Lynx, Inc. v. Ordnance Products, Inc.

Decision Date06 November 1974
Docket NumberNo. 12,12
Citation327 A.2d 502,273 Md. 1
Parties, 15 UCC Rep.Serv. 1040 LYNX, INCORPORATED v. ORDNANCE PRODUCTS, INC., et al.
CourtMaryland Court of Appeals

H. Norman Wilson, Jr., Elkton (Fockler & Wilson, Elkton, on the brief), for appellant.

James W. Constable, Baltimore (Constable, Alexander & Daneker, Baltimore, on the brief), for appellees.

Argued before MURPHY, C. J., and SINGLEY, SMITH, DIGGES, LEVINE, ELDRIDGE, and O'DONNELL, JJ.

O'DONNELL, Judge.

The appellant, Lynx, Inc. (Lynx), revisits us in its efforts to avoid the finality of summary judgments entered against it in favor of Ordinance Products, Inc. (OPI) and Martin Electronics, Inc. (MEI). Its first incursion resulted in its appeal being dismissed since the order of June 1, 1973, granting summary judgment under the appellees' counts Six, Seven and Eight, did not comply with Maryland Rule 605 a, requiring 'an express determination that there is no just reason for delay and . . . an express direction for the entry of judgment' where more than one claim for relief is presented in an action. Lynx, Inc. v. Ordinance Products, Inc. (No. 132, Sept. Term 1973, decided January 28, 1974) (unreported opinion). 1

As a prime contractor for the United States government, Lynx, on August 27, 1971, entered into a contract with OPI for the manufacture and delivery to Lynx of 3,000,000 M-213 hand grenade fuzes (P.O. 1070); by addenda and amendments dated February 29 and August 28, 1972, the number of fuzes ordered by Lynx under P.O. 1070 was increased to 4,780,050. In addition to the manufacture of the fuzes OPI agreed to provide labor and material for 'strapping' government packing boxes (at $.0037 per fuze).

Lynx similarly contracted on September 17, 1971, with MEI for the manufacture and delivery of 1,647,100 XM-228 hand grenade fuzes (P.O. 1074); that order was supplemented on May 3, 1972, to provide for the production of a total of 2,403,100 such fuzes.

On July 19, 1972, Lynx entered into yet an additional contract with MEI (P.O. 1498) for the manufacture and delivery to it of 2,044,000 M-213 hand grenade fuzes.

Each of the contracts provided for the delivery of the hand grenade fuzes to Perry, Florida; each provided for government inspection of the product prior to shipment from the respective plants of OPI and MEI; and each provided that as payments were received from the United States government, under the prime contracts, by Lynx, or its assignee financing institution (Commercial Credit Business Loan, Inc.), that a portion of such receipts representing the respective billings by OPI and MEI were to be paid unto each of them 'on the same day.' An appendage to the purchase orders provided a schedule for delivery of the fuzes commencing August 31, 1972, and terminating January 31, 1973.

Both OPI and MEI on March 19, 1973, filed their declaration, 2 coupled with a motion for summary judgment against Lynx alleging inter sese that the hand grenade fuzes manufactured under the respective purchase orders were delivered to Lynx and accepted as tendered and that Lynx had refused to pay for the delivered and accepted units. OPI asserted that $46,854.72 was due and owing it; MEI claimed $67,066.41.

On April 23, 1973, Lynx filed its general issue plea, as well as an affidavit in opposition to the motion for summary judgment. Lynx's affiant, its vice president, asserted that there was 'a genuine dispute' between the parties which was 'material to the plaintiffs' claims;' it asserted that purchase order No. 1070 had not been 'fulfilled' by OPI in that 118,659 units (manufactured by it) had been rejected by the government; that as a result of the 'poor quality of work done' by OPI and its failure to 'rework' these rejected units, Lynx's contract with the government was 'in danger of being terminated.' Lynx similarly asserted in the affidavit that five lots totalling 244,800 of the units produced by OPI, although accepted at the plant, were found unacceptable 'when tested further by the Government in the field due to poor quality and substandard materials used.'

In connection with the claim by MEI, the affidavit on behalf of Lynx asserted that 317,200 units produced by MEI under purchase orders 1074 and 1498, although accepted by the government at the plant, were similarly later rejected after field testing and that Lynx was in 'a position of having to rework or resupply these units to satisfy the Government, keep a good relationship and thereby preventing its contract or contracts from being terminated by the Government. . . .'

Lynx additionally undertook to challenge in its affidavit the unit price payable to OPI under amended P.O. 1070 'for strapping the shipping boxes,' alleging that the government had found such price unacceptable. 3

A supplemental affidavit in support of the motion for summary judgment was filed on May 25, 1973, on behalf of OPI and MEI, setting forth a letter dated March 5, 1973, from the vice president of Lynx (its affiant) to both appellees, which stated in pertinent part:

'Our cash flow has been severely interrupted in the last 60 days, due in part to a quality problem at OPI and MEI resulting in 187,770 units being unacceptable to the Government with a subsequent delay in payments from the Government. We had a 'past due' amount owing OPI and/or MEI of approximately $114,000.'

