Opinion
CA 99-0979-C.
October 12, 2000.
JUDGMENT
In accordance with the order entered on this date, it is hereby ORDERED, ADJUDGED, and DECREED that the defendants' motions for summary judgment be GRANTED, that plaintiff's complaint be DISMISSED WITH PREJUDICE, and that the costs of this action be taxed to the plaintiff.
MEMORANDUM OPINION AND ORDER
This cause is before the Court on the defendants' motions for summary judgment (Docs. 20 23; see also Docs. 21 24 (briefs in support of the motions for summary judgment)), the plaintiff's briefs in opposition to the summary judgment motions (Docs. 32 33), and the defendants' reply briefs (Docs. 34 35). The parties have consented to the exercise of jurisdiction by the Magistrate Judge, pursuant to 28 U.S.C. § 636(c), for all proceedings, including disposition of these motions. ( See Doc. 9 ("In accordance with the provisions of 28 U.S.C. § 636(c) and Fed.R.Civ.P. 73, the parties in this case consent to have a United States Magistrate Judge conduct any and all proceedings in this case, including the trial, and order the entry of a final judgment, and conduct all post-judgment proceedings.")) Upon consideration of the contents of the briefs and all pertinent materials submitted in support of the briefs, the Court GRANTS the motions for summary judgment on plaintiff's claims and ORDERS that plaintiff's complaint be DISMISSED WITH PREJUDICE.
Any appeal taken from this memorandum opinion and order and judgment shall be made to the Eleventh Circuit Court of Appeals. ( See Doc. 9 ("An appeal from a judgment entered by a Magistrate Judge shall be taken directly to the United States Court of Appeals for this judicial circuit in the same manner as an appeal from any other judgment of this district court."))
FINDINGS OF FACT
1. It is clear that from approximately August 8 or 9, 1991 until at least June of 1994, John Deere heard and addressed some complaints from its dealers and customers regarding the 648-E skidder's hydraulic system, including overheating problems. (Doc. 32, Exhibit 1, Deposition of Dennis Helmle in Martin v. John Deere Industrial Equipment Co., CV-96-865 (Walker County, Alabama) and Ivey v. John Deere Industrial Equipment Co., CV-96-862 (Walker County, Alabama), at 26-29 31-34) John Deere's August 8 or 9, 1991 service newsletter to dealers addressed a complaint of "oil leaks from the hydraulic pump between the displacement control valve and pump housing[,]" ( id. at 32), and made some suggestions about how to go about fixing that particular complaint ( see id. at 66). The manufacturer's November 12, 1992 service newsletter addressed the following complaints: "Hydraulic system improvements and hard starting, complaint or symptom number one, hydraulic system has high pressure spikes. Number two, machine starts hard, engine turns over slowly. . . . Number three, arch and boom cylinders cavitate. Number four, hydraulic system gets hot and hydraulics slow." ( Id. at 71-72) John Deere's recommendations in response to these complaints, however, did not fix the hydraulic overheating problem. ( Id. at 72) Finally, John Deere's newsletter of December 14, 1992 addressed complaints of leakage between sections of the Gresen control valve, which is part of the hydraulic system, by adopting new seal kits for the Gresen control valve. ( See id.)2. David Crouch, a salesman for Metrac of Columbus, Inc., visited plaintiff's Alabama work site on several occasions in the several months prior to March, 1994 and on each occasion touted the John Deere 648-E skidder. (Doc. 21, Exhibit A, Deposition of Anthony L. Ison, at 83-84; see also id. at 21-22) Crouch told Anthony Ison and his brother, Joseph Ison, that the 648-E skidder was an excellent machine which would outperform the Caterpillar ("Cat") skidders plaintiff was then running in that it was faster and would pull more wood than the Cat skidders. ( Id.) In fact, Crouch let the plaintiff try out a 648-E skidder for three or four days and the machine "run like he [Crouch] represented it." ( Id. at 29)
As of October 29, 1999, Anthony Ison had been in the logging business for twenty-nine years. ( Id. at 12) Anthony and Joseph Ison took over the family business when their father retired in 1989. ( See id. at 13-16) Since 1997, Anthony Ison has owned one hundred percent of Ison Logging. ( Id. at 15-16)
