WHITAKER v FARMHAND INC

Annotate this Case

Download PDF

No. 13228 I N THE SUPREME COURT O F THE STATE O MONTANA F 1977 DONALD WHITAKER, DOUGLAS WHITAKER, and G A E M. WHITAKER, R C P l a i n t i f f s and R e s p o n d e n t s , FARMHAND, I N C . , H L W. B I C K , A a c o r p o r a t i o n , and D e f e n d a n t s and A p p e l l a n t s . Appeal from: D i s t r i c t Court of t h e Seventeenth J u d i c i a l D i s t r i c t , Honorable Thomas Dignan, J u d g e p r e s i d i n g . C o u n s e l o f Record: For Appellants: Moulton, B e l l i n g h a m , Longo and M a t h e r , B i l l i n g s , Montana Ward Swanser a r g u e d , B i l l i n g s , Montana L-L~ I-~ly I bl __I F o r Respondents : R o b e r t H u r l y a r g u e d , Glasgow, Montana John M. K l i n e , M i l e s C i t y , Montana Submitted: Decided. May 4 , 1977 Hon. P e t e r G . Meloy, D i s t r i c t Judge, s i t t i n g f o r M r . J u s t i c e Frank I . Haswell, d e l i v e r e d t h e Opinion of t h e Court. This i s an a p p e a l by defendants from a judgment of t h e d i s t r i c t c o u r t , P h i l l i p s County, i n f a v o r of p l a i n t i f f s . The l i t i g a t i o n a r i s e s from t h e s a l e of a c i r c u l a r s p r i n k l i n g i r r i g a t i o n system t o p l a i n t i f f s by d e f e n d a n t s . The d i s t r i c t c o u r t found f o r p l a i n t i f f s . The i s s u e s p r e s e n t e d f o r review a r e : A. Did t h e d i s t r i c t c o u r t e r r i n f i n d i n g l i a b i l i t y on b e h a l f of Bick and Farmhand, I n c . i n s t r i c t l i a b i l i t y , n e g l i g e n c e i n d e s i g n , manufacture and i n s t a l l a t i o n , b r e a c h of w a r r a n t i e s , and t h e implied warranty of f i t n e s s ? B. Did t h e c o u r t e r r i n r e j e c t i n g t h e d i s c l a i m e r o f warranty and damages p r o v i s i o n of t h e warranty and c o n t r a c t . C. Did t h e d i s t r i c t c o u r t e r r i n n o t applying t h e p r o p e r measure of damages t o a commercial l o s s c a s e ? P l a i n t i f f s a r e Donald Whitaker, Douglas Whitaker and Grace Whitaker, farm owners i n P h i l l i p s County, Montana. Defendants a r e Farmhand, I n c . , and Hal. W. E i c k , Farmhand's e x c l u s i v e dealer i n the area. I n May 1972 p l a i n t i f f s i n s t i g a t e d t h i s s u i t a g a i n s t d e f e n d a n t s f o r b r e a c h of w a r r a n t i e s , n e g l i g e n c e i n d e s i g n and i n s t a l l a t i o n , and s t r i c t l i a b i l i t y , a l l having t o do w i t h a Farmhand i r r i g a t i o n system which p l a i n t i f f s bought through Bick. Bick counterclaimed f o r an amount a l l e g e d due from p l a i n t i f f s and crossclaimed f o r indemnity from Farmhand. P r i o r t o t r i a l Bick and Farmhand s t i p u l a t e d t h a t i f l i a b i l i t y i s found, t h e y would be l i a b l e i n t h e f o l l o w i n g manner: 25% Bick and 75% Farmhand, w i t h a t o t a l maximum l i a b i l i t y a g a i n s t Bick of $20,000. 1975. A nonjury t r i a l was h e l d commencing on February 1 7 , A t t h e c l o s e of t r i a l t h e p a r t i e s submitted proposed f i n d i n g s of f a c t and c o n c l u s i o n s of law t o t h e c o u r t . The c o u r t adopted t h e p l a i n t i f f s ' proposed f i n d i n g s and c o n c l u s i o n s and e n t e r e d judgment f o r p l a i n t i f f s . by d e f e n d a n t s was denied. A motion f o r a new t r i a l made Bick and Farmhand s t i p u l a t e d t h a t armh hand's a t t o r n e y would p e r f e c t t h i s a p p e a l f o r b o t h d e f e n d a n t