Peninsular Carpets, Inc. v. Bradley Homes, Inc.

• Court: Wisconsin Supreme Court
• Writing for the Court: HANLEY
• Citation: Peninsular Carpets, Inc. v. Bradley Homes, Inc., 58 Wis.2d 405, 206 N.W.2d 408 (Wis. 1973)
• Decision Date: 20 April 1973
• Docket Number: No. 290,290
• Parties: PENINSULAR CARPETS, INC., a foreign corp., Appellant, v. BRADLEY HOMES, INC., a Wis. corp., Respondent.

Page 408

206 N.W.2d 408

58 Wis.2d 405

PENINSULAR CARPETS, INC., a foreign corp., Appellant, v. BRADLEY HOMES, INC., a Wis. corp., Respondent.

No. 290.

Supreme Court of Wisconsin.

April 20, 1973.

Robert A. Christensen, Foley & Lardner, Milwaukee, for appellant.

Robert M. Siegman and Aaron Boxer, Milwaukee, for respondent.

HANLEY, Justice.

The sole issue presented on this appeal is whether the trial court erred in denying plaintiff's motion for summary judgment.

In the past, this court has indicated a reluctance to reverse orders denying motions for summary judgment since, for the most part, not many cases easily lend themselves to purely legal rather than factual issues. Balcom v. Royal Ins. Co. (1968), 40 Wis.2d 351, 161 N.W.2d 918. As a remedy, summary judgment is drastic which cannot or should not be used to institute a trial by affidavit or adverse examination. Voysey v. Labisky (1960), 10 Wis.2d 274, 103 N.W.2d 9; Jahns v. Milwaukee Mut. Ins. Co. (1968), 37 Wis.2d 524, 155 N.W.2d 674. For this reason, the burden of proof rests with the movant, Kubiak v. General Acc. F. & L. Assur. Corp. (1962), 15 Wis.2d 344, 349, 113 N.W.2d 46, and if there are any material facts in dispute or any reasonable inferences that might be drawn from undisputed facts which point to a result contrary to the one sought by the movant, the motion must be denied. Marshall v. Miles (1972), 54 Wis.2d 155, 194 N.W.2d 630. These issues remain for the trier of fact and the only question for a trial court is whether such material issues of fact exist in the first instance.

In keeping with the nature of the remedy itself, this court has set forth for the aid of trial courts the precise methodology which should be employed in determining whether the case then before them is an appropriate one for disposition by summary judgment. This methodology was described with great particularity in the recent case of Marshall v. Miles, supra, where, at pages 160, 161, 194 N.W.2d at page 633 it is stated:

'The summary-judgment procedure initially requires an examination of the pleadings to determine whether a cause of action has been stated and whether material issues of fact are presented. Younger v. Rosenow Paper & Supply Co. (1971), 51 Wis.2d 619, 188 N.W.2d 507. However, the allegations of the pleadings may not be considered as evidence or other proof on a disposition of the motion. Milwaukee County v. Schmidt (1968), 38 Wis.2d 131, 156 N.W.2d 493; McCluskey v. Thranow (1966), 31 Wis.2d 245, 142 N.W.2d 787. Assuming a cause of action and the existence of factual issues, an examination is then made of the moving party's (defendant's) affidavits and other proof to determine whether a prima facie defense has been established. Cirillo v. Milwaukee (1967), 34 Wis.2d 705, 150 N.W.2d 460. If the moving party has made a prima facie case for summary judgment, an examination is then made of the opposing party's (plaintiff's) affidavit and other proof to determine whether there exists disputed material facts, or undisputed material facts from which reasonable alternative inferences may be drawn, sufficient to entitle the opposing party to a trial. Skyline Construction, Inc. v. Sentry Realty, Inc. (1966), 31 Wis.2d 1, 141 N.W.2d 909.'

This methodology must now be applied to the case at bar and the appropriate test is whether the trial court abused its discretion in denying plaintiff's motion for summary judgment. Hardscrabble Ski Area v. First Nat. Bank (1969), 42 Wis.2d 334, 166 N.W.2d 191.

