Trustmark Insur Co v. Gen'l & Cologne Life

In the

United States Court of Appeals

For the Seventh Circuit

____________

No. 04-3216

TRUSTMARK INSURANCE COMPANY,

Plaintiff-Appellant,

v.

GENERAL & COLOGNE LIFE RE OF AMERICA,

formerly known as COLOGNE LIFE

REINSURANCE COMPANY,

Defendant-Appellee.

____________

Appeal from the United States District Court

for the Northern District of Illinois, Eastern Division.

No. 00 C 1926—Blanche M. Manning, Judge.

____________

ARGUED FEBRUARY 7, 2005—DECIDED SEPTEMBER 13, 2005

____________

Before ROVNER, WILLIAMS, and SYKES, Circuit Judges.

WILLIAMS, Circuit Judge. Surely, if there is any moral

to this story, it is to “get it in writing.” It is astounding

in this day and age to find it necessary to repeat this

admonition, but no less so than to find a sophisticated party

willing to leverage an agreement involving multiple years

and millions of dollars solely on the enforceability of a

simple handshake. Yet that is precisely what has happened

in this case. Plaintiff Trustmark Insurance Company

(“Trustmark”) brought suit against defendant General &

Cologne Life Re of America (“Cologne”), another insurance

2 No. 04-3216

company, over an alleged reinsurance deal that was not

committed to writing.

Nonetheless, Trustmark presses its claims under theories

of breach of contract, breach of fiduciary duty, and promis-

sory estoppel, alleging that Cologne breached an unwritten

joint-venture agreement and amorphous promises to

acquire a block of individual disability insurance (“IDI”)

policies. The district court granted partial summary

judgment in Cologne’s favor on the breach of contract and

breach of fiduciary duty claims, finding no joint-venture

because the parties did not exercise mutual control over a

joint enterprise. The court further found, in entering final

judgment in favor of Cologne after a subsequent bench trial,

that plaintiff ’s promissory estoppel claim was barred by the

statute of frauds. Because we find that plaintiff has failed

to proffer sufficient evidence of mutual control over a joint-

venture, and that the availability of an adequate remedy at

law precludes Trustmark from invoking the partial perfor-

mance exception to the statute of frauds, we affirm both

rulings.

I. BACKGROUND

In early 1998, Trustmark and Cologne jointly investi-

gated, with a view toward acquiring, a block of 7000 IDI

policies offered for sale by Hartford Life Insurance Co.

(hereinafter, “the Hartford Block” or “the Block”). In the

course of their investigation, the record suggests that

these parties talked about a lot of things that would hap-

pen in the event of a successful purchase of the Block. They

talked about sharing profits and the risk of loss. They even

talked about Trustmark taking on the responsibility for

administering claims on the purchased policies, as Cologne

lacked the capacity to do so itself. The problem is, none

of this talk was committed to writing.

Despite having no written agreement—even as to how

No. 04-3216 3

this investigation itself would proceed—the parties together

performed the actuarial work and due diligence necessary

to determine a purchase price for the proposed acquisition.

Negotiations over the purchase, however, took place solely

between Trustmark and Hartford. These negotiations bore

fruit on October 28, 1998, when, after some back and forth,

Trustmark and Hartford signed a letter of intent on the sale

of the Block. Although Cologne had reviewed, commented

on, and approved this letter of intent, it did not sign the

letter and its name is not mentioned anywhere. On its face,

the letter sets forth a relationship solely between

Trustmark and Hartford.

In conjunction with the letter of intent, Trustmark also

entered into a separate claims-administration agreement

with Hartford, immediately conferring upon Trustmark the

responsibility for administering claims on the pur-

chased policies after signing the letter of intent. Trustmark

did not consult Cologne regarding the terms of this separate

agreement, nor did it seek the defendant’s approval of the

document prior to its execution. This separate agreement

makes no mention of Cologne whatsoever.