s . ~ l a i n t i f f s 'ranch c o n s i s t s of 6,280 a c r e s of deeded land and 2,000 a c r e s of l e a s e d l a n d . P r i o r t o t h e purchase o f t h e i r r i g a t i o n system, p l a i n t i f f s farmed 1,000 a c r e s and a n o t h e r 1,000 acres was i r r i g a t e d by a f l o o d and d i k e i r r i g a t i o n system. Before t h e purchase of t h e i r r i g a t i o n system t h e 1,000 a c r e s t h a t was i r r i g a t e d was roughly divided---200 a c r e s i r r i g a t e d p a s t u r e , 250 a c r e s a l f a l f a , and 600 a c r e s hay and a l f a l f a . Also p r i o r t o t h e system p l a i n t i f f s c a r r i e d approximately 400 head of c a t t l e and 100 head of sheep. P l a i n t i f f s f i r s t became i n t e r e s t e d i n o b t a i n i n g a s p r i n k l e r i r r i g a t i o n system i n about 1964. They wrote t o s e v e r a l companies and o b t a i n e d l i t e r a t u r e about s e v e r a l b r a n d s . I n t h e s p r i n g of 1969 t h e y f i r s t c o n t a c t e d Farmhand r e q u e s t i n g i n f o r m a t i o n about i t s systems. Farmhand s e n t p l a i n t i f f s a brochure on i t s i r r i g a t i n g systems and arranged f o r Bick, i t s a u t h o r i z e d d e a l e r , t o c o n t a c t them. The brochure r e p r e s e n t e d and d e s c r i b e d t h e system a s : (1) It h a s p o r t a b l e , ( 2 ) i t would provide f a l l p a s t u r e , ( 3 ) l i t t l e o r no l a n d p r e p a r a t i o n was n e c e s s a r y , (4) i t was dependable, (5) i t was s a f e , ( 6 ) i t was t r o u b l e f r e e , and (7) i t had a long l i f e . On September 1 5 , 1969, Bick came t o p l a i n t i f f s ' ranch t o t a l k about Farmhand's systems. A t t h i s time Bick made r e p r e s e n t a t i o n s about t h e system, i . e . , how i t was designed t o be p o r t a b l e , e t c . P l a i n t i f f s took Bick on a t o u r of t h e i r farm and t o l d Bick of t h e i r p l a n s f o r two c i r c l e s of s p r i n k l e r i r r i g a t i o n . Plaintiffs a l s o took Bick t o meet t h e i r banker t o d i s c u s s t h i s p r o j e c t . At a l a t e r d a t e Eick took p l a i n t i f f s and t h e i r banker on a t r i p t o s e e some Farmhand systems i n o p e r a t i o n . They saw s e v e r a l Farmhand sys tems , b u t none had towing wheels. P l a i n t i f f s t h e n h i r e d Bick t o do survey work n e c e s s a r y f o r s e t t i n g up t h e two c i r c l e s - f o r i r r i g a t i o n . Bick was t o b i l l p l a i n t i f f s $500 f o r t h e survey work i n t h e event p l a i n t i f f s d i d n o t purchase t h e system. I f p l a i n t i f f s decided t o buy t h e system, t h e work was t o be f r e e . On October 1 5 , 1969, p l a i n t i f f s c o n t r a c t e d w i t h Bick t o buy t h e Farmhand 18 tower towable i r r i g a t i o n system. There i s some c o n f l i c t a s t o whether t h i s was an o r a l o r w r i t t e n c o n t r a c t . P l a i n t i f f s a t t h a t time made a down payment of $11,715. amount of t h e c o n t r a c t was $45,800. The t o t a l The Farrrrhand system i t s e l f was $25,540. The b a l a n c e was f o r pump, e n g i n e , p i p e and i n s t a l l a tion. Most of t h e i n s t a l l a t i o n work was t o be done by Bick and h i s crew b u t p l a i n t i f f s agreed t o do some of t h e work t o keep t h e c o s t down. E i c k o r d e r e d t h e system from Farmhand, complete w i t h towing wheels. The system a r r i v e d a t ~ l a i n t i f f s ' farm i n November 1969, w i t h o u t t h e towing wheels. B i c k ' s crew, under Farmhand s u