Amos v. Walter N. Kelley Co.

• Decision Date: 03 October 1927
• Docket Number: No. 130.,130.
• Citation: 215 N.W. 397,240 Mich. 257
• Parties: AMOS et al. v. WALTER N. KELLEY CO.
• Court: Michigan Supreme Court

240 Mich. 257

215 N.W. 397

AMOS et al.

v.WALTER N. KELLEY CO.

No. 130.

Supreme Court of Michigan.

Oct. 3, 1927.

Error to Circuit Court, Wayne County; Ray Hart, Judge.

Action by Ora A. Amos and another, partners, doing business as the Amos Lumber Company, against the Walter N. Kelley Company. Judgment for plaintiffs, and defendant brings error. Affirmed.

Argued before the Entire Bench.Robert M. Brownson and Gerald M. Meehan, both of Detroit, for appellant.

Douglas, Barbour, Brown & Rogers, of Detroit, for appellees.

FELLOWS, J.

At a named price, defendant, a dealer in lumber, made an offer to purchase of plaintiffs 50,000 feet of hard maple No. 1, common or better, to grade 50 to 60 per cent. FAS (first and second), to be dry, unless otherwise specified, which was otherwise specified in the contract by the provision, ‘stock to be put in pile before November 1, 1920, and shipped out from time to time when 60 days dry,’ the undisputed testimony showing that lumber in pile or ‘on the sticks,’ an expression used by the trade, for that period, is green lumber. The offer provided that inspection was to be made by an inspector of the National Hardwood Lumber Association and each party to pay one-half of the cost of such inspection. Defendant by a separate writing also offered to purchase 100,000 feet of beech to grade 20 to 30 per cent. FAS. The offer was similar in language to the offer to purchase the maple. Plaintiffs, located at Edinburg, Ind., there accepted both officers. Some time after the making of the contracts by these offers and acceptances, defendant requested the plaintiffs to ship some of the lumber after having it kiln-dried, offering to pay the expense of the kiln-drying. An inspector of the association was called, the lumber inspected by him, kiln-dried, and shipped. The demand for lumber of the kind and grade here involved slackened about this time, and no further lumber was ordered or shipped, and many pages of correspondence are found in the record in which each party asserted what it claimed was its rights, and in which fruitless attempts were made to adjust the differences of the parties.

Upon the trial, defendant insisted as its main defense to plaintiffs' claim and on its claim of recoupment that, before the making of the contract, it informed plaintiffs that it had resold the lumber to be used in the manufacture of automobiles, and the defense to plaintiffs' claim and its claim of the right to recoup damages are based on its claim that there was an an implied warranty that the lumber was suitable for use in the manufacture of automobiles.

It seems to be conceded by defendant's counsel that, the offer having been accepted in Indiana, the contract is an Indiana contract. Dudley A. Tyng & Co. v. Converse, 180 Mich. 195, 146 N. W. 629. It is likewise conceded that at the time the contract was made the Uniform Sales Act had not been adopted in that state. The rights here asserted by defendant are not rights having to do with the remedy, but are claimed to be a part of the contrary by implication. Under such circumstances the law of Indiana controls, and we should assume that the common law of Indiana is the same as here. We therefore do not find it necessary to construe the Uniform Sales Act, which was not in force in Indiana, or to determine whether in the particulars here involved it but follows the common law.

That the Indiana court of last resort and this court are in substantial harmony is, we think, demonstrated by the only case from that court cited to us by counsel. Oil Well Supply Co. v. Watson, 168 Ind. 603, 80 N. E. 157,15 L. R. A. (N. S.) 868. In that case the Indiana court held (quoting section 3 of the syllabus):

‘Where the vendor sells and the vendee buys a specific chattel for a known purpose, for a full consideration, and inspection is either impracticable or no opportunity is afforded, there is an implied warranty that the chattel is fit for the purpose; and this is true, regardless of whether the vendor was the manufacturer or a mere dealer, or whether the contract of sale was executory or executed.’

But it also held (quoting section 2 of the syllabus):

‘Where the vendor, who is neither the manufacturer nor producer, sells the goods for all purposes to which they are adapted, and the goods are in existence and capable of inspection, the maxim caveat emptor applies, in the absence of fraud, even though defects, not discoverable on examination, exist in the goods.’

In opposition to the claim which defendant asserts it is insisted on behalf of plaintiffs that, while the doctrine of implied warranty of fitness has its place in the common law, it is not applicable where the transaction, as here, is between dealers, and there is agreement and opportunity for inspection.

We are persuaded that plaintiffs invoke the correct rule applicable to the case in hand. As noted, it is the rule adopted by the court of last resort of Indiana, and it is in consonance with the common-law rule uniformly applied by this court. In Talbot Paving Co. v. Gorman, 103 Mich. 403, 61 N. W. 655,27 L. R. A. 96, Mr. Justice Hooker speaking for the court said:

‘He had simply undertaken to deliver certain stone of given dimensions. If he should beliver such he would be entitled to pay. If he did not, it could hardly be claimed that he could require acceptance on the ground that the stone were suitable, or better adapted to the purpose of the plaintiff than as though made according to direction. Clearly, if plaintiff had furnished specifications, and had a right to insist on the stone being in conformity thereto, regardless of defendant's judgment, it could not sustain the proposition that the law should imply a warranty to make them conform to some other test; and manifestly it cannot be said that knowledge of the use intended should require defendant to vary from his contract as to dimensions. The conclusion appears to us irresistible that no such warranty as this can be implied.’

In the more recent case of Zielinski v. Potter, 195 Mich. 90, 161 N. W. 851, L. R. A. 1917D, 822, this court had before it a case involving the sale of food products. The courts have uniformly protected the consumer of such products by applying the doctrine of implied warranty of fitness. But the case before us was between dealers, and there was opportunity for inspection. Chief Justice Kuhn speaking for the court said:

‘An examination of the authorities shows that this doctrine of implied warranty does not apply to a situation such as is presented by this record. Where a purchaser by reason of his knowledge and occupation is in as good a position to judge as to fitness of the article for food as the vendor is, the doctrine of caveat emptor applies. While it is true that, where a private individual buys for his own use and consumption from a vendor who is a dealer in the business of handling such articles, there is an implied warranty as to fitness for the purpose for which they are sold, nevertheless, where there...