer agreement at the timethat it was signed. Second, the document defendants rely upon provides that the parties did not release "claims whicheither party does not know or reasonably suspect to exist in its favor at the time of the execution of this Agreement." Kent Newbold's affidavit stated that he did not know or suspect the existence of the claims when the agreements wereexecuted. Although defendants disagree with these two verified statements, the statements present disputed issues offact, and therefore, the ruling on the summary judgment motion merges with the judgment order and is not appealable. See Labate, 288 Ill. App. 3d 738, 682 N.E.2d 91.
Defendants' next point on appeal is that plaintiff failed to prove the proximate cause of its claimed damages,and it submits several arguments in support of its contention. Defendants' first argument on this point is based on theircontention that plaintiff's expert admitted that he could not establish causation. Defendants contend that plaintiff'sexpert assumed (1) that plaintiff would have ordered a certain number of vehicles in the given years, (2) that plaintiffwould have sold those vehicles, and (3) that defendants' failure to furnish that number of vehicles caused plaintiff'sdamages. Defendants contend that, in spite of Ostlund's assumptions, he admitted that he could not quantify in anydetail the harm suffered by plaintiff. Defendants' second argument on this point is that plaintiff failed to prove causationwithin a reasonable degree of certainty.
Plaintiff responds that defendants' first argument essentially sets forth plaintiff's causation connection. Plaintiffargues that but for defendants' failure to allocate the appropriate, and larger, number of vehicles to plaintiff, plaintiffwould have sold that larger number and therein lies its proof of causation, and plaintiff contends that the proof is withina reasonable degree of certainty. Plaintiff argues that a comparison of the number of vehicles it should have receivedto the number it actually received is precisely the analysis that should be used. Plaintiff cites Jay Edwards, Inc. v. NewEngland Toyota Distributor, Inc., 708 F.2d 814 (1st Cir. 1983). In Jay Edwards, Inc., the court approved the plaintiff'spresentation of evidence that its dealership was offered some 300 fewer cars per year than was a comparable dealership. The plaintiff in Jay Edwards, Inc. based its damages on the loss of profits from the smaller number of cars availableto it multiplied by the profit per vehicle it would have received on each car.
Defendants' next two arguments on the causation issue are that plaintiff failed to account for intersecting causesthat could have caused the loss in its profits (see Midland Hotel Corp. v. Reuben H. Donnelley Corp., 118 Ill. 2d 306,515 N.E.2d 61 (1987)) and that Ostlund's damage models are not based on the facts. According to defendants, plaintiff'sexpert, Ostlund, testified to many factors that could affect plaintiff's sales and profitability, such as the location of thedealership, the quality and number of personnel, and pricing practices. Defendants criticize Ostlund's analysis becauseit focused strictly on the availability of vehicles and because he did not point to specific facts to establish plaintiff'slosses.
Plaintiff responds that the analysis outlined by Ostlund was based on plaintiff's actual business performanceduring the time involved and that it therefore reflected the various intersecting factors that affect profits. In addition,and with specific regard to defendants' contention that the damage models were not based on actual data, plaintiff pointsout that Ostlund not only calculated the number of vehicles that should have been allocated to plaintiff but alsocalculated the average gross profit that plaintiff made from each new Toyota vehicle sold in each year in issue. Then,in order to arrive at a net profit per vehicle, Ostlund deducted numerous expenses derived directly from plaintiff'sfinancial statements.
We agree with plaintiff that the primary case relied upon by defendants, Midland Hotel Corp., isdistinguishable. In Midland Hotel Corp., the plaintiff hotel sought damages for the breach of a contract to include itin a new telephone directory. To establish its lost profits, the plaintiff presented evidence of the variance between theplaintiff's occupancy percentage and the average occupancy percentage of other Chicago hotels. The percentages werederived from a trade publication called Trends In The Hotel Industry (Trends). The plaintiff's expert assumed that sincethe plaintiff's average occupancy rate for the 30-month period immediately preceding the publication of the directorywas approximately 1% below the average rate published in Trends, it was reasonable to assume that the occupancy rateswould have continued to correspond, except for the fact that the defendant had omitted the plaintiff from its directoryin 1981. The supreme court rejected this contention because the averages did not sufficiently indicate what washappening. In fact, the plaintiff's occupancy rate had been much higher in 1979 but had been decreasing even beforethe 1981 publication of the directory. In addition, even though the plaintiff was included in the 1982 directory, itsoccupancy rate continued to decline. The supreme court concluded that if the exclusion from the directory in 1981caused substantial losses, then one would expect that the inclusion in the directory in 1982 would result in at leastmodest gains. Therefore, the supreme court concluded that the plaintiff's expert's assumption about occupancy rateswas unfounded and did not support the verdict.
