Waldinger Corp. v. CRS Group Engineers, Inc.

775 F.2d 781, 42 U.C.C. Rep. Serv. (West) 172
CourtCourt of Appeals for the Seventh Circuit
DecidedOctober 14, 1985
DocketNos. 83-1925, 83-2037
StatusPublished
Cited by8 cases

This text of 775 F.2d 781 (Waldinger Corp. v. CRS Group Engineers, Inc.) is published on Counsel Stack Legal Research, covering Court of Appeals for the Seventh Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Waldinger Corp. v. CRS Group Engineers, Inc., 775 F.2d 781, 42 U.C.C. Rep. Serv. (West) 172 (7th Cir. 1985).

Opinions

HARLINGTON WOOD, Jr., Circuit Judge.

In 1977, the Urbana and Champaign Sanitary District was engaged in planning two waste water treatment facilities. CRS Group Engineers, Inc., Clark Dietz Division (“Dietz”), as engineer for the Sanitary District, prepared the specifications for these facilities. Among the equipment necessary for the facilities were belt filter presses.1 The specifications for these presses detailed two types of requirements — performance capabilities and mechanical components. The Waldinger Corporation (“Wal-dinger”), a mechanical contractor, preparing to bid on the mechanical portions of the projects, received quotations for sludge de-watering equipment from four belt press manufacturers, including Ashbrook-Simon-Hartley, Inc. (“Ashbrook”). Waldinger successfully bid on the projects and became the mechanical subcontractor; Ashbrook was successful in its bid to be the supplier of the sludge dewatering equipment. Ash-brook, however, was unable to supply the equipment described in the specifications set forth in its contract with Waldinger, and Waldinger obtained the equipment from The Ralph B. Carter Company (“Carter”).

Waldinger then sued Ashbrook for breach of contract. Ashbrook, in defense, claimed impracticability of performance due to Dietz’s intentional or negligent drafting of restrictive specifications. Wal-dinger also sued Dietz, claiming that Dietz intentionally interfered with the contract between Ashbrook and Waldinger and, alternatively, that Dietz negligently failed to draft proper specifications for the sludge dewatering equipment.

Following a bench trial, the district court found that Dietz intentionally prepared exclusionary specifications, and insisted without justification that Ashbrook comply literally with those specifications. The court also found that Ashbrook did not bid with the realization that it could not comply with the specifications. The court concluded as a matter of law that Dietz intentionally interfered with the contract between Ash-brook and Waldinger and that Ashbrook was excused from performing its contract with Waldinger because performance was impracticable. Waldinger v. Ashbrook-Simon-Hartley, Inc., 564 F.Supp. 970 (C.D.Ill.1983).

I.

The district court made the following factual findings, none of which is clearly erro[784]*784neous, Anderson v. City of Bessemer City, N.C., — U.S. -, 105 S.Ct. 1504, 84 L.Ed.2d 518 (1985). In the summer of 1977, Dietz decided to use equipment manufactured by Carter as the model for the sludge dewatering equipment to be used on the projects, though Dietz had never seen the Carter 15-31 machine perform.2 Carter supplied the data and performance descriptions which were incorporated in the specifications drawn by Dietz. Dietz took the Carter performance claims at face value, making no independent study of them. Dietz knew that no manufacturer but Carter recycled the belt wash water used in the machine but nevertheless specified that subsystem.3 Dietz had no data proving that such recycling would increase solid removal or reduce polymer consumption in the sludge dewatering process. Indeed, the evidence adduced at trial showed that recycling had no positive effect on a filter press’ production capacities, but likely had a negative effect. Dietz had no scientific basis for including in the specifications other features of the Carter machine, specifically, the 540 square foot dewatering area and the stainless steel clad rollers. The structure designed to house the filter presses was sized to fit the Carter 15-31 machine.

In November and December of 1977, Ashbrook contacted Dietz concerning the sludge dewatering equipment to be used in the facilities. Ashbrook subsequently asked Dietz to approve its size 1-V Winkel-press for use on the projects. The evidence established that as early as January, 1978, Dietz had decided to reject the Ashbrook machine. Ashbrook, believing it could meet the performance requirements of the specifications and relying on its experience that specific mechanical subsystems were ordinarily waived by an owner’s engineer if a supplier could show that its equipment met performance specifications, bid to supply the sludge dewatering equipment in March, 1978. A March 10, 1978 evaluation prepared by a member of the Dietz design team concluded that Ashbrook’s equipment did indeed meet the performance specifications.

Subsequently, on April 5, 1978, Dietz retreated from that conclusion, stating that the size 1-V Winkelpress did not have the performance capacity required by the specifications because the machine did not recycle belt wash water. Dietz also questioned the limitation on maintenance space created by the use of an Ashbrook machine in a building designed to house a Carter machine. Dietz stated that it would not approve the machine for use on the projects based upon the information then in its possession. Ashbrook replied that it would provide actual operation data to confirm the machine’s capacity and that it would supply equipment that would comply with the specifications.

On May 1, 1978, Waldinger issued, and on May 22, 1978 Ashbrook executed, purchase orders under which Ashbrook agreed to furnish the sludge dewatering equipment “in complete accordance with plans and specifications § 11140 — sludge dewa-tering system____” The purchase orders further provided that the equipment furnished by Ashbrook would require the approval of Dietz. Ashbrook, in executing the purchase orders, agreed to furnish the required submittal data for approval by Dietz. General Condition No. 10 of the purchase orders provided as follows:

All material and equipment furnished under this Purchase Order shall be subject to the approval of the Owner, architect [or] engineer ..., and Seller shall furnish the required submittal data ... for said approval. In the event such approval is not obtained, this Purchase Order shall be deemed to be cancelled, with no liability on the part of either Purchaser or Seller, unless this Purchase Order is placed with the requirement that the material [or] equipment ... is to be supplied of the type and in such a manner as to [785]*785meet requirements of plans and specifications. In the latter case the material [or] equipment ... furnished hereunder shall be in strict accordance with plans [and] specifications ..., and Seller shall be bound thereby. In the event the' material [or] equipment ... does not meet the foregoing requirements, Seller shall, upon receipt of notice, immediately replace same, or remedy any deficiency, without expense to the Purchaser, and further, Seller shall pay to Purchaser all loss or damage resulting therefrom.

At the beginning of the relationship between Ashbrook and Dietz, Dietz requested only performance data on the 1-V machine. Ashbrook set about meeting the production test requirements laid down by Dietz. In August of 1978, Dietz concluded that the 1-V machine met the performance requirements of the specifications. Dietz then demanded performance data on the machine’s dewatering capacity with alum sludge. Throughout the testing period, Dietz rejected Ashbrook’s performance data as insufficient even though it had no data from Carter. Dietz ultimately rejected the 1-V machine because it did not have proven dewatering capacity with alum sludge; the Carter machine, to the knowledge of Dietz, had never been tested on alum sludge.4

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775 F.2d 781, 42 U.C.C. Rep. Serv. (West) 172, Counsel Stack Legal Research, https://law.counselstack.com/opinion/waldinger-corp-v-crs-group-engineers-inc-ca7-1985.