J. C. Boss Engineering Co. v. Gunderson Brick & Tile Co.

• Decision Date: 09 July 1926
• Docket Number: No. 25294.,25294.
• Court: Minnesota Supreme Court
• Parties: J. C. BOSS ENGINEERING CO. v. GUNDERSON BRICK & TILE CO.

209 N.W. 876

168 Minn. 183

J. C. BOSS ENGINEERING CO. v. GUNDERSON BRICK & TILE CO.

No. 25294.

Supreme Court of Minnesota.

July 9, 1926.

Appeal from District Court, Goodhue County; W. A. Schultz, Judge.

Action by the J. C. Boss Engineering Company against the Gunderson Brick & Tile Company. After defendant's motion to dismiss the action was granted, from a judgment for plaintiff, ordered on a motion for a new trial, defendant appeals. Affirmed.

O. B. Strand, of Kenyon, A. J. Rockne, of Zumbrota, and Albert Mohn, of Red Wing, for appellant.

Thomas Mohn, of Red Wing, for respondent.

WILSON, C. J.

Plaintiff moved for a directed verdict. The court granted defendant's motion to dismiss the action. Plaintiff moved for judgment or a new trial, and the court ordered judgment in favor of plaintiff for $1,406.25, and, in case plaintiff refused to accept this amount, that a new trial be granted. The amount was accepted, and defendant appealed.

Plaintiff, an Indiana corporation, sold to defendant a Boss system brick burning equipment, including the rights to use under a patent, and including blueprints and specifications for construction and installation. The contract provided for a demonstration burn, and, if unsatisfactory, money paid to be refunded. It further provided that the title should remain in plaintiff until full payment was made. It also provided that, in case defendant desired to cancel the contract if the demonstration burn was unsatisfactory, notice should be forwarded by defendant to plaintiff immediately when the result of such demonstration should be fully determined, and should such notice not be received the defendant agreed to make full settlement according to the terms of the contract. The contract also contained a provision fixing the value of services of an engineer at $10 a day and expenses in case the defendant required instructions in service other than those contained in the plans and specifications.

At the request of defendant an engineer was sent to this state to instruct how to install the fire boxes and air ducts, which required about three or four days. About four months later the engineer again came to Minnesota at the request of defendant to aid in teaching it how to operate the equipment, which took about a week. The demonstration burn was made. Tile were overburned. Defendant advised plaintiff:

"We have followed your instructions to the letter, and we have decided that your method of operating is at fault, and would not seem to apply in burning hollow tile with our clay. It would seem that your closing the damper and forcing the fire did not work out, and your instructions in having the bottoms closed upon kilns Nos. 9 and 10 did not work out satisfactory. We are now going to try again, applying our own actual experience in burning our clay, and trust we will have a better result, as we are more anxious than you are that your system of burning shall prove satisfactory with us."

About a month later defendant wrote plaintiff:

"We have finally succeeded in burning our ware successfully with your system, although it is far from coming up to our expectation, or up to your representation. We are, however, fairly well satisfied with it, and are effecting a saving in fuel. We found that we could not follow your method of instructions in burning. We had to adopt our own method, and use 5 days instead of 3½ days as you tried and instructed us to do; in that way we have fairly good success. We lost fully half of the ware in the first four kilns which you fired and superintended, and which incurred a loss to us of at least $400 a kiln, which makes us $1,600 in the four kilns. This loss we shall expect you to assume."

The contract called for payment of $1,875 for the equipment for six kilns, of which $468.75 was paid, leaving a balance of $1,406.25. By this action plaintiff sought to recover this balance and $195.75 for services and expenses of the engineer. The answer alleged that the demonstration burn was unsatisfactory, and that plaintiff was notified thereof as per the terms of the contract. Defendant counterclaimed for $468.75. By amendant the answer alleged that plaintiff had failed to comply with section 7494, G. S. 1923, and was in this transaction doing business in the state of Minnesota contrary thereto. In ordering judgment the court required plaintiff to eliminate its claim of $195.75. Plaintiff, having consented to this elimination, does not seek to recover for this item.

1. It seems to be substantially conceded that the transaction involved was an interstate sale, and hence was not governed by our statute regulating foreign corporations, unless by virtue of the acts of the plaintiff in sending its engineer into this state for the purposes above mentioned. It has now been long established that the interstate commerce power embraces that which is relevant or reasonably appropriate to the power granted, and that the right to make an interstate commerce contract includes in its very terms the right to incorporate therein provisions which are relevant and appropriate to the contract made. It is earnestly urged in this case that the construction and installation of the equipment could have been made by any man competent to read the blueprints, and also that instructions and directions could have been given by mail, and that such a contract is in violation of our statute unless the foreign corporation can show that the installation was, because of some peculiar quality or complexity, essential to the making of the sale. This contention finds support in Palm Vacuum Cleaner Co. v. Bjornstad, 136 Minn. 38, 161 N. W. 215, L. R. A. 1917C, 1012. We think, however, that the particular machinery involved, its necessary construction and installation, including the fire boxes and air ducts, and the "teaching" how to operate the equipment, which, obviously from the record, includes a determination of the degree of heat to be applied to the particular kind of clay used, attaches to the transaction an element essentially incidental to the interstate business. The operation must be with skill and precision in order that the equipment may produce the best results. The seller should properly have the right as an incident of the sale to supervise installation and personally direct in the operation. The necessity and propriety of directions for operation based upon personal observation of the clay used and its moisture and the degree and uniformity of heat to be applied are amply illustrated by the experience in this case. It requires an expert to make the equipment accomplish the purposes for which it is sold and to satisfy the buyer. Under the terms of the contract, if the buyer was not satisfied there would be no sale. In this respect it was a liberal contract. Matters essential to the sucessful installation of such equipment and supervision of a test demonstration that the equipment will do what is claimed for it and if properly operated accomplish the purpose for which if is bought must be regarded as relevant and appropriate to an interstate sale, and beyond the reach of our statute. Such supervision is fairly and intrinsically interstate, and so closely related to the transaction that it must be protected by the federal Constitution. York Mfg. Co. v. Colley, 247 U. S. 21, 38 S. Ct. 430, 62 L. Ed. 963, 11 A. L. R. 611; Mojonnier Bros. Co. v. Detroit Milling Co., 233 Mich. 312, 206 N. W. 525; Westerlin & Campbell Co. v. Detroit Milling Co., 233 Mich. 384, 206 N. W. 371; Kaw Boiler Works Co. v. Interstate Refineries, Inc., 118 Kan. 693, 236 P. 654; McCaskey Reg. Co. v. Mann (Tex. Civ. App.) 273 S. W. 1113; United Iron Works Co. v. Watterson Hotel Co., 182 Ky. 113, 206 S. W. 166; Lyons et al. v. Federal System of Bakeries (C. C. A.) 290 F. 793; Michigan Lubricating Co. v. Ontario Cartridge Co. (C. C. A.) 275 F. 902; Hess Warming & Ventilating Co. v. Burlington Elevator Co. et al., 280 Mo. 163, 217 S. W. 493; City of Atlanta v. York Mfg. Co., 155 Ga. 33, 166 S. E. 195; Kinnear v. Miner, 89 Vt. 572, 96 A. 333; Power Specialty Co. v. Michigan Power...