p e r - v i s i o n , f i n i s h e d t h e m a j o r i t y of t h e e r e c t i o n of t h e machine i n November 1969. Weather prevented f i n i s h i n g . The Farmhand w a r r a n t y was c o n t a i n e d i n t h e o p e r a t o r ' s manual which a r r i v e d a t t h e time t h e system a r r i v e d , subsequent t o t h e i n i t i a l c o n t r a c t . On December 1 5 , 1969, t h e o r i g i n a l c o n t r a c t was r e p l a c e d by a formal w r i t t e n c o n t r a c t . these contracts. P l a i n t i f f s p a i d $43,272.52 on P r i o r t o e i t h e r c o n t r a c t w i t h Farmhand, p l a i n t i f f s c o n t r a c t e d t o s e l l t h e a l f a l f a o f f o f t h e proposed south c i r c l e , beginning i n 1971 f o r $12 p e r ton i n 1971 and 1972, and $25 p e r ton i n 1973 and 1974. Bick' s crew and p l a i n t i f f s completed e r e c t i o n o f t h e machine i n t h e s p r i n g of 1970. The system, w i t h o u t t h e towing mechanism, was f i r s t s t a r t e d i n May 1970 on t h e n o r t h c i r c l e . Immediately i t was discovered t h e Cummin's pump engine and i m p e l l e r were too s m a l l , a s was t h e p r o p e l l i n g engine. Bick replaced t h e p r o p e l l i n g engine a t no c o s t t o p l a i n t i f f s and ordered a l a r g e r Cummin's pump engine and i m p e l l e r . The i m p e l l e r was t o be f r e e t o p l a i n t i f f s and t h e pump engine was t o be r e p l a c e d f o r $880. A t t h i s time a d i s p u t e a r o s e between p l a i n t i f f s and Bick. The d i s p u t e concerned t h e amount of work i n e r e c t i n g t h e system c o n t r i b u t e d by p l a i n t i f f s and t h e amount done by Bick; it a l s o concerned $3,267 withheld by p l a i n t i f f s from t h e c o n t r a c t p r i c e . This was never res6lved and p l a i n t i f f s r e f u s e d t o pay t h e a d d i t i o n a l $880 f o r t h e l a r g e r pump engine. Bick t h e n s e n t t h e new pump engine and i m p e l l e r back and r e f u s e d any f u r t h e r s e r v i c e t o p l a i n t i f f s . P l a i n t i f f s t h e r e a f t e r d i d b u s i n e s s d i r e c t l y w i t h Farmhand. Throughout t h e summer of 1970, t h e system only made 5 rotations. During each of t h e s e r o t a t i o n s t h e system s t u c k i n t h e d i t c h which Bick designed. Farmhand personnel came t o a s s i s t p l a i n t i f f s on two occasions during t h a t summer. The towing system a r r i v e d i n t h e s p r i n g of 1971. The system was n o t complete and p l a i n t i f f s had t o manufacture some p a r t s on t h e i r own. A Farmhand crew came t o p l a i n t i f f s ' farm i n t h e s p r i n g of 1971 t o do some r e p a i r work on t h e system. P l a i n t i f f s planted t h e south c i r c l e i n a l f a l f a t h a t spring, a y e a r l a t e r t h a n o r i g i n a l l y planned. On t h e f i r s t a t t e m p t t o move t h e system from t h e n o r t h c i r c l e , where i t had been, t o t h e s o u t h c i r c l e , p l a i n t i f f s n o t i c e d s u b s t a n t i a l damage caused by t h e move. The machine was moved twice more d u r i n g 1971, back t o t h e n o r t h c i r c l e and back a g a i n t o t h e s o u t h c i r c l e . l a s t move was some time i n J u l y . The During each of t h e s e moves, t h e machine was damaged and needed s u b s t a n t i a l r e p a i r b e f o r e it could be used. I n l a t e J u l y 1971, p l a i n t i f f s a t t e n d e d a meeting i n B i l l i n g s w i t h Farmhand r e p r e s e n t a t i v e s and Bick. The meeting was t o work o u t problems w i t h t