Alpirn v. Williams Steel & Supply Co.
| Citation | 199 F.2d 734 |
| Decision Date | 05 November 1952 |
| Docket Number | No. 10596.,10596. |
| Parties | ALPIRN et al. v. WILLIAMS STEEL & SUPPLY CO. |
| Court | United States Courts of Appeals. United States Court of Appeals (7th Circuit) |
Arthur Magidson, Emil Hersh, Frederick Hersh, Milwaukee, Wis. (Jack W. Marer, Omaha, Neb., of counsel), for appellant.
Ben L. Chernov, Robert A. Hess, Milwaukee, Wis., for appellee.
Before MAJOR, Chief Judge, FINNEGAN and SWAIM, Circuit Judges.
The plaintiff, Morton Alpirn, d/b/a Western Smelting & Refining Co., was engaged in the business of buying and selling metal products, including steel pipe, as a broker, wholesaler and dealer in Omaha, Nebraska. On November 14, 1947, after the exchange of several letters and telegrams and after he had been furnished a sample of steel pipe, the plaintiffs ordered by letter from the defendant, Herman Williams, d/b/a Williams Steel & Supply Co., in Milwaukee, Wisconsin, "new steel pipe" which was described as follows:
This letter also stated that the plaintiff was enclosing a bank cashier's check in the amount of $4,000.00; and that the parties had agreed that, should any lengths be received by the plaintiff which were plugged, Williams would accept the return of same and allow the plaintiff freight charges also. The letter also authorized the defendant to draw a draft on the plaintiff for the unpaid balance of the purchase price. The total price of this pipe, at 13½¢ per foot, was $5,400. In later communications the parties agreed that the pipe was to be shipped to the plaintiff C. O. D. as to the unpaid balance of $1,400, and the pipe was so shipped.
When the shipment of this pipe arrived in Omaha it was sent to the warehouse of Morris Levey to whom the plaintiff had negotiated a sale of the pipe at 18¾¢ per foot. When Mr. Levey arrived at the warehouse the truckdriver had unloaded 40 or 50 pieces of pipe and had then been stopped by Levey's foreman who did not consider the pipe satisfactory. After Levey's arrival he examined the pipe that had been unloaded and then took a few pieces off of the truck "to see if it was probably some just on top, and we walked around the truck and looked as far as we could without unloading it all, and when we saw that it was all of that nature I (Levey) said, `Let's call Morton Alpirn.'"
Mr. Alpirn said that when he arrived at Levey's warehouse about 50 pieces of the pipe had been removed from the truck and that Mr. Levey and his employee and the plaintiff's brother-in-law were inspecting them. The plaintiff testified that after the pipe had been inspected he notified the defendant that the pipe had arrived and was rejected because it was not in accordance with the contract.
The plaintiff thereafter brought an action for the alleged breach of the contract in the United States District Court for the Eastern District of Wisconsin against the defendant Herman Williams and against the corporate defendant Williams Steel and Supply Co., which had then become the successor to the business of the individual defendant and had assumed the obligations of his business. The plaintiff alleged damages of the $4,000 he had paid to the defendant as part of the purchase price and $2,100 as a loss of profit by the plaintiff on the resale of the pipe to Levey which the plaintiff alleged he could not make because of the failure of the pipe to meet the specifications of the contract of purchase from Williams.
The defendant filed an answer and counterclaim alleging that the pipe shipped to the plaintiff substantially met the specifications of the contract and that the plaintiff had rejected the shipment without cause and refused to pay the balance of the purchase price. The defendant further alleged that after plaintiff's rejection, defendant, in order to minimize the damage, took possession of the pipe and resold it and that after charging to the plaintiff the expenses on the resale, there was a balance due plaintiff of $1,233.88 from the $4,000 which the plaintiff had originally paid but that the defendant had sustained damages of $907.35 because of a writ of attachment which plaintiff had caused to be issued against the pipe without cause and that this amount should be deducted from the refund owing to the plaintiff, thereby leaving a balance of only $326.53 due to the plaintiff.
