Frantl Industries, Inc. v. Maier Const., Inc.

• Court: Wisconsin Supreme Court
• Writing for the Court: HEFFERNAN
• Citation: Frantl Industries, Inc. v. Maier Const., Inc., 229 N.W.2d 610, 68 Wis.2d 590 (Wis. 1975)
• Decision Date: 03 June 1975
• Docket Number: No. 399,399
• Parties: FRANTL INDUSTRIES, INC., Appellant, v. MAIER CONSTRUCTION, INC., Respondent.

Page 610

229 N.W.2d 610

68 Wis.2d 590

FRANTL INDUSTRIES, INC., Appellant, v. MAIER CONSTRUCTION, INC., Respondent.

No. 399.

Supreme Court of Wisconsin.

June 3, 1975.

Willis J. Zick, Waukesha, for appellant.

Richard D. Finley, Milwaukee, for respondent.

HEFFERNAN, Justice.

On December 28, 1971, Frantl Industries, Inc., entered into a contract with Maier Construction, Inc., to perform work and furnish materials for the interior of a steam-heated drying kiln at a plant of the American Concrete Pipe Company. After the work was completed, the paint used bubbled off and it was necessary for Maier to re-contract to have the work done by another. Nevertheless, on May 10, 1972, Frantl Industries commenced an action against Maier Construction, Inc. for payment in the sum of $5,516 for the work done pursuant to the contract dated December 28, 1971. It also sued Maier on an oral contract by which Maier agreed to pay Frantl $400 for removal of the urethane lining of the kiln, which deteriorated after the paint softened and bubbled away.

The case was tried to the court, and the trial judge found that Frantl was entitled to $1,380, the cost of a steel ceiling which Frantl had properly installed in the kiln. He concluded, however, that Frantl could not recover on the written contract of December 28, 1971, because it had failed to comply with a provision of that contract that the materials must withstand live steam to the temperature of 250 degrees, a provision not written into the contract, but which the judge concluded was omitted by mutual mistake. Thus, the trial judge reformed the contract to include the specification in regard to the ability of the materials to withstand heat. As the contract was reformed, he found that the plaintiff had breached the contract and therefore was not entitled to recover.

From an examination of the record, we conclude that there is no evidence that the parties intended to include in the written contract a specification or warranty that the paint withstand steam heat to a temperature of 250 degrees. There was no evidence that the failure to include that provision was due to a mutual mistake of the parties. Under accepted rules of law, the facts shown were not sufficient to warrant reformation.

We accordingly conclude that the contract was performed, and the plaintiff is entitled to recover the contract price.

In examining the record, we find that Frantl had previously, and only a short time before, attempted to do the work on the steam-heated drying kiln for the American Concrete Pipe Company, but the paint then used ignited and American Concrete was obliged to have the work done over. This prior contract is of importance only to the extent that it furnishes evidence that Frantl knew that the materials used in the interior of the kiln would be subjected to live steam.

The defendant contends that the undisputed facts found by the trial judge are sufficient to authorize the reformation of the contract and, as reformed, the plaintiff failed to fulfil its obligation. The facts which the defendant considers controlling are these: (1) The parties entered into a written contract on December 28, 1971; (2) at the time the contract was made, both parties knew that the materials used must withstand steam to 250 degrees Fahrenheit; (3) that specification, in regard to temperature, was not written into the contract; and (4) the materials used did not withstand 250 degrees Fahrenheit steam and dissolved upon the first use of the kiln.

The defendant argues that, by the proof of these facts, its defense and counter-claim under the reformed contract was satisfied. We think not. Three elements must be proved by clear, satisfactory, and convincing evidence to make possible the substitution of a reformed contract for the written contract entered into by the parties. Those elements are: (1) The parties reached an agreement; (2) the parties intended that such an agreement be included in the written expression of agreement; and (3) the oral agreement was not included in the written expression because of the mutual mistake of the parties.

Under this accepted test, the mere fact that in the instant case both parties knew that the materials must withstand steam to a temperature of 250 degrees is not synonymous with the statement that the parties agreed to that provision or that they agreed that such provision should be included in the written contract. Nor are those facts probative that mutual mistake was the reason for not including that agreement in the written contract.

The trial judge's findings of fact parallel the statement of undisputed facts, which the defendant contends are controlling. However, as the plaintiff points out, the question is not whether those facts are supported by the evidence but whether those facts are sufficient to mandate a reformation of the contract. Conceding that the facts found by the trial judge are supported by the evidence, they are, nonetheless, insufficient. Moreover, from an examination of the record we conclude that the facts proved were insufficient to support findings that would mandate reformation.

The rule in respect to reformation of written contracts was succinctly stated in Ahnapee & Western R. Co. v. Challoner (1967), 34 Wis.2d 134, 137, 148 N.W.2d 646, 648:

'An insurance policy like any other contract may be reformed because of mutual mistake when the policy does not contain the provisions intended by the parties to be included. But, the contract must be reformed to conform to some oral agreement or understanding which the written document was intended to express. . . . The quantum of proof necessary to show...