Notwithstanding Cologne’s omission from the operative

paperwork, over the next ten months while the final

purchase documents were being drafted, representatives

of Cologne and Trustmark continued to speak as if the

defendant was still a part of the deal. For example, in

sales pitch letters to third parties dated December 30,

1998, and February 9, 1999, Andrew Perkins, Senior Vice

President of Cologne’s Individual Health Group, referred to

the Cologne and Trustmark as “successful partners” in the

purchase of the Hartford Block. On February 23, 1999,

Perkins sent a draft of the Coinsurance/Assumption

Reinsurance Agreement between Trustmark and Hart-

ford to his assistant with a handwritten note stating

4 No. 04-3216

“we’ll end up with a retro1 to us from Trustmark, follow-

ing this language.” In addition, Cologne made several

reassurances to Trustmark between February and July

1999—in the face of mounting losses on the Hartford

acquisition—that it remained committed to sharing the

risk on the Hartford Block. But, throughout all this, the

final purchase agreement with Hartford had yet to be

finalized and signed, and Cologne’s name had yet to appear

formally on paper.

On September 3, 1999, after learning of additional and

substantial losses on the Block, but prior to final consum-

mation of the acquisition, Cologne informed Trustmark that

it would not go forward with the purchase. Cologne claims

that its decision to renege was based on Trustmark’s poor

ability to administer policy claims; the failure of the parties

to agree upon or even discuss Trustmark’s compensation for

administering claims (a figure that would determine how

much premium Cologne would receive on the back end); and

the delay of Trustmark and Hartford, by the terms of their

own letter of intent, in entering into a “definitive agree-

ment” on the Block purchase. Each of these items, according

to Cologne, were understood conditions to its involvement

in the deal. Trustmark claims the decision to renege came

upon Cologne’s discovery that Hartford Block was losing a

lot of money. Whatever the reason, Cologne was out, and

Trustmark was unhappy. Notwithstanding this abandon-

ment, Trustmark went on to finalize the purchase from

Hartford on December 28, 1999.

In February 2000, Trustmark brought suit against

Cologne under five counts. Under Count I, Trustmark

sought a declaratory judgment that Cologne was obliged to

reinsure Trustmark on the Hartford Block in accordance

1

Refering to a “retrocession,” which is a transfer of risks as-

sumed by one reinsurer to a second reinsurer.

No. 04-3216 5

with an alleged joint-venture agreement. Count II sought

specific performance on this alleged joint-venture agree-

ment. Count III sought damages for breach of the alleged

joint-venture agreement, while Count IV sought damages

for breach of fiduciary duty. Count V claimed damages

under a theory of promissory estoppel. In October 2001, the

district court granted the defendant’s motion for summary

judgment as to Counts I through IV, rejecting those counts

premised on the existence of a joint-venture agreement as

a matter of law. In particular, the court found that

Trustmark had failed to show that the parties had main-

tained joint control over an IDI policy purchasing enter-

prise. The court also denied a motion by Trustmark to

amend its complaint to add a claim of “equitable estoppel,”

finding that the plaintiff failed to show good cause to

add the claim more than nine months after the deadline

for amending pleadings, and that such a late amend-

ment would prejudice the defendant by necessitating

additional discovery.

This left Trustmark with only its promissory estoppel

claim, which survived Cologne’s statute of frauds challenge

at summary judgment only by virtue of the potential

applicability of the doctrine of partial performance. Other-

wise, the district court determined that the stat-

ute of frauds applied to the alleged joint-venture promise at

the heart of Trustmark’s promissory estoppel claim, and

there was no writing to satisfy the statute’s prescriptions.

With the statute of frauds bar so avoided, however, the

district court found that Trustmark had created a genuine

issue of fact as to whether Trustmark entered into the let-

ter of intent with Hartford in reliance on Cologne’s al-

leged promise to join in the purchase of the Block.

In June 2002, however, Cologne requested that the

district court reconsider its October 2001 order with re-

spect to Trustmark’s promissory estoppel claim. In particu-

lar, the defendant noted that the doctrine of partial perfor-

6 No. 04-3216

mance, upon which the plaintiff’s only surviving claim

relied, is an equitable doctrine. Trustmark’s promissory

estoppel claim, in contrast, explicitly sought damages.

