Vorthman v. Keith E. Myers Enterprises

• Decision Date: 17 September 1980
• Docket Number: No. 62654,62654
• Citation: 296 N.W.2d 772
• Court: Iowa Supreme Court
• Parties: , 30 UCC Rep.Serv. 924 Alfred VORTHMAN, Appellee, v. KEITH E. MYERS ENTERPRISES, Appellant.

Page 772

296 N.W.2d 772

14 A.L.R.4th 1085, 30 UCC Rep.Serv. 924

Alfred VORTHMAN, Appellee, v. KEITH E. MYERS ENTERPRISES, Appellant.

No. 62654.

Supreme Court of Iowa.

Sept. 17, 1980.

Rehearing Denied Oct. 9, 1980.

Frederick G. White, Waterloo, and Kirby D. Schmidt of Kliebenstein, Heronimus & Schmidt, Grundy Center, for appellant.

Robert W. Feilmeyer of Cambridge, Feilmeyer, Landsness, Rutherford & Chase, Atlantic, for appellee.

Considered by LeGRAND, P. J., and UHLENHOPP, HARRIS, McCORMICK and LARSON, JJ.

LeGRAND, Justice.

This action, brought to recover damages for breach of warranty in the sale of 511 pigs, resulted in a jury verdict for plaintiff in the amount of $18,823.89. Defendant appealed, and plaintiff cross-appealed. We reverse and remand on defendant's appeal and affirm on plaintiff's cross-appeal.

Defendant is a family corporation engaged in the business of buying and selling feeder pigs. Plaintiff is an experienced farmer who has engaged for some years in the business of raising pigs. They negotiated through agents for the sale and purchase of feeder pigs at $33 each. It was agreed the animals were to be "good healthy feeder pigs."

After being trucked from the state of Mississippi, where they were raised, the pigs were delivered to plaintiff's farm late in the evening of October 18, 1975. The truck transporting them had been loaded for two separate deliveries, one to a farmer in Illinois and the other to plaintiff. The Illinois delivery was made first.

When the shipment arrived at plaintiff's farm, some of the animals appeared gaunt and sick. There were also several dead pigs among them. Furthermore, the load was "over" there were more animals than the 500 originally contracted for. Plaintiff had some discussion with the driver concerning the condition of the animals. The driver made several telephone calls to defendant, and it was ultimately agreed that the plaintiff would accept 511 pigs. This figure was arrived at after rejecting some of the sick animals and, of course, discarding the dead ones.

Several days later, plaintiff had the animals examined by a veterinarian. It was then discovered they were suffering from both pasteurella, an ailment common to livestock and related to pneumonia, and salmonella, an intestinal disorder. These ailments were both contagious and infectious. They also showed symptoms of atrophic rhinitis. Fifty-five of the animals died. Many of the others required the attention of a veterinarian, who prescribed treatment and medication. The survivors eventually recovered and were sold at a profit.

Plaintiff claims that the animals were expressly warranted to be good, healthy feeder pigs; that they were sick and infected with one or more contagious diseases; and that he is entitled to damages for breach of warranty. Plaintiff further claims there was an implied warranty of merchantability which defendant breached. Defendant denies there was any breach of warranty and alleges further that, even if there were, plaintiff has waived any right to rely thereon because he signed a waiver at the time the pigs were delivered. This is the main dispute in the case although several

other issues are raised. Defendant's appeal presents these three questions:

1. Did the plaintiff waive his claim for breach of warranty as a matter of law?

2. Did the trial court err in denying defendant's motion in limine to exclude certain evidence?

3. Did the trial court err in the instruction on damages?

I. WAIVER AND DISCLAIMER.

The case was submitted on both express and implied warranty. The jury verdict was general, and we do not know which theory the jury adopted. The question of waiver arises because, when the animals were delivered, plaintiff signed an instrument containing this clause:

ACCEPTANCE OF FEEDER PIGS

1. The purchaser shall have the right to inspect and reject any or all feeder pigs before loading.

2. When delivery is made directly to the purchaser, and purchaser has not previously inspected the feeder pigs, he shall have the right to inspect and reject any and all before the delivery truck leaves the premises of the purchaser.

3. THE PURCHASER HEREBY ACCEPTS THE FEEDER PIGS "AS IS" AND UNDERSTANDS THAT NO WARRANTIES EXIST IN REGARD THERETO. IT IS UNDERSTOOD THAT NO IMPLIED WARRANTIES OF MERCHANTABILITY OR IMPLIED WARRANTIES OF FITNESS EXIST IN REGARD TO THIS TRANSACTION.