h e system and a l s o t h e problems between Bick and p l a i n t i f f s . A t t h i s meeting Farmhand r e p r e s e n t a t i v e s t o l d p l a i n t i f f s t h e towing mechanism was n o t working p r o p e r l y and t h e machine should n o t be towed. To p r o v i d e f o r p l a i n t i f f s ' need f o r i r r i g a t i o n on t h e second c i r c l e Farmhand a t t h i s meeting o f f e r e d t o s e l l p l a i n t i f f s a new Farmhand system f o r t h e reduced c o s t o f $26,500 complete. a n d / o r t h e i r banker. T h i s o f f e r was r e j e c t e d by p l a i n t i f f s The system was used i n t h e s o u t h c i r c l e d u r i n g t h e y e a r s 1972 and 1973, when i t was towed o u t t o make room f o r a new Valley system. I n e a r l y 1972, Farmhand o f f e r e d t o s e l l p l a i n t i f f s a used Farmhand system f o r t h e i r second c i r c l e f o r $10,000 on a 50% recourse basis. T h i s o f f e r , t o o , was r e j e c t e d by p l a i n t i f f s and/or t h e i r banker. From t h i s p o i n t on p l a i n t i f f s ' r e l a t i o n - s h i p w i t h Farmhand d i s i n t e g r a t e d . They never c o n t a c t e d Farmhand f o r a d d i t i o n a l s e r v i c e , n o r d i d Farmhand t e n d e r any s e r v i c e o r f u r t h e r proposals. - 6 - l i a b i l i t y , n e g l i g e n c e i n d e s i g n , a a n u f a c t u r e and i n s t a l l a t i o l ~ , breach of e x p r e s s w a r r a n t i e s , and t h e implied warranty of f i t n e s s . dc w i l l d i s c u s s t h e s e i n o r d e r . Z. Strict liability. T h i s t h e o r y f i r s t came i n t o being because of t h e problem sf i:he l a c k of p r i v i t y i n warranty c a s e s . 2 Restatement of T o r t s %d accepted t h i s t h e o r y i n $ 402A which r e a d s : " ( 1 ) One who s e l l s any product i n a d e f e c t i v e c o n d i t i o n unreasonably dangerous t o t h e u s e r o r consumer o r t o h i s p r o p e r t y I s s u b j e c t t o l i a b i l i t y f o r p h y s i c a l harm t h e r e b y caused t o t h e u l t i m a t e ~ i s e ro r consumer o r t o h i s p r o p e r t y , i f " a ) t h e s e l l e r i s engaged i n t h e b u s i n e s s of .jeLLi~lgsuch a p r o d u c t , and "b) i t i s expected t o and does r e a c h t h e u s e r . ~ zoilsumer w i t h o u t s u b s t a n t i a l change i n t h e c o n d i t i o n r In which i t i s s o l d . (2) The r u l e s t a t e d i n Subsection (1) a p p l i e s d Lthough L d i e " a ) t h e s e l l e r has e x e r c i s e d a l l p o s s i b l e i-n t h e p r e p a r a t i o n and s a l e of h i s p r o d u c t , and b The u s e r o r consumer h a s n o t bought t h e p i o d u c t from o r e n t e r e d i n t o any c o n t r a c t u a l r e l a t i o n d t h the s e l l e r . " vlo~ltana adopted t h e Restatement i n Brandenburger v. Toyota 3ocor S a l e s , 162 Mont. 506, 513 P.2d 268. T h i s d e c i s i o n provided qzh*t a l t h o u g h t h e burden t o prove t h e d e f e c t i s on t h e p l a i n t i f f , i h i s burden can be met by c i r c u m s t a n t i a l evidence and i n f e r e n c e s c h e r e f rom. W e have b r i e f l y d i s c u s s e d t h e d o c t r i n e of s t r i c t l i a b i l i t y brcdase it was plead and c o n s i d e r e d by t h e t r i a l c o u r t . O n dppeal i t s a p p l i c a t i o n i s claimed a s e r r o r by d e f e n d a n t s . t~ i s n o t r e v e r s i b l e e r r o r when c o n s i d e r e d i n l i g h t of t h e !:acts of t h i s c a s e . A more p r e c i s e l e g a l a n a l y s i s of t h e c a s e ac t h e i n c e p t i o n would more c o r r e c t l y have confined t h e c o u r s e of t h e l i t i g a t i o n w i t h i n t h e bounds d i s c u s s e d h e r e a f t e r , where i t p r o p e r l y belongs and upon which t h i s Court w i l l r e s t i t s determination. 