A&M Produce Co. v. Fmc Corporation

186 Cal.Rptr. 114 (1982)

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Nature of the Case

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Facts

A& M(P) decided to get into the tomato business. They researched machines and took bids from two different companies. The Decco bid was approximately $68,000 and included a variable speed machine with a cooler. The FMC machine did not need a cooler because it operated so fast and cost about $32,000. Contracts were signed with FMC (D) that included a clause for disclaimer of consequential damages. The equipment was installed and did not work as advertised and overflow tomatoes had to be sent through the machinery twice causing damage to the crop because there was no cooler. D worked the problem out by starting and stopping the machine but that significantly reduced processing speed and D's equipment did not have a variable speed control like Decco's did. P tried to mitigate losses but was unsuccessful, and most of the tomatoes were rejected as cannery tomatoes. P offered to return the machine to D if D would refund the down payment and pay the freight charges. D refused. P sued D for damages for breach of express warranties, implied warranty and misrepresentation. The court held the disclaimer of warranty unconscionable and then the jury returned a verdict for P of $281,326. The court found for D on a cross-complaint but awarded P $45,000 in attorney fees and prejudgment interest.