P. B. Yates MacH. Co. v. Groce

PHEASANTS, O. J. This suit was brought by appellees against appellant to recover damages for the alleged breach of a contract of sale, by which appellant sold appellees a machine designated in the contract as a No. Ill molder. The material allegations of plaintiff’s pleadings are thus sufficiently stated in .appellant’s brief: “The material allegations of plaintiff’s first amended original petition is that the Yates Machine Company sold (June 13, 1922) to Groce Hardwood Manufacturing Company a Yates molder machine, ‘and represented and guaranteed that the said machine would properly do the work desired by plaintiff of a machine of such character, and sold the same on such representation and guaranty’; that Groce Hardwood Manufacturing Company was not familiar with such machines and relied upon the representation and guaranty; that Yates Machine Company was familiar with the work defendant desired tó do, among others a manufacture of flooring; that the machine was received, set up, and failed ‘to do the work required thereof,’ resulting to plaintiff in damages as follows: “(á) Freight, $266.40. “G>) Unloading charge, $25. “(c) Cost of labor for installing, $140. “(e) Plaintiff’s pay roll August to December 1, 1922, operating and attempting to operate the machine, $657.85. “(f) Difference in market price and sale price of 6,500 feet white oak flooring manufactured by machine, $260. “(g) Freight, unloading, cost of one car of white oak lumber returned to seller, ‘because said lumber would not make salable flooring,’ $581.81. “By trial amendment filed under circumstances shown in- appellant’s bill of exception No. 2, the above-quoted language was changed so as to read ‘because, the said Yates machine would not make salable flooring from same.’ “(b) Defendants’ loss of $1,000 on the sale price of flooring manufactured by the machine, being the difference between the market price of properly manufactured flooring and the sale price of flooring manufactured. “That the purchase contract signed provided that the machine should be returned 30 days from the daté of shipment, but said time was insufficient for plaintiff to determine whether representations alleged, express or implied warranty, were true and to that extent legal fraud is alleged; that within two weeks plaintiff notified Yates Company that the machine would not do the work represented the defendant requested plaintiff to await the arrival of defendants’ agent and that written notice of rejection was given within a reasonable time; that if there were no expressed representations, then there was an implied warranty that the machine would manufacture merchantable oak flooring, inasmuch as defendants’ agent was informed that plaintiff wanted the machine for the purpose of manufacturing molding and oak flooring; that plaintiff had on hand oak staves — known to defendants’ agent — from which plaintiff desired to manufacture _ oak flooring strips; that no consideration existed for the indebtedness represented by the signed contract, because of breach of warranties and representations alleged. The prayer is for damage alleged, foreclosure of an attachment lien, and cancellation of contract.” Defendant answered by general demurrer and by special exceptions, the nature of which, if necessary for the purposes of this opinion, will be hereinafter stated. It further answered by general and special denial of the material allegations of plaintiff’s petition, and specially pleaded a provision in the contract, hereinafter set out, as a defense against any claim for damages by plaintiffs. By cross-action defendant pleaded the contract and sought to recover thereon the purchase price which plaintiffs had. agreed to pay for the machine amounting to the sum of $3,758.64. By supplemental petition, plaintiffs answered defendant’s cross-action by general demurrer and special exception and by special pleas, setting up failure of consideration and waiver by defendant of the provision in contract which it claims relieves it of any liability for damages sustained by plaintiffs. Additional supplemental pleadings filed by both parties contain no material allegations or averments and in no way change the character of the suit as evidenced by the pleadings before set out. • The cause was tried by a jury in the court below upon special issues and based upon the findings of the jury. Judgment was rendered in favor of appellees for the sum of $2,-096.94 and against appellant on its suit to recover the purchase price of the machine. The evidence shows that appellees, under their then firm name and style, Groce Hardware Company, on May 23, 1922, wrote appellant a letter asking the price of type C-l molder, one of the machines manufactured and sold by appellant, and inquiring as to the fitness of the machine for manufacturing oak flooring. In response to this letter, appellant wrote appellees thanking them for their letter and telling them that one of its. *228 agents would call on them in a few days and the writer trusted would be able to show them a machine adapted to their work, and would obtain their order. This letter further stated: “We might say that the 0-1 molder is adapted for not only making molding, but in large quantities and at fast speed. But for anything else