Milwaukee Valve Co. v. Mishawaka Brass Manufacturing, Inc.

319 N.W.2d 885, 107 Wis. 2d 164, 34 U.C.C. Rep. Serv. (West) 15, 1982 Wisc. App. LEXIS 3441
CourtCourt of Appeals of Wisconsin
DecidedMarch 2, 1982
Docket81-872
StatusPublished
Cited by3 cases

This text of 319 N.W.2d 885 (Milwaukee Valve Co. v. Mishawaka Brass Manufacturing, Inc.) is published on Counsel Stack Legal Research, covering Court of Appeals of Wisconsin primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Milwaukee Valve Co. v. Mishawaka Brass Manufacturing, Inc., 319 N.W.2d 885, 107 Wis. 2d 164, 34 U.C.C. Rep. Serv. (West) 15, 1982 Wisc. App. LEXIS 3441 (Wis. Ct. App. 1982).

Opinion

DECKER, C.J.

This appeal arises from two contracts for the sale of copper ingot. The seller claims the first contract was breached by the buyer’s wrongful rejection of goods. As to the second contract, the seller claims that the buyer failed to effect proper cover, and that the trial court improperly excluded both parol evidence and purported fair market value testimony. We disagree and affirm.

The first contract was for the sale by Mishawaka Brass Manufacturing, Inc. (Mishawaka), of 200,000 pounds of “85-5-5-5” copper ingot to Milwaukee Valve Company, Inc. (Milwaukee Valve). The contract provided that the ingot had to comply with standards of the American Society for Testing of Materials (ASTM B-62 Standards). Milwaukee Valve rejected two shipments of this ingot and half of a third for noncompli-ace with ASTM B-62, and cancelled the contract.

The second contract was for the sale by Mishawaka of 110,000 pounds of “Navy M” copper ingot to Milwaukee Valve. Mishawaka sold the ingot to another customer when Milwaukee Valve would not take immediate delivery, and Milwaukee Valve bought Navy M ingot from another supplier when Mishawaka was unable to deliver at a later date.

Milwaukee Valve sued Mishawaka for the difference between the price of the Navy M ingot bought from another supplier and the price specified in its contract with Mishawaka. Mishawaka denied liability, and by *167 counterclaim sued Milwaukee Valve for breach of the first contract, claiming wrongful rejection of the 85-5-5-5 ingot.

The jury determined that the 85-5-5-5 ingot which Milwaukee Valve rejected failed to conform to the requirements of the first contract, that Mishawaka breached its contract to supply Milwaukee Valve with Navy M ingot, and that Milwaukee Valve in good faith and without unreasonable delay made a reasonable purchase of goods in substitution for those due from Mish-awaka. Damages were calculated based upon the difference between the price of Navy M ingot bought in substitution and the price specified in Milwaukee Valve’s contract with Mishawaka.

Mishawaka raises the following arguments:

(1) The 85-5-5-5 ingot rejected by Milwaukee Valve conformed to the contract specifications;

(2) Milwaukee Valve’s purchase of Navy M ingot in substitution for that due from Mishawaka did not constitute cover as defined in sec. 402.712, Stats;

(3) The trial court erred in excluding testimony of Mishawaka’s president as to market price of Navy M ingot at the time of breach of the contract; and

(4) The trial court improperly excluded prior oral negotiations concerning the shipping dates of Navy M ingot.

REJECTION OF 85-5-5-5 INGOT

Section 402.106(2), Stats., provides: “Goods or conduct including any part of a performance are ‘conforming’ or conform to the contract when they are in accordance with the obligations under the contract.” Section 402.601 gives a buyer the right to reject if goods fail to conform to the contract. Milwaukee Valve seasonably rejected two shipments of 85-5-5-5 ingot and half of a *168 third after it determined that the rejected ingot failed to conform to the contract.

The contract for 85-5-5-5 ingot required it to conform to ASTM B-62 standards. Mishawaka tested samples from each lot by wet chemical analysis before shipment and determined that the ingot conformed to the standards specified in the contract. Milwaukee Valve used spectrometer testing to determine that the ingot failed to conform to the contract.

Mishawaka claims that the jury determination that the 85-5-5-5 ingot rejected by Milwaukee Valve failed to conform to the contract is clearly erroneous and not supported by any credible evidence in the record because it was undisputed at trial that:

(1) ASTM standards require use of wet chemical analysis to resolve disputes; and

(2) wet chemical analysis is more accurate than spectrometer testing. 1

Our review of the record indicates that there is sufficient credible evidence to support the jury’s determination. The accuracy of Mishawaka’s wet chemical analysis was thrown into doubt at trial. Although Mish-awaka’s analysis showed the first load to be conforming, a second wet chemical analysis by Mishawaka of samples from this load produced considerably different results. The variation greatly exceeded the margin of error for wet chemical analysis which Mishawaka’s expert initially posited in support of the accuracy of this testing procedure.

Mishawaka and Milwaukee Valve agreed to have an independent laboratory test samples from the first shipment, and after that laboratory’s wet chemical analysis corroborated Milwaukee Valve’s spectrometer testing re- *169 suits, Mishawaka accepted return of the shipment. Return of the second shipment upon rejection was accepted without a request for independent laboratory analysis. The record also reflects that Mishawaka’s president agreed that the ingot was nonconforming and commented that Mishawaka’s wet chemical analysis equipment obviously was not being used properly.

The jury determination that the rejected 85-5-5-5 ingot' was nonconforming is supported by credible evidence.

PAROL EVIDENCE

The contract for purchase of the Navy M ingot was evidenced by a Milwaukee Valve purchase order dated October 10, 1978, which stated that delivery was to be “as required during the first quarter of 1979.” It also stated that it was confirming a telephone conversation between the president of Milwaukee Valve and the president of Mishawaka. The president of Mishawaka, as Mishawaka’s authorized agent, indicated acceptance by signing the order form in the space designated “accepted by.”

At trial the president of Mishawaka adamantly asserted that during the telephone conversation referred to in the purchase order the parties either expressly agreed to normal delivery terms 2 or that normal delivery terms were presumed by both parties. The trial court excluded introduction of any evidence to that effect because it was an attempted variation of the terms of the contract by parol evidence. We agree.

*170 Section 402.202, Stats., provides:

Final written expression: parol or extrinsic evidence. Terms with respect to which the confirmatory memor-anda of the parties agree or which are otherwise set forth in a writing intended by the parties as a final expression of their agreement with respect to such terms as are included therein may not be contradicted by evidence of any prior agreement or of a contemporaneous oral agreement but may be explained or supplemented:
(1) By course of dealing or usage of trade (s. 401.-205) or by course of performance (s. 402.208);
(2) By evidence of consistent additional terms unless the court finds the writing to have been intended also as a complete and exclusive statement of the terms of the agreement.

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319 N.W.2d 885, 107 Wis. 2d 164, 34 U.C.C. Rep. Serv. (West) 15, 1982 Wisc. App. LEXIS 3441, Counsel Stack Legal Research, https://law.counselstack.com/opinion/milwaukee-valve-co-v-mishawaka-brass-manufacturing-inc-wisctapp-1982.