Sale of business; liquidated damages for breach of contract
And they call some tort cases frivolous!?
In Caincare Inc. v. Ellison, decided 3/15/05 in the Georgia Court of Appeals, a contract for sale of a pharmacy provided liquidated damages if the buyer failed to cease all use of the old store name within six months. An employee programmed the old name in the header generated by a fax machine which continued sending out faxes bearing the old name beyond the six months. When this was called to its attention, the new owner changed the header. However, the seller sued for breach of contract and sought liquidated damages totally unrelated to the scope of the alleged breach.
The Court of Appeals flushed this frivolous case, but was polite enough not to use the phrase that a federal judge employed to describe an insurance company’s defense in a disability insurance case: “pure poppycock.”
A liquidated damages provision for the misuse of the seller’s brand name in a sales agreement for an existing pharmacy was an unenforceable penalty, since the seller never adequately explained how the damages amount was calculated. See the opinion below.
The Shigley Law Firm represents plaintiffs in wrongful death and catastrophic injury cases statewide in Georgia, and in other states subject to the multijurisdictional practice and pro hac vice rules in each state. Ken Shigley was designated as a “SuperLawyer” in Atlanta Magazine and one of the “Legal Elite” in Georgia Trend Magazine. He is a Certified Civil Trial Advocate of the National Board of Trial Advocacy, Chair of the Southeastern Motor Carrier Liability Institute and former chair of the Georgia Insurance Law Institute. He particularly focuses on cases arising from truck wrecks and accidents (tractor trailers truck wrecks, semi truck wrecks,18 wheeler truck wrecks, big rig truck wrecks, log truck wrecks, dump truck wrecks).