Though the court agreed that the doctrine of partial

performance could not save Trustmark’s promissory

estoppel claim to the extent it sought monetary damages, it

found the claim could nonetheless survive because it

had incorporated the requests for equitable relief sought

in the other (dismissed) counts—namely the declaratory

judgment and specific performance sought in Counts I

and II, respectively. Accordingly, the promissory estop-

pel claim received a bench trial in April 2003.

After the bench trial, the district court entered final

judgment in favor of Cologne on August 3, 2004, finding

that the ability to quantify the extent of Trustmark’s loss on

the Hartford Block left the plaintiff with an adequate

remedy at law—thereby precluding equitable relief and

reliance on the equitable doctrine of partial performance

to preserve the promissory estoppel claim. Trustmark

appeals both this final entry of judgment, and the prior

grant of partial summary judgment.

II. ANALYSIS

A. Cologne and Trustmark Did Not Exercise Suffi-

cient Mutual Control to Establish a Joint-Venture

Trustmark first challenges the district court’s entry

of partial summary judgment on its joint-venture claims

(Counts I through IV). “We review a district court’s decision

to grant a motion for summary judgment de

novo, construing all facts, and drawing all reasonable

inferences from those facts, in favor of the nonmoving

party.” Telemark Dev. Group, Inc. v. Mengelt, 313 F.3d 972,

976 (7th Cir. 2002). Summary judgment is properly granted

when “the pleadings, depositions, answers to interrogato-

ries, and admissions on file, together with the affidavits,

No. 04-3216 7

if any, show that there is no genuine issue as to any

material fact and the moving party is entitled to judgment

as a matter of law.” Fed. R. Civ. P. 56(c); Celotex Corp. v.

Catrett, 477 U.S. 317, 322 (1986).

In granting partial summary judgment, the court found

that the parties were not engaged in a joint-venture

when they worked in concert to acquire the Hartford

Block. To establish a joint-venture under governing Illi-

nois law, a party must prove:

(1) an express or implied agreement to carry on some

enterprise; (2) a manifestation of intent by the parties

to be associated as joint venturers; (3) a joint interest as

shown by the contribution of property, financial re-

sources, effort, skill, or knowledge; (4) a degree of joint

proprietorship or mutual right to the exercise of control

over the enterprise; and (5) provision for joint sharing

of profits and losses.

Minyo v. Minyo, 581 N.E.2d 170, 173 (Ill. App. Ct. 1991)

(citing Ambuul v. Swanson, 516 N.E.2d 427 (Ill. App. Ct.

1987)). Here, the controversy centers around the fourth

element—mutual control over a joint enterprise.

As a threshold matter, there is some discrepancy as to

the scope of the enterprise over which the parties al-

legedly exerted control. Trustmark insists that the joint-

venture at the heart of its claim extended only to the

purchase of the Hartford Block, and not, as the district

court reasoned, to the purchase of IDI policies in general.

Indeed, the size of the enterprise may bear on a plaintiff’s

burden in establishing the control element, for the

bigger the enterprise, the more sweeping the requisite

control; and the more sweeping the control, the more the

plaintiff would have to establish to survive summary

judgment. Thus, Trustmark argues that the district court

erred when it grounded its dismissal of the breach of

contract claim in part on the parties’ inability to control

8 No. 04-3216

each other’s activities in pursuing IDI policies in general.

This argument, however, belies the allegations of Trust-

mark’s own complaint, which by its own terms describes the

joint-venture as existing “for the purpose of acquiring large

blocks of IDI policies from various insurance companies.”

Compl. at 3 (emphasis added). In any event, how great or

small the scope of the averred enterprise is of

little consequence here, for, whether the enterprise’s end

be IDI policies in general or merely the Hartford acquisition

in particular, the record remains devoid of any evidence of

mutual control.

