Stiefel Feed Company v. Aerovent Fan Company, Civ. No. 1670.
| Decision Date | 30 March 1956 |
| Docket Number | Civ. No. 1670. |
| Parties | STIEFEL FEED COMPANY, Plaintiff, v. AEROVENT FAN COMPANY, Defendant. |
| Court | U.S. District Court — Southern District of Ohio |
Rothberg, Callmeyer & Doermer, Fort Wayne, Ind., Wasserman & Talbot, Dayton, Ohio, for plaintiff.
Hugh H. Altick, Dayton, Ohio, Robert S. Miller, Troy, Ohio, for defendant.
In the early Spring of 1952, and for some time prior thereto, Harold Brown was employed by the Mid-West Grain Company of Fort Wayne, Indiana. At that time this company was producing a feed with a corn-oil-meal and blackstrap molasses content.
In April, 1952, the Mid-West company went into bankruptcy and Mr. Brown was out of employment. He had been in the elevator and feed business for a number of years and had developed an interest in producing a feed made of approximately 60% blackstrap molasses and 40% corn-oil-meal. Mr. Brown had particularly in mind a feed known as Oma-Las, manufactured by Vilactos Laboratories of Des Moines, Iowa. This feed was light and fluffy and had a pleasant aroma. Mr. Brown desired to duplicate this as nearly as possible.
In May of 1952, he met Mr. Joseph L. Stiefel. Mr. Stiefel operated an elevator under the name of Stiefel Grain Company of Syracuse, Incorporated. Mr. Brown interested Mr. Stiefel in his project and they entered into an agreement to manufacture a corn-oil-meal and blackstrap molasses feed as nearly like Oma-Las as possible. They first contacted a Mr. Robert Reese of the Indiana Grain and Machinery Company, with reference to equipment required for their project. It was recognized that a dryer or dehydrating machine would be necessary and Mr. Reese, not having such equipment, Mr. Joseph Shape, of the Sidney Grain Machinery Company, was next contacted. This first contact was made at Syracuse. Subsequent to this, Mr. Brown and Mr. Stiefel went to Sidney and met Mr. Shape. Mr. Shape introduced them to Mr. Carl Slagetter, Plant Superintendent of Sidney Grain Machinery Company.
They discussed their problem with Mr. Slagetter and he advised them that Mr. Chester Culp, of Aerovent Fan Company in Piqua, knew a great deal about dryers and dehydrating machines. This was June 6, 1952. On the afternoon of that day, Mr. Slagetter, Mr. Shape, Mr. Brown and Mr. Stiefel went to Piqua to see Mr. Culp. They entered the Engineering Building of the Aerovent Fan Company and Mr. Slagetter introduced the other men to Mr. Culp.
The problem was discussed with Mr. Culp and he stated that he was not familiar with the drying of molasses. Mr. Brown said "Well, that is nothing to be alarmed about, we don't either." Mr. Culp told about drying broom straws at a plant in Springfield, Ohio, and drying grains and hay. (R. p. 440.) On this occasion Mr. Culp explained to the men present a machine known as "Star Drier" which he had invented. He showed them this machine and demonstrated its operation. It was agreed here that Mr. Culp would pick up Mr. Shape in Sidney the next day, June 7, and go to Syracuse, Indiana, to look over the elevator of Stiefel Grain Company. This was done and Mr. Culp made measurements and figured out approximate locations of the different pieces of equipment. He agreed to draw and submit some plans for the installation. This was later done.
In the discussions either at Piqua on June 6, or at Syracuse on June 7, a question arose as to insurance. As a result of this discussion, Mr. Culp, Mr. Brown and Mr. Stiefel went to Chicago on June 19 to see a representative of the insurance company. They had a conference on June 20, with Mr. Parks, a representative of the insurance company and an arrangement was worked out whereby the dryer could be installed in the basement of the elevator. While consulting with the insurance company, they were met by Mr. Knowland Mitchell, Sales Manager of Aerovent Fan & Equipment, Inc., of Lansing, Mich. They later took Mr. Mitchell to the airport from whence he returned to Lansing. Following this, Mr. Shape contacted Paul L. Myers, a millwright, who was employed to make the installation in the elevator.
On June 26, Mr. Brown, Mr. Stiefel, Mr. Myers and Joseph Hunt went to Piqua and again saw Mr. Culp. The record is not clear as to just where or how the dryer was ordered. Mr. Stiefel indicates (R. p. 193) that it was purchased on the night of June 26, at Piqua. On this occasion Mr. Culp was met at the hotel after factory closing hours and he went with the other men to the factory, opened it up and let them in. Mr. Stiefel says (R. p. 193) "As I see it, the fan was ordered that night for delivery as soon as we were ready to install it." It seems that the purchase of the dryer was more or less implied from the beginning of the negotiations and that there never was a written purchase order given or a definite contract, either oral or written, made.
The installation by Mr. Myers and his crew was begun about the end of June and completed on or before August 24. During the progress of this installation, Mr. Culp wrote to Minneapolis-Honeywell Company to arrange for thermostatic controls in accordance with the requirements of the insurance company. These controls involved complicated wiring and during the installation, Mr. Culp sent Marion Free to Syracuse to supervise the installation of the wiring. On August 15, Mr. Culp, and Mr. Free left Piqua with the "Star Drier" in question. It was delivered at Syracuse on August 16, and Mr. Culp and Mr. Free assisted in placing it in the basement where it was to be installed. The plant was put in operation on August 24 and utterly failed to produce the desired results. The day following the unsuccessful operation of the plant, Mr. Culp went to Syracuse and following this, he met Mr. Stiefel in Sidney on August 27.
When Mr. Brown and Mr. Stiefel met Mr. Culp on June 6, they informed him that they were planning to form a corporation to be called "Stiefel Feed Company, Inc.," for the purpose of manufacturing a feed product. The articles of incorporation for this company were issued July 8, 1952. The Directors' meeting and election of officers was July 24, 1952.
The only written indication of sale is an invoice of Aerovent Fan & Equipment, Inc., of Lansing, Michigan, dated September 19, 1952. This invoice has been offered in evidence as plaintiff's Exhibit 9. It is directed to "Stiefel Grain Company, Syracuse, Indiana," and shows the order date as August 4; the date shipped, August 15, August 29 and September 19. Under the heading: "Salesman" are listed Stewart Supply Co., George Rolfes and Chester Culp. Under the heading "Shipped Via" is "Delivery by Culp, Expressways' Inc., and Railway Express." The amount of the invoice is $2,200.03, and it is admitted that it has never been paid.
The plaintiff, Stiefel Feed Company, Inc., filed an amended complaint, by which it seeks to recover from Aerovent Fan Company, Inc., defendant, the sum of approximately $49,000 for breach of warranties.
It is claimed by plaintiff that the defendant warranted that the dryer would not only dry the molasses, but would cause it to come out as a dry, fluffy product like Oma-Las. The defendant claims that Mr. Culp did not in fact make any such warranties and that if he did make them, it was not within the scope of his authority to do so.
It is conceded that none of the parties knew how to produce the desired result. The process by which Oma-Las, the only known product of its kind, was manufactured, was unknown. This process was apparently a well-guarded secret. Mr. Reese offered to work his way into the plant and find out, but this was not permitted by Mr. Brown. The officers and management of the defendant...
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