655 F.2d 440 (1st Cir. 1981), 80-1788, Bestway Equipment Services, Inc. v. Berwind Lines, Inc.

Docket Nº:80-1788.
Citation:655 F.2d 440
Party Name:BESTWAY EQUIPMENT SERVICES, INC., Plaintiff, Appellant, v. BERWIND LINES, INC., Defendant, Third Party Plaintiff, Appellee, v. CARIBE TUG CORPORATION, Third Party Defendant, Appellee.
Case Date:July 17, 1981
Court:United States Courts of Appeals, Court of Appeals for the First Circuit
 
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Page 440

655 F.2d 440 (1st Cir. 1981)

BESTWAY EQUIPMENT SERVICES, INC., Plaintiff, Appellant,

v.

BERWIND LINES, INC., Defendant, Third Party Plaintiff, Appellee,

v.

CARIBE TUG CORPORATION, Third Party Defendant, Appellee.

No. 80-1788.

United States Court of Appeals, First Circuit

July 17, 1981

        Argued June 1, 1981.

Page 441

        Henry R. Stoinski, Woodbury, N.J., for plaintiff, appellant.

        Jose A. Fernandez Paoli, Santurce, P. R., for third party defendant, appellee Caribe Tug Corp.

        Andres R. Nevares Gonzalez, San Juan, P. R., for defendant, third party plaintiff, appellee Berwind Lines, Inc.

        Before COFFIN, Chief Judge, CAMPBELL and BREYER, Circuit Judges.

        BREYER, Circuit Judge.

        In this diversity action, appellant, Bestway Equipment Services, Inc., sued Berwind Lines, Inc. in the federal district court for Puerto Rico alleging: (1) that Berwind kept fifty trailers that belonged to Bestway; (2) that Berwind had not paid Bestway rent that it owed for the lease of fifteen other trailers; and (3) that Berwind had not paid Bestway for trailer repairs that were Berwind's responsibility. Berwind, in turn, sued Caribe Tug Corporation

Page 442

as a third party defendant on the second claim, for Caribe Tug had taken over Berwind's lease and had assumed any resulting liability. A jury found against Bestway on all claims. Bestway appeals. After reviewing the record, we find no appealable error and affirm the judgment of the district court.

       I.

        Bestway sold, leased and repaired truck trailers commercial trailers pulled by a truck tractor used to haul goods. Berwind, a trucker, needed equipment and approached Bestway in 1972. It is undisputed that in September 1972 Berwind and Bestway entered into a written lease. Under the lease Bestway rented fifty "dry" (non-refrigerated) trailers for thirty-six months at a rental of $70 per month per trailer. The lease specifically states that Berwind "acknowledges that at all times during the term of this lease, the title to and ownership of the vehicles ... shall remain" in Bestway and that Berwind "does not by these presents acquire any title or proprietary rights therein." The lease adds that at its termination Berwind is to return all the trailers to Bestway in the same condition as when leased subject to ordinary wear. And, the lease states that "there are no agreements, understandings or representations between the parties hereto not embraced herein." Despite this language, Berwind did not return the trailers to Bestway. Rather, it kept them while offering Bestway $1 per trailer.

        Berwind's defense is that there existed a separate oral agreement that at the termination of the lease, Bestway would sell the trailers to Berwind for $1 each. The evidence of this separate agreement consisted, first, of the testimony of Hugh McComas, a former Berwind executive, who said that it was his intention to create a "lease-purchase" arrangement with Bestway. He said that the "$1 purchase" part of the agreement was deliberately not put in the lease so that Berwind's auditors would not capitalize the lease's value. He added that he instructed his vice-president, Mr. Robeson, to negotiate a lease purchase in this form. This evidence was followed by the testimony of another Berwind executive, John Forsythe, who said that he saw Robeson hand a specific document to Harold Burger, the president of Bestway. The document, which was admitted into evidence, is a Berwind purchase order, which states:

Quantity Description 50 ea. Dry Highway Van Trailers on Rental/Purchase for a period of 36 months, commencing when delivered, at the rate of $70.00...

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