Trustmark’s only hope to establish a genuine issue of

material fact regarding mutual control rests on Cologne’s

involvement in drafting the letter of intent that bound

Trustmark to proceed with the acquisition of the Hartford

Block. Cologne was unquestionably involved in the let-

ter’s drafting: the company reviewed, commented on,

and ultimately approved the terms reflected in the letter

of intent, and its subsidiary, JHA, is credited with deter-

mining the purchase price for the block provided in the

letter. But this involvement does not, as Trustmark con-

tends, exhibit Cologne’s control over the purchase of

the Block. Cologne’s asserted involvement here occurred

well before Trustmark entered into the final purchase

agreement with Hartford, during the preliminary stages

of the purchase negotiations. Indeed, “Illinois . . . allows

parties to approach agreement in stages, without fear that

by reaching a preliminary understanding they have bar-

gained away their privilege to disagree on the specifics.”

Empro Mfg. Co. v. Ball-Co. Mfg., Inc., 870 F.2d 423, 426

(7th Cir. 1989). Cologne’s consultations and involvement

at this stage, while not insignificant, remain best char-

acterized as its thorough investigation of a business

opportunity, and its approval of terms as a preliminary

understanding of that opportunity’s contours. Review

and comment on documents that shape preliminary under-

No. 04-3216 9

standings of deals yet to be finalized do not amount to an

exercise of control.

Trustmark next cites Herst v. Chark, 579 N.E.2d 990 (Ill.

App. Ct. 1991) for the proposition that mutual control

necessary to establish a joint-venture will be found where

the parties divide responsibilities along functional lines.

Reading Herst so, Trustmark argues that such responsibil-

ity divisions were made here—with Cologne performing due

diligence on the underwriting of the Hartford Block; Co-

logne’s subsidiary (JHA) determining the acquisition’s

purchase price; Trustmark and JHA undertaking due

diligence on Hartford’s claims handling; and Trustmark

taking sole responsibility for claims administration upon

consummation of the purchase. With this division of

responsibilities in mind, the plaintiff insists that a fact-

ual issue remains as to mutual control.

Even assuming this division of responsibilities to be

accurate, however, Trustmark fundamentally misconstrues

the holding of Herst. The case does not stand for the

proposition that mutual control exists wherever parties

divide responsibilities along functional lines. Rather, the

case merely notes that the fact that one party was not

involved in every aspect of an enterprise does not preclude

the finding of a joint-venture. Id. at 993-94. Nothing

in Herst holds that mutual control could exist notwith-

standing the inability of either party to exercise control over

the other toward achieving the object of the alleged joint-

venture.

In the final analysis, neither Trustmark nor Cologne

could force the other party to enter into an IDI policy

purchase—be it in general or merely for the Hartford

Block—nor could they compel the use of each other’s

employees or resources toward such ends. These parties

could not exercise any control over each other’s operations

or policies whatsoever, and therefore we affirm the dis-

10 No. 04-3216

trict court’s grant of partial summary judgment on the joint-

venture claims for lack of mutual control.

B. Trustmark Proffers no Writings that Could Sat-

isfy the Statute of Frauds

Turning to its promissory estoppel claim, the plaintiff

next contends that the district court erred in finding that

it had proffered no document to satisfy the writing re-

quirement of the statute of frauds. Because the court

made this finding in its October 22, 2001, partial summary

judgment ruling, which tied the fate of Trustmark’s promis-

sory estoppel claim to the applicability of the doctrine of

partial performance, our review is de novo. Telemark, 313

F.3d at 976.

The Illinois statute of frauds provides that

[n]o action shall be brought . . . upon any agreement

that is not to be performed within the space of one

year from the making thereof, unless the promise or

agreement upon which such action shall be brought, or

some memorandum or note thereof, shall be in writing,

and signed by the party to be charged therewith, or

some other person thereunto by him lawfully autho-

rized.

740 ILCS 80/1. It is undisputed that Trustmark and

Cologne have not entered into a written contract. Further-

more, Trustmark does not dispute the district court’s

finding that Cologne’s alleged promise to reinsure the

Hartford Block cannot be performed within one year. And

it is clear that “[u]nder Illinois law, the statute of frauds

is applicable to a promise claimed to be enforceable

by virtue of the doctrine of promissory estoppel.” Fischer v.

First Chicago Capital Mkts., Inc., 195 F.3d 279, 284 (7th

Cir. 1999) (citing Architectural Metal Sys., Inc. v. Consoli-

dated Sys., Inc., 58 F.3d 1227, 1231 (7th Cir. 1995));

No. 04-3216 11

McInerney v. Charter Golf, Inc., 680 N.E.2d 1347, 1352 (Ill.