3. Anthony and Joseph Ison eventually decided to purchase a John Deere 648-E skidder because it had come to a time when the company needed to update its equipment. ( Id. at 84 ("The Caterpillar was six years old and it was time to update equipment.")) When negotiating for the purchase of the 648-E skidder in March of 1994, Anthony and Joseph Ison spoke only to Metrac's Crouch; neither man spoke to anyone from John Deere, in person or over the telephone, during those negotiations. ( Id. at 23-24) The Isons did look over John Deere's spec sheet on the 648-E prior to the purchase and liked the looks of the skidder on the sheet. ( Id. at 24-25)
During these discussions, Crouch never mentioned anything about the skidder's hydraulic system. ( Id. at 25)
4. The plaintiff, Ison Logging, L.L.C., purchased a 648-E skidder, bearing product identification number DW648ES544115, from Metrac of Columbus, Inc., an authorized dealer of John Deere products, on March 9, 1994, with delivery of the skidder being made on March 24, 1994. ( See Doc. 24, Exhibit B) The face of the purchase order contains the following language:
IMPORTANT WARRANTY NOTICE: The written new equipment warranty for John Deere industrial products, "Secure Warranty", is printed on the back of this Purchase Order and is a part of this contract. Please read it carefully before signing. No express warranty is made unless identified on this Purchase Order. YOUR RIGHTS AND REMEDIES PERTAINING TO THIS PURCHASE ARE LIMITED AS INDICATED ON BOTH SIDES OF THIS PURCHASE ORDER. WHERE PERMITTED BY LAW, NO IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS IS MADE.
( Id.) The back of the purchase order describes the "Secure Warranty" as John Deere's "standard new equipment warranty, which provides the coverage described on this page at no additional charge to the purchaser[,] and contains three provisions impacting upon plaintiff's remedies. ( See id.)
H. NO IMPLIED WARRANTY OR OTHER REPRESENTATION
I. LIMITATION OF PURCHASER'S REMEDIES
Where permitted by law, neither John Deere nor any company affiliated with it makes any warranties, representations or promises, express or implied, as to the quality, performance, or freedom from defect of its products, other than those set forth on this page, and NO IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS IS MADE.
Where permitted by law, the purchaser's only remedies in connection with the breach of performance of any warranty on any John Deere industrial product are those set forth on this page. In no event will the dealer, John Deere or any company affiliated with John Deere be liable for any incidental or consequential damages, including but not limited to loss of profits, rental of substitute equipment or other commercial loss.
The selling dealer makes no warranty of his own on any item covered by this warranty, and makes no warranty on other items unless he delivers to the purchaser a separate written warranty certificate specifically warranting the item. The dealer has no authority to make any representation or promise on behalf of John Deere, or to modify the terms or limitations of this warranty in any way.
( Id.)
5. The John Deere New Equipment Warranty states: "Under the below-described `Secure Warranty Full Machine' or `Secure Warranty Power Train' coverage, whichever applies, John Deere will repair or replace, at its option, any parts . . . of new John Deere Industrial product that, as delivered to the original retail purchaser, are defective in material or workmanship." (Doc. 24, Exhibit B)
1. Security Warranty Full Machine: All parts of a new John Deere Industrial product (except those noted in Sections C and D below) are covered by warranty for 6 months/unlimited hours from date of delivery of the product to the original retail purchaser.
2. Secure Warranty Power Train: Certain power train components are covered by warranty for a total of 12 months or 2,000 hours of machine operation (no hour limitation for the first six (6) months), whichever occurs first. This power train warranty commences and runs concurrently with Secure Warranty Full Machine coverage[.]
