Carroll Instrument Co. v. B.W.B. Controls, Inc.

677 S.W.2d 654, 39 U.C.C. Rep. Serv. (West) 1688, 1984 Tex. App. LEXIS 5945
CourtCourt of Appeals of Texas
DecidedAugust 16, 1984
Docket01-83-0399-CV
StatusPublished
Cited by31 cases

This text of 677 S.W.2d 654 (Carroll Instrument Co. v. B.W.B. Controls, Inc.) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Carroll Instrument Co. v. B.W.B. Controls, Inc., 677 S.W.2d 654, 39 U.C.C. Rep. Serv. (West) 1688, 1984 Tex. App. LEXIS 5945 (Tex. Ct. App. 1984).

Opinion

OPINION

LEVY, Justice.

B.W.B. Controls, Inc., hereinafter referred to as appellee, placed an order with appellant, Carroll Instrument Co., Inc., in 1976 for certain component parts which were to be manufactured into a device used in the oilfield industry, known as an “O Control.” The parties agreed on the price and quantity of the parts to be purchased, and appellee paid approximately one-half of the purchase price as a deposit.

The parties specified that the parts were to be made of a certain type of rust-resistant stainless steel (“303” stainless steel), but some of the parts, shipped to appellee in December of 1976, began to rust at a later date, after being assembled into the completed unit. This rusting made the O Controls useless, and potentially hazardous, as they could no longer function as designed. Appellee ultimately replaced the rusted controls with units manufactured by another company, at considerable cost. After refusing to pay the balance owed on the account, appellee was sued by appellant in an action on a sworn account. Appellee affirmatively pleaded a breach of warranty of merchantability and of fitness for a particular purpose, and counter-sued for damages incurred as a result of having to replace the defective parts.

Trial was held to the court in March, 1983, and judgment was entered by the trial court that neither party was entitled to recovery. Only the appellant has appealed its portion of the judgment denying relief; appellee has not.

As we interpret the parties’ arguments, the crux of this appeal is whether, first of all, the parts in question were made of “303 stainless steel,” as specified in the order; and if not, whether appellee, after discovering the rusted stems, ever notified appellant of the defect, and gave it reasonable time to cure the defect. We will address appellant’s points of error in three separate arguments. Points of error one through six address the issue of whether sufficient notice was given to appellant of *656 the rusting parts to satisfy the requirements of Tex.Bus. & Com.Code Ann. § 2.607. Points of error seven and eight deal with appellee’s establishing of a complete defense to appellant’s claim for damages. Finally, points of error nine through thirteen challenge the trial court’s finding that the defective component parts were not made of 303 stainless steel, and that 303 stainless steel does not rust.

On the subject of notice, we first note the certain provisions of the Texas Business and Commerce Code that are applicable, specifically those dealing with the rights and obligations of buyers and sellers, and the rejection of goods.

Section 2.602(a) provides that:

Rejection of goods must be within a reasonable time after their delivery of tender. It is ineffective unless the buyer seasonably notifies the seller.

Section 2.607(a), Tex.Bus. & Com.Code Ann., provides that if the goods are accepted, the buyer must pay for the goods at the contract rate. Section 2.607(c) provides that:

Where a tender has been accepted (1) the buyer must within a reasonable time after he discovers or should have discovered any breach notify the seller of breach or be barred from any remedy ...

Appellant argues in points of error one, two, and six that the trial court erred in finding that appellant received notice from appellee via Joe Taylor that the component parts were rusting. Related to this are points of error three and four, which challenge the trial court’s finding that Joe Taylor was an agent of appellee for purposes of giving said notice. Appellant urges no evidence and insufficient evidence to support both of these findings.

Where legal insufficiency points are raised and the challenge is to “no evidence”, the appellate court is charged with reviewing only the evidence which tends to support the finding, viewing it in the most favorable light in support of the finding. The court must also give effect to all reasonable inferences that may be drawn properly from the findings, and must disregard all contrary or conflicting evidence. McClure v. Allied Stores of Texas, 608 S.W.2d 901, 904 (Tex.1980); Butler v. Hanson, 455 S.W.2d 942, 944 (Tex.1970); Garza v. Alviar, 395 S.W.2d 821, 823 (Tex.1965).

On the other hand, where factual insufficiency points are raised, alleging “insufficient evidence”, the appellate court is charged with examining all the evidence in the record that is relevant to the fact being challenged, including any evidence to the contrary. In re King’s Estate, 150 Tex. 662, 244 S.W.2d 660 (1951).

Reviewing the record before us, we find that the evidence is conflicting on the issue of notice, even from the appellant itself. Initially Joe Carroll, President of Carroll Instrument Co., testified on cross-examination that the first time he became aware that there was a problem with the parts in question was during the deposition taken for purposes of the lawsuit in 1982. Later on he testified that he was “told of some problem rusting by Mr. Joe Taylor of Control Pilots, Inc.” In response as to when he was informed of this, he replied “... he brought a part to my shop roughly, I would estimate, a month after I delivered the parts to B.W.B., and we discussed the fact that it was off color, not rusted.” An objection was sustained that the answer became nonresponsive after the statement of date, and this was ordered stricken from the record.

Later testimony went as follows:

Q. So it is now your testimony that one month after the time of delivery of product to B.W.B. Controls_, one month after your delivery you became aware of a problem regarding rusting stems; is that correct?
A. (by Mr. Carroll) Yes. But they may or
Q- -

Appellee’s attorney evidently cut Carroll off, because there followed a discussion as to why Carroll should have been allowed to explain his answer. The court, however, *657 did not strike any portion of that response from the record.

Carroll later testified that the appellee did not make demand upon him for correction of the problem between the date of delivery of the product and the time of trial.

On redirect, Carroll testified that he was never contacted by Ned Bergeron (the President of B.W.B.) or anyone from B.W.B. and asked to take back any parts, or to refund any money paid to them nor did anyone from B.W.B. ever complain to him that the parts did not work. He further testified that he could have traced the allegedly defective materials back to where they were manufactured, had anyone come to him from B.W.B. and said there was a problem with the rusted stems, but that he was denied that opportunity by the lack of complaint.

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Bluebook (online)
677 S.W.2d 654, 39 U.C.C. Rep. Serv. (West) 1688, 1984 Tex. App. LEXIS 5945, Counsel Stack Legal Research, https://law.counselstack.com/opinion/carroll-instrument-co-v-bwb-controls-inc-texapp-1984.