11. Negligence i n d e s i g n , manufacture and i n s t a l l a t i o n . The d i s t r i c t c o u r t i n i t s f i n d i n g of f a c t No. 35(1) found t h a t t h e system "was so n e g l i g e n t l y , c a r e l e s s l y and r e c k l e s s l y manufactured, designed and i n s t a l l e d by t h e d e f e n d a n t s t h a t i t never o p e r a t e d f o r t h e purpose f o r which i t was sold.'' The t h e o r y of n e g l i g e n c e has been a p p l i e d a g a i n s t t h e rernote manufacturer i n s e v e r a l c a s e s , t h e l e a d i n g one MacPherson ".+ v . Buick Motor Co., 382, 1 1 N . E . 1 217 N.Y. 1050. This doctrine has been accepted i n 2 Restatement of T o r t s 2d, $395. Montana hds followed t h i s r u l e i n Knudson v. Edgewater Automotive D i v i - j i o n , 157 Mont. 400, 486 P.2d 596 and Duchesneau v. S i l v e r Bow County, 158 Mont. 369, 492 P.2d 926. The f a c t s h e r e c l e a r l y show such n e g l i g e n c e . !~1. Implied w a r r a n t i e s o f m e r c h a n t a b i l i t y and f i t n e s s f o r s u d r ~ i c u l a rpurpose. The Uniform Commercial Code p r o v i s i o n s f o r t h e s e w a r r a n t i e s a r e 5 e c t i o n 87A-2-314, R.C.M. 3 1 ~ - 2 - 3 1 5 , R.C.M. 1947, f o r m e r c h a n t a b i l i t y and s e c t i o n 1947, f o r f i t n e s s f o r a p a r t i c u l a r purpose. * "Unless excluded o r modified fc 9; a warranty 87A-2-314. t h a t t h e goods s h a l l be merchantable i s implied i n a ~ o n t r a c tf o r t h e i r s a l e i f t h e s e l l e r i s a merchant w i t h r e s p e c t t o goods of t h a t kind. ' fc fc k ( 2 Goods t o be merchantable must be a t l e a s t SUiil dS " ( c ) a r e f i t f o r t h e o r d i n a r y purposes f o r which s ~ 300ds a r e used +c h * hey 87A-2-315. "Where t h e s e l l e r a t t h e time of cont r a c t i n g has reason t o know any p a r t i c u l a r purpose f o r which t h e goods a r e r e q u i r e d and t h a t t h e buyer i s r e l y i n g on t h e s e l l e r ' s s k i l l o r judgment t o s e l e c t o r f u r n i s h s u i t a b l e goods, t h e r e i s u n l e s s excluded o r modified under t h e n e x t s e c t i o n an implied warranty t h a t t h e goods s h a l l be f i t f o r such purpose." Most c o u r t s now follow t h e r u l e s e t f o r t h i n Henningsen v. Bloomfield Motors, I n c . , 32 N . J . 358, l G l A . 2 d 69, which h o l d s t h e remote manufacturer l i a b l e f o r implied w a r r a n t i e s . The evidence s u p p o r t s t h e d i s t r i c t c o u r t ' s f i n d i n g s t h a t such implied w a r r a n t i e s d i d e x i s t and they were breached. IV. Express Warranties. The Uniform Commercial Code, s e c t i o n 87A-2-313, R.C.M. 1947, provides i n p e r t i n e n t p a r t : " ( 1 ) Express w a r r a n t i e s by t h e s e l l e r a r e c r e a t e d a s follows : " ( a ) Any a f f i r m a t i o n of f a c t o r p r ~ m i s emade by t h e s e l l e r t o t h e buyer which r e l a t e s t o t h e goods and becomes p a r t of t h e b a s i s f o r t h e b a r g a i n c r e a t e s a n e x p r e s s warranty t h a t t h e goods s h a l l conform t o t h e a f f i r m a t i o n o r promise. " ( b ) Any d e s c r i p t i o n of t h e goods which i s made a p a r t of t h e b a s i s of t h e b a r g a i n c r e a t e s an e x p r e s s warranty t h a t t h e goods s h a l l conform t o t h e d e s c r i p t i o n . " ( c ) Any sample o r model which i s made p a r t of t h e b a s i s of t h e b a r g a i n c r e a t e s a n e x p r e s s warranty t h a t t h e whole of t h e goods s h a l l conform t o t h e sample o r model. " ( 2 ) I t i s n o t necessary t o t h e c r e a t i o n of an e x p r e s s warranty t h a t t h e s e l l e r use formal words such a s t warrant' o r ' g u a r a n t e e ' o r t h a t he have a s p e c i f i c ; k Jc." i n t e n t i o n t o make a warranty * * Such a f f i r m a t i o n s , promises o r d e s c r i p t i o n s were made by Bick t o p l a i n t i f f s . Such a f f i r m a t i o n s , promises o r d e s c r i p - t i o n s were a l s o s e t f o r t h i n t h e Farmhand brochure. The law appears t o be w e l l s e t t l e d t h a t a remote manufacturer without p r i v i t y w i t h t h e purchaser i s l i a b l e f o r breach of warranty by a d v e r t i s i n g on r a d i o and t e l e v i s i o n , i n newspapers and magazines, and i n brochures made a v a i l a b l e t o p r o s p e c t i v e p u r c h a s e r s , i f t h e purchaser r e l i e s on them t o h i s d e t r i m e n t . Toni Home Permanent Co., Rogers v. 167 Ohio S t . 244, 147 N.E.2d 612; Baxter v . Ford Motor Co., 168 Wash. 456, 12 P.2d 409, 88 A.L.R. 521; Randy Knitwear, I n c . , v. American Cyanamid Co., 1 N.Y.2d 1 181 N.E.2d 399. 5, The Montana c a s e c i t e d by d e f e n d a n t s , Jangula v. United S t a t e s Rubber Co., n o t speak t o t h e p o i n t . 147 Mont. 98, 410 P.2d 462, d i d I n a n o t h e r c a s e c i t e d by d e f e n d a n t s , Jacobson v . Colorado Fuel and I r o n Corp., 409 F.2d 1263, t h e c o u r t h e l d t h a t a statement i n a brochure d i d n o t g i v e r i s e t o an e x p r e s s warranty under every c o n d i t i o n . The c o u r t , however, implied t h a t i t might very w e l l g i v e r i s e t o such a warranty i n some c a s e s . Lander v. Sheehan, 32 Mont. 25, 79 P. 406, h e l d t h a t whether a statement i s t o be t r e a t e d a s a n e x p r e s s warranty i s a f a c t t o be determined by t h e t r i e r of f a c t . The evidence h e r e s u p p o r t s t h e d i s t r i c t c o u r t ' s f i n d i n g t h a t Bick and Farmhand made express w a r r a n t i e s t o p l a i n t i f f s , and t h a t they were breached. Defendants contend t h e c o u r t e r r e d i n r e j e c t i n g t h e d i s c l a i m e r of warranty and damage p r o v i s i o n of t h e warranty and t h e c o n t r a c t . Defendants c l a i m t h a t even i f t h e c o u r t d i d f i n d such implied and e x p r e s s w a r r a n t i e s , they were e f f e c t i v e l y disclaimed by t h e Farmhand warranty contained i n t h e e r e c t i o n manual. They r e l y on s e v e r a l Montana c a s e s which upheld such d i s c l a i m e r s . S t a t e ex r e l . Mountain S t a t e s T e l . & T e l , Co. v. D i s t r i c t Court, 160 Mont. 443, 503 P.2d 526; Ryan v. Ald, I n c . , 146 Mont. 299, 406 P.2d 373; Spurgeon v. Jamieson Motors, 164 Mont. 296, 521 P.2d 924; R i e f f l i n v. H a r t f o r d I n s . Co., 164 Mont. 287, 521 675. See a l s o : S e c t i o n 87A-2-719, R.C. M. - 10 - 1947. The q u e s t i o n b e f o r e t h i s Court i s n o t t h e v a l i d i t y and e n f o r c e a b i l i t y of such d i s c l a i m e r s , r a t h e r i t i s t h e t i m e l i n e s s of t h e d i s c l a i m e r . The express and implied w a r r a n t i e s were made t o p l a i n t i f f % p r i o r t o t h e e n t e r i n g i n t o of t h e c o n t r a c t on October 1 5 , 1969. P l a i n t i f f d i d n o t and could n o t know of t h e d i s c l a i m e r u n