Alco Standard Corp. v. F & B Mfg. Co.
| Decision Date | 30 March 1972 |
| Docket Number | No. 44098,44098 |
| Citation | 51 Ill.2d 186,281 N.E.2d 652 |
| Court | Illinois Supreme Court |
| Parties | , 10 UCC Rep.Serv. 639 ALCO STANDARD CORPORATION, Appellee, v. F & B MANUFACTURING CO., Appellant. |
Canfield, Canfield, Franks, Wylde & Hoad, Rockford, and Leahy & Klein, Chicago (Robert R. Canfield, Rockford, Mary Lee Leahy and Seymour Keith, Chicago, of counsel), for appellant.
Guyer & Enichen, Rockford, for appellee.
In 1968 the defendant, F & B Manufacturing Co., entered into a contract to buy an industrial heat treating furnace from Ipsen Industries, a division of the plaintiff, Alco Standard Corporation, for a price of $66,595. The contract described the dimensions and other specifications of the furnace. The furnace was delivered to F & B's plant in Phoenix, Arizona, on or about July 6 of the same year. F & B rejected it on the ground that it was not large enough to meet its needs. By agreement of the parties the defendant paid the cost of shipping the furnace to a warehouse in California, where the plaintiff resold it to another manufacturer for $57,500.
Thereafter the plaintiff brought this action to recover the difference between the contract price and the price for which the furnace was resold. A jury was waived, and after a trial, judgment was entered for the plaintiff in the sum of $9,095. Interest at 5%, in the sum of $505, was also allowed, because payment had been withheld 'by unreasonable and vexatious delay.' The Appellate Court Second District, affirmed the judgment for $9,095, and reversed the judgment insofar as it provided for the payment of interest. (Alco Standard Corp. v. F & B Manufacturing Co. (Ill.App.1970), 265 N.E.2d 507.) We allowed leave to appeal.
In this court the buyer contends that in reselling the rejected furnace, the seller was required to comply with section 2--706 (3) of the Uniform Commercial Code, but failed to do so. That provision states: 'Where the resale is at private sale the seller must give the buyer reasonable notification of his intention to resell.' Ill.Rev.Stat.1967, ch. 26, par. 2--706(3).
The buyer asserts that before a seller is entitled to recover damages under that section of the Uniform Commercial Code he must prove his compliance with it, and that the appellate court erroneously held that section 2--706(3) establishes an affirmative defense, which must be pleaded and proved by the buyer.
The opinion of the appellate court states: These statements strongly suggest a misinterpretation of the statute, which does not require that the defaulting buyer be notified of 'the proposed resale,' but instead requires only that the seller 'give the buyer reasonable notification of his intention to resell.' It is not necessary however to determine the proper allocation of the burden of pleading and proof under the Code for the reason that the testimony is undisputed that the buyer's plant manager in Phoenix was told by the seller's west coast manager that there was a potential buyer for the machine in California and the buyer then paid for shipping the machine there. If we assume the buyer's contention to be correct this is sufficient proof of notice under the provisions of the Code.
The contract of sale provides in part:
'In the event of the Purchaser's default * * * Ipsen may resell it at public or private sale, And in the case of public sale, Ipsen or any other person may purchase the same and from the proceeds pay the retaking, repairing, storing, selling expenses and attorney's fees And apply the remaining amount to any balance the Purchaser owes Ipsen And Ipsen may recover any resulting deficiency from the Purchaser as liquidated damages * * *.'
The buyer contends that the seller cannot recover the deficiency claimed and argues: ...
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