Standard Brands v. Consolidated Badger Cooperative, Civ. A. No. 4642.

• Decision Date: 13 March 1950
• Docket Number: Civ. A. No. 4642.
• Citation: 89 F. Supp. 5
• Parties: STANDARD BRANDS INCORPORATED v. CONSOLIDATED BADGER COOPERATIVE.
• Court: U.S. District Court — Eastern District of Wisconsin

89 F. Supp. 5

STANDARD BRANDS INCORPORATED v. CONSOLIDATED BADGER COOPERATIVE.

Civ. A. No. 4642.

United States District Court E. D. Wisconsin.

March 13, 1950.

William F. Morris, De Pere, Wis., for plaintiff.

Wallrich Law Office, Lloyd G. Andrews, Shawano, Wis., for defendant.

TEHAN, District Judge.

This action was brought by the plaintiff to recover the balance of a purchase price it alleges is due to it on a contract for the sale of a cheese manufacturing plant. The defendant admits the execution of the contract but defends its nonpayment of the balance, claiming a set-off arising from expenses incurred by defendant because of a faulty boiler. The defendant claims the benefit of warranties as to the fitness of this boiler.

Plaintiff has moved for summary judgment on the basis of the pleadings, affidavits and depositions on file with the Court. Under Rule 56(c), Federal Rules of Civil Procedure, 28 U.S.C.A., summary judgment is granted only if the "pleadings, depositions, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Our task then is to examine the record to see if it does present a genuine issue of material fact.

The pleadings indicate that formal contract negotiations began with the submission of an offer by the defendant to the plaintiff on August 4, 1947. This offer which was contained in a letter, recited in part:

"This offer is submitted on behalf of our organization and summarizes the final conclusions reached at our several conferences. This offer has been discussed with our Board of Directors and has received their approval.

* * * * * *

"(1) We will pay $63,600 for the land, milk plant, garage, and other out-buildings, sewage rights, wells and water rights located on the lot fronting on Elizabeth Street and in the intersection of Morrow Street.

"(2) We will pay the sum of $43,200 for the equipment located in said building as appears from the final listing thereof submitted by you under date of August 1, 1947, — specifically excluding from said list the five items listed on page 2 thereof not suitable for our purpose and consisting of the following: * * *". (Emphasis added.)

On August 28, 1947 the plaintiff replied to the offer suggesting a modification of a provision, not relevant to this controversy, and accepting all the other provisions of the offer.

Then, on September 11, 1947, a document entitled, "Agreement", which incorporated all of the provisions of the offer and counter-offer, was formally executed by the parties. This agreement provided as follows:

"This Agreement made and entered into this 11th day of September, A.D.1947, by and between Standard Brands Incorporated, a corporation duly organized and existing under and by virtue of the laws of the State of Delaware, of New York County, New York, party of the first part, hereinafter called `Seller', and Consolidated Badger Cooperative, a cooperative association duly organized and existing under and by virtue of the laws of the State of Wisconsin, with principal offices in the City of Shawano, Shawano County, Wisconsin, party of the second part, hereinafter called `Buyer',

"Witnesseth

"For and in consideration of the mutual promises, covenants and agreements between the parties hereinafter contained, and the payments of the sums of money in the amounts and at the times and in the manner by second party to first party as hereinafter specified, it is stipulated and agreed by and between the parties hereto as follows:

"Seller agrees to convey to Buyer its cheese factory property in the City of Seymour, Outagamie County, Wisconsin, described as follows:

* * * * * *

"Seller agrees to convey the real-estate and buildings by Corporate Deed duly executed and acknowledged in customary form and content, conveying good merchantable title to said premises, and to convey the said machinery and personal property by proper Bill of Sale duly executed and delivered.

"Buyer agrees to pay Seller for said property, as follows:

"1. Sixty-three Thousand Six Hundred Dollars ($63,600.00) for the land, milk plant, garage and other out buildings, including sewage rights, wells and water rights.

"2. Forty-three Thousand Two Hundred Dollars ($43,200.00) for the equipment located in and used in connection with said property more particularly described in Exhibit A attached hereto.

"3. In addition to the above amounts Ten Thousand Dollars ($10,000.00) in cash on or before August 15, 1948.

"4. Buyer agrees to purchase and pay for two (2) Stoelting Agitators recently installed at the invoiced price thereof.

"5. Buyer agrees to purchase and pay for one (1) York Pasturizer installed at the cost price, less depreciation, plus installation cost, the total cost of which, however, is not to exceed Five Thousand Dollars ($5,000.00).

"6. Seller agrees to deliver possession of the said property and premises to the Buyer at Twelve (12) o'clock midnight September 15, 1947.

"It is understood and agreed by and between the parties hereto that upon the execution of this Agreement and prior to the delivery of possession Buyer will pay to Seller the sum of Fifty Thousand Dollars ($50,000.00) and the balances agreed to be paid hereunder to be paid at the time of the delivery of properly executed documents of conveyance showing good marketable title to the premises therein conveyed except the deferred payment which shall be paid at the time and in the manner hereinbefore specified.

"It is further understood and agreed by and between the parties hereto that the Seller shall retain and have the right to the exclusive use of the warehouse building on said premises for its convenience in the removal and disposition of its equipment for a period not to exceed sixty (60) days from the date of the delivery of possession of said premises to Buyer.

"It is further understood and agreed that the real-estate taxes assessed for the year 1947 shall be pro-rated between the parties to the date of the delivery of possession of the premises to the Buyer.

"In Witness Whereof, the parties hereto have caused these presents to be executed by their duly authorized officers and their corporate seals to be hereto affixed the day and year first above written."

Exhibit A attached to the contract provided in part:

"Exhibit A

"Seymour Cheese Factory Equipment

* * * * * *

"Boiler Room

"1 Par compressor and 5 H.P. motor for cooler

"1 150 H.P. Freeman & Sons boiler equipped with Iron Fireman Stoker and water pump * * *."

Pursuant to the terms of the agreement, the plaintiff executed and delivered to the defendant the necessary documents to convey title to the real and personal property involved, and the defendant paid the plaintiff the purchase price stated in the agreement with the exception of the $10,000 referred to in paragraph numbered 3 of the contract, which was not paid when it came due and has not been paid. To collect this $10,000, plaintiff brought this action.

The defendant seeks to defend its non-payment by alleging that during the negotiations prior to the execution of the aforementioned agreement the plaintiff, through its agent, orally warranted that the 150 H.P. Freeman & Sons boiler "was sound, safe, without defects, in good condition, and amply fit for the purpose for which it would be used by the purchaser", and that, in fact, the boiler was not usable for the purposes for which it was needed and had to be replaced. Thus, the defendant seeks the opportunity to establish an express warranty. Plaintiff contends that any evidence seeking to establish such express oral warranty is inadmissible in that it tends to place upon the plaintiff an obligation not assumed by it in the written agreement, or, in other words, it tends to modify the written agreement by adding these warranties thereto.

As noted above, the written agreement resulted directly from a written offer of the defendant which was accepted by the plaintiff and formally integrated into the contract which set forth the obligations of the parties. This Court feels that the instrument on its face shows itself to be a complete recital of the obligations of the respective parties. The rule is very well established that parol evidence may not be admitted to add to the terms of a written agreement. 32 C.J.S., Evidence, § 851; Restatement of the Law of Contracts, sec. 237. Such evidence is clearly not admissible in this jurisdiction.¹ Using language which is applicable to this case, the Wisconsin Supreme Court has said: "Certainly no such warranties appear in the contract, and parol evidence to show verbal warranties is not...