that can be run on a machine of this nature, it would be particularly good for you for making flooring in considerable quantities. Of course, if you wanted a machine for absolutely nothing else but a hardwood flooring machine, we would recommend to you our A-Y special flooring machine.” On June 12, 1922, an agent of appellant, Mr. G. W. Simmons, called on appellees and' after ascertaining the character of machine appellees desired to purchase, sold them a No-. Ill molder, another type of machine manufactured and sold by appellant. The contract of sale made by the parties was in writing signed by appellees on June 12th and thereafter approved and signed by appellant on June 20, 1922. The machine was shipped on July 20, and reached Houston on July 29, 1922, and was set up at appellees’ place of business July 31st. On August 15th, after appellees had been trying to operate the machine for 15 days, they wrote appellant they were unable to make it do any kind of satisfactory work and asked that Mr. Simmons be sent to put it in proper working condition. On August ISth, appellant replied to this letter informing appellees that it had an agent on the way to look after the machine, and saying that though the machine was not a flooring machine, it ought to make flooring out of the material mentioned in appellees’ letter without trouble. The agent of appellant, referred to in this letter, was prevented by sickness from looking after the machine, and appellant sent another agent, a Mr. Banius, a machinist, who reached Houston on September 1, 1922, and supervised the operation of the machine for 10 or 12 days, during which time he manufactured for appellees approximately 6,500 feet of flooring, and offered to manufacture more, but appellees declined the offer, and on September 18th wrote appellant that the machine was not operating to appel-lees’ satisfaction. On November 9th, appellant, not having received the consideration which appellees had agreed to give for the machine wrote them that “they would be disappointed if the machine was returned, as Mr. Lanius reported samples showing fine work.” On December 1, 1922, appel-lees wrote appellant that they had sold the planing mill and requested appellant to come and remove the machine at once. This letter also contained a claim for damages in the sum of $691.40. Appellant in reply to this letter wrote appellees that their agent would see appellees the first week in January, 1923, in regard to the machine and requesting appellees to await an interview with the agent. This interview did not occur, and appellees filed this suit on January 25, 1923, and attached the machine. Before the trial in the court below, the parties entered into a written agreement reciting that appellees held possession of the machine, and that it should be sold for the benefit of the parties; the disposition of the proceeds to be determined by the result of the suit. The written contract of sale, which is evidenced by a written order for the machine, signed by appellees, and accepted and signed •by appellant, after describing the machine ordered and stating the consideration to be paid therefor by appellees, contains the following stipulations and agreements: “It is agreed that title to the property mentioned herein, and all subsequent additions thereto, shall remain in P. B. Yates Machine Company (the consignor) until fully paid' for in cash; that in ease of rejection of the property forwarded, or failure to pay as stated herein undersigned the purchaser shall at once return and deliver the property in good order to consignor f. o. b. cars at Beloit, Wisconsin, that a retention of the property forwardqd after thirty days from date of shipment shall constitute a trial and acceptance, be a conclusive admission of the truth of all representations made by or for the consignor and void all its contracts of warranty, express or implied. * * * It is agreed that this contract is not modified or added to by any agreement not expressly stated herein: That this contract shall not hereafter be changed or modified in any respect unless a written memorandum, embodying such changes or modifications, duly dated, signed by both parties hereto, and bearing distinct date reference to this contract be attached to and made a part of this agreement.” (Note: Printed across the face of the above contract is the following): “This order not subject to cancellation. Demonstrator will be charged for at not tell (less) than $15.00 per day, plus necessary expenses, charge beginning on date .of leaving factory and continuing until return. A charge of about ten per cent, will be made when goods are returned to factory by customer. “It is hereby agreed that if a demonstrator be furnished the purchaser shall (in addition to contract price) pay the seller for demonstrator’s expenses and that the printed matter on the reverse side shall be a part of this contract.” When Simmons sold the machine to appel-lees, he knew the material appellees had on hand and out of which they desired to make oak flooring, and while he advised appellees to buy a higher priced regular flooring machine, he told them that the machine he sold them would make merchantable flooring out of ap-pellees’ material. In response to special issues submitted by the court, the jury found