1997) (“[P]romissory estoppel does not bar the application of

the statute of frauds in Illinois.”). Thus, the issue here is

whether Trustmark has proffered a writing sufficient to

satisfy the statute of frauds.

“A writing sufficient to satisfy the Statute of Frauds

need not itself be a valid contract, but only evidence of one.”

Crawley v. Hathaway, 721 N.E.2d 1208, 1211 (Ill. App. Ct.

1999) (quoting Melrose Park Nat’l Bank v. Carr, 618 N.E.2d

839, 843 (Ill. App. Ct. 1993)). Indeed, a sufficient memoran-

dum may be composed of multiple documents of varying

forms. Am. Coll. of Surgeons v. Lumbermens Mut. Cas. Co.,

491 N.E.2d 1179, 1192 (Ill. App. Ct. 1986). Toward that end,

Trustmark has adduced several writings in an effort to

satisfy the statute’s prescriptions. That said, for multiple

writings to satisfy the statute, “all the essential terms [of

the contract] must be in writing, and there must be an

express reference to the other writings or such a connection

between the documents, physical or otherwise, as to

demonstrate that they relate to the same contract.” Dickens

v. Quincy Coll., 615 N.E.2d 381, 384 (Ill. App. Ct. 1993)

(citing cases). It is here that the multiple documents

proffered by Trustmark fall short, for they neither state

essential terms, refer expressly to each other, nor connect

in such a way as to reflect relation to a particular contract.

Trustmark first cites the sales pitch letter written by

Perkins of Cologne to a third party (Lincoln National

Insurance) stating “Cologne and Trustmark have been

working jointly in pursuit of non-cancellable disability

opportunities and were successful partners in the . . .

Hartford acquisition.” The plaintiff rightly notes that

“letters addressed to a third party, stating and affirming

a contract, may be used against the writer as a memoran-

dum of it.” Gaines v. McAdam, 79 Ill. App. 201 (1898).

However, here the letter to Lincoln National neither

states any terms of the purported contract between

12 No. 04-3216

Trustmark and Cologne (let alone all of them); nor does

it affirm the existence of a contract, as it makes ex-

plicitly clear that the Hartford deal was still “impending.”

At best, this letter indicates that Trustmark and Cologne

were still in the non-binding, preliminary agreement

stage of their negotiations on the Hartford acquisition, at

that time merely exploring the possibility of a joint-venture

on the Block. And even employees of Trustmark who

were intimately involved in the acquisition—such as

Leonard Koloms, Trustmark’s Corporate Actuary, and

Rowen Bell, Trustmark’s point man on the letter of intent

with Hartford—admit that their own use of the term

“partner” was not intended to have any operative legal

connotation.

Trustmark also cites the handwritten note penned

by Perkins on a draft of the Coinsurance/Assumption

Reinsurance Agreement between Trustmark and Hartford.

The note states, “[W]e’ll end up with a retro to us from

Trustmark, following this language.” First, the words “we’ll

end up with” themselves suggest that Cologne had not yet

agreed to reinsure Trustmark on the Hartford deal. And,

again, the attached draft agreement between Trustmark

and Hartford omits several terms that would be essential to

a reinsurance deal between Cologne and Trustmark—terms

such as Trustmark’s share of incoming premium to cover

the expense of its administration of policy claims (and in

turn that share of premiums Cologne could expect to receive

on the back end), or the percentage of risk that Cologne

would assume on the Hartford Block.

