Queen City Pastry, LLC v. Bakery Tech. Enters., LLC
| Decision Date | 14 August 2018 |
| Docket Number | No. M2017-00112-COA-R3-CV,M2017-00112-COA-R3-CV |
| Parties | QUEEN CITY PASTRY, LLC v. BAKERY TECHNOLOGY ENTERPRISES, LLC |
| Court | Tennessee Court of Appeals |
Appeal from the Circuit Court for Maury County
The purchaser of automated cake-line equipment filed this action against the seller alleging breach of contract, breach of express and implied warranties, negligent misrepresentation, and violation of the Tennessee Consumer Protection Act. On the seller's motion, the trial court dismissed the complaint as untimely. Because we conclude that the complaint was filed after the applicable limitations periods, either as agreed to by the parties or set by statute, we affirm.
W. NEAL MCBRAYER, J., delivered the opinion of the court, in which FRANK G. CLEMENT, JR., P.J., M.S., and ANDY D. BENNETT, J., joined.
Colin B. Calhoun and M. Ben Moore II, Nashville, Tennessee, for the appellant, Queen City Pastry, LLC.
Dalton M. Mounger, Charles M. Molder, and Kori Bledsoe Jones, Columbia, Tennessee, for the appellee, Bakery Technology Enterprises, LLC.
OPINIONQueen City Pastry, LLC makes, sells, and distributes a line of specialty cakes and related bakery products. In 2010, Queen City decided to automate its cake-baking process. To that end, the company contacted Bakery Technology Enterprises, LLC about purchasing equipment for an automated cake line. Representatives of Bakery Technology later visited Queen City's facility to view its operations and to discuss its needs.
On March 25, 2011, Bakery Technology sent Queen City a proposal that included prices and specifications for equipment for an automated cake line. The proposal gave Queen City the option of either a used or a new oven and the option of adding an auto-depan system as part of the line. Significantly, the proposal was also subject to eight pages of terms and conditions, discussed further below.
Queen City accepted the proposal, choosing an automated line with a used oven and adding the auto-depan system. And a representative of Queen City signed the proposal. On May 20, 2012, Bakery Technology delivered the used oven and other related equipment for which Queen City paid in excess of $550,000.
According to Queen City, after delivery, it discovered that the oven was designed primarily for baking cookies or crackers, not specialty cakes, and that the other equipment it purchased from Bakery Technology was inappropriate. But Queen City did not reject the goods or notify Bakery Technology that the delivered goods were defective. Instead, the company requested additional information,1 which Queen City claimed Bakery Technology never provided.
On July 30, 2014, Queen City filed suit against Bakery Technology in North Carolina, but after the case was removed to federal court, the United States District Court for the Western District of North Carolina dismissed the case for improper venue. One year after the dismissal, Queen City refiled in the Circuit Court for Maury County, Tennessee. The complaint alleged breach of contract, negligent misrepresentation, breach of express and implied warranties, and violation of the Tennessee Consumer Protection Act. See Tenn. Code Ann. §§ 47-18-101 to -131 (2013 & Supp. 2017).
Under Tennessee Rule of Civil Procedure 12.02(6), Bakery Technology moved to dismiss the case for failure to state a claim upon which relief could be granted. The trial court determined that Queen City's claims for relief were based in contract and that the parties' contract gave the buyer fifteen months to file a lawsuit against the seller. Because Queen City's original complaint was filed after the time allowed, the court granted the motion to dismiss.
A Rule 12.02(6) motion "challenges only the legal sufficiency of the complaint, not the strength of the plaintiff's proof or evidence." Webb v. Nashville Area Habitat for Humanity, Inc., 346 S.W.3d 422, 426 (Tenn. 2011). Thus, "[t]he resolution of a 12.02(6) motion to dismiss is determined by an examination of the pleadings alone." Id. Consideration may also be given to exhibits attached to the complaint. Ivy v. Tenn. Dep't of Corr., No. M2001-01219-COA-R3-CV, 2003 WL 22383613, at *3 (Tenn. Ct. App. Oct. 20, 2003); see West v. Schofield, 468 S.W.3d 482, 488-89 (Tenn. 2015) ().
We "construe the complaint liberally, presuming all factual allegations to be true and giving the plaintiff the benefit of all reasonable inferences." Trau-Med of Am., Inc. v. Allstate Ins. Co., 71 S.W.3d 691, 696 (Tenn. 2002). The complaint should not be dismissed unless it appears that the plaintiff can prove no set of facts in support of his or her claim that would warrant relief. Doe v. Sundquist, 2 S.W.3d 919, 922 (Tenn. 1999) (citing Riggs v. Burson, 941 S.W.2d 44, 47 (Tenn. 1997)). Making such a determination presents a question of law. Our review of a trial court's determinations on issues of law is de novo, with no presumption of correctness. Id. (citing Stein v. Davidson Hotel Co., 945 S.W.2d 714, 716 (Tenn. 1997)).
The trial court's resolution of the motion to dismiss rested on the parties' agreement. As noted above, Bakery Technology's proposal was subject to terms and conditions, which limited both its liability and Queen City's remedies. In pertinent part, the terms and conditions provided as follows:
Tennessee law favors "allowing competent parties to strike their own bargains." Ellis v. Pauline S. Sprouse Residuary Tr., 280 S.W.3d 806, 814 (Tenn. 2009); see also Tenn. Code Ann. § 47-1-302 cmt. 1 (Supp. 2017) (emphasizing the role of freedom of contract in commercial transactions). Courts are not concerned with the wisdom or folly of voluntary agreements. Chapman Drug Co. v. Chapman, 341 S.W.2d 392, 398 (Tenn. 1960). Our "role is to enforce an unambiguous contract as it is written unless the contract is being challenged based on fraud or mistake." Boyd v. Comdata Network, Inc., 88 S.W.3d 203, 223 (Tenn. Ct. App. 2002).
Both parties agree that this transaction is governed by Article 2 of the Uniform Commercial Code as adopted in Tennessee. See Tenn. Code Ann. §§ 47-2-101 to -725. (2001 & Supp. 2017). Queen City alleged that the oven and related equipment did not conform to the contract. When a seller tenders nonconforming goods, Article 2 allows the buyer to accept or reject those goods in whole or in part. Id. § 47-2-601 (2001). If the buyer chooses to accept the goods, rejection is no longer an option, but other remedies are available under Article 2 unless limited by the parties' agreement. Id. §§ 47-2-607(2), -719(1) (2001).
Bakery Technology delivered the oven and related equipment on May 20, 2012. Under the parties' agreement, Queen City had three days after delivery to notify Bakery Technology that it was rejecting the goods. See id. § 47-2-602 cmt. 1 (2001) ("Contract provisions limiting the time for rejection . . . are effective if the time set gives the buyer a reasonable time for discovery of defects."). But Queen City did not reject the goods or notify Bakery Technology that the goods were nonconforming. Queen City also paid for the delivered goods. Under both Article 2 and the terms of the contract, Queen City accepted the goods. See id. § 47-2-606 (2001).
As provided by the parties' agreement, once Queen City accepted the goods, its "sole and exclusive remedy with respect to such goods, including the right to revoke acceptance, [was] limited to claims under Seller's Warranty, if any, as set forth [in the terms and conditions]." See id. § 47-2-719(1) (). The agreed upon terms and conditions included an express warranty to repair or replace defective goods for...
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