that the machine did not turn out hardwood flooring in merchantable quantities and was not reasonably adapted or suited for doing such work; that appellant waived the 30 days’ limit upon the *229 return of the machine hy appellees and also waived the provision of the contract requiring its return. They further found that the several items of damages claimed by appel-lees, and which constituted the aggregate amount of damages upon which the judgment is' based, were sustained by appellees and were each in the reasonable contemplation of the parties at the time the contract was made as a probable result of the breach of the contract by appellant. In answer to a special issue submitted at request of appellant, the jury found that the machine would not turn out merchantable hardwood flooring, as represented by appellant’s agent Simmons, and in answer to special issue submitted by appellee found that the machine was worthless to appellees for the purpose for which it was sold to them. There is sufficient evidence to support each and all of these findings. Under appropriate assignments of error, appellant presents two propositions, which, in the opinion of the majority of the court, should be sustained and require a reversal of the judgment of the trial court. ' These propositions are as follows: “First Proposition. Under fourth and nineteenth assignments of error. A mandatory provision in a sales contract for trial and return in event of breach of warranty furnishes the exclusive remedy and precludes action for damage by reason of the breach. “Second Proposition. Pertinent to third and twenty-first and twenty-fifth assignment of error. When a written contract purports to include the whole engagement of the parties, specially providing that such writing constitutes the entire agreement and fully expresses the terms thereof, oral proof of a warranty, concering which the writing is silent is not admissible.” We shall consider these questions in inverse order to that in which they are presented. As before set out by the written contract' signed by appellees, they expressly agreed that the contract as written should not “be modified or added to by any agreement not expressly stated therein.” This language is plain and unambiguous, and in the absence of any pleading of mistake or fraud appellees must be held bound by their plainly expressed agreement, and will not be permitted to add any conditions or warranties to the contract not expressed therein. The contract contains no express warranty of any kind, and appellees can at most only claim the benefit of the warranty which the law implies, that the machine was reasonably fitted to perform the work which appellant knew it was purchased to perform. By another expressed provision of the contract before set out, appellees agreed that in .case they rejected the machine af£er 30 days’ trial they would at once return it to appellant in good order, and' that the retention of the machine for a longer time than 30 days should constitute trial and acceptance and would avoid all contracts of warranty, express or implied. This provision of the contract is also plain and unambiguous. We do not think the contract is susceptible of any other construction than that appellant was not to be bound by any representation or warranties not expressed in the written con-' tract, and that if the máchine should not do satisfactory work after a trial of 30 days, ap-pellees’ only remedy was to rescind the contract by returning the machine. This provision in the contract for trial and return being mandatory, appellees cannot maintain' their suit for damages for breach of the alleged warranty. Nunn v. Brillhart (Tex. Com. App.) 242 S. W. 450. The jury have found on sufficient evidence that appellant waived the return of the machine, but this waiver cannot affect the plain and unequivocal meaning of the contract that appellees are not entitled to recover damages for breach of warranty of the capacity of the machine. By permitting the ap-. pellees to keep the machine on trial for a longer time than 30 days appellant did not waive its right to insist that appellees aré bound by their agreement not to claim damages for a breach of warranty. There is no charge of fraud in the petition other than that appellant knew when the contract was entered into that 30 days was not a sufficient time in which to test the capacity of the machine, and that limiting this time to 30 days was in law a fraud upon appellees. It is not alleged that the contract was procured by fraud, and its rescission is not sought on this ground. The suit for damages is based wholly on the alleged breach of warranty of the machine, and appellees’ suit to recover the contract price of the machine is resisted on the ground of failure of consideration, in that the machine is worthless to plaintiffs. The jury having found that the machine is worthless to appellees, they should not be required to pay the purchase price therefor, and that portion of the judgment of the trial court should be affirmed; but we do not think, for the reasons above stated, the judgment in appellees’ favor for damages can be sustained, and that portion of the judgment should be reversed and judgment here rendered in favor of appellant. Reversed and rendered in part; affirmed in part. ' ,