Marion Mach. Foundry & Supply Co. v. Cincinnati Coffin Co., s. 33895

• Decision Date: 12 January 1955
• Docket Number: Nos. 33895,33896,s. 33895
• Citation: 124 N.E.2d 132,162 Ohio St. 455
• Parties: , 55 O.O. 297 MARION MACHINE, FOUNDRY & SUPPLY CO., Appellee, v. The CINCINNATI COFFIN CO., Appellant, et al., Appellee. MARION MACHINE, FOUNDRY & SUPPLY CO., Appellant, v. The CINCINNATI COFFIN CO. et al., Appellees.
• Court: Ohio Supreme Court

Page 455

162 Ohio St. 455

124 N.E.2d 132, 55 O.O. 297

MARION MACHINE, FOUNDRY & SUPPLY CO., Appellee, v. The CINCINNATI COFFIN CO., Appellant, et al., Appellee.

MARION MACHINE, FOUNDRY & SUPPLY CO., Appellant, v. The CINCINNATI COFFIN CO. et al., Appellees.

Nos. 33895, 33896.

Supreme Court of Ohio.

Jan. 12, 1955.

Syllabus by the Court.

1. Where a sale of goods is made by a written contract which contains exclusive remedies available to the purchaser in the event of any defect in the design, construction, material or workmanship of such goods, the purchaser is bound by and limited to such remedies in the event of any defect in such design, construction, material or workmanship.

2. Where a sale of machinery is made as a result of a written purchase order submitted by the purchaser, describing the machinery to be delivered by the seller and containing a detailed description of the machinery and provisions that verbal instructions or agreements relative to or altering the order will not be recognized, that no changes will be made except upon written instruction, that defective machinery will be returned at the seller's expense, that no machinery returned as defective may be replaced without a formal replacement order, and that all machinery will be subject to the purchaser's inspection and rejection, and where the machinery is delivered to the purchaser by the seller and the purchaser keeps and uses the same until the completion of a contract with a third party, for the performance of which contract the purchaser ordered the machinery, and where thereafter the purchaser sells the machinery and retains the proceeds therefrom such purchaser may not either claim recoupment as against a demand for the purchase price or claim special damages because of alleged defects in the design, construction, material or workmanship of such machinery.

These two appeals are in an action originally instituted in the Court of Common Pleas of Hamilton County by the Marion Machine Foundry & Supply Company, hereinafter designated plaintiff, a corporation under the laws of Indiana and with its principal place of business in the city of Marion, Indiana, against The Cincinnati Coffin Company, a corporation under the laws of Ohio and hereinafter designated defendant. The United States of America appears as a defendant, its interest in the controversy arising by reason of an alleged assignment to it of a part of any recovery secured by defendant against plaintiff, and it asserts no claim other than the derivative one.

In plaintiff's petition, filed December 8, 1947, it is alleged that plaintiff entered into a contract with defendant whereby plaintiff agreed to manufacture for defendant one double-action 100-ton hydraulic press, in accordance with the requirements and specifications agreed to between plaintiff, defendant and one J. N. Leake, a resident of Monroe, Michigan; that plaintiff agreed in the contract to sell and deliver the press to defendant, and defendant agreed to purchase the press for the sum of $38,000, of which sum defendant paid $19,000 at the time of the contract and agreed to pay the balance of $19,000 on completion of the press; that the press was manufactured and completed in accordance with the requirements and specifications; that plaintiff performed all the conditions required by the contract; that on March 5, 1947, it made demand on defendant for payment of the balance due; and that at all times since such date defendant has refused and still refuses to pay the balance of $19,000 or any part thereof.

Plaintiff prays for judgment in the sum of $19,000, with interest at six per cent per annum from March 5, 1947, and costs.

Defendant filed an amended answer and cross-petition in which it admits the contract; alleges that the press was to receive the approval of Leake upon completion, and that the press was not completed, did not have the approval of Leake and was not received by defendant; admits that the purchase price was to be $38,000, of which $19,000 has been paid by it; denies that plaintiff manufactured and completed the press in accordance with the agreed requirements and specifications, and that plaintiff performed all the conditions required by the contract; and alleges that the contract provided for delivery of the press on or before December 15, 1946, and that plaintiff breached the contract, in that the press was not installed until March 5, 1947.