( Id.) The Secure Warranty Full Machine covered any problems associated with the hydraulic system during the first six months of use. (Doc. 32, Exhibit 4, Deposition of Frank Clark taken in Waid v. John Deere Industrial Equipment Co., CV-96-68 (Winston County, Alabama), at 16)
6. Anthony Ison described in some detail, at his deposition, the various problems Ison Logging experienced with the 648-E skidder and the steps Metrac took to fix the skidder. ( Id. at 29-34 38-47)
Q. . . . Now, subsequently did you develop some problems with the skidder?
A. Yes, sir.
Q. What type problems?
A. We had continuous breakage of lines, lines developing small leaks. We had problems with just the complete whole hydraulic system, leakage around rod seals, o-rings.
Q. Anything else?
A. We also had problems with engines and transmission problems.
Q. What type of problems did you have with the transmission?
A. The filter housing was very poorly constructed, kept breaking off. The transmission would go back into neutral position. You'd be running it and the transmission — you'd let up off the gas and the transmission would go into a neutral position and you had to start over and shift back up.
Q. So it slipped out of gear?
A. It went to a neutral — you'd be going along in second or third gear and you'd let up off the accelerator as you were going and it would go back to a neutral position. You had to reach over and catch it and put it back in gear.
Q. Okay. How many times did that occur that somebody worked on it from Metrac?
A. I know it happened once or twice. I don't know how many.
Q. Did they eventually fix it?
A. Yes, sir, they said they did.
Q. Did you continue to have problems with it —
A. Well, the last time —
Q. — after they said they fixed it?
A. Well, the last time we didn't have no problems after they — before we sold that machine.
Q. Okay. How long between the time that you had it worked on and the time you sold it?
A. I don't know. I'd have to look back in the records to see that.
Q. How about the engine, what kind of problems did you have with the engine?
A. A lot.
Q. What were they?
A. The machine came, they told us — we ran it with about one thousand, somewhere in the neighborhood of one thousand hours. It developed a knock. They took it and tore it down and said that somebody in the factory had left a clip . . . off a wrist pin.
Q. Yes.
A. You know what a wrist pin is?
Q. Yes.
A. And the wrist pin came off and came up and wore a groove in the side of the cylinder wall and busted the bottom of the piston out.
Q. Okay. Were they able to repair that?
A. They repaired that. They replaced the cylinder sleeve. And then somewhere around four thousand hours, the harmonic balance that came off the end of the crankshaft, separated — the harmonic balance on that model had a V-belt pull on it, made in connection with it. It had a thin rubber sleeve around it that held the V-belt pulley on the harmonic balance and it pulled the air conditioner. The air conditioner was kicking off and on all the time the engine was running. It stripped that rubber seal they had in there. It fell off in the belly fan, and the crankshaft became unbalanced and it broke the crankshaft.
Q. I assume that it was out of warranty at four thousand hours?
A. Yes, sir.
Q. What about the wrist pin at one thousand hours?
A. It was still under warranty then.
Q. That was paid for by warranty?
A. Right.
Q. Okay. At four thousand hours when the crankshaft broke, did you have it repaired?
A. We replaced the engine.
Q. Okay.
A. They told us with the heat and all that was there they couldn't — we'd . . . have to redo the — have a engine, that it was cheaper for us to put a new engine in and try to get the machine back to running.
Q. Okay. So you bought a new engine at four thousand hours on the machine?
A. Yeah, thereabouts.
Q. How many hours did it have on it when you sold it to the Potts Brothers?
A. It had, roughly guessing, somewhere around forty-five hundred hours. We ran it very little after that.
. . .
Q. . . . Mr. Ison, we were going to talk about the problems that you had with the hydraulic system. You told me that you had some hoses blow?
