Opinion
Civil No. 2:99cv3
June 7, 2000
MEMORANDUM AND ORDER
Defendant Browning Enterprises, Inc. and FabTech, a division of Browning Enterprises, Inc. (hereinafter "FabTech") brought a motion for partial summary judgment, requesting this court dismiss the negligence claim asserted by the plaintiff, Vigen Construction, Inc. (hereinafter "Vigen"), as well as plaintiff's claim for damages as it relates to particular claimed defects due to lack of proper notice of the same (Doc. #16). Plaintiff opposed the motion (Doc. #19). In its opposition to the motion plaintiff conceded the Uniform Commercial Code applies to this transaction, and the court has evaluated the case accordingly. Just prior to the Final Pretrial and Settlement Conference conducted by the court the parties were advised of the court's intention to grant summary judgment to the defendant on the negligence claim and deny summary judgment on the basis of defective notice. This memorandum and order memorializes the court's order.
Summary Judgment Standard
Summary judgment is appropriate if there is not a genuine issue of material fact and the moving party is entitled to judgment as a matter of law. Fed.R.Civ.Pro. 56(c); Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986). Rule 56 of the Federal Rules of Civil Procedure "mandates the entry of summary judgment . . . against a party failing to make a showing sufficient to establish the existence of an element essential to that party's case." Celotex, 477 U.S. at 322. If the moving party has supported its motion for summary judgment, the nonmoving party has an affirmative burden placed on it to go beyond the pleadings and show a genuine triable issue of fact. Commercial Union Ins. Co. v. Schmidt, 967 F.2d 270, 271 (8th Cir. 1992). However, the court considering a motion for summary judgment must view the evidence in the light most favorable to the nonmoving party who enjoys "the benefit of all reasonable inferences to be drawn from the facts." Vacca v. Viacom Broadcasting of Missouri, Inc. Et al., 875 F.2d 1337, 1339 (8th Cir. 1989) (citation omitted).
Summary judgment is improper if the court finds a genuine issue of material fact; however, "the mere existence of some alleged factual dispute between the parties will not defeat an otherwise properly supported motion for summary judgment. . . ." Commercial Union Insurance Co. v. Schmidt, 967 F.2d 270, 271-72 (8th Cir. 1992) (citation omitted). The issue is whether "the evidence is sufficient to allow a reasonable jury to return a verdict for the nonmoving party." Landon v. Northwest Airlines, Inc., 72 F.3d 620, 624 (8th Cir. 1995).
Brief Factual Background
In October 1997 Vigen began work on the construction of a flour mill in Fairmount, North Dakota. Vigen contracted with FabTech to fabricate, manufacture, assemble and deliver steel flour hoppers for installation as components of the mill, to be constructed in accordance with specifications and shop drawings provided by Vigen to FabTech. The parties entered into a contract on or about April 2, 1998.
Shortly after commencement of the fabrication of the flour hoppers, FabTech experienced some problems in keeping the "square to round" hoppers round. FabTech notified Vigen of the problems and suggested replacing the specified flat bar flange with an angle ring flange. Due to time constraints, Vigen demanded the hoppers be shipped immediately, despite the fabrication deficiencies identified. The hoppers were shipped as directed on June11 and June 16. On June 17, Vigen informed FabTech by facsimile that "the flanges are 2 +" out of round [and] vertically they wave up to 1 +"." The facsimile also advised that "the holes in the flanges may also be a problem." By facsimile dated June 24, 1998 FabTech advised Vigen that it could get the angle ring flanges fabricated in 8 days. On July 1, 1998 Vigen corresponded with Fab Tech, advising "the hoppers we purchased from you for our project in Fairmount, North Dakota arrived in an unacceptable condition." The letter contains a discussion of the problems with the "square to round" hoppers as well as the "square to square" hoppers. Discussions ensued, culminating in a FabTech representative traveling to Fairmount to inspect the site. Reworking of the hoppers had already commenced by the time of his arrival. The parties agreed that Vigen would fix the hoppers on site and backcharge the cost to FabTech. At that time Vigen estimated it would cost approximately $2,500 to $3,000 each to repair 10 of the "square to round" hoppers, for a total backcharge of $25,000 to $30,000. Vigen still owed FabTech $27,000. Thus, based on Vigen's "guess," FabTech expected a "wash." Instead, in December 1998 FabTech received an invoice from Vigen in the amount of $112,055.44, less the amount remaining due FabTech from Vigen of $27,000, for a total amount claimed due of $84,455.44. The work identified on the invoice was "Reconstruct hoppers listed on drawing SM45, SM46 and SM49 at the [Fairmount, ND location]." FabTech refused to remit the invoice amount. After the parties were unable to resolve their differences, Vigen commenced this action on January 19, 1999.