t i l November 1969, v~hent h e e r e c t i o n manual came with t h e machine. A d i s c l a i m e r o r l i m i t a t i o n of warranty contained i n a manufacturer's manual received by t h e purchasers subsequent t o t h e s a l e does n o t l i m i t recovery f o r implied o r e x p r e s s w a r r a n t i e s made p r i o r t o o r a t t h e time of t h e s a l e . Power Shovel Co. v. Huntsman, 246 Ark. 152, 437 S.W.2d Marion 784; Cooper P a i n t i n g s & Coatings, I n c . , v . S M Corp., 62 Tenn.App. C 1 3 , 457 S.W.2d 864; Rehurek v. Chrysler C r e d i t Corp., F l a J@G . 262 2 So.2d 452; Dougall v. Brown Bay Boat Works and S a l e s , I n c . , 287 Minn. 290, I78 N.W.2d 217. Even i f t h e Farmhand d i s c l a i m e r had been made p r i o r t o t h e s a l e , such d i s c l a i m e r would n o t have been e f f e c t i v e t o d e s t r o y t h e e x p r e s s w a r r a n t i e s made i n t h e brochure and by Bick. Anderson Uniform Commercial Code, $ 2-316:28, In 1 p. 698, it i s stated: "When t h e r e i s a c o n f l i c t between a s p e c i f i c e x p r e s s warranty and a c l a u s e which i n g e n e r a l language exc l u d e s a l l w a r r a n t i e s , t h e s p e c i f i c warranty p r o v i s i o n prevails ." Nor w i l l a d i s c l a i m e r of warranty s t o p a purchaser from recovering on s t r i c t l i a b i l i t y . 2 Restatement of T o r t s 2d, 5 402A, Comment m; Arrow T r a n s p o r t a t i o n Co. v. Fruehauf Corp., The d i s t r i c t c o u r t found t h e implied and express w a r r a n t i e s made by Bick and Farmhand remained v a l i d and e n f o r c e a b l e . agree. - I1 - W e Defendants contenj. i f t h e r e i s l i a b i l i t y and daniages a l l o s ~ e df o r l o s s of p r o d u c t i o n such a r e not proper a f t e r t h e y e a r 1971, t h e time t h e defendants c l a i m t h e system would n o t s e r v e t h e purpose f o r which i t was purchased. I t i s t h e law of Montana t h a t c o n s e q u e n t i a l damages cannot a c c r u e p a s t t h e time t h e i n j u r e d p a r t y h a s knowledge of t h e f a i l u r e of t h e equipment and a r e a s o n a b l e time t h e r e a f t e r w i t h i n which t o make o t h e r arrangements. Such i s t h e e f f e c t of t h e d e c i s i o n of Bos v. Dolajak, 167 Mont. 1, 7 , 534 P.2d 1258. The r e a s o n a b l e man r u l e of damages i s a p p l i e d i n Baden v . C u r t i s s Breeding S e r v i c e , 380 F.Supp. Co., 243. Spackman v. Ralph M. Parsons 147 Mont. 500, 414 P. 2d 918, p o i n t s o u t t h a t i n awarding compensatory damages ingenious methods have been propounded and: "a +f * while such methods s e r v e a s u s e f u l g u i d e s , t h e f i n a l answer r e s t s i n good s e n s e r a t h e r t h a n mechanical a p p l i c a t i o n of formulas." 147 Mont 506. . I n t h i s r e s p e c t t h e d i s t r i c t c o u r t made i t s f i n d i n g of f a c t , No. 46: "That P l a i n t i f f s made r e a s o n a b l e e f f o r t t o g e t said Farmhand system t o i r r i g a t e b o t h t h e i r f i e l d s and t o g e t t h e Defendants t o f i x s a i d system S O i t would i r r i g a t e b o t h f i e l d s ; t h a t when t h e y once d e t e r mined t h a t t h e Defendants would n o t f i x s a i d machine L O i r r i g a t e b o t h f i e l d s , they made r e a s o n a b l e e f f o r t s t o a c q u i r e o t h e r means of i r r i g a t i o n ; and they d i d a c q u i r e one o t h e r p i v o t i r r i g a t i o n system; t h a t t h e i r f i n a n c i a l c o n d i t i o n prevented them from a c q u i r i n g t h a t i r r i g a t i o n