CHANDLER LEAS. DIV., ETC. v. Florida-Vanderbilt Dev. Corp., No. 72-1383 Summary Calendar.

CourtUnited States Courts of Appeals. United States Court of Appeals (5th Circuit)
Writing for the CourtBELL, DYER and CLARK, Circuit
Citation464 F.2d 267
Docket NumberNo. 72-1383 Summary Calendar.
Decision Date22 August 1972
PartiesCHANDLER LEASING DIVISION, PEPSICO SERVICE INDUSTRIES LEASING CORPORATION, Plaintiff-Appellant-Cross-Appellee, v. FLORIDA-VANDERBILT DEVELOPMENT CORPORATION, formerly known as Florida Realty Co., and Harold J. Baker, individually, Defendants-Appellees-Cross-Appellants.

464 F.2d 267 (1972)

CHANDLER LEASING DIVISION, PEPSICO SERVICE INDUSTRIES LEASING CORPORATION, Plaintiff-Appellant-Cross-Appellee,
v.
FLORIDA-VANDERBILT DEVELOPMENT CORPORATION, formerly known as Florida Realty Co., and Harold J. Baker, individually, Defendants-Appellees-Cross-Appellants.

No. 72-1383 Summary Calendar.*

United States Court of Appeals, Fifth Circuit.

July 18, 1972.

Rehearing Denied August 22, 1972.


464 F.2d 268

John L. Britton, Miami, Fla., for plaintiff-appellant-cross-appellee.

William E. Sadowski, Thomas B. DeWolf, Miami, Fla., for defendants-appellees-cross-appellants.

Before BELL, DYER and CLARK, Circuit Judges.

CLARK, Circuit Judge:

This appeal by plaintiff, Chandler Leasing Division of Pepsico Service Industries Leasing Corporation (Chandler), and cross-appeal by defendant, Florida-Vanderbilt Development Corporation (Florida-Vanderbilt), involves the validity of the defense of breach of warranty of seaworthiness and the proper measure of damages for an admitted breach of a written lease agreement covering a 55 foot yacht. The facts are not in dispute, but the admiralty and Florida legal conclusions to be derived therefrom are contested.

On January 23, 1970, Chandler leased to Florida-Vanderbilt a 1970 Chris Craft Cruiser for a nine-year term. On September 1, Florida-Vanderbilt ceased remitting payments and on October 30 wrote to Chandler terminating the lease because of acute electrolysis problems. Pursuant to a judgment of replevin issued by a Florida state court, Chandler repossessed the vessel on February 11, 1971, proceeded to hold a public sale of the vessel (which is not attacked procedurally) and purchased the vessel at that sale for 100,000 dollars.

Chandler filed this suit seeking a recovery of damages in accordance with the provisions of the lease contract which essentially consisted of the discounted value of all future rent payments less the purchase price of 100,000 dollars. Florida-Vanderbilt defended by claiming a breach of the warranty of seaworthiness. The district court refused to recognize the seaworthiness defense but entered summary judgment which limited Chandler's recovery to the accrued rental in default as of February 11.

Florida-Vanderbilt cross-appeals from the district court's disallowance of its affirmative defense that Chandler breached its warranty of seaworthiness. Florida-Vanderbilt argues that a warranty of seaworthiness attached to the lease agreement despite the existence of a general, but universal, disclaimer clause.1 It contends that the disclaimer in order to be efficacious against a warranty of seaworthiness, must specifically state that the warranty is abjured. The facts in the case at bar make this defense wholly inapplicable. Chandler was not a boat owner offering to lease a vessel. The lease makes it transparently clear that Florida-Vanderbilt chose the exact yacht and equipment it wanted and even selected the boat company from which it wanted the yacht to be acquired. The very first term of the lease provided:

"EQUIPMENT; ACCEPTANCE. Lessee hereby leases from lessor, and
464 F.2d 269
lessor leaves to lessee, the personal property described above and in any schedule made a part hereof by the parties hereto (herein called `equipment\'). Lessee has chosen and requested equipment of the type and quantity specified herein and has selected the supplier named above. Lessor agrees to order such equipment from said supplier, but shall not be liable in any event for specific performance of this lease or for damages of any type, if, with or without excuse, the supplier delays or fails to fill the order or delivery of the equipment is otherwise delayed or not made. Any delay in such delivery shall not affect the validity of this lease. Lessee shall accept such equipment if delivered in good repair, and hereby authorizes lessor to insert herein the serial number of each item of equipment so delivered. Unless lessee gives lessor written notice of each defect or other proper objection to any item of equipment within five (5) business days after receipt thereof, it shall be conclusively presumed, as between lessee and lessor, that the item was delivered in good repair and that lessee accepts it as an item of equipment described herein."