FabTech fabricated two types of hoppers for Vigen. One is identified as a "square to round" hopper, in which the upper portion of the hopper is square to mate with a square concrete bin and the bottom portion is round to connect with a flour bin discharger. The other type of hopper is a "square to square" hopper.
Vigen asserts the hoppers were to be delivered in mid March, 1998 and were received approximately 3 months late, necessitating their immediate installation in order to complete the project on time.
FabTech's motion for summary judgment seeks dismissal of Vigen's claims relating to alleged deficiencies in the top portion of the "square to round" flour hoppers and in the "square to square" hoppers for lack of timely notice as required by N.D. Cent. Code § 41-02-70 [U.C.C. § 2-607]. FabTech also seeks dismissal of Vigen's claims of negligence because there is no independent duty to support the negligence claim.
Negligence
Vigen asserts a claim for damages for defendant's negligence in the manufacture, fabrication and assembly of the steel flour hoppers. Complaint IX. However, the basis for the action stems directly from the contractual claims of breach of expressed and implied warranties and plaintiff's damages, if any, are a direct consequence of such alleged breach. The North Dakota Supreme Court, in Dakota Grain Co., Inc. v. Ehrmantrout, 502 N.W.2d 234 (N.D. 1993), recognized that there is no reason to mix contract and tort theories and unnecessarily complicate the action in a classic breach of warranty case such as this. In so holding the Court held:
[T]he seller's negligence, or lack of negligence, is not relevant to the question of whether the seller breached his or her express warranty to deliver conforming goods. A mere breach of contract does not, by itself, furnish a basis for liability in tort for negligence. Conduct that constitutes a breach of contract does not subject the actor to an action in tort for negligence, unless the conduct also constitutes a breach of an independent duty that did not arise from the contract.Dakota Grain Co., Inc., 502 N.W.2d at 236-37 (citations omitted). Thus, in order for Vigen to maintain the negligence claim, plaintiff must show a breach of independent duty. This it has failed to do. Plaintiff has not plead or presented any facts giving rise to an independent duty apart from those which arise directly from the alleged breach of the contract between Vigen and FabTech. Therefore, defendant FabTech's motion to dismiss Vigen's negligence claim is GRANTED.
Notice of Alleged Defects
Defendant FabTech has requested summary judgment dismissing plaintiff Vigen's claim for damages arising out of alleged defects in the top portion of the "square to round" hoppers and in the "square to square" hoppers on the basis that plaintiff failed to give adequate notice of the alleged deficiencies in accordance with N.D. Cent. Code § 41-02070(3)(a). This section states, in relevant part:
3. If tender has been accepted:
a. The buyer must within a reasonable time after the buyer discovers or should have discovered any breach notify the seller of breach or be barred from any remedy.
N.D. Cent. Code § 41-02-70(3)(a) (1999).
Although it does appear from the existing record before this court that some notice may have been given of the nonconforming nature of the flour hoppers, this court is not inclined to "carve out" the notice of a particular problem and determine the sufficiency of such notice on the present record. The adequacy and timeliness of the notice of alleged defects are factual inquiries best left to the jury to decide at the time of trial. Stamper Black Hills Gold Jewelry v. Souther, 414 N.W.2d601, 605 (N.D. 1987); Industrial Fiberglass v. Jandt, 361 N.W.2d 595, 598 (N.D. 1985) (`the sufficiency of notice and what constitutes a reasonable time within which to give notice of breach of warranty are ordinarily questions of fact"). Defendant's motion to dismiss on the basis of insufficient notice is DENIED.
The defendant argues that a higher standard of notice would apply to the transaction because Vigen and FabTech are both merchants. Stamper Black Hills Gold Jewelry v. Souther, 414 N.W.2d 601, 605 (N.D. 1987) (citing Industrial Fiberglass v. Jandt, 361 N.W.2d 595, 598 (N.D. 1985)). The court agrees, but for the reasons stated herein will not determine at this juncture whether the notice given by the plaintiff was adequate, under any standard.
IT IS ORDERED:
1. Defendant's Motion to Dismiss Plaintiff's Negligence Claim is GRANTED (Doc. #16);
2. Defendant's Motion to Dismiss Plaintiff's Claim for Damages arising out of alleged defects in the top portion of the "square to round" hoppers and in the "square to square" hoppers on the basis of failure to give adequate notice is DENIED (Doc. #16).
Dated this __ day of June, 2000.