A. Yes, sir.
Q. You had some hoses leak?
A. Yes, sir.
Q. You told me something about a valve — no, you told me you had a leakage around the rod seals?
A. Yes.
Q. Where is that on the machine?
A. On the hydraulic cylinder rod.
Q. You had to re[-]pack some cylinders?
A. Right, we had to re[-]pack cylinders.
Q. Do you know how often you had to re[-]pack your cylinders?
A. We probably averaged maybe one every two months.
Q. One every two months?
A. Right, on the rod cylinders.
Q. Okay.
A. Cylinder rods.
Q. Now, with your Cat skidder, did you ever have to re[-]pack the cylinders on it?
A. Not too often, maybe once a year — I mean, once every two — once every two years or something like that.
Q. So it's not unusual to have to re[-]pack cylinders, but it was unusual to you that you had to do it as frequently with this John Deere?
A. Right.
Q. Okay. Did you ever have any problems with your hydraulic pump?
A. I never replaced the hydraulic pump.
Q. Did you ever replace any portion of the hydraulic system other than just hoses and o-rings and re[-]packing the cylinders?
A. Well, they put an upgrade kit on it after we had blown the engine. After we had that last engine problem, we complained so much that they made us aware of an update kit that we could get some cost sharing on. We'd have to pay for part of it and they paid for the other part and the dealer paid for some of it or something. Anyway, they replaced the hydraulic system at that time.
Q. All right. When did they do the update kit?
A. It was sometime in the middle of '97.
. . .
Q. When did the first problems with the hydraulic system begin?
A. We started having leaks on the grapple within the first three or four months.
Q. All right. That's where you had to re[-]pack the cylinders?
A. No, sir, where we had to start replacing hydraulic lines.
Q. Okay.
A. We had a hydraulic line problem. We even made the salesman come out there and put hydraulic lines on.
. . .
Q. . . . You said the problem with your lines started three to four months after you bought it?
A. Yes, sir.
Q. So we're talking about summertime of '94?
A. Yes, sir.
Q. Before you bought your 648E, did you know anybody that was running them?
A. No, sir.
Q. Okay. Mr. Ison, I'm looking here at what purports to be your warranty history that Deere has on file. It looks like on July 14, '94, you had a hydraulic hose leak. Does that sound right?
A. Sounds — yeah.
. . .
A. That would be about three or four months.
Q. . . . And then February 27, 1995, the next one is a snap ring missing in piston.
A. Right, that was —
Q. That's what you told me about that they repaired the engine that time; right?
A. Right.
Q. Okay. Then on your next entry on your warranty history is June 6th, of 1997, hydraulic mod kit where they put in the new valve?
A. June 6th again?
Q. Of'97?
A. '97 right.
Q. Does that sound right?
A. Yes, sir.
Q. And then July 31, '97, your crankshaft had been broken and your engine was replaced?
A. No. We replaced the engine before — the reason the engine was delayed for that — we put the engine in before the hydraulic problem.
Q. All right. It may be when the paperwork came through —
A. Paperwork came through on it.
Q. — is the date. But it was '97?
A. Right.
Q. Okay. Do you know how soon after you had the engine replaced until you had the hydraulic system replaced.
A. It was very shortly. We replaced the engine oursel[ves]. We went and bought the engine.
Q. Bought the engine and put it in?
A. Right.
Q. Okay.
A. The reason I said — reason I distinctly remember that, we cranked the machine up after we put the engine in it, drove it outside the shop we were working at, let it sit there a few minutes to kind of make sure everything was all right. We walked off and came back a few minutes later, the blade was down and the grapple was sitting on the ground. We came back a few minutes later, the whole machine was sitting up off the ground because the hydraulic system had malfunctioned and picked the machine completely up off the ground.
