Appellant Payless Car Rental System, Inc. ("Payless"), is a franchisor of retail car rental businesses. Appellants L & S Vehicle Leasing, Inc. ("L & S"), Orlin, Inc., and Atlin, Inc., are entities affiliated with Payless and are engaged in the car rental or leasing business. Appellee PRG Group, LLC ("PRG"), a Payless franchisee, is a Georgia limited liability company wholly-owned and managed by appellee Anthony Elkik.
Because appellants challenge the trial court's ruling on summary judgment, we apply the following standard of review:
Properly construed, the evidence can be summarized as follows.
Section 5.2 of the Purchase Agreement provided that for the first year, Orlin "or its assignee" would lease "up to 300" vehicles to PRG for use in its car rental business, "subject to the approval of Orlin's fleet financing companies." Charles Steven Blakley, a vice president of Payless, testified by deposition that this arrangement was put in place because
PRG has acknowledged that when it acquired the franchise, it selected approximately 215 cars from Atlin's existing fleet with which to begin its rental operations. These vehicles were titled in L & S's name, and L & S, as Orlin's assignee, leased the vehicles to PRG. Blakley testified that PRG subsequently notified Payless that it wished to order an additional 285 rental vehicles; that the vehicles were ordered from Walden Leasing and Eckhaus Fleet, the leasing companies with which L & S did business; that the leasing companies leased the vehicles to L & S; that L & S then subleased the vehicles to PRG; and that L & S submitted invoices to PRG for the leased vehicles at L & S's cost plus $25 per car per month.
On February 1, 2007, after 15 months of operation, PRG sold its franchise for $1.4 million and received net sales proceeds of $1,239,830. Appellants contend that at that time, PRG owed L & S a balance of $856,795.63 for amounts due on leased vehicles. Seeking to collect these lease charges, Payless and L & S filed the underlying action against PRG and Elkik, asserting claims based on open account, quantum meruit, and breach of contract.
PRG subsequently filed counterclaims against Payless and L & S and third-party claims against Orlin and Atlin, claiming, inter alia, that appellants breached the Purchase Agreement by failing to supply PRG with the required number of leased vehicles. PRG further asserted that appellants had breached the implied covenant of good faith and fair dealing as to the Purchase Agreement.
1. Breach of Purchase Agreement. Appellants contend that the trial court erred in finding that issues of material fact existed as to whether appellants breached the Purchase Agreement by refusing to lease 300 vehicles to PRG. In its order, the trial court did not identify what those questions of fact might be.
At issue here is the following provision of the Purchase Agreement:
PRG admits that it obtained 215 rental vehicles from Atlin's existing fleet. According to Blakley's testimony, PRG notified Payless that it wished to order an additional 285 vehicles, because some of the original vehicles obtained from Atlin's existing stock were under leases which were due to expire
Under the express terms of Section 5.2 of the Purchase Agreement, appellants' obligation to lease vehicles to PRG was made "subject to the approval of Orlin's fleet financing companies." Thus, PRG's claims for breach of contract are not supported by PRG's allegation that the fleet leasing companies failed to deliver all the vehicles ordered. Appellants submitted the affidavit of Richard L. Stevens, president of Payless, who testified that Orlin and L & S had business relationships with several independent fleet financing companies, among them Walden Leasing and Eckhaus Fleet; that once the orders for fleet vehicles were placed, it was the leasing company, Walden Leasing or Eckhaus Fleet, which shipped and delivered the vehicles to PRG, not appellants; and that appellants had no involvement in and were not responsible for shipping or delivery of the vehicles to PRG. Blakley also testified that he was not involved with the shipment or delivery of the vehicles by the leasing company to PRG. In his deposition, Elkik acknowledged that the vehicles were delivered, not by the appellants, but by the leasing companies.
Appellants have thus shown by reference to the record that PRG's claim for breach of contract of the Purchase Agreement's vehicle leasing requirement does not raise an issue of material fact. At this point, in order to avoid summary judgment on this issue, PRG was required to come forward with some evidence sufficient to generate an issue of material fact.
2. Breach of the implied covenant of good faith and fair dealing. Appellants assert that the trial court erred in denying their motion for summary judgment on PRG's counterclaim and third-party claim that appellants breached the implied covenant of good faith and fair dealing in the Purchase Agreement. The trial court ruled that "[b]ecause PRG's claims for breach of an express term of the [Purchase Agreement] remain, so too does its claim for breach of the implied duty of good faith and fair dealing related to that breach." As discussed in Division 1 above, however, appellants are entitled to summary judgment on PRG's claim for breach of Section 5.2 of the Purchase Agreement. Under Florida law, which applies herein, a claim for breach of the implied covenant of good faith and fair dealing is not recognized as an independent cause of action separate from a claim for breach of contract;
Judgment reversed.
SMITH, P.J., and ADAMS, J., concur.