Mid-Continent Refrigerator Co. v. Way
| Decision Date | 27 August 1974 |
| Docket Number | No. 19880,MID-CONTINENT,19880 |
| Court | South Carolina Supreme Court |
| Parties | REFRIGERATOR COMPANY, Respondent, v. Willie C. WAY, Appellant. |
Marshall B. Williams, Orangeburg, and Hammer & Bernstein, Columbia, for appellant.
Bryant, Fanning & Yarborough, Orangeburg, for respondent.
The plaintiff-respondent instituted this action alleging a breach of a contract, denominated a lease, under which it had furnished to the defendant-appellant, Way, certain refrigeration equipment. The plaintiff sought to recover 36 monthly installments allegedly due it, totaling the sum of $3,744.00, certain additional expenses allegedly incurred by it and attorney's fees.
The defendant, by answer, denied the material allegations of the complaint, alleged that the plaintiff rather than the defendant had breached the terms of the contract and she further interposed a counterclaim seeking damages allegedly sustained as a result of plaintiff's breach of contract.
Upon the trial of the case both parties moved for directed verdicts in their respective favors. The trial judge directed a verdict against the plaintiff as to the alleged additional expenses and attorney's fees from which direction plaintiff does not appeal. He directed a verdict, however, in favor of the plaintiff for the balance of 36 monthly installments allegedly due it; denied the defendant's motion for a directed verdict and granted a nonsuit as to defendant's counterclaim. Only the defendant appeals, asserting error in denying her motion for a directed verdict, and error in granting the plaintiff's motions. The motions having been decided adversely to the defendant, it is elementary that in determining whether the trial judge was correct, the evidence and all of the inferences reasonably deducible therefrom have to be viewed in the light most favorable to the defendant. We accordingly review the evidence and state the facts in the light of this basic principle.
The plaintiff, Mid-Continent, is a corporation whose principal place of business is located in Denver, Colorado and it is engaged in the business, inter alia, of supplying, under contract, refrigeration units and/or display cases to mercantile establishments. The defendant is the owner and operator of Way's Grocery located on S.C. Highway 6 near Vance in Orangeburg County. In December, 1971, in response to an inquiry from the defendant, a salesman for plaintiff called upon defendant at her place of business. After some discussion the parties entered into a contract whereby the plaintiff delivered to defendant's place of business two frozen food merchandisers, the same being delivered on or about December 21.
The contract between the parties actually consisted of two written documents both upon plaintiff's printed forms and executed simultaneously by the parties on December 3, 1971. The first document has at the top of the first page the words 'financing statement' and immediately thereunder the word 'lease.' It is a four page document and contains, in addition to unnumbered paragraphs, 25 numbered paragraphs in relatively fine print. This document is in the form of a lease, under the terms of which the units were leased to the defendant for a term of four years, with 48 installments of rent at the rate of $104.00 per month commencing on December 25, 1971. Under one of its provisions the option was given to the defendant to obtain five successive new leases for one year periods at the rate of $104.00 per annum. The other document constituting the contract between the parties was the 'shipping order' and this document is not entirely consistent in its terms and provisions with the lease. The shipping order makes more than one reference to the accompanying lease, and among other things, it gives to the defendant the option to obtain title to the equipment at the termination of the four year lease, at no charge whatever except sales tax in the amount of $112.35. It is, of course, elementary that any ambiguities or conflicts in these documents, prepared by the plaintiff, have to be construed favorably to the defendant and we shall later revert to what we think is the meaning and effect of the two documents, when all of the provisions are considered together. Upon execution of the documents defendant paid three monthly installments; thereafter she paid nine monthly installments, making a total payment of $1,248.00.
The equipment functioned quite satisfactorily during the winter months, but as soon as the weather became hot such commenced to malfunction and as the result thereof the defendant sustained damage through loss of merchandise, refunds to customers for spoiled merchandise and loss of customers. She repeatedly reported the malfunction to Mid-Continent, who declined to do anything whatever about defendant's complaints. The defendant, or her agent, consulted a refrigeration expert in Orangeburg, who came and examined the equipment and after this examination defendant advised plaintiff that she would make no further payments and that in the absence of it doing something about the defective equipment it should take the equipment back. When the defendant so notified the plaintiff, she was not in default on any of the monthly payments and the plaintiff did actually repossess the equipment on October 2, 1972, with the defendant making no further payments thereafter.
Upon trial the plaintiff offered no evidence of any breach of contract by the defendant other than her failure to make the remainder of the payments which would have come due under the terms of the lease after she no longer had the equipment. It also offered no evidence as to the equipment, its condition, or what it did with it, and no evidence of any damage sustained by it. Instead it relied upon a provision of the lease which accorded it the right 'to sue for and recover all rents, then accrued or thereafter accruing' despite the fact that it had already repossessed the equipment. The defendant opposed plaintiff's motion for a directed verdict and moved for a directed verdict in her favor, as to plaintiff's alleged cause of action, on the grounds that the plaintiff had neither proved any damages nor any breach of contract by the defendant. As to the amount of damages, we think the court was clearly in error in directing a verdict favorably to the plaintiff. The language of the lease relied upon by the plaintiff is in the nature of a penalty, which is not favored in the law, and if enforceable at all, it would only support a cause of action for any damages actually...
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