Looking first then to the pleadings, paragraph 3 of plaintiff's complaint alleges that on August 3, 1970, the parties entered into a purchase order ¹ contract for a specified amount of carpeting do be purchased by the defendant from the plaintiff. Paragraph 3 of defendant's answer while admitting that a document was in fact executed, denies that the document constituted a contract, rather alleging that it was 'a memorandum of some of the terms which were to be incorporated in a contract.' Likewise, paragraph 6 alleges that the transaction was subject to the approval by the defendant of the agreements to be drawn and admits by failure to deny that defendant repudiated this document. Thus, the pleadings raise the question of whether the document executed on August 3rd is in fact a contract or merely a memorandum of some terms which were later to be incorporated in a contract; the question being one of intent.

Since the alleged contract is one for the sale of goods, Article 2 of the Uniform Commercial Code, more particularly Sec. 402.102, Stats., ² is applicable. Additionally, since the question before this court is whether the parties actually intended to form a contract on August 3rd when the document was executed, Sec. 402.204, Stats. (U.C.C. Sec. 2--204) is also of prime importance, particularly subsection (3) thereof which provides:

'(3) Even though one or more terms are left open a contract for sale does not fail for indefiniteness if the parties have intended to make a contract and there is a reasonably certain basis for giving an appropriate remedy.' In his treatise on the subject, Professor Corbin said of the intent of the parties to enter into a contract:

'One of the most common illustrations of preliminary negotiation that is totally inoperative is one where the parties consider the details of a proposed agreement, perhaps settling them one by one, with the understanding during this process that the agreement is to be embodied in a formal written document and that neither party is to be bound until he executes this document. Often it is a difficult question of fact whether the parties have this understanding; and there are very many decisions holding both ways. These decisions should not be regarded as conflicting, even though it may be hard to reconcile some of them on the facts that are reported to us in the appellate reports. It is a question of fact that the courts are deciding, not a question of law; and the facts of each case are numerous and not identical with those of any other case. In very many cases the question may properly be left to a jury. (Emphasis added) 1 Corbin on Contracts (1963), sec. 30, at page 97.

In support of its argument that the document executed on August 3rd embodied a definite expression of intent by the parties that a contract was to thereby be formed, plaintiff relies on selected excerpts of the deposition of Mr. Jack E. Meyers, who signed the document. It is contended that these excerpts ³ demonstrate that Meyers thought he had a definite agreement with plaintiff for the purchase of carpeting under the terms of the August 3rd document and, therefore, regardless of the fact that the subsequent document submitted at the end of August was not in complete compliance with the provisions originally agreed upon on August 3rd, the August 3rd document represents an intent that it be a contract, mutually binding between the parties.

However, certain excerpts from Meyers' deposition would support a reasonable inference that the language contained in the August 3rd document shows an express intent not to be bound on any contract until a subsequent formal agreement was approved by the parties. When asked what was said at the time of the meeting with Grossman, Meyers responded:

'Well, he brought this Peninsular Carpet out, and he brought this form to write it out, and he said that--I don't remember what he said to explain it--I said okay, why don't you go back and get a contract or an agreement or something legal from them and come back and we will spell the terms out exactly, and he said that he couldn't do it, he was leaving town, and he had to get some memo, he called it a memorandum or memo, and take it back, and the contracts would be forthcoming, and that's why he put in here: 'as per agreement, assignment or assignment to Cornet Carpet Company, subject to approval of buyer and seller and/or assignee.' He was supposed to get some kind of agreement up, but he wanted to show this to--what the contents were and the amount of yardage and price.' (Emphasis added)

The use of the phrase 'as per agreement, assignment to Cornet (sic) Carpet Company subject to approval of buyer and seller and or assignee' could arguably support a reasonable inference of expressed intent that there was to be no legal obligation until the subsequent formal document met with their approval.

In Younger v. Rosenow Paper & Supply Co. (1971), 51 Wis.2d 619, 188 N.W.2d 507, the court at page 629, 188 N.W.2d at page 512 stated:

'Neither the affidavit nor the documents settle the issue raised by the pleadings . . .

'. . . While the legal effect to be given an agreement may, in a proper case, be determined on a motion for summary judgment, where there is a dispute as to the intent of the parties to the agreement, a fact issue is presented, and summary judgment is inappropriate.'

In Lemake v. Larsen Co. (1967), 35 Wis.2d 427, 151 N.W.2d 17, it was stated at pages 431, 432, 151 N.W.2d at page 19 tht:

'While the construction of a contract when it is not ambiguous, is a matter of law for the court to determine, however, when there is...