Cologne’s “percentage of risk assumed” would certainly be

an essential term in this alleged joint-venture, and, toward

that end, Trustmark cites the deposition testimony of

Perkins in an attempt to lock down that term in writing. “A

deposition may qualify as a signed writing for statute of

frauds purposes.” Bower v. Jones, 978 F.2d 1004, 1009 (7th

Cir. 1992). In his deposition, Perkins testified that “it was

No. 04-3216 13

[his] expectation that Cologne would reinsure 50 percent of

this business from Trustmark.” However, he immediately

qualified this statement by stating that “Trustmark in-

tended to reinsure [50 percent of] the business with [Co-

logne] if the transaction went forward as had been

intended.” (emphasis added). Clearly, Perkins’s testimony

does not provide, as Trustmark argues, an unconditional

commitment to a percentage. To the contrary, it serves as

yet further evidence that the purported deal between the

parties was not consummated. The same may be said of the

July 14, 1999 draft report prepared by Cologne’s outside

actuaries, Tillinghast-Towers Perrin. While this report does

muse that Cologne “is 50% retrocessionaire from Trustmark

who has the other 50% and is the administrator,” it is also

littered with terms revealing that a reinsurance agreement

between Cologne and Trustmark on the Hartford deal had

yet to be finalized (stating that the “[r]einsurance contracts

are not signed yet,” and that the “parties are renegotiat-

ing”).

As for the July 28, 1999, letter from Perkins to Trust-

mark, forwarding JHA’s proposal for the subsidiary’s

possible involvement in managing claims on the Hartford

Block, this writing fails to memorialize a single term that

would be essential to a reinsurance agreement. This letter

states, “It is critical that significant additional resource [sic]

be brought to bear as soon as possible in order to limit our

potential losses on this deal.” While this letter has every-

thing to do with potential claims management, it has

little (if anything) to do with a reinsurance agreement

between Trustmark and Cologne. Indeed, there are no

reinsurance agreement terms—let alone essential terms—

to mine from this document, and it is thus of no use

to Trustmark in its efforts to overcome the statute of frauds.

At best, these writings proffered by Trustmark uniformly

reveal a reinsurance agreement between the parties yet

to be finalized—a deal contemplated, though not necessarily

14 No. 04-3216

consummated.2 Between all these writings, there is only one

essential term arguably suggested, and its validity is

dubious at best. These documents fall far short of providing

all requisite essential terms for a reinsurance agreement, to

say nothing of the fact that each fails to reference or

connect to the others in a manner that might confirm

relation to a common contract.

Together, these documents proffered by Trustmark do

make one thing clear: the plaintiff is grasping at straws.

How it came to be in this unfortunate predicament—a

predicament in which it must cobble together a sufficient

writing where none exists—is clear as well. It put itself

there. As Trustmark’s counsel informed us at oral argu-

ment, “reinsurance is something that is often done on a

handshake, . . . perhaps resulting in more litigation than

it should these days.” We may be shocked by the former, but

we see first hand the veracity of the latter. Indeed, we dare

say, it is quite the understatement. Accordingly, like all

those before it, we affirm the district court’s finding where

2

We pause briefly to address Trustmark’s contention that

Cologne has waived its statute of frauds defense by admitting

to the existence and terms of the purported agreement. “When . . .

there is particularly compelling evidence of the contract’s exis-

tence, the strictures of the statute of frauds can safely be relaxed,

for example in the case of an admission.” Consolidation Servs.,

Inc. v. Keybank Nat’l Ass’n, 185 F.3d 817, 821 (7th Cir. 1999).

Toward that end, Trustmark cites those same writings proffered

herein to satisfy the statute of frauds. However, under Illinois law

the admission must be “unequivocal” to constitute waiver of a

statute of frauds defense. See Derby Meadows Util. Co. v. Inter-

Continental Real Estate, 559 N.E.2d 986, 989, 991 (Ill. App. Ct.

1990). Because these writings express at best an expectancy to

reinsure Trustmark on the Hartford Block, not an unequivocal

admission that it was contractually bound, or had promised, to do

so, we find that Cologne’s statute of frauds defense has not been

waived.

No. 04-3216 15

a plaintiff has again failed to adduce written evidence

sufficient to satisfy the requirements of the statute of

frauds.