Defendant insists this amounted to a waiver of any claim as a matter of law. We agree with the trial court that the meaning and effect of this provision was a matter which the jury, rather than the court, should decide.

Defendant relies on section 554.2316, The Code, which we set out in part:

1. Words or conduct relevant to the creation of an express warranty and words or conduct tending to negate or limit warranty shall be construed wherever reasonable as consistent with each other; but subject to the provisions of this Article . . . negation or limitation is inoperative to the extent that such construction is unreasonable.

2. Subject to subsection 3, to exclude or modify the implied warranty of merchantability or any part of it the language must mention merchantability and in case of a writing must be conspicuous, and to exclude or modify any implied warranty of fitness the exclusion must be by a writing and conspicuous. Language to exclude all implied warranties of fitness is sufficient if it states, for example, that "There are no warranties which extend beyond the description on the face hereof."

3. Notwithstanding subsection 2

a. unless the circumstances indicate otherwise, all implied warranties are excluded by expressions like "as is", "with all faults" other language which in common understanding calls the buyer's attention to the exclusion of warranties and makes plain that there is no implied warranty; and

b. when the buyer before entering into the contract has examined the goods or the sample or model as fully as he desired or has refused to examine the goods there is no implied warranty with regard to defects which an examination ought in the circumstances to have revealed to him; . . .

It is quite apparent defendant sought to pattern the language of this "waiver" after the language of section 554.2316 relating to both express and implied warranties. Despite this literal compliance with the statute, we are convinced the waiver was not established as a matter of law. To hold otherwise would contravene those positions of section 554.2316 which direct, on the one hand, that limitation or negation of an express warranty "is inoperative to the extent that such construction is unreasonable" and, on the other hand, that "circumstances (may) indicate otherwise," despite language claimed to constitute a waiver of implied warranty. There is substantial evidence to support a finding of breach of warranty, both express and implied. Thus the vital question is: Did plaintiff waive his claim as a matter of law by signing the instrument already referred to? We believe not.

Negotiations for the purchase of these pigs were carried on orally. There was no suggestion plaintiff was to inspect them at his peril before acceptance. This matter arose for the first time, when the load of pigs arrived at plaintiff's farm.

The driver of the truck then presented plaintiff with an instrument to be signed in order to obtain delivery. This was not simply a receipt for the delivery of 511 pigs, however. It included, too, the language heretofore set out which is now relied on as a waiver of claim. This instrument, it is true, gave plaintiff the right to inspect before accepting the shipment, and plaintiff made a visual examination and rejected the dead pigs and a few others which appeared to be sick.

It would have been manifestly unreasonable to require that plaintiff make a thorough examination of 511 pigs at that time in order to ascertain all were fit and sound.

Plaintiff testified the delivery was made about 7 p. m. on a Saturday evening. The truck driver was anxious to get home. He wanted to get the pigs off his truck. Plaintiff wanted the animals and had been waiting for them all day. He read parts and perhaps all of the waiver. He had some conversation with the driver about the animals. A minor adjustment on price was made by a telephone call to defendant. There was some urgency on both sides to unload the pigs and get them settled on plaintiff's farm.

Whether the visual inspection made was adequate and whether plaintiff should have insisted on a full examination before accepting the load were questions for the jury. Stated differently, we hold it would be unreasonable to say the facts before us constitute a waiver by plaintiff as a matter of law. This conclusion applies to both express and implied warranty.

We hold this issue was properly submitted for determination by the jury.

II. ORDER ON MOTION IN LIMINE.

Before trial, defendant filed a motion in limine seeking to exclude the testimony of Robert Trott, the Illinois farmer to whom some of the pigs from the same shipment were delivered prior to delivery of plaintiff's pigs. The motion also sought to exclude certain evidence concerning identifying ear-tags attached to the animals. The motion was denied. No objection to this testimony was made at the trial and thus no error is preserved for review here. State v. Judkins, 242 N.W.2d 266, 269 (Iowa 1976); Rush v. Sioux City, 240 N.W.2d 431, 438 (Iowa 1976); Twyford v. Webber, 220 N.W.2d 919, 922-24 (Iowa 1974); State v. Hinsey, 200 N.W.2d 810, 817-18 (Iowa 1972).

III. DAMAGES.

This brings us to the issue of damages. The matter was submitted by Instruction 17 under which the jury was permitted to consider the following items of loss:

1. The value of the fifty-five feeder pigs which died.

2. The difference between the value of the remaining pigs (456) if they had been as warranted and their value in the condition in which they were delivered.

3. The reasonable value of the veterinary...