Photo Copy, Inc. v. Software, Inc.

• Decision Date: 26 June 1987
• Docket Number: No. 86-703,86-703
• Citation: 510 So.2d 1337
• Parties: PHOTO COPY, INC., Plaintiff-Appellant, v. SOFTWARE, INC., Defendant-Appellee.
• Court: Court of Appeal of Louisiana — District of US

Page 1337

510 So.2d 1337

PHOTO COPY, INC., Plaintiff-Appellant, v. SOFTWARE, INC., Defendant-Appellee.

No. 86-703.

Court of Appeal of Louisiana Third Circuit.

June 26, 1987.

Stockwell and Assoc., Bernard McLaughlin, Lake Charles, for plaintiff-appellant.

Scofield, Bergstedt Gerard, Mount & Veron P.C., Richard E. Gerard, Lake Charles, for defendant-appellee.

Before GUIDRY, STOKER and DOUCET, JJ.

DOUCET, Judge.

Plaintiff, Photo Copy, Inc., filed suit against defendant, Software, Inc., alleging that it sustained damages caused by the failure of Software, Inc. to deliver a customized computer software package which would perform specific functions and which was to be free from defects. The trial court rendered judgment on May 29, 1986, dismissing both the main demand of Photo Copy, Inc., and the reconventional demand of Software, Inc. It is from this judgment that plaintiff appeals. Defendant answered the appeal urging error in the trial court's rejection of its reconventional demand and in casting defendant for one-half of the court costs.

On January 24, 1984, defendant, Software, Inc., submitted to plaintiff, Photo Copy, Inc., a proposal for an IBM personal computer system and a hardware maintenance agreement. Included in this computer package was to be customized software, which would be used by plaintiff with the proposed computer system. The IBM computer was $5,596.50. The maintenance agreement was an additional $426.00, and the customized software was priced at $4,360.00.

Defendant contracted to furnish a customized software system which would perform accounts receivable, accounts payable, and general ledger functions. The software was to include a series of specifically designed applications which were to be based on the particular needs of Photo Copy in its everyday business operations.

Plaintiff put a $1,000.00 down payment on the price of the customized software program. Plaintiff contends that the software program did not perform the functions in the manner promised by defendant. As such, plaintiff urges that it was required to pay overtime salary to its bookkeeper in order to do the necessary accounting and invoicing previously performed on the computer system that it was using prior to the installation of the computer obtained from defendant. Additionally, plaintiff contends that in order to issue statements, minimize its losses, and to achieve some utility from the IBM computer obtained from defendant, it was forced to purchase "canned" programs at a cost of $1,190.00. Thus, plaintiff seeks recovery of the $1,000 down payment on the custom software program, along with damages for inconvenience, cost of a replacement commercial program, other damages and reasonable attorney's fees. Defendant reconvened seeking the contract price of the Software less the $1,000 paid. As aforestated, the trial court dismissed plaintiff's demands as well as defendant's reconventional demand.

On appeal, plaintiff first contends that the trial court erred in failing to hold that the custom computer program sold to plaintiff was redhibitorily defective. We agree.

Redhibition is the avoidance of a sale on account of some vice or defect in the thing sold, which renders it either absolutely useless, or its use so inconvenient and imperfect, that it must be supposed that the buyer would not have purchased the object, if the buyer would have been aware of the vice or defect in the object. La.C.C. art. 2520. Thus, in order to be successful in a suit for redhibition, it is incumbent upon the buyer to prove that the thing is defective and that he/she would not have purchased the object had he/she known that it was defective.

In this case, when defendant, Software, Inc., obligated itself to provide a custom computer package to plaintiff, it entered into a contract of sale with plaintiff and such sale was subject to our laws of redhibition. Austin's of Monroe v. Bill Brown, d/b/a/ Bastrop-Monroe Cash Register Sales and Service, 474 So.2d 1383 (La.App. 2nd Cir.1985). The specific items that Software, Inc. obligated itself to provide in the custom software package were as follows:

1. The ability to pull up a customer's name when only an invoice is known;

2. The option of being able to isolate individual sections of the aged receivables report;

3. The option to charge or not charge interest;

4. Automatic interest charges on aged accounts;

5. The ability to set up different tax rates for different customers;

6. The ability to pull up an account without knowing the account number, only the account name;

7. The ability to apply a payment to an account and have both the credit memo number and the invoice number appear on the statement;

8. The ability to provide mailing labels from the customer file and;

9. The ability of the statement to state terms and be variable for different invoices.

The personnel of Photo Copy, Inc. relied on the promises made by Software, Inc. to provide the listed features. Some of these features were provided while others were not. Specifically, Software, Inc. readily conceded that it was unable to provide Photo Copy, Inc. with item number one. As previously stated, item number one of the desired features is the ability of the computer to pull up a customer's name when only an invoice is known. The record reveals that out of all the functions requested of the Software, Inc. program, the most important function to Photo Copy, Inc. was this cross-referencing feature. Thus, we conclude that the principal motive or cause which prompted Photo Copy, Inc. to purchase the custom software package was the assurance that the custom software package would contain this cross-referencing feature. Because Software, Inc. did not do so, we find that the software program was redhibitorily defective and order a diminution in price pursuant to the provision of La.C.C. art. 2543.

Software, Inc. contends that Photo Copy's redhibition action must fail because they were not given the opportunity to perform their obligation after they were put in default. We disagree. Photo Copy, Inc. and its attorney, each sent a letter to Software, Inc., demanding performance. Twelve days later, Photo Copy received correspondence from Software, Inc., stating that some of the features were ready to be installed, others would be ready for installation at a later date, and that item one on the list of features, the cross referencing feature, was not available and could therefore never be installed. By Software's own admission, the feature that was the principal motive for entering...