Defendant's amended answer alleges further that the press, after delivery, was defective in design, construction, material and workmanship; that it failed to comply with the speeds specified; that it failed to operate a great part of the time from March 5, 1947, to the date of the filing of the amended answer, which was June 17, 1948; that the press and its parts repeatedly blew out and leaked oil excessively; that the electrical wiring was defective and had to be replaced; that the electric motors were inadequate and secondhand and had to be replaced with new and higher-horsepower motors; that plaintiff, until September 10, 1947, made repeated repairs in attemption to make the press operate properly; and that thereafter the press broke down repeatedly so that defendant was required to employ others to repair it.

Defendant's amended answer alleges further that the contract of purchase between it and plaintiff incorporated by reference, and made it subject to, terms and conditions of quartermaster's contract No. W12-036-QM-19710 by and between defendant and the United States through the War Department; that pursuant to such government contract the press was to produce stampings and drawings as component parts of caskets for the United States' repatriation-of-war-dead program; that such government contract included a delivery schedule of stampings from defendant's subcontractor, The Leake Stamping Company of Monroe, Michigan, of which company J. N. Leake was president, and in whose plant this press was installed by plaintiff; that these stampings were to be assembled and built into caskets by defendant at its plant in Cincinnati; that the schedule provided for the delivery of 50,000 completed caskets by December 28, 1948, but due to the defective condition of the press installed by plaintiff and its frequent breakdowns, The Leake Stamping Company was prevented from producing more than 33,000 completed sets of stampings; that defendant was delinquent in its contract in the amount of approximately 21,000 finished caskets; and that if the contract was not completed by August 15, 1948, defendant would be liable to the United States in the sum of approximately $3,500 per day.

Defendant's amended answer alleges further that on or about June 4, 1947, defendant notified plaintiff that the press continued in a defective condition; that damages due thereto were increasing daily; that in order to mitigate such damages defendant was required to and would purchase a press which would operate properly and enable it to comply with the terms of its government contract; and that thereafter it purchased another press for a sum of approximately $180,956.48, in which sum the United States, by assignment, had an interest in the amount of $42,826.41.

Defendant's amended answer alleges further that due to the defective press it was necessary for defendant to maintain its plants at Cincinnati with a force of employees who were idle and partly idle during periods of the breakdowns, resulting in damages in the approximate sum of $208,120.41; and that plaintiff had been notified it would be held responsible for all such costs, expenses and damages resulting from the failure of the press to operate efficiently and continuously.

Defendant's amended answer alleges additional damages in smaller amounts due to repairs to the press by defendant, and that plaintiff owes defendant large sums of money in excess of the sums claimed to be due plaintiff, because of damages resulting from the condition of the press.

Defendant's amended cross-petition substantially adopts and restates all the facts set forth in the answer and prays for judgment against plaintiff in the sum of $408,563.17, plus interest.

The intervening petition of the United States alleges that it and defendant are the owners of the cause of action set forth in the amended cross-petition; that they have agreed that judgment on the amended cross-petition may and should be rendered jointly in favor of them; that the proceeds of such judgment will thereafter be divided between them in such a manner as they shall agree; that the cost of the purchase and installation of the second press totaled $180,956.48; and that defendant has assigned to the intervenor a portion of that obligation, in the sum of $42,826.41. The intervenor prays that the petition of plaintiff be dismissed, and that judgment be rendered in favor of defendant and the intervenor jointly for all the relief prayed for in the amended answer and crosspetition of defendant, plus the sum of $42,826.41 on intervenor's cross-petition

Amendments of and supplements to the amended answer and cross-petition were filed September 21, 1951, claiming additional damages for delays between the dates of the filing of the amended answer and cross-petition and the completion of the contract, to which supplements the United States, joining with the defendant, filed an answer.

Plaintiff filed a second amended reply which denies generally the allegations in the defendant's amended answer and amendments and supplements thereto and incorporates a second amended answer to defendant's amended cross-petition and the supplements thereto. This second amended answer incorporates and adopts the allegations in the second amended reply and admits that plaintiff had received an order for the press in accordance with the terms alleged by defendant in its cross-petition; that it had accepted this order on October 15, 1946; that the press failed to operate part of the time between the...