In contrast, in this case the crucial assumption by plaintiff's expert is that, in times of shortage, if additionalvehicles had been allocated to plaintiff, those vehicles could have been sold, and on this common-sense point even someof defendants' witnesses agreed.
We agree with plaintiff that the analysis of Ostlund, which, as he indicated, is a methodology that is reasonablyaccepted in the field of automobile finance, effectively accounted for intersecting factors and was sufficiently based onactual data to survive defendants' challenge. See Earl Evans Chevrolet, Inc. v. General Motors Corp., 74 Ohio App.3d 266, 598 N.E.2d 1187 (1991); Malatesta v. Leichter, 186 Ill. App. 3d 602, 542 N.E.2d 768 (1989); Tower Oil &Technology Co. v. Buckley, 99 Ill. App. 3d 637, 425 N.E.2d 1060 (1981).
Defendants' next attack on the causation issue is based on the fact that Ostlund testified to eight differentpotential awards that encompassed a range from approximately $5 million to approximately $11 million. Defendantscontend that Ostlund's presentation of eight possibilities within a range of $6 million establishes that plaintiff was unableto establish damages within a reasonable degree of certainty. Plaintiff responds that the alternative damage estimateswere entirely appropriate because the correct measure of damages depended upon the outcome of factual disputes thatthe jury had to resolve. For example, if the jury found that there was no shortage of vehicles, it might still considerdamages based on plaintiff's theory that an order system was in existence. We agree with plaintiff that since alternativetheories and different periods were involved, it was appropriate for different estimates of damages based on the differentfactors to be supplied to the jury. See Hills of Palos Condominium Ass'n, Inc. v. I-Del, Inc., 255 Ill. App. 3d 448, 626N.E.2d 1311 (1993); Landes Construction Co. v. Royal Bank of Canada, 833 F.2d 1365 (9th Cir. 1987); see also EarlEvans Chevrolet, Inc., 74 Ohio App. 3d 266, 598 N.E.2d 1187; Fox Motors, Inc. v. Mazda Distributors (Gulf), Inc.,806 F.2d 953 (10th Cir. 1986).
Defendants' final contention on the causation issue is that plaintiff's claimed damages were improperly inflatedby prejudgment interest, which plaintiff was not entitled to recover. Plaintiff's first response is that Ostlund did nottestify about prejudgment interest but about reinvestment earnings and interest recovery. According to defendants,Ostlund's reinvestment theory assumed that plaintiff would have reinvested every dollar of lost profit in the businessand would have earned a return on this reinvestment and that this is nothing more than prejudgment interest in anotherguise. See Sterling Freight Lines, Inc. v. Prairie Material Sales, Inc., 285 Ill. App. 3d 914, 674 N.E.2d 948 (1996). Plaintiff's second response is that even if the reinvestment testimony was improperly admitted, defendants were notprejudiced, because the jury did not return an award for those claimed damages. In support of this argument, plaintiffpoints to the cross-examination of Ostlund, during which he was asked to exclude several categories of plaintiff'sdamages, including the claimed prejudgment damages. The results of those exclusions were damage estimates rangingfrom $2.1 million to $3.7 million. Since it is apparent from the jury's verdicts of $2.25 and $2.5 million that thereinvestment portion of plaintiff's claimed damages was not awarded to plaintiff, we conclude that Ostlund's testimonyon this point, even if erroneously admitted, did not rise to the level of reversible error.
