Veretto v. Eli Lilly and Company

369 F. Supp. 1254, 14 U.C.C. Rep. Serv. (West) 1239, 1974 U.S. Dist. LEXIS 12620
CourtDistrict Court, N.D. Texas
DecidedJanuary 24, 1974
DocketCiv. A. 5-1148
StatusPublished
Cited by6 cases

This text of 369 F. Supp. 1254 (Veretto v. Eli Lilly and Company) is published on Counsel Stack Legal Research, covering District Court, N.D. Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Veretto v. Eli Lilly and Company, 369 F. Supp. 1254, 14 U.C.C. Rep. Serv. (West) 1239, 1974 U.S. Dist. LEXIS 12620 (N.D. Tex. 1974).

Opinion

MEMORANDUM AND ORDER

WOODWARD, District Judge.

Plaintiff, a farmer in Lubbock County, Texas, in 1972 planted several hundred acres of cotton on his farm which is south of the City of Lubbock, Texas. In the process of preparing this land he also applied a weed control substance known as Treflan which was manufac *1255 tured by the. defendant corporation. The defendant, after manufacturing the Treflan, would ship it to a warehouse in Dallas, Texas and from there it was distributed to various retail outlets. The plaintiff purchased 50 gallons of Treflan from the College Avenue Co-op Gin and another 126y2 gallons from Four Corners Farm Supply Center. Plaintiff then hired Four Corners to apply the 176% gallons of the Treflan to his cotton. The plaintiff alleges in his complaint that the Treflan failed to control the weeds and he is asking for the return of the purchase price along with certain consequential damages such as the cost of extra labor needed to hoe the weeds in the cotton fields, the amount expended in applying the Treflan to the cotton fields and the loss sustained because he was forced to plow up a certain portion of his cotton which was unharvestable due to the excess weeds.

Plaintiff did not found his cause of action upon strict liability in tort but rather on a theory of breach of implied warranty of merchantability as well as the breach of certain guarantees and express warranties made by the defendant-manufacturer. The evidence showed that each can of Treflan was wrapped in a label (Defendant’s Exhibit 4) which contained directions for the use of the Treflan, and there was attached thereto a smaller sheet of instructions (Defendant’s Exhibit 3), showing the rate of application for various crops and types of soil, as well as a warranty card (Defendant’s Exhibit 2) and a guarantee registration card (Defendant’s Exhibit 2) which contained what was referred to as the “Treflan Performance Guarantee.”

In response to the submitted special issues, the jury found that the defendant represented in its written guarantees and advertising that Treflan would control weeds if applied and incorporated according to directions given on the various labels and brochures; that the plaintiff relied on the guarantee and warranty so made by the defendant; that the Treflan in question in this case failed to effectively control the weeds on the plaintiff’s land in the crop year 1972; and that the plaintiff followed good farming practices in applying Treflan. In Special Issue No. Four the jury specifically found that the plaintiff properly applied, incorporated and used the proper mixtures and amounts of the Treflan purchased. In connection with that Special Issue the court instructed the jury that the instructions and directions given by the defendant in its labels and pamphlets accompanying the Treflan provided the criteria by which they were to determine whether the chemical was applied and incorporated in the proper amount and manner.

They further found that the plaintiff paid a purchase of $3,919.50 for the Treflan. As consequential damages, the jury awarded $2,500.00 to compensate for extra hoeing labor which plaintiff had to hire because of the excess weeds, $521.00 for the application fee charged by Four Corners Farm Supply and $700.00 for one field of cotton which the plaintiff had to plow under entirely due to an extreme weed problem.

Defendant filed a motion for an instructed verdict and in the alternative for the court to remove the case from the jury and enter judgment for the defendant at the close of the plaintiff’s testimony, renewed this motion after all parties had rested and moved for judgment notwithstanding the verdict after the verdict was received.

The court has determined that as a matter of law there is no privity of contract between the plaintiff and the defendant. The merchandise was purchased from independent retail dealers without any intervention in the ordinary retail sales process by the defendant that would create privity between these parties. As plaintiff bases his suit on a theory of breach of warranties, both express and implied, there can be no recovery of consequential economic damages from the remote manufacturer in this case because of the lack of privity of contract between them. Industrias Velasco v. Applied Power Equip. and Mfg. Co., 227 F.Supp. 937 (S.D.Tex.1964); *1256 Thermal Supply v. Asel, 468 S.W.2d 927 (C.C.A. Austin 1971, no writ); Eli Lilly Company v. Casey, 472 S.W.2d 598 (C.C.A. Eastland 1971, writ dism’d w. o. j.); Pioneer Hi-Bred International, Inc. v. Talley, 493 S.W.2d 602 (Tex.Civ.App. —Amarillo 1973, no writ). Therefore, defendant’s motion for judgment is granted insofar as it pertains to any recovery by the plaintiff of consequential damages as found by the jury in answering Special Issues Nos. Seven (a) and Seven (b), Eight and Nine.

However, the lack of privity does not bar recovery by the plaintiff for the purchase money of the Treflan under the express warranty or guarantee made by the defendant on the labels and pamphlets accompanying each can of Treflan and also under the guarantees made by defendant in their advertising program. These pamphlets, labels and guarantee cards were relied upon by the plaintiff and he is entitled to recover thereon, provided that he demonstrates compliance with the terms of the guarantee. But, as discussed above, his recovery is limited to the amount of the purchase price as the evidence is uneontradicted that the written labels and guarantees provide that the defendant will refund the purchase price of Treflan under certain conditions and that the recovery is limited to that sum. Of course, before recovery can be allowed on the basis of these warranties and guarantees, the plaintiff must show by a preponderance of the evidence that the plaintiff complied with the , conditions precedent set forth in the written instructions.

Specifically the written guarantees and warranties relied upon by the plaintiff for recovery are shown by Defendant’s Exhibits 2, 3 and 4. Exhibit 2 was in the form of a guarantee registration which the testimony shows was mailed in by the retail supplier registering the plaintiff’s purchase and which contained the following conditions:

“1. Purchaser must complete, sign and return guarantee registration card (attached) within 30 days of his Treflan purchase.
“2. Purchaser must notify Elanco promptly if a lack of satisfactory control occurs. Such notice must be given within 90 days after the first planting or application of Treflan to treated crop, whichever occurs later.
“3. An Elanco representative must be satisfied that purchaser used Treflan according to label and must visually observe unsatisfactory control of weeds in field.
“4. Refund shall be limited to acreage on which weed control was not satisfactory and to season in which crop was treated.
“5.

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Bluebook (online)
369 F. Supp. 1254, 14 U.C.C. Rep. Serv. (West) 1239, 1974 U.S. Dist. LEXIS 12620, Counsel Stack Legal Research, https://law.counselstack.com/opinion/veretto-v-eli-lilly-and-company-txnd-1974.