Essex Crane Rental Corp. v. Weyher/Livsey Constructors, Inc.

713 F. Supp. 1350, 10 U.C.C. Rep. Serv. 2d (West) 314, 1989 U.S. Dist. LEXIS 6095, 1989 WL 56671
CourtDistrict Court, D. Idaho
DecidedMay 25, 1989
DocketCiv. 87-1246
StatusPublished
Cited by1 cases

This text of 713 F. Supp. 1350 (Essex Crane Rental Corp. v. Weyher/Livsey Constructors, Inc.) is published on Counsel Stack Legal Research, covering District Court, D. Idaho primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Essex Crane Rental Corp. v. Weyher/Livsey Constructors, Inc., 713 F. Supp. 1350, 10 U.C.C. Rep. Serv. 2d (West) 314, 1989 U.S. Dist. LEXIS 6095, 1989 WL 56671 (D. Idaho 1989).

Opinion

MEMORANDUM OPINION AND ORDER

RYAN, Chief Judge.

I. FACTS AND PROCEDURE

In May of 1986, Defendant Wey-her/Livsey Constructors, Inc., (Wey-her/Livsey) leased a crane from Plaintiff Essex Crane Rental Corp. (Essex) for a minimum term of one year. On January 26, 1987, a cable which supported the boom of the crane failed, causing the death of a Weyher/Livsey employee and property damage. Essex was sued, along with others, for damages arising from the death of the Weyher/Livsey employee.

Essex brought this suit against Wey-her/Livsey, seeking a declaration of rights and duties regarding (1) indemnity for the death of the Weyher/Livsey employee, (2) Weyher/Livsey’s duty to obtain insurance covering Essex, and (3) Weyher/Livsey’s duty to maintain and repair the damaged crane. Essex also seeks damages for the following breaches of contract: (1) failure to disclose conditions under which the crane would be operated, (2) failure to obtain insurance, (3) failure to pay rent after February 20, 1987, (4) failure to repair or pay for damage to the crane, and (5) failure to indemnify Essex.

Weyher/Livsey has counterclaimed on seven theories: (1) failure to provide a crane serviceable for twelve months, (2) breach of an implied warranty for fitness for a particular purpose, (3) breach of an implied warranty of merchantability, (4) restitution of lease overpayments, (5) breach of express contract terms and warranties, (6) negligent failure to inspect and maintain the crane, and (7) strict product liability.

*1353 Currently before the court are two summary judgment motions by Essex, and a motion for partial summary judgment by Weyher/Livsey.

II. ANALYSIS

A. Formation Issues

At the root of most issues in the pending motions is determining which document, if any, embodies the agreement between the parties. Weyher/Livsey contends that the controlling document is one of two purchase orders. Essex claims that its form lease agreement controls.

It is useful here to briefly recount the negotiations which led to the contract in this case. On or about May 12, 1986, Clayton Record, a Weyher/Livsey employee, and Robert Stork, an Essex employee, discussed the basic terms of a crane lease. Their agreement was memorialized in a handwritten document which is attached as an exhibit to Exhibit A to Weyher/Livsey’s Memorandum in Support of Partial Summary Judgment. This document states “no rental agreement,” which Record states in deposition meant that Weyher/Livsey would not accept an Essex lease agreement. The document also mentions a purchase order number 3039 P-02400. Essex has placed in the record uncontroverted evidence which shows that no purchase order by this number was sent to Essex.

On or about May 9, 1986, Essex began transporting the crane to Weyher/Livsey’s job site. On or about May 13, 1986, Essex forwarded to Weyher/Livsey the lease agreement at issue in this case, number 03190, back-dated to May 5, 1986. Wey-her/Livsey did not, and has never, signed this agreement.

After Weyher/Livsey had used the crane for about two weeks, Weyher/Livsey sent a letter to Essex advising it that Wey-her/Livsey would not sign the lease agreement, and that the terms of the agreement are contained in purchase order number 3039-P02400. Again, it is uncontroverted that Essex received no such purchase order.

Weyher/Livsey refused to pay the agreed rent. Weyher/Livsey advised Essex that its policy prohibited any payments without a signed purchase order. After the crane had been used by Weyher/Livsey for about two months, Weyher/Livsey forwarded purchase order number 3039R00100 to Essex. This purchase order was signed by a Weyher/Livsey agent, and by Carl Morano, an Essex agent. However, Morano signed the purchase order with the handwritten proviso, “subject to our lease # 03190.” Exhibit 1 to Exhibit E to Memorandum of Weyher/Livsey Constructors, Inc., in Support of Partial Summary Judgment, filed Sept. 16, 1988.

A threshold issue is whether this case is governed by the common law of contracts or the provisions of the Uniform Commercial Code (“Code”). Essex argues primarily for common law, while Weyher/Livsey argues for applying the Code.

Prior to the enactment of Article 2, the “mirror image” rule applied to sales of goods. Under that rule, a document which purported to accept an offer would be construed as a rejection and counteroffer if the terms of the acceptance differed in any way from the terms of the offer. This created problems in commercial transactions, where merchants on either side of a deal would send to the other parties forms containing boilerplate slanted in their favor (known as the “battle of the forms”). By operation of the mirror image rule, the net result of a battle of forms would often be that no contract was formed.

Article 2 addresses this and similar problems in several ways, two of which are at issue here. First, the Code does away with the need for a formal offer and acceptance. Rather, a contract can be found to exist even where it is impossible to determine when the contract was made. Idaho Code § 28-2-204(2) (1980). Also, “[a] contract for sale of goods may be made in any manner sufficient to show agreement, including conduct by both parties which recognizes the existence of such a contract.” Idaho Code § 28-2-204(1) (1980).

Second, the Code does away with the mirror image rule, providing that an ac *1354 ceptance which varies from an offer may nonetheless operate as an acceptance. Idaho Code § 28-2-207 (1980).

The battle of the forms is not a situation unique to sales of goods. It can occur in any commercial transaction. In fact, this case is an example of the phenomenon in a lease of goods. When the policies which gave rise to a Code provision apply in a transaction other than a sale of goods, Idaho courts will look to those provisions in determining the applicable law. All-States Leasing Co. v. Bass, 96 Idaho 873, 878, 538 P.2d 1177, 1182 (1975). Because this case presents the very situation covered by the rules on formation of contracts in the Code, this court will look to the Code to find applicable rules of law.

1. The handwritten memorandum.

The first document which arguably controls is the Stork-Record memorandum. If this were the controlling document, it would be advantageous to Weyher/Livsey, since it apparently incorporates a Weyher/Livsey purchase order by reference. However, it is not.

Uncontroverted evidence has been placed in the record which shows that Stork had no authority to bind Essex.

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713 F. Supp. 1350, 10 U.C.C. Rep. Serv. 2d (West) 314, 1989 U.S. Dist. LEXIS 6095, 1989 WL 56671, Counsel Stack Legal Research, https://law.counselstack.com/opinion/essex-crane-rental-corp-v-weyherlivsey-constructors-inc-idd-1989.