system any sooner; and t h e i r f i n a n c i a l c o n d i t i o n p r e v e n t s them from a c q u i r i n g a second i r r i g a t i o n system up t o and i n c l u d i n g t h e d a t e of t r i a l ; t h a t P l a i n t i f f s have done e v e r y t h i n g reasonably r e q u i r e d of them t o cover and t o m i t i g a t e t h e i r damages ' I . The i n s t a n t c a s e i s n o t u n l i k e t h e f a c t u a l s i t u a t i o n of Bos v . Doiajalc, s u p r a , where t h e Court found t h a t t h e s i l o 1 'was a 1 i . t e r n of p r o p e r t y w i t h s p e c i a l c h a r a c t e r i s t i c s . It c o u l d n o t b e r e p l a c e d t h e n e x t day a t t h e l o c a l hardware s t o r e o r automobile d e a l e r s h i p .!' Here, t h e p l a i n t i f f s were engaged i n a l a r g e a g r i c u l t u r a l b u s i n e s s and wanting t o improve product i o n c o n t r a c t e d f o r a complete new method of p r o d u c t i o n of hay. To accomodate t h e new method defendant Bick surveyed t h e premises and made t h e n e c e s s a r y recommendations which r e q u i r e d t h e removal of t h e o l d d i k e and f l o o d system and d i t c h e s . I n r e l i a n c e on t h e contemplated i n c r e a s e i n hay p r o d u c t i o n p l a i n t i f f s c o n t r a c t e d t o s e l l t h e hay t o be produced. Concerning t h e d a t e p l a i n t i f f s became aware t h e machine would n o t work, i t a p p e a r s t h a t u n t i l t h e f a l l of 1973 p l a i n t i f f s w i t h t h e urging of d e f e n d a n t s attempted t o make t h e machine s e r v e t h e purpose f o r which i t was designed and s o l d . There was no evidence produced by d e f e n d a n t s a s t o t h e e f f o r t s upon t h e p a r t of p l a i n t i f f s t o m i t i g a t e . The burden of proof a s t o m i t i g a t i o n i s upon t h e d e f e n d a n t s . & Son v . Reber Plumbing & h e a t i n g Co., Klemens 139 Mont. 115, 360 P.2d 1005. T h i s burden i n c l u d e s e s t a b l i s h i n g t h a t p l a i n t i f f s could have m i t i g a t e d t h e damages b u t f a i l e d t o do s o . See: LTV Aerospace Corp. v . Bateman, Tex.Am1973, 492 S.W.2d 703. There i s s u b s t a n t i a l evidence t h e p l a i n t i f f s d i d n o t have the f i n a n c i a l c a p a b i l i t y t o acquire other s a t i s f a c t o r y devices t o accomplish t h e purpose f o r which t h e y a r r a n g e d t h e i r o p e r a t i o n a s designed by t h e d e f e n d a n t s u n t i l a f t e r t h e 1974 season. The d i s t r i c t c o u r t so found. T h i s Court i s a n a p p e l l a t e c o u r t and i s c o n f i n e d t o t h e r e c o r d made b e f o r e t h e d i s t r i c t c o u r t . The f i n d i n g s of f a c t and c o n c l u s i o n s of law of t h e d i s t r i c t judge who heard t h e w i t n e s s e s t e s t i f y , a r e t o be s u s t a i n e d i f t h e r e i s s u b s t a n t i a l c r e d i b l e e v i dence t o s u p p o r t them. Bender v. Bender, 144 Mont. 470, 397 P.2d 957; Spencer v. Robertson, 151 Mont. 507, 445 P.2d 48; Cope v. Cope, 158 Mont. 388, 493 P.2d 336.. The r e c o r d h e r e d i s c l o s e s s u b s t a n t i a l evidence t o s u p p o r t t h e d i s t r i c t c o u r t ' s f i n d i n g s , c o n c l u s i o n s and judgment. The judgment i s a f f i r m e d I . Haswell. W Concur: e . Chief J u s t i c e I \

Some case metadata and case summaries were written with the help of AI, which can produce inaccuracies. You should read the full case before relying on it for legal research purposes.

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.