No principle of the maritime doctrine of warranty of seaworthiness, which applies to demise charters and related vessel leases, proscribes Chandler from contracting with Florida-Vanderbilt that a part of the consideration for the lease of a vessel Florida-Vanderbilt selected and caused Chandler to purchase should include a waiver of any warranty from Chandler. In substance, Chandler was not a demise charterer but rather was a financing agent. Under the facts here, the general disclaimer clause effectively remitted any claim arising from the leased vessel's physical condition to such claim as could be exerted against the manufacturer's warranties. The district court correctly struck the affirmative defense of breach of warranty of seaworthiness.

Florida-Vanderbilt attempts to also cast its defense in a failure of consideration mold. We similarly reject this attempt to reach the same result via a substitute route. The leased vessel it picked out was accepted and used, and rentals were remitted for many months. The obligations of the...

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16 practice notes
  • Sommer v. Kridel
    • United States
    • United States State Supreme Court (New Jersey)
    • June 29, 1977
    ...861 (App.Div.1971); Ross v. Smigelski, 42 Wis.2d 185, 166 N.W.2d 243 (1969); with Chandler Leas. Div. v. Florida-Vanderbilt Dev. Corp., 464 F.2d 267 (5 Cir. 1972) cert. den. 409 U.S. 1041, 93 S.Ct. 527, 34 L.Ed.2d 491 (1972) (applying Florida law to the rental of a yacht); Winshall v. Ampco......
  • Chaffin v. Ramsey
    • United States
    • Supreme Court of Oregon
    • October 21, 1976
    ...of the date of a breach of the lease, was held to be invalid as a penalty in Chandler Leas. Div., Etc. v. Florida-Vanderbilt Dev. Corp., 464 F.2d 267, 271 (5th Cir. 1972), citing Restatement § 339 as authority and stating 'The percentage remained inflexible throughout the years of the lease......
  • Bre Mariner Marco Town Ctr., LLC v. Zoom Tan, Inc., Case No: 2:15-cv-284-FtM-29CM
    • United States
    • United States District Courts. 11th Circuit. United States District Court of Middle District of Florida
    • April 28, 2016
    ...lease remedies violate public policy." Chandler Leasing Div., Pepsico Serv. Indus. Leasing Corp. v. Fla.-Vanderbilt Dev. Corp., 464 F.2d 267, 271 (5th Cir. 1972). The Lease Agreement contains remedies similar to those provided by law in Florida, and also contains an acceleration clause......
  • Fence Wholesalers of America, Inc. v. Beneficial Commercial Corp., No. 83-1497
    • United States
    • Court of Appeal of Florida (US)
    • March 13, 1985
    ...(Fla. 3d DCA 1983); see also Chandler Leasing Division, Pepsico Service Industries Leasing Corp. v. Florida-Vanderbilt Development Corp., 464 F.2d 267 (5th Cir.), cert. denied, 409 U.S. 1041, 93 S.Ct. 527, 34 L.Ed.2d 491 (1972) (where lease provided that lessee remain liable for all rents u......
  • Request a trial to view additional results
16 cases
  • Sommer v. Kridel
    • United States
    • United States State Supreme Court (New Jersey)
    • June 29, 1977
    ...861 (App.Div.1971); Ross v. Smigelski, 42 Wis.2d 185, 166 N.W.2d 243 (1969); with Chandler Leas. Div. v. Florida-Vanderbilt Dev. Corp., 464 F.2d 267 (5 Cir. 1972) cert. den. 409 U.S. 1041, 93 S.Ct. 527, 34 L.Ed.2d 491 (1972) (applying Florida law to the rental of a yacht); Winshall v. Ampco......
  • Chaffin v. Ramsey
    • United States
    • Supreme Court of Oregon
    • October 21, 1976
    ...of the date of a breach of the lease, was held to be invalid as a penalty in Chandler Leas. Div., Etc. v. Florida-Vanderbilt Dev. Corp., 464 F.2d 267, 271 (5th Cir. 1972), citing Restatement § 339 as authority and stating 'The percentage remained inflexible throughout the years of the lease......
  • Bre Mariner Marco Town Ctr., LLC v. Zoom Tan, Inc., Case No: 2:15-cv-284-FtM-29CM
    • United States
    • United States District Courts. 11th Circuit. United States District Court of Middle District of Florida
    • April 28, 2016
    ...lease remedies violate public policy." Chandler Leasing Div., Pepsico Serv. Indus. Leasing Corp. v. Fla.-Vanderbilt Dev. Corp., 464 F.2d 267, 271 (5th Cir. 1972). The Lease Agreement contains remedies similar to those provided by law in Florida, and also contains an acceleration clause that......
  • Fence Wholesalers of America, Inc. v. Beneficial Commercial Corp., No. 83-1497
    • United States
    • Court of Appeal of Florida (US)
    • March 13, 1985
    ...(Fla. 3d DCA 1983); see also Chandler Leasing Division, Pepsico Service Industries Leasing Corp. v. Florida-Vanderbilt Development Corp., 464 F.2d 267 (5th Cir.), cert. denied, 409 U.S. 1041, 93 S.Ct. 527, 34 L.Ed.2d 491 (1972) (where lease provided that lessee remain liable for all rents u......
  • Request a trial to view additional results

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