Defendants' next claim is that plaintiff was not entitled to recover under the Act for several reasons, that itsvehicle-allocation system was not arbitrary and capricious, either in general or in its particular application as to plaintiff,and that the court improperly refused defendants' instruction that defined "arbitrary and capricious." In addition,defendants challenge the trial court's award of treble damages under the Act and the constitutionality of section 4(d)(1)of the Act, which provides:
"(d) It shall be deemed a violation for a *** distributor ***:
(1) to adopt, change, establish[,] or implement a plan or system for the allocation anddistribution of new motor vehicles to motor vehicle dealers which is arbitrary or capricious or tomodify an existing plan so as to cause the same to be arbitrary or capricious." 815 ILCS 710/4(d)(1)(West 1998).
Defendants first argue that the balanced-days-supply system was not arbitrary and capricious as to dealers ingeneral because defendants had sound business reasons for its use. For example, defendants point out that theparameters built into the system, which were described by plaintiff's expert, Benson, although perhaps giving it theability to manipulate, which Benson discussed, also served the sound business purpose of giving it flexibility, whichBenson admitted. Plaintiff responds that the adjustable parameters that defendants built into its computer allocationsystems were designed to allow management to manipulate the results of allocations and that the jury could considerthe evidence that defendants either did not create or destroyed documentation of how the parameters were set. Inaddition, plaintiff points out that although defendants promised dealers that these allocations would be calculated ona turn-and-earn system, the allocation system did not give turn-and-earn results. Finally, plaintiff points out that oneof defendants' internal memoranda stated, "The projected result of any factor or series of factors [in the allocationsystem] cannot be easily simulated."
In view of these items of evidence and others, plaintiff contends that defendants' reliance upon CabrioletPorsche Audi, Inc. v. American Honda Motor Co., 773 F.2d 1193 (11th Cir. 1985) (Cabriolet), is misplaced. Defendants contend that the Cabriolet court reversed a judgment against Honda that had used a balanced-day-supplymodel similar to the one employed by defendants. Therefore, according to defendants, the balanced-day-supply modelit used could not have been arbitrary and capricious. Plaintiff challenges the applicability of Cabriolet to this casebecause the reversal was based upon the record in that case and the plaintiff's failure in that case to establish thatHonda's conduct was arbitrary.
A perusal of this record makes it clear that the result in Cabriolet was based upon a record considerablydifferent than the record before this court. For example, in Cabriolet, both parties agreed that the allocation system usedby Honda was the balanced-day-supply system. In this case, there is certainly no agreement on that issue. In addition,in Cabriolet the evidence about the 15% hold-back cars, a system similar to defendants' 10% regional manager's pool,was significantly different. In Cabriolet, the Honda employees had to account for the cars distributed from the 15%pool, while in this case plaintiff presented evidence that defendants' regional managers used their discretion to allocatevehicles to dealers just to improve the dealer's future allocation, without any identification of special circumstances, andthat the managers allocated excessive numbers of vehicles to certain dealers without regard for the numerical limits setin defendants' own policy manual. Therefore, we conclude that Cabriolet is distinguishable, that plaintiff submittedsufficient evidence to establish that defendants violated the Act, and that the trial court properly denied defendants'motion for judgment n.o.v. and for a new trial on that claim. See Kawasaki Shop of Aurora, Inc. v. Kawasaki MotorsCorp., U.S.A., 188 Ill. App. 3d 664, 544 N.E.2d 457 (1989).
Defendants' next argument on the statutory claim is that the trial court improperly refused to define the words"arbitrary and capricious" that are contained in the Act. The mere fact that words are contained in a statute does notmean that they require an instruction defining them to make them intelligible to a jury. As long as the words areunderstandable and are used in their conventional sense, there is no necessity to define them. The authorities cited bydefendants, Olympic Chevrolet, Inc. v. General Motors Corp., 959 F. Supp. 918 (N.D. Ill. 1997), Schott MotorcycleSupply, Inc. v. American Honda Motor Co., 976 F.2d 58 (1st Cir. 1992), and Thoroughbred Ford, Inc. v. Ford MotorCo., 908 S.W.2d 719 (Mo. App. 1995), define the terms by using definitions from standard dictionaries.
