Crystal Foods Corporation v. B & K Equipment Company (mem. dec.)

CourtIndiana Court of Appeals
DecidedJune 3, 2020
Docket19A-PL-2773
StatusPublished

This text of Crystal Foods Corporation v. B & K Equipment Company (mem. dec.) (Crystal Foods Corporation v. B & K Equipment Company (mem. dec.)) is published on Counsel Stack Legal Research, covering Indiana Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Crystal Foods Corporation v. B & K Equipment Company (mem. dec.), (Ind. Ct. App. 2020).

Opinion

MEMORANDUM DECISION Pursuant to Ind. Appellate Rule 65(D), this Memorandum Decision shall not be regarded as precedent or cited before any FILED court except for the purpose of establishing Jun 03 2020, 8:13 am

the defense of res judicata, collateral CLERK estoppel, or the law of the case. Indiana Supreme Court Court of Appeals and Tax Court

ATTORNEY FOR APPELLANT ATTORNEY FOR APPELLEE Patrick A. Schuster Laura S. Reed Crown Point, Indiana Indianapolis, Indiana

IN THE COURT OF APPEALS OF INDIANA

Crystal Foods Corporation, June 3, 2020 Appellant-Plaintiff, Court of Appeals Case No. 19A-PL-2773 v. Appeal from the Lake Superior Court B & K Equipment Company, The Honorable Kristina Kantar, Appellee-Defendant. Judge Trial Court Cause No. 45D04-1506-PL-47

Tavitas, Judge.

Case Summary [1] Crystal Foods Corporation (“Crystal”) appeals the trial court’s grant of

summary judgment to B&K Equipment Company (“B&K”). We affirm in part,

reverse in part, and remand.

Court of Appeals of Indiana | Memorandum Decision 19A-PL-2773 | June 3, 2020 Page 1 of 16 Issues [2] Crystal raises two issues, which we consolidate and restate as whether the trial

court properly granted summary judgment to B&K for breach of warranty. On

cross-appeal, B&K also argues that the trial court erred by denying its motion

for summary judgment regarding its statute of limitation defense.

Facts [3] Crystal operated a gas station in Merrillville on property owned by Nuch

Corporation (“Nuch”). In March 2007, Crystal entered into a contract with

B&K to remove and replace an underground storage tank located at Crystal’s

gas station. B&K provided Crystal with a four-page “Proposal,” which Crystal

signed (“Contract”). Appellant’s App. Vol. II p. 29. The first three pages of the

Contract itemized and detailed the work B&K was to perform for Crystal. The

Contract required B&K to “furnish material and labor to complete a tank

replacement project” that included, in part: “[e]xcavat[ion], remov[al],

clean[ing] and dispos[al] of the existing steel underground storage tanks”;

“[f]urnish[ing] and install[ation of] a Xerxes, 22,000 gallon single wall fiberglass

underground storage tank”; “[f]ill[ing] the excavation with compacted stone

backfill”; and replac[ing] the concrete curb and “excavated pavement under the

existing canopy with 6 [inch] thick fibermesh reinforced concrete.” Id. Each of

these three pages was signed by both B&K and Crystal. At the bottom of each

of the three pages, the following language was included: “SEE TERMS AND

CONDITIONS TO THIS PROPOSAL.” Id. The third page of the Contract

Court of Appeals of Indiana | Memorandum Decision 19A-PL-2773 | June 3, 2020 Page 2 of 16 included “TERMS”, which detailed payment provisions and Crystal’s failure to

comply with the terms of the Contract.

[4] The fourth page of the Contract was titled “TERMS AND CONDITIONS”

and was not signed by the parties. The page included the following boilerplate

language:

TITLE AND OWNERSHIP: Unless otherwise directed by customer, if this contract includes installation, it is a construction contract which is an agreement between this Contractor/Seller and the Purchaser/Owner to alter, improve, repair, replace, or erect real property. It is expressly agreed that title to and ownership of the fixtures included in this construction contract pass to the Purchaser/Owner upon permanent and complete installation of the fixtures to real estate. . . .

If this contract does not include installation or if it is a contract with a valid tax-exempt organization or if a valid resale certificate has been issued, it is a sale of tangible personal property and it is expressly agreed that title and ownership of the fixtures pass upon delivery, prior to installation. . . .

*****

If for any reason this contract is not paid in full within 90 days of completion of installation, it is agreed that in addition to collecting all balances due, the contractor shall have the right to remove the installed fixtures without written permission from or prior notice to the Purchaser/Owner and thereafter the fixtures shall become the personal property of Contractor and Contractor shall not be responsible for any damage to purchaser/owners property cause by such removal. . . .

Court of Appeals of Indiana | Memorandum Decision 19A-PL-2773 | June 3, 2020 Page 3 of 16 GRANT OF SECURITY INTEREST: For sales of tangible personal property, Purchaser hereby grants and Seller retains a purchase money security interest in said product/equipment, including proceeds there from, for the purpose of securing Purchaser’s obligation to make payment in full, until payment is received in full in cash or collected funds, at which time the security interest shall cease. . . . .

PAYMENT AND COLLECTION TERMS: It is expressly understood and agreed that payment in full shall be due upon completion of installation or delivery unless prior arrangements have been made and agreed to. . . .

WARRANTIES: All equipment/Product(s) and components carry a manufacturer’s warranty, which is passed onto the purchaser according to the manufacturer’s policy. No other warranties are either expressed or implied, including the warranty of merchantability and fitness for a particular purpose.

Id. at 32.

[5] In 2008, the concrete in the area where B&K performed work settled and

cracked. An engineering study concluded that the “3-inch size rock [used by

B&K] was not a suitable backfill material.” Id. at 36. The study concluded that

the “settlement of old concrete pavement around the backfill area and

movement in the gasoline island No. 7 & 8 is caused by the improper

backfilling of the former [underground storage tank] area.” Id. at 37. Crystal

estimated its resulting damages at more than $312,000.00.

[6] In June 2015, Crystal and Nuch filed a complaint against B&K and alleged

breach of contract and negligence. Crystal’s complaint alleged, in part, that:

Court of Appeals of Indiana | Memorandum Decision 19A-PL-2773 | June 3, 2020 Page 4 of 16 B&K “owed a duty to [Crystal] to perform its work in a good and workmanlike

manner”; B&K was contracted to excavate, remove, and replace an

underground storage tank on the property; and there was “a deficiency in the

design, planning, supervision, construction, or observation of construction on

the improvement to the Property by B&K constituting a breach by B&K of the

Contract.” Appellant’s App. Vol. II p. 14.

[7] B&K filed a motion for summary judgment and claimed: (1) Crystal’s claim

was barred because it was subject to a six-year statute of limitation for damage

to real property pursuant to Indiana Code Section 34-11-2-7; (2) Crystal’s

claims were barred by the written disclaimer of implied warranties in the

Contract; and (3) Nuch was not a party to the Contract. Crystal filed a

response to B&K’s motion for summary judgment. Crystal argued that: (1) the

action was not barred by the statute of limitation because the ten-year statute of

limitation for a written contract action pursuant to Indiana Code Section 34-11-

2-11 applied; and (2) B&K’s two-paragraph warranty argument was “devoid of

substantive law and facts to support the argument.” Id. at 42.

[8] After a hearing, the trial court granted summary judgment to B&K. 1 The trial

court noted that Crystal did not dispute that Nuch was not a party to the

Contract and did not dispute B&K’s motion for summary judgment regarding

the negligence claim. The trial court concluded that B&K’s statute of limitation

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