AVENUE GARAGE INC LICENSE

AVENUE GARAGE INC LICENSE

The court concluded 'by ceasing operation of its hotel, Savoy is not excused, as a matter of law, from obligations under its agreement with the garage, and that there is, at least, an issue of fact as to implied conditions in the agreement.' The court first concluded that the Supreme Court's characterization of the relevant contract was not correct, because it was not a requirements contract, but instead a license or franchise. 'hether the closing of the hotel prior to the expiration of the contract period, due to the asserted financial inability of Savoy to remain in the hotel business, subjects it to continued liability under the contract'? The Supreme Court treated the contract as a requirements contract, and found that absent any allegations of bad faith, the Defendant was not liable for breach of contract.

The property was sold to another company, and an office building was erected in its place. The only provision concerning termination allowed the Defendant to 'terminate the contract should the garage default in the performance of any condition, including the provision of adequate service, and then fail to cure the default within 30 days after receiving written notice.' In June 1965, the Defendant's hotel was no longer profitable after incurring substantial financial losses, and subsequently was demolished. There was no language in the agreement specifying that the Defendant must remain in the hotel business. The contract was to last for a period of 5 years, and the Plaintiff agreed to pay the Defendant 10% of all 'gross transient storage charges to the hotel guests.' The agreement was to expire on September 30, 1968. (the 'Defendant'), on October 1, 1963, to provide garage services for the Savoy Hilton Hotel.

(the 'Plaintiff'), entered into an agreement with the Defendant, Savoy Fifth Avenue Corp.

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