Q. All right. Did you call Metrac at that point and say, you know, something is wrong with this —
A. That's when we called, we got it to Metrac and raised finally enough sand that they finally done something about it.
Q. Okay. So they put the new update kit on it?
A. Put the new update kit on it.
Q. Do you know if that update kit was available when you bought your skidder in 1994, March of 1994?
A. I did not know that.
Q. Never heard that before, that it was available in 1994?
A. No.
Q. Okay. Now, how often did you have trouble with your hydraulic lines?
A. We averaged putting about two lines a week on the machine.
Anthony Ison estimated that Ison Logging replaced about three hundred lines on the skidder as a result of problems with the hydraulic system. ( Id. at 61-62)
Q. Two per week?
A. Yes, sir.
Q. How much downtime did you have when you had to replace a line?
A. Downtime was ranging anywhere from three to four hours. We were spending about three hours and then probably an hour for travel time, maybe sometimes a longer distance distance, depending on how far we had to travel to get a line.
Plaintiff attempted to alleviate somewhat lower productivity during the times when the John Deere 648-E skidder was down by making arrangements to work closer to the loader so that the Cat skidder could make shorter runs to the loader. ( See id. at 53-54)
( Id.)
7. Ison Logging ran the John Deere 648-E skidder only another four or five hundred hours after the update kit was placed on the machine but during that time plaintiff experienced no further hydraulic problems. ( Id. at 51)
8. When Ison Logging first started using the 648-E skidder all of Crouch's representations about the machine proved true but once the litany of problems began that was no longer the case. ( Id. at 85-86)
Q. All right. Now you said that David Crouch told you that the skidder would outperform a Cat, it was an excellent machine, it was faster than the Cat —
A. Yes, sir.
Q. — and would pull more wood?
A. Yes, sir.
Q. Okay. When one of your crew was using the John Deere, did you find that all of those representations ended up to be true?
A. It started out that way.
Q. What made it not be true?
A. The hydraulic problems when you started using it at a regular pace and you started having the busted lines and stuff. And as far as the machine, the basic design was designed to do that. But with the hydraulic problems, you wasn't producing what you said it would produce because of the downtime and the loss of —
Q. Okay. Let me ask you this then: If not for the hydraulic problems that you've already testified about, would everything that David Crouch told you about this skidder still have been true —
A. No.
Q. — had there been no hydraulic problems?
A. Right. No.
Q. What else would have kept that from being true?
A. Well, the engine and transmission problems also.
Q. Okay.
A. I don't know if that was —
Q. Okay. I understand what you're saying. Let me ask you this then: Taking into account had the transmission not giv[en] you any problems and the hydraulic system not giving you any problems or the engine throwing a pin, I think you said the wrist pin, had those things not been a problem for you, would it have been a better skidder, an excellent machine, faster than the Cat?
A. Yeah, I would say it would have — it would have done a good job.
( Id.)
9. Ison Logging sold the 648-E skidder to Potts Brothers, a logging company, during the latter part of 1997. ( Id. at 25)
10. Ison Logging has not bought any equipment from Metrac since the purchase of the 648-E skidder ( id. at 49), not because Metrac told Anthony Ison something that was not true but rather, because Ison does not want to buy a piece of equipment manufactured by John Deere ( id. at 89-90).
Q. Okay. Are you not buying from Metrac anymore because Metrac told you something that was untrue?
A. I wouldn't say that.
Q. Would it be more fair to say that you're not buying from Metrac because you don't want to buy a John Deere piece of equipment?
A. I would say that.
Q. Okay. So if David Crouch approached you and wanted to sell you a Caterpillar machine, would you talk to him?
A. Yes.
( Id.)
11. Anthony Ison has never been upset with David Crouch's attempts to fix any problems associated with the 648-E skidder but was less than impressed with Metrac's warranty service and failure to immediately put on the hydraulic update kit. ( See id. at 91-92 94-94)
Q. Did Metrac respond promptly to your request for service when you did have a request?
A. What are you speaking of?
Q. Well, if you ever called Metrac and said, I'm having a problem with my skidder for any reason, did they respond promptly to those requests?
