Landsman Packing Co., Inc. v. Continental Can Co., Inc.

• Decision Date: 20 April 1988
• Citation: 864 F.2d 721
• Parties: 7 UCC Rep.Serv.2d 1363 LANDSMAN PACKING CO., INC., A New Jersey Corporation, Plaintiff-Appellee, (Out
• Court: U.S. Court of Appeals — Eleventh Circuit

Page 721

864 F.2d 721

7 UCC Rep.Serv.2d 1363

LANDSMAN PACKING CO., INC., A New Jersey Corporation Plaintiff-Appellee, (Out 4/20/88), v. CONTINENTAL CAN COMPANY, INC., A Delaware Corporation Defendant-Appellant, American Motorists Insurance Company, et al., Defendants.

No. 87-5998.

United States Court of Appeals Eleventh Circuit.

Jan. 30, 1989.

Hugh J. Turner, Jr., Miami, Fla., Eugene L. Stewart, Washington, D.C., for Continental Can Co., Inc.

Peter Kneski, Arthur J. England, Jr., Miami, Fla., for Landsman Packing Co., Inc.

Appeal from the United States District Court for the Southern District of Florida.

Before KRAVITCH and EDMONDSON, Circuit Judges, and HOFFMAN ^*, Senior District Judge

WALTER E. HOFFMAN, Senior District Judge:

Landsman Packing Company ("Landsman") filed suit against Continental Can Company ("Continental") in the Circuit Court of the Eleventh Judicial Circuit in and for Dade County, Florida, alleging breach of contract regarding Landsman's leasing of a capping machine from Continental. Continental counterclaimed for rents due on the capping machine, costs of machine parts unpaid by Landsman, and to regain possession of a loaned capping machine allegedly converted by Landsman. Continental removed the case to the United States District Court for the Southern District of Florida pursuant to 28 U.S.C. Secs. 1332 and 1441. The district court granted Continental's motion for summary judgment on its counterclaim for machine rent and cost of parts in the amount of $26,672.20.

The case proceeded to a jury trial on Landsman's breach of contract claim and Continental's counterclaim of conversion. The jury decided against Continental on the conversion claim and ruled in favor of Landsman on its breach of contract claim, awarding $500,490 in direct damages and $5,332,500 in consequential damages. The district court denied Continental's post-trial motions for judgment n.o.v. and new trial, but granted a motion for remittitur and reduced direct damages from $500,490 to $8,710. Continental appeals the judgment following the jury's award of direct and consequential damages, and the jury's finding of no conversion.

Because the trial judge improperly instructed the jury on the breach of contract issue, we vacate the jury's award of damages and remand the case to the district court for a new trial. The jury's verdict on the conversion claim is also vacated as against the clear weight of the evidence, and the issue is remanded for a determination of damages.

I.

In 1969 Landsman contracted to lease a capping machine from Continental for the purpose of placing caps on jars of fruit processed by Landsman. The machine was shipped to Landsman in 1972 and ran satisfactorily until May 1981. On June 11, 1981, the parties renewed the 1969 contract and executed a new lease agreement that contained essentially the same terms as the 1969 agreement and provided for automatic annual renewals. ¹ At all times under the lease, Landsman was using the capping machine originally shipped in 1972.

In May 1981, the machine allegedly began misapplying caps, resulting in a faulty seal, which caused the fruit contents to spoil. Landsman contacted Continental and they sent servicemen to repair the machine. Despite Continental's repair efforts, the machine continued to malfunction, and on October 30, 1981, Landsman's plant manager gave its first written notice to Continental regarding Continental's failure to repair the machine. The capping problem continued to recur through December 1982, at which time Continental loaned Landsman a new machine to determine if that would cure the problem. ² Although the new machine worked properly, Landsman was forced to close its plant in April 1983, allegedly because of loss of customers and sales due to the malfunctioning machine. New York law controls the issues in this case pursuant to paragraph 13 of the lease agreement. ³

II.

On appeal, Continental asserts several grounds for reversal of the jury's findings below. We will categorize and review these issues in three groups. The first issue we will address is whether Landsman's claims are barred by the expiration of specific time limitations in the lease, such as the 12 month limited warranty, and the 30 day written notice of claim requirement. See supra note 1 (quoting paragraphs 9(a) and (b) of lease). Second we will comment on the trial judge's admission of certain expert testimony. The final issue calls for a review of whether the jury's finding that Landsman did not convert the loaned capping machine was against the clear weight of the evidence.

III.

