Ivey's Plumbing & Elec. v. Petrochem Maintenance

• Citation: 463 F. Supp. 543
• Decision Date: 19 December 1978
• Docket Number: No. EC 78-57-K.,EC 78-57-K.
• Court: U.S. District Court — Northern District of Mississippi
• Parties: IVEY'S PLUMBING & ELECTRIC COMPANY INC., Plaintiff, v. PETROCHEM MAINTENANCE, INC. and Gardner-Denver Company, Defendants.

463 F. Supp. 543

IVEY'S PLUMBING & ELECTRIC COMPANY INC., Plaintiff, v. PETROCHEM MAINTENANCE, INC. and Gardner-Denver Company, Defendants.

No. EC 78-57-K.

United States District Court, N. D. Mississippi, E. D.

December 19, 1978.

COPYRIGHT MATERIAL OMITTED

David W. Mockbee, Jackson, Miss., for plaintiff.

Fred Krutz, III, Jackson, Miss., for Petrochem.

Henderson S. Hall, Jr., Jackson, Miss., for Gardner-Denver.

MEMORANDUM OF DECISION

KEADY, Chief Judge.

In this diversity action removed from the Chancery Court of Attala County, Mississippi, Ivey's Plumbing & Electric Company, Inc. (Ivey's), a Mississippi corporation engaged in the contracting business with its offices located at Kosciusko, seeks damages in the sum of $31,926.38 plus interest and attorney fees from two defendants, Gardner-Denver Company (G-D), a Delaware corporation engaged in the manufacture of equipment, and Petrochem Maintenance, Inc. (Petrochem), a Louisiana corporation engaged as a supplier of contractor's equipment.

The court has before it the motion of defendant G-D for summary judgment on the claims against it asserted by plaintiff Ivey's as well as the co-defendant Petrochem. Similarly, Petrochem has a motion for summary judgment against Ivey's, as well as the cross-claim interposed against it by G-D. Certain material facts, clearly established by the record, enable us to dispose of several aspects of these motions. It is, of course, elemental that if there is a dispute of material fact or inferences have to be weighed in order to determine the facts, or unless it clearly appears as a matter of law that the movant for summary judgment is entitled to prevail, it would be inappropriate to grant any portion of the motions of G-D and Petrochem for summary judgment. We therefore restrict our consideration only to undisputed facts upon the basis of the evidentiary material presented to the court at this juncture.

Sometime prior to September 13, 1977, Ivey's became interested in submitting a bid as subcontractor for the mechanical portion of a construction project designated as the Maintenance and Repair Facility, Naval Construction Battalion Facility, at Gulfport, Mississippi. In order to submit a bid it was necessary for Ivey's to receive quotations on five air compressors called for by the project specifications. Petrochem supplied a quotation orally on September 13; its quotation for $89,073.62 being the lowest for these components, Ivey's used it in making its bid, which was that day accepted by the prime contractor. The day before, Petrochem had obtained an oral quotation from G-D's agent, Robert Theriot, who gave Petrochem an estimate sheet listing two of the air compressors with accessory equipment, orally indicating they could supply three more compressors at the same unit price. This document, entitled "Estimate Sheet" was dated September 12 and signed by Theriot.

Shortly after Ivey's made its successful bid as mechanical contractor, Lonnie Wright, Petrochem's branch manager, learned that other suppliers such as Ingersoll-Rand and Sandair Corporations were quoting five compressors of like character with equipment for a reported $144,000, or approximately $64,000 more than Petrochem's quotation to Ivey's and so advised G-D. G-D's agents, Theriot and Don Geers, visited Petrochem's office to review the project's plans and specifications which were in Petrochem's possession. On September 26, G-D issued a revised quotation for the compressors and equipment called for by the plans and specifications for approximately $113,000. Petrochem, ignoring this revised quotation, issued a purchase order on October 24 to G-D for the lump sum price of $80,366.24, which was the amount of the original oral quotation by G-D. On November 4, Wright forwarded a letter to G-D advising that Petrochem had not received notice of G-D's intention to fulfill the purchase order of October 24 and stated that "should we fail to receive notice by November 7 we shall be compelled to assume that you do not intend to fulfill the contract." By letter dated November 7, G-D advised that it did not intend to furnish equipment as per their original quotation but only in accordance with their revised quotation of September 26.