Defendants' reliance upon Head v. Lutheran General Hospital, 163 Ill. App. 3d 682, 516 N.E.2d 921 (1987),is unpersuasive for three reasons. First, although Head approved one definition of arbitrary and capricious, it did nothold that a definition was required. Second, the definition of arbitrary and capricious submitted by defendants is not theone approved by Head. Third, our supreme court has held, "It is well established that the meaning of words, used intheir conventional sense, need not be defined or explained in giving instructions to the jury." Larson v. CommonwealthEdison Co., 33 Ill. 2d 316, 323, 211 N.E.2d 247, 252 (1965); see Kingston v. Turner, 115 Ill. 2d 445, 459, 505 N.E.2d320, 326 (1987). Therefore, we conclude that the trial court did not err in refusing defendants' definition of arbitraryand capricious.
We now turn to defendants' criticism of the jury's finding of willful or wanton conduct on the statutory claimand the trial court's award of treble damages. Defendants' first point on this issue is that the trial court erroneously gaveIllinois Pattern Jury Instructions, Civil, No. 14.01 (3d ed. 1995) (hereinafter IPI) as its definition of willful and wanton. Defendants quote from Loitz v. Remington Arms Co., 138 Ill. 2d 404, 563 N.E.2d 397 (1990), on punitive damages:
"[T]hese damages can be awarded only for conduct for which this remedy is appropriate-which is to say,conduct involving some element of outrage similar to that usually found in a crime. The conduct must beoutrageous, either because the defendant's acts are done with an evil motive or because they are done withreckless indifference to the rights of others." (Emphasis added.) Loitz, 138 Ill. 2d at 415-16, 563 N.E.2d at402.
The next sentence in the supreme court's opinion is:
"In this context, willful and wanton misconduct 'approaches the degree of moral blame attached to intentionalharm, since the defendant deliberately inflicts a highly unreasonable risk of harm upon others in consciousdisregard of it.' " (Emphasis added.) Loitz, 138 Ill. 2d at 416, 563 N.E.2d at 402.
The first emphasized portion of the preceding quotes is the language contained in defendants' tendered and refusedinstruction on this point. The last two emphasized phrases, "reckless indifference" and "conscious disregard," are muchcloser to IPI No. 14.01's language "utter indifference to or conscious disregard of." In view of the greater similarity ofthe latter emphasized quotations to the IPI language and particularly in view of the admonition of Supreme Court Rule239 (177 Ill. 2d R. 239) to trial courts to use IPI instructions whenever they cover the circumstances, we conclude thatthe trial court did not err in refusing defendants' tendered definition and instead instructing in the language of IPI No.14.01.
Defendants next contend that even assuming that the jury was properly instructed on this point, its finding thatdefendants' conduct was willful and wanton is against the manifest weight of the evidence. In support of its argument,defendants point to certain evidence that showed their concern for dealers in general and for plaintiff in particular. Plaintiff counters with examples of evidence to the contrary. In addition to evidence already alluded to, plaintiffcontends that defendants' allocation system in the Chicago region favored dealers in Chicago, because they receivedvehicles days earlier than Southern Illinois dealers because of the Chicago dealers' proximity to the railhead. Plaintiffargues that although this resulted in Chicago dealers receiving more cars to plaintiff's detriment and although defendantscould have compensated for this delivery delay in its computer allocation program, they did not. Further, plaintiff pointsout that it presented evidence that numerous dealers complained to defendants about the allocation system but despitethese complaints, defendants never tested the system to see if their allocation results were consistent with their turn-and-earn claims. Finally, plaintiff presented evidence that the regional pool managers improperly allocated vehicles andconcealed from dealers the effect of regional pool awards on future allocations. In view of the evidence presented, weconclude that the jury's finding of willful and wanton was not against the manifest weight of the evidence.
Defendants' next contention is that the trial court's award of treble damages was erroneous because the courtfailed to consider factors pertinent to such a determination. Defendants cite Kawasaki Shop of Aurora, Inc. v. KawasakiMotors Corp., U.S.A., 188 Ill. App. 3d 664, 544 N.E.2d 457 (1989) (Kawasaki Shop), for the proposition that it isincumbent upon trial courts to consider the four factors considered by the trial court in Kawasaki Shop. This, however,is not the holding of Kawasaki Shop. Although the appellate court noted four factors the trial court considered, theappellate court in no way made the consideration of those factors a mandatory step in trial court decisions on whetherto award treble damages. Kawasaki Shop simply held that the trial court's decision to refuse treble damages based onthe record in that case was not an abuse of discretion. Similarly, we conclude that the trial court's decision to awardtreble damages based on the evidence already alluded to in this case was not an abuse of discretion.