A. The 12 Month Warranty

At trial Landsman alleged that Continental breached two provisions of the lease agreement: first, paragraph 4 of the lease, which requires Continental to furnish repair parts and machine service; ⁴ and, second, paragraph 9(b), which provides for a warranty against faulty workmanship and defective materials extending twelve months from the date of original shipment of the machine or its replacement parts. See supra note 1. Landsman further claimed that the exclusive remedy of repair or replacement provided in paragraph 9(c) failed of its essential purpose. Id.

Apparently, at trial Landsman focused its claim on Continental's alleged breach of the 12 month warranty. By its terms, the warranty coverage for the machine was limited to 12 months from the date of original shipment, which was in 1972. The warranty also covered any replaced parts for 12 months from the date of shipment of the particular part. Id. Regarding Landsman's breach of warranty claim, the trial judge instructed the jury that the time limitations set forth in the lease may be disregarded if so unreasonable that they amount to eliminating all remedy under the contract and charged the jury with the following special interrogatory:

Do you find that the part or parts were not defective within 12 months from the date of shipment to Plaintiff [Landsman] and that such time limitation was reasonable?

Continental argues on appeal that the special interrogatory is erroneous for two reasons. First, Continental contends that the last clause of the interrogatory, stating as follows: "and that such time limitation was reasonable," makes the interrogatory erroneous because in form it is an impermissible compound question. Second, Continental argues that the jury should not have been permitted to determine the reasonableness of the 12 month warranty. Before we address the merits of this claim, we must first determine whether Continental properly preserved this issue for appeal. Although Continental objected to the interrogatory during a precharge conference held in judicial chambers, it failed to object at the critical moment the jury was charged with the interrogatory.

Rule 51 of the Federal Rules of Civil Procedure requires that an objection to jury instructions be stated distinctly after the charge and before the jury retires. Lang v. Texas & Pacific Railway Co., 624 F.2d 1275, 1279 (5th Cir.1980). ⁵ The purpose of Rule 51 is to ensure that the trial judge is made aware of any alleged errors, and to give the judge an opportunity to correct any error before the jury begins its deliberations. Pate v. Seaboard Railroad, Inc., 819 F.2d 1074, 1082 (11th Cir.1987); Lang, 624 F.2d at 1279; Williams v. Hoyt, 556 F.2d 1336, 1340 (5th Cir.1977), cert. denied, 435 U.S. 946, 98 S.Ct. 1530, 55 L.Ed.2d 544 (1978); Independent Development Board v. Fuqua Industries, Inc., 523 F.2d 1226, 1237-38 (5th Cir.1975). Additionally, Rule 51 must be read in conjunction with Rule 46, which essentially states that formal exceptions to court rulings or orders are unnecessary provided the party makes his objections known to the court. ⁶ See Fuqua Industries, 523 F.2d at 1238 n. 11.

This Circuit has recognized two narrow exceptions where a party's failure to properly object will be disregarded: 1) where the party's position has been made clear previously to the court and it is plain that further objection would have been unavailing; and, 2) where it is necessary to correct a fundamental error or prevent a miscarriage of justice. Pate, 819 F.2d at 1082; Lang, 624 F.2d at 1279; Williams, 556 F.2d at 1340; Fuqua Industries, 523 F.2d at 1238. The first exception is pertinent to this case.

Continental's first claim of error, regarding the form of the interrogatory, can be dispensed with easily. See supra (quoting alleged objectionable interrogatory). As a general rule, an interrogatory constitutes reversible error if it is ambiguous or if one of the issues is improperly submitted to the jury. Dougherty v. Continental Oil Co., 579 F.2d 954, 960 n. 2 (5th Cir.1978), vacated by joint stipulation, 591 F.2d 1206 (5th Cir.1979). A party who fails to object during trial to the form of an interrogatory, however, cannot raise the objection for the first time on appeal. Charles Stores, Inc. v. Aetna Insurance Co., 490 F.2d 64, 67-68 (5th Cir.1974); Nimnicht v. Dick Evans, Inc., 477 F.2d 133, 134 (5th Cir.1973); see also 5A J. Moore & J. Lucas, Moore's Federal Practice 49.03 (2d ed. 1988). Although Continental objected to a jury determination of reasonableness during the precharge conference, there was no objection to the form of the interrogatory either at the precharge conference or at the charging of the jury. On the contrary, the record indicates that during the precharge conference, Continental expressly requested the form of the interrogatory to which it now objects. ⁷ Counsel for Continental stated the following:

Without waiving our objection, Your Honor, I would make a suggestion after the word "defective" in Paragraph 2, you could state "and whether such time limitation was reasonable."

Continental failed to preserve for appeal any issue regarding the form of the interrogatory and will not be permitted to claim error in the form of an interrogatory that it requested.

Continental's second objection claims the interrogatory...