The action was tried to the District Court without a jury. The court found that the defendant had breached the contract "in that the pipe as tendered was not in accordance with the written specifications and express warranties contained in the contract between the parties, and, further, was not as per sample furnished." As specific instances of the defects in the pipe the court found that:
The court found, further, that, because of the defects in the pipe, the shipment was first rejected by Levey, to whom a sale of the pipe at 18¾¢ per foot had been negotiated by the plaintiff, and the pipe was also rejected by the plaintiff who forthwith notified the defendant; and that plaintiff was unable to procure other pipe with which to fill his contract with Levey. The court also found that the defendant Williams knew that the plaintiff was a dealer in metals and knew that in the normal course of business the plaintiff would resell this pipe to other persons; that the contract between the plaintiff and Morris Levey to sell the pipe to Levey was "a bona fide, arms-length agreement which was indicative of the fact that the market price of pipe of the said specifications was at least Eighteen and Three-fourths Cents (18¾¢) plus freight in Omaha in November, 1947"; that by reason of the defendant's breach of the contract, the plaintiff had sustained damages in the amount of $2,100 by losing the sale to Levey at 18¾¢ per foot (which the court also found was the market price of pipe meeting the specifications); and that the plaintiff was entitled to the return of the $4,000 which he had paid on the purchase price of the pipe.
The defendant contends that where, as here, a sale is for cash on delivery and the buyer fails to make such payment prior to delivery, the buyer does not have the right to inspect the goods and to reject the shipment for failure of the shipment to meet the specifications, and, further, that, under these circumstances, the buyer had no right to bring an action for a breach of the contract.
If we grant, arguendo, that under the strict terms of the contract the plaintiff was not given the right to inspect the shipment prior to his payment of the balance of the purchase price, the fact remains that such an inspection was made and that the inspection revealed that the shipment consisted of pipe substantially inferior to the pipe which the plaintiff had contracted to buy. The inspection was made by the plaintiff at the warehouse of Levey where the truckdriver had started to unload the pipe on Levey's shipping dock. There it was in plain sight of anyone who happened to be there and wanted to look at it. It is not apparent who, if anyone, told the truckdriver to start unloading the pipe. If the contract had been for the purchase of a horse and the attempted delivery had been of a cow which the plaintiff saw, surely the defendant would not contend that the plaintiff was under an obligation to pay the balance of the purchase price before rejecting delivery of the cow. Certainly, before there was any duty on the plaintiff to pay, there was the obligation of the defendant to deliver, or have ready for delivery, the pipe which the plaintiff had bought.
While the record contains some conflicting evidence as to the condition of the pipe and as to the methods used in testing it, there was an abundance of evidence, when we consider the record as a whole, to justify the court's finding that the pipe tendered neither met the written specifications of the contract of purchase nor corresponded to the sample furnished by the defendant. The plaintiff, seeing the pipe under the circumstances of this case and realizing that it did not conform to the specifications of the contract nor to the sample, was under no duty to pay the balance of the purchase price before rejecting the pipe. It was the duty of the defendant, at the time of the payment of the balance of the purchase price, to deliver, or tender for delivery, pipe meeting the specifications of the contract and conforming to the sample. At that time the plaintiff knew that the defendant could not do this. The plaintiff was, therefore, neither bound to accept delivery nor to pay the balance of the purchase price. Sec. 121.41, Wis.Stat.1947; Hageman v. Ule, 188 Wis. 617, 620, 206 N.W. 842.
The defendant insists that since the contract of the parties included the provision that the defendant would accept the return of any lengths of the pipe that were plugged and would allow freight charges on same, this constituted plaintiff's exclusive remedy and precluded the rejection of the entire shipment and an action by the plaintiff for breach of the contract. The decisions cited by the defendant in support of this...
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Morse v. Andler
...as to the condition of the entire lot. Distribuidora Del Pacifico, S. A. v. Gonzalez, D.C., 88 F.Supp. 538; Alpirn v. Williams Steel & Supply Co., 7 Cir., 199 F.2d 734, 738. See Sorrells v. Ancona Co., 250 Mass. 381, 390, 145 N.E. The judge could find that the records were in good condition......
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