Defendants' final point regarding the statutory claim is that section 4(d)(1) of the Act is unconstitutionallyvague and in violation of defendants' due process rights. Defendants contend that the statute's language that makes itunlawful to "adopt, change, establish[,] or implement" an allocation system that is "arbitrary or capricious" (815 ILCS710/4(d)(1) (West 1998)) fails to specifically delineate the types of conduct that violate the Act or the types of allocationsystems that are impermissible. These failures, defendants contend, mean that the statute does not convey sufficientnotice and fair warning of what conduct is proscribed and that, therefore, the statute is unconstitutional.
Although plaintiff contends that defendants waived this contention because they did not raise it until they filedtheir posttrial motion, we disagree. Constitutional challenges can be raised at any time. Brown v. Department of PublicAid, 274 Ill. App. 3d 410, 654 N.E.2d 582 (1995), vacated on other grounds, 167 Ill. 2d 550, 665 N.E.2d 841 (1996). Therefore, we will not consider defendants' argument on this point to be waived.
Defendants' contention on this point is similar to that raised earlier on the necessity to define the terms"arbitrary and capricious" by instruction. In this argument, however, defendants contend that the failure to provide adefinition rises to the level of an unconstitutional deprivation of due process. We cannot agree. The terms arbitraryand capricious are neither so esoteric nor so vague as to require specific definition. Statutes enjoy a presumption ofconstitutionality, and the party who challenges them has the burden of establishing their invalidity. People v. Warren,173 Ill. 2d 348, 671 N.E.2d 700 (1996). If the terms in a statute have a readily discernible common meaning, they aresufficiently specific to notify those subject to them of the conduct that is prohibited. Desnick v. Department ofProfessional Regulation, 171 Ill. 2d 510, 665 N.E.2d 1346 (1996). The terms arbitrary (without fair or substantialreason) and capricious (unpredictable) are sufficiently specific, and we conclude that section 4(d)(1) is constitutional.
The next issue raised by defendants is their statute-of-limitation defense, which was raised by a motion todismiss and by a motion for summary judgment, both of which were denied. Defendants contend that the breach-of-contract action was barred by the four-year statute under the Uniform Commercial Code (UCC) (810 ILCS 5/1-101 etseq. (West 1998)) for the 1980 contract, which contained a choice-of-law provision, under California's four-year statuteof limitation. As to plaintiff's claim under the Act, defendants assert that it is barred by that Act's four-year statute oflimitation. On the breach-of-contract claim, plaintiff responds with the contention, among others, that the UCC shouldnot apply because defendants provided in three of the form agreements as follows: "This is a personal service contract." Because personal service contracts are not governed by the UCC, plaintiff contends that Illinois's 10-year statute oflimitation should apply. As to the choice-of-law provision, plaintiff argues that statutes of limitation are procedural,to be determined by the law of the forum, and that, therefore, Illinois's 10-year statute should apply.
As to the statutory claim, plaintiff relies upon its claim that the violation of the Act was a continuing violationand that, therefore, the statute of limitation did not come into play because the violations continued throughout theperiod of the claim.
Although the parties' positions on the breach-of-contract claim are well argued, we need not extend the lengthof this opinion by addressing them in any further detail, because we conclude that the trial court properly applied thecontinuing-violation rule to the statutory claim. Since the jury found for plaintiff on both claims and since the trial courtruled that the larger award on the breach-of-contract claim could be satisfied by a payment of the lesser award on thestatutory claim, it is unnecessary to rule on the statute-of-limitation defense on the breach-of-contract claim or onwhether the continuing-violation rule applies to the contract claims. See 735 ILCS 5/2-1201(d) (West 1998); Yates v.Chicago National League Ball Club, Inc., 230 Ill. App. 3d 472, 595 N.E.2d 570 (1992).
Turning to the statute-of-limitation defense on the statutory claim, defendants argue that the trial court shouldhave allowed its pretrial motions or, in the alternative, it should have given to the jury defendants' tendered instructionson that issue.
The trial court apparently concluded that the continuing violation of the Act tolled the running of the statuteof limitation. Although there is little authority on this point, we note that a violation of a similar federal statute, theAutomobile Dealers' Day in Court Act (15 U.S.C.,