Kansas City Diesel Power Co. v. Kirloskar, Inc.

647 S.W.2d 841, 1983 Mo. App. LEXIS 3086
CourtMissouri Court of Appeals
DecidedJanuary 11, 1983
DocketNo. WD 32904
StatusPublished
Cited by2 cases

This text of 647 S.W.2d 841 (Kansas City Diesel Power Co. v. Kirloskar, Inc.) is published on Counsel Stack Legal Research, covering Missouri Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Kansas City Diesel Power Co. v. Kirloskar, Inc., 647 S.W.2d 841, 1983 Mo. App. LEXIS 3086 (Mo. Ct. App. 1983).

Opinion

KENNEDY, Judge.

K.C. Diesel Power Company in 1978 entered into a distributorship agreement with Kirloskar, Inc., whereby K.C. Diesel agreed to become a distributor of Kirloskar diesel motors in Missouri and Kansas. By the terms of the contract K.C. Diesel was to maintain an inventory of Kirloskar diesel engines and parts. At K.C. Diesel’s request, a termination provision was added to the distributorship contract tendered by Kirloskar. This provided for termination by either party on 120 days’ notice, and obliged Kirloskar in the event of termination to repurchase new, unused and undamaged engines and spare parts purchased from Kirloskar during the 12 months before the date of termination.

At approximately the same time as the distributorship agreement, the parties entered into a separate consignment arrangement. Under this arrangement — which was not in writing — Kirloskar would ship engines to K.C. Diesel on consignment. They were kept in K.C. Diesel’s warehouse. When K.C. Diesel itself sold a consigned engine, it would buy it from Kirloskar and re-sell it to its customer. Or at Kirloskar’s direction, K.C. Diesel would load a consigned engine on a common carrier for shipment to any place designated by Kirloskar. Consigned engines remained the property of Kirloskar.

[843]*843After a year K.C. Diesel elected to terminate the distributorship agreement and so notified Kirloskar by letter dated April 16, 1979. The effective termination date was August 14, 1979. Apparently both parties understood that the termination of the distributorship agreement also brought the consignment arrangement to an end, and the parties intended to sever the entire relationship.

At the time of termination, K.C. Diesel had on hand 11 consigned engines, and also had in inventory a number of purchased engines and parts.

A dispute arose between the parties as to the engines and parts which Kirloskar was obligated to repurchase from K.C. Diesel. K.C. Diesel submitted a list of engines and parts which it claimed were qualified for repurchase under the termination agreement. The total of these, along with certain other debits, totaled $43,646.14. It advised Kirloskar by letter dated August 10 that “[a]ll units will be shipped in a consolidated shipment immediately when settlement received.”

On August 16, Kirloskar submitted to K.C. Diesel its own settlement figure of $21,291.81.

On August 30 a letter from K.C. Diesel to Kirloskar referring to “our conversations [of] the past few days” reduced its claim to $28,726.83. On August 29 Kirloskar agreed additionally to repurchase all the new engines purchased from Kirloskar by K.C. Diesel, including four over-one-year engines which Kirloskar had earlier declined to repurchase.

At this point, the parties were apparently in agreement as to the parts and engines to be repurchased by Kirloskar, and perhaps the amount Kirloskar was to pay. K.C. Diesel, however, now declined to ship the merchandise until it had first received payment. Kirloskar then on September 28 advised K.C. Diesel that it would make payment when it had received the merchandise. The September 28 letter from Kirloskar to K.C. Diesel demanded the return of: “All Product eligible for return under termination clause of the Distributor Agreement are to be returned, freight collect, to Kirlos-kar, Inc. 1401 Cherry Hill Rd., Balto., MD 21225, as previously requested.” Both parties, at least upon trial of the case and here, treat this as a withdrawal of Kirloskar’s earlier (August 29) offer to repurchase the four over-one-year engines.

On October 8, K.C. Diesel wrote to Kirlos-kar, saying:

K.C. Diesel will ship all units back to United Rigging and Hauling, Inc. 6701 Ammendale Road, Beltsville, MD, consigned to ourselves. I will inform you of shipping time and expected availability for inspection. I will accompany your representative to check out the units. At the time units are inspected, and certified or cashier’s check in the amount of $28,-726.83 (reference my letter of 8/30/79) for product, plus transportation in the estimated amount of $1,500.00 is received, units will be released to you.

Kirloskar turned down this proposition.

Throughout the correspondence, Kirlos-kar made repeated demands that the consigned engines be returned to them “freight collect”.

In early November K.C. Diesel, without explanation for its change of position, shipped its entire Kirloskar inventory (not including the consigned engines) to Kirlos-kar. Kirloskar sent K.C. Diesel a letter dated November 14, 1979, acknowledging the receipt of the merchandise. There were 12 engines in the shipment. Kirloskar gave K.C. Diesel credit for four of the engines. It denied credit for four used engines, and four “over-one-year engines”. Only the “over-one-year” engines are involved in the case before us.

By the same letter, Kirloskar debited K.C. Diesel for the “list amount” of the consigned engines remaining in K.C. Diesel’s possession. There were 11 of them, and the total was $29,940. After giving K.C. Diesel credit for $11,139.32 for the returned inventory and various other credits, and after certain adjustments in their earlier accounts, Kirloskar claimed a total due from K.C. Diesel of $21,583.64. At this point, the situation was as follows:

[844]*8441. K.C. Diesel had in its possession in Kansas City 11 consigned diesel engines belonging to Kirloskar.
2. Kirloskar had in its possession in Baltimore (insofar as our case is concerned) four over-one-year diesel engines which K.C. Diesel had shipped to it for repurchase, but which Kirlos-kar had refused to repurchase.
3. Kirloskar owed K.C. Diesel for repurchased inventory, with certain adjustments to their mutual accounts, the sum of $15,398.62. This was the amount fixed by, the judgment upon trial, although it apparently remained in dispute until trial. The amount is not in controversy on this appeal.

1. Conversion by Kirloskar of four “over-one-year” engines.

Two weeks later plaintiff K.C. Diesel filed suit against Kirloskar for the amount alleged to be owing to it for repurchased inventory and other charges (no longer in issue in the case), and for damages for conversion of the four over-one-year engines. Defendant Kirloskar’s attorney, in his opening statement, admitted that Kir-loskar had sold three of the over-one-year engines. The trial court on the basis of that admission, directed a verdict for K.C. Diesel for Kirloskar’s conversion of the three engines for the prices at which Kirlos-kar had sold them, a total of $7,004.98.

The case proceeded to trial for the conversion of the fourth engine, which remained in Kirloskar’s possession.

The jury verdict in the claim for damages for conversion of the engine was in favor of K.C. Diesel and against Kirloskar for actual damages of $3,700 and for punitive damages of $25,000.

From this verdict and judgment Kirlos-kar takes an appeal, claiming that K.C. Diesel did not make out a submissible case for the conversion by Kirloskar of the fourth over-one-year engine. In this argument defendant Kirloskar must be sustained. The engine was shipped by K.C. Diesel to Kirloskar in Baltimore. Kirloskar had not invited it to do so, and K.C.

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Bluebook (online)
647 S.W.2d 841, 1983 Mo. App. LEXIS 3086, Counsel Stack Legal Research, https://law.counselstack.com/opinion/kansas-city-diesel-power-co-v-kirloskar-inc-moctapp-1983.