The letter additionally proposed a financial 'arrangement' between Lynx and the appellees whereby from the balances paid to Lynx by the government it would remit certain amounts to both OPI and MEI on account of the balance due them, but left an unpaid balance in the amount of $36,876-without any provision for payment.

The Circuit Court for Cecil County (Roney, J.), holding that under the provisions of Maryland Code (1957, 1964 Repl.Vol.) Art. 95B, § 2-606 and § 2-607, that there had been an acceptance of the goods by Lynx, entered summary judgment on June 1, 1973, in favor of both OPI and MEI in the total amount of $113,921.13, without apportionment to the respective plaintiffs.

Following our remand, the trial court in compliance with the provisions of Rule 605a, found that there was 'no just reason for delay' and entered final amended summary judgments respectively in favor of OPI for $46,854.72 and in favor of MEI for $67,066.41. 4

Lynx here again asserts that it was error for the trial court to have entered the final summary judgments (as amended) against it since a material question of fact-whether quantities of fuzes produced and delivered had been rejected-was raised in the pleadings and affidavits. We do not see it that way and shall this time affirm.

Rule 610 d 1 provides that summary judgment shall be rendered forthwith if the pleadings, depositions, and admissions on file, together with the affidavits, if any, show that there is no genuine dispute as to any material fact and that the moving party is entitled to a judgment as a matter of law. Gildenhorn v. Columbia Real Estate Title Ins. Co., 271 Md. 387, 408, 317 A.2d 836, 847 (1974).

The function of the summary judgment procedure is not to try the case or decide the issues of fact raised; it is merely to determine whether or not there is an issue of fact to be tried and if there is none, to cause judgment to be rendered accordingly. Brewer v. Mele, 267 Md. 437, 298 A.2d 156 (1972); Broadwater v. Arch, 267 Md. 329, 297 A.2d 671 (1972); Greenwell v. American Guaranty Corp., 262 Md. 102, 277 A.2d 70 (1971); Trustees of Broadfording Church of Brethren v. Western Maryland Ry. Co., 262 Md. 84, 277 A.2d 276 (1971). At the trial level, the purpose of the hearing on the motion is to decide whether a real dispute as to material facts does exist; if the pleadings, depositions, admissions and affidavits (if any) show that there is no genuine dispute as to any material fact and that the movant is entitled to judgment as a matter of law, summary judgment should be granted. Salisbury Beauty Schools v. State Bd. of Cosmetologists, 268 Md. 32, 300 A.2d 367 (1973); Brewer v. Mele, supra; Brown v. Suburban Cadillac, Inc., 260 Md. 251, 272 A.2d 42 (1971).

A bare allegation in a general way that there is a dispute as to material facts is never sufficient to defeat a motion for summary judgment. James v. Tyler, 269 Md. 48, 304 A.2d 256 (1973); Shaffer v. Lohr, 264 Md. 397, 287 A.2d 42 (1972); Melbourne v. Griffith, 263 Md. 486, 283 A.2d 363 (1971). General allegations which do not show facts in detail and with precision are insufficient to prevent the entry of summary judgment. Davis v. Montgomery County, 267 Md. 456, 298 A.2d 178 (1972).

Even where it is shown that there is a dispute as to a fact, when the resolution of that factual dispute is not material to the controversy, such dispute does not prevent the entry of summary judgment. Salisbury Beauty Schools v. State Bd. of Cosmetologists, supra; Shaffer v. Lohr, supra; S. L. Hammerman Organization, Inc. v. Community Health Facilities, Inc., 264 Md. 37, 50, 284 A.2d 599, 605 (1971); Meola v. Bethlehem Steel Co., 246 Md. 226, 239-240, 228 A.2d 254, 262 (1967). Such a material fact must be one, the resolution of which will somehow affect the outcome of the case. Rooney v. Statewide Plumbing and Heating-Gen. Contractors, Inc., 265 Md. 559, 290 A.2d 496 (1972); Parklawn, Inc. v. Nee, 243 Md. 249, 220 A.2d 563 (1966).

In connection with a ruling to be made on a motion for summary judgment the function of the trial court is much the same as that which it performs at the close of all the evidence in a jury trial when motions for directed verdict or requests for peremptory instructions require a decision as to whether an issue requires resolution by a jury or is to be decided by the court as a matter of law. Salisbury Beauty Schools v. State Bd. of Cosmetologists, supra; Rooney v. Statewide Plumbing and Heating-Gen. Contractors, Inc., supra.

In reviewing the propriety of the grant of a summary judgment we are concerned primarily with deciding whether...

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