C. Trustmark Cannot Invoke the Doctrine of Partial

Performance

Despite Trustmark’s inability to adduce a writing or

writings sufficient to satisfy the statute of frauds, there are

several exceptions to the statute’s writing requirement. One

such exception, invoked by the plaintiff here in an effort

to save its promissory estoppel claim, is the equitable

doctrine of partial performance. In its post-bench trial entry

of judgment, however, the district court found that

Trustmark could not invoke this doctrine because it had an

available remedy at law. Trustmark challenges this find-

ing on appeal, arguing that it cannot be adequately compen-

sated by monetary damages. In reviewing a bench trial,

conclusions of law are subject to de novo review, while

findings of fact are subject to the deferential clearly errone-

ous standard. Spurgin-Dienst v. United States, 359 F.3d

451, 453 (7th Cir. 2004).

The doctrine of part performance is an equitable doctrine.

Dickens v. Quincy College Corp., 615 N.E.2d 381, 385 (Ill.

App. Ct. 1993). As such, the doctrine excepts only those

actions seeking equitable relief from the writing require-

ment of the statute of frauds, to the exclusion of those

claims where there exists an adequate remedy at law. See

Sjogren v. Maybrooks, Inc., 573 N.E.2d 1367, 1368 (Ill. App.

Ct. 1991) (“Although acts of partial performance are

typically sufficient to take an oral agreement out from

under the operation of the Statute of Frauds in an action at

equity, such acts do not take an action at law outside

the operation of the Statute of Frauds.”) (citing cases);

Gibbon v. Stillwell, 500 N.E.2d 965, 969 (Ill. App. Ct. 1986).

Illinois courts further limit the scope of the exception,

16 No. 04-3216

holding that “part performance will avoid application of [the

Statute of Frauds] only where a party is seeking the

equitable remedy of specific enforcement.” Doherty v. Kahn,

682 N.E.2d 163, 175 (Ill. App. Ct. 1997) (citing Phillips v.

Britton, 516 N.E.2d 692, 697 (Ill. App. Ct. 1987)) (emphasis

added), abrogated on other grounds by Byung Moo Soh v.

Target Mktg. Sys., Inc., 817 N.E.2d 1105, 1109 (Ill. App. Ct.

2004).

Here, in order for the plaintiff to invoke the doctrine of

partial performance, it must first establish entitlement

to equitable relief. And to be entitled to equitable relief,

Trustmark must show that it has no adequate remedy

at law. John O. Schofield, Inc. v. Nikkel, 731 N.E.2d 915,

925 (Ill. App. Ct. 2000) (“[T]he party seeking the application

of equitable principles to defeat the interposition of the

statute of frauds must establish that the promisee cannot

be made whole by damages or by another adequate remedy

at law.”).

Under Illinois law, “damages cannot be based on potential

or future loss, unless it is reasonably certain to occur, nor

can damages be based on speculation or conjecture.”

Platinum Tech, Inc. v. Fed. Ins. Co., 282 F.3d 927, 933 (7th

Cir. 2002). Trustmark insists that money damages would

be inadequate here because its future loss on the Hart-

ford Block cannot be calculated with requisite certainty

considering (1) the volatility of the policies of the Block,

(2) the extended period of time covered by those policies,

and (3) putative legal barriers that ostensibly prohibit that

award of future damages on contracts of indemnity (to

which Trustmark contends its reinsurance agreement to

be akin).

Contrary to its arguments regarding the hopeless uncer-

tainty of future damages, however, is the trial testimony

of Trustmark’s own damages and actuarial sciences ex-

pert. This expert testified that “a best estimate of the actual

No. 04-3216 17

losses on the Hartford block at some point in the future”

could be calculated by using a “gross premium valuation.”

This testimony went uncontested. And though the testi-

mony suggests the availability of nothing better than a

“best estimate,” “the law only requires there be an adequate

basis in the record for the court’s determination of [dam-

ages], and absolute certainty is unnecessary.” Moniuszko v.

Moniuszko, 606 N.E.2d 468, 474 (Ill. App. Ct. 1992); see also

SNA Nut Co. v. The Haagen-Daz Co., Inc., 302 F.3d 725,

733 (7th Cir. 2002) (“[C]ertainty as to the amount of

damages goes no further than to require a basis for a

reasoned conclusion.”); Jabat, Inc. v. Smith, 201 F.3d 852,

857 (7th Cir. 2000) (“In Illinois, the evidence need only tend

to show a basis for the computation of damages with a fair

degree of probability.”).