Meanwhile, Ivey's had become apprised of the quotation problems connected with Petrochem's supplying the air compressors and equipment at the originally quoted price. On October 6, Lonnie Wright and Jonathan Beeson, representing Petrochem, met at Ivey's office at Kosciusko with Don Hayes, Ivey's vice-president and senior project manager. At this meeting, Hayes delivered a purchase order to Wright for the compressor equipment in the amount of $89,073.62. Immediately prior to the issuance of the purchase order, certain discussions took place regarding problems associated with the quotation on the air compressors. Although the depositions of Lonnie Wright and Don Geers were taken, they did not undertake to give their version of what occurred. Only Don Hayes in his discovery deposition was asked about what took place before the purchase order was handed to Wright. The relevant portion of that testimony is as follows:

Q . . . what was the substance of the conversation that took place at that meeting . . .?

A Petrochem told me that Gardner-Denver was not going to honor their quotation, and I handed them a purchase order. . . . The gist of it was that I was going to look to them to furnish the air compressors at the quoted price. It was that simple. We might have elaborated for an hour and a half, or however long they were there, and I probably told them that they needed to protect themselves, because we were looking for five air compressors for $89,000. . . (Hayes' dep., p. 85)

Q Is it true though, Mr. Hayes, that you submitted this . . . purchase order to Mr. Beeson subsequent to the time he told you that he would not be able to supply the air compressors for $89,073?

A If subsequent you mean immediately after he told me that I handed it to him, yes, I would say it was—it wasn't no five or six days later. It might have been one minute, two minutes.

Q But the first act was him telling you he couldn't supply them; the second act being you handed him the purchase order.

A Right.

Q Okay. When you gave him the purchase order, it is also a fact, is it not, that he, John Beeson, expressly stated he was not accepting that as a purchase order and he wouldn't be able to produce unless Gardner-Denver produced?

A I couldn't say exactly what he said. He may have said that. The gist— the feeling was that Petrochem was in the middle. They quoted Gardner-Denver. Petrochem quoted us. All right, even though they say that they couldn't supply them, we have a quotation that we relied upon to get the bid. I'm positive that that quotation was out to some of my competitors . . . and I'm sure my competitors used it. I used it to get the bid; whether it was that specific thing that got it or I left labor low or what. Whatever, we got the job. All right, I used it to get the job. Subsequently, I issued them a purchase order. Whether he said he couldn't supply it or not is beside the point, as far as I was concerned.

Q Um-hum, well,—

A And did he say that specifically, I doubt if he said it just like that because Jon Beeson and Lonnie's attitude was that they were there to help. They took that attitude and have had that attitude all along. In fact, all through this thing both of them have been very open and above board and treated us the way we would like to be treated. It is just that they got caught and couldn't furnish what—and that was the attitude that prevailed in that meeting. (Id. pp. 86-87).

* * * * * * Q . . . That's not quite correct, though, is it Mr. Hayes, because as you have testified to, isn't it a fact that they refused to supply the air compressors before they received the purchase order?

A Not necessarily. If you will recall, I made the statement that Lonnie Wright sent Gardner-Denver a telegram. This was after the 6th October meeting.

Q But—

A And they were asking Gardner-Denver to furnish the air compressors. If you will look over my correspondence, all of the correspondence was generated after this meeting. So, they had not refused to supply the air compressors at this time.

Q Well, this is not a not-necessarily-answer question here.

A Okay.

Q This is a yes-or-no answer question: Did—on October 6 isn't it a fact that Jon Beeson told you that he could not supply the air compressors before you issued him the purchase order?

A I can't answer that a yes or no. From the attitude of the meeting, I would have to say that he did not say that in those terms. He may have said Gardner-Denver probably isn't, but there was no—I'll say this, there was no definitive, no specific—by either Lonnie or Jon—that they were not going to do this.

Q Okay, let me ask it this way:—

A This is apparent by the correspondence after this fact.

Q Well,—

A And they had a very congenial attitude, and they were totally on my side at that point where they left.

Q Well, let me ask it this way, then: Isn't it a fact that Jon Beeson told you on October 6th before you handed him the purchase order that he could not supply the air compressors at $89,073 unless Gardner-Denver supplied it to him for Gardner-Denver's quote to him?

A I don't know if he said it; it is a fair statement. (Id. pp. 89-90)

On November 1, Ivey's wrote Petrochem advising that it had received notice of the latter's attempt to fulfill the October 6 purchase order, and stating that unless Petrochem notified Ivey's by November 4 the subcontractor would have no alternative but to purchase air compressors elsewhere. On November 7, Petrochem replied to Ivey's referring to G-D's change of quotation:

We are nun the less sic calling upon them to make delivery as per your purchase order of October 6, 1977. We will advise of their response as soon as they make it available to us. We will be happy to assist you in working out a

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