A. They came out and inspected it.
Q. Okay.
A. Is that what you're asking?
Q. Well, it didn't take them several weeks to get out there, they would come out —
A. Most of the time within forty-eight hours.
Q. Okay. In fact, I think you even testified that Mr. Crouch came out and did some hydraulic work on it?
A. Yes, sir, he did.
Q. Okay. Was that at your request that he do the work?
A. Basically, yeah.
Q. Okay. What happened during that visit? Tell me about any conversations you [had] with Mr. Crouch regarding him coming out and repairing the hydraulic lines, do you remember?
A. I don't remember that far. You're talking a long time.
Q. When you talked to —
A. I'm not —
Q. I'm sorry.
A. I'm not upset with Mr. Crouch by no means. You know, he done his best to try to satisfy us.
Q. Okay. Did Metrac do its best to try and satisfy y'all?
A. I can't say that for Metrac.
Q. Why not?
A. From what I know today, they should have put this hydraulic update on it at the time it became available.
. . .
Q. . . . So are you saying that Metrac should have put the update kit on your skidder sooner than when you did?
A. Speaking as of what I've been told as of today, yes, I feel like they should have put it on when it first came out available.
Q. Okay. With regard to the transmission and the engine problems, were you satisfied with the maintenance Metrac provided to you for the skidder for those problems?
A. Not completely satisfied.
Q. What complaints did you have about those with Metrac?
A. I felt like we should have had a lot better service, warranty service than what we got, just wasn't satisfied.
Q. Did they not respond fast enough or did they not get the problems corrected?
A. They didn't get all the problems corrected.
( Id.)
12. The amount of wood production Ison Logging had in the four years prior to 1994 and the four years thereafter is, as follows: (1) in 1990, $368,847; (2) in 1991, $542,289; (3) in 1992, $666,657; (4) in 1993, $557,218; (5) in 1994, $507,914; (6) in 1995, $549,546; (7) in 1996, $749,216; (8) in 1997, $859,800; and (9) in 1998, $841,868. ( See Id. at 68-75)
In 1998, Ison Logging was not running the 648-E skidder, having sold the machine during the latter part of 1997. ( Id. at 74)
13. Plaintiff filed suit on August 6, 1999 and in its complaint alleged six causes of action against one or both of the defendants, as follows: (1) the defendants, by and through their agents, fraudulently represented to the plaintiff that (a) the skidder was fully capable of operating in the capacity for which it was intended; (b) the hydraulic system on the skidder was suitable for its intended use; and (c) the hydraulic system was not faulty, which representations were relied upon by plaintiff and were material to plaintiff's decision to purchase the defective skidder; (2) defendants knew at the time plaintiff purchased the skidder that significant hydraulic problems with model number 648E had been experienced by the vast majority of loggers in North Alabama and had a strict duty to disclose all material facts regarding the skidder to the plaintiff yet knowingly suppressed this material knowledge and information in an attempt to cause the plaintiff to purchase the skidder; (3) defendant Metrac negligently failed to repair, complete warranty work, service, maintain, advise, consult, and/or perform maintenance service on the skidder, and failed to act on their express and implied warranties and the plaintiff has suffered damages as a result of the negligence; (4) the defendants failure to timely repair the plaintiff's skidder was a breach of their implied warranty of fitness for a particular purpose and implied warranty of merchantability; (5) defendants gave plaintiff express warranties at the time of sale, the skidder as represented and sold to the plaintiff failed to operate in the capacity for which it was intended, and the defendants failed to timely repair the skidder when repair was demanded by the plaintiff; and (6) defendants failed to exercise reasonable and ordinary care in the operation of their business by making negligent and/or wanton representations about the skidder, negligently and/or wantonly suppressing material facts known to them about the skidder, and failing to act on their express and implied warranties and plaintiff has suffered damages as a proximate result of their negligence.