Nor should the plaintiff take umbrage with the propriety

of using an actuarial model—such as the gross premium

valuation—to calculate future damages. Such models are

not only well accepted in courts throughout the land, but

also staples of the plaintiff’s own industry. Peoples Security

Life Ins. Co. v. Monumental Life Ins. Co., 991 F.2d 141, 148

(4th Cir. 1993) (“Actuarial tables are the life’s blood of the

life insurance industry. It is disingenuous for [the defen-

dant] to question the accuracy of the very methodology

employed by the industry in issuing its policies simply

because actuarial tables were used to determine [an adverse

award].”); MacGregor Yacht Corp. v. State Compensation

Ins. Fund, 63 Cal. App. 4th 448, 460 (1998) (“There

was nothing speculative about the actuary’s damage

analysis. He used the same formulas used by the insurance

industry . . . .”). It is odd—or, in the very least, counter-

intuitive—considering the nature of the business, to find

an insurance company complain of the speculative nature

of actuarial tables, or to learn that an insurer of risk

believes future loss cannot be reliably predicted. In any

event, it suffices to say that Trustmark’s damages could be

18 No. 04-3216

calculated with requisite certainty under Illinois law, and

for that reason the company could avail itself of an ade-

quate remedy at law. Accordingly, Trustmark cannot invoke

the doctrine of part performance to avoid the preclusive bite

of the statute of frauds, and thus its promissory estoppel

claim must fail.

D. District Court Did Not Abuse its Discretion in

Denying Motion to Amend Complaint

Finally, we address Trustmark’s appeal of the district

court’s denial of its motion for leave to amend its complaint

to add a claim of equitable estoppel. We review such rulings

for abuse of discretion. Lac Courte Oreilles Band of Lake

Superior Chippewa Indians of Wis. v. United States, 367

F.3d 650, 668 (7th Cir. 2004). To amend a pleading after the

expiration of the trial court’s Scheduling Order deadline to

amend pleadings, the moving party must show “good cause.”

Fed. R. Civ. P. 16(b). As our sister circuit succinctly stated,

“Rule 16(b)’s ‘good cause’ standard primarily considers the

diligence of the party seeking amendment.” Johnson v.

Mammouth Recreations, Inc., 975 F.2d 604, 609 (9th Cir.

1992). Here, nine months after the prescribed deadline of

June 30, 2000, Trustmark sought leave to amend its

complaint to add a claim of equitable estoppel based on

allegations that Cologne, through its subsidiary (JHA),

failed to perform adequate due diligence on the Hartford

Block, resulting in an overvaluation of the policies. In an

effort to show good cause for the amendment, the plaintiff

contends that it did not confirm its suspicions of this

misrepresentation—and thus the facts supporting its

equitable estoppel claim—until April 26, 2001, when the

depositions of both a JHA employee involved in the valua-

tion (DeMarco) and Cologne’s actuarial experts were

completed.

However, Trustmark concedes that it harbored suspicions

No. 04-3216 19

that JHA had misrepresented the value of the Hartford

Block prior to these depositions, and in fact the deposition

testimony of Trustmark’s actuarial (Daniel Winslow)

reveals that the company was concerned about the quality

of DeMarco’s valuation work as early as the end of

1999—months before the plaintiff filed its original com-

plaint against Cologne. Based on this testimony, the district

court found that Trustmark failed to show good cause for its

failure to amend its complaint in a timely manner, finding

that Trustmark was, or should have been, aware of the facts

underlying its equitable estoppel claim as early as 1999. In

so doing, the court did not abuse its discretion, and we

affirm the denial of leave to amend accordingly.

III. CONCLUSION

For the foregoing reasons, we AFFIRM the district court’s

grant of partial summary judgment in Cologne’s favor on

Trustmark’s breach of contract and breach of fiduciary duty

claims, its denial of Trustmark’s motion for leave to amend

its complaint, and its entry of final judgment

on the promissory estoppel claim.

20 No. 04-3216

A true Copy:

Teste:

________________________________

Clerk of the United States Court of

Appeals for the Seventh Circuit

USCA-02-C-0072—9-13-05