Plateq Corp. Of North Haven v. Machlett Labs, Inc

456 A.2d 786 (1983)

Purchase the Printed Copy at bsmsphd.com

Nature of the Case

To access this section all you need to do is click here and register.

Facts

Machlett (D) ordered from Plateq (P) two lead covered steel tanks. The tanks were designed for testing x-ray tubes and were required to be radiation proof as per federal standards. The contract provided that the tanks would be tested for radiation leaks after installation at D’s premises. P accepted the liability for any defects that post-installation testing might uncover. P had never done this type of business before, and D had never designed such tanks before. P encountered difficulties, and D only called the delays to P’s attention. Eventually, the tanks were completed, and D’s engineer noted some remaining deficiencies, but P promised to fix them and deliver the next day. There was no indication that D was upset. D’s engineer led P to believe that D’s truck would pick up the tanks. Instead, D sent notice of cancellation. P got it three days later on October 11. The notice had no particular grounds for the cancellation. P sued D for damages measured by the contract price and incidental damages for a wrongful cancellation. The trial court determined that D had accepted the tanks under the UCC 2-606 (1)(a) and (1)(b). The court reasoned that D could have then rejected under 2-608 only by showing substantial impairment of value which had not been proven at trial. Under 2-703 and 709(1)(b), P got a recovery of $14,837.92. D appealed.