Plaintiff claims that the defendants placed the defective skidder in the flow of commerce for purchase by plaintiff with full knowledge of its defective condition, that such actions were done in a negligent manner and that it has suffered damages as a proximate result thereof.
CONCLUSIONS OF LAW
A. Summary Judgment Standard .1. Summary judgment is proper "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue of material fact and that the moving party is entitled to a judgment as a matter of law." Fed.R.Civ.P. 56(c); see Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-248, 106 S.Ct. 2505, 2510, 91 L.Ed.2d 202 (1986) ("The mere existence of some alleged factual dispute between the parties will not defeat an otherwise properly supported motion for summary judgment."). The clear language of Rule 56(c) "mandates the entry of summary judgment, after adequate time for discovery and upon motion, against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial." Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 2552, 91 L.Ed.2d 265 (1986). A complete failure of proof by the non-movant on an element essential to his case renders all facts immaterial, so the movant is entitled to judgment as a matter of law. Id. at 323, 106 S.Ct. at 2553; see Bennett v. Parker, 898 F.2d 1530, 1532 (11th Cir. 1990) ("Facts in dispute cease to be `material' facts when the plaintiff fails to establish a prima facie case."), cert. denied, 498 U.S. 1103, 111 S.Ct. 1003, 112 L.Ed.2d 1085 (1991).
The substantive law will identify which facts are material. 477 U.S. at 248, 106 S.Ct. at 2510. The Supreme Court concluded in Anderson "that the determination of whether a given factual dispute requires submission to a jury must be guided by the substantive evidentiary standards that apply to the case." Id. at 255, 106 S.Ct. at 2514.
2. This Court must inquire "whether reasonable jurors could find by a preponderance of the evidence that the plaintiff is entitled to a verdict — `whether there is [evidence] upon which a jury can properly proceed to find a verdict for the party producing it, upon whom the onus of proof is imposed." Anderson, 477 U.S. at 252, 106 S.Ct. at 2512 (citation omitted) (emphasis in original). The party seeking summary judgment has the initial responsibility of informing the court of the basis for the motion and of establishing, based upon the discovery instruments outlined in Rule 56(c), that there is no genuine issue of material fact and that the moving party is entitled to judgment as a matter of law. Celotex, 477 U.S. at 323, 106 S.Ct. at 2553. When the burden of proof at trial belongs to the nonmovant, as is the case here, the moving party need not "support its motion with affidavits or other similar materials negating the opponent's claim," id., but rather, "a summary judgment motion may properly be made in reliance solely on the `pleadings, depositions, answers to interrogatories, and admissions on file.'" Id. at 324, 106 S.Ct. at 2553. Once this initial demonstration is made, Rule 56(e) requires the nonmoving party to "go beyond the pleadings and by her own affidavits, or by the `depositions, answers to interrogatories, and admissions on file,' designate `specific facts showing that there is a genuine issue for trial.'" Id., quoting Fed.R.Civ.P. 56(e).
Forbidding reliance upon pleadings precludes a party from "choos[ing] to wait until trial to develop claims or defenses relevant to the summary judgment motion.". . . This effectuates the purpose of summary judgment which "`is to pierce the pleadings and to assess the proof in order to see whether there is a genuine need for trial.'" . . . Thus, "mere general allegations which do not reveal detailed and precise facts" will not prevent the award of summary judgment upon a court's determination that no genuine issue for trial exists.Resolution Trust Corp. v. Dunmar Corp., 43 F.3d 587, 592 (11th Cir.), cert. denied sub nom. Jones v. Resolution Trust Corp., 516 U.S. 817, 116 S.Ct. 74, 133 L.Ed.2d 33 (1995). In other words, there is no genuine issue for trial "[w]here the record taken as a whole could not lead a rational trier of fact to find for the non-moving party[.]" Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 1356, 89 L.Ed.2d 538 (1986).
3. In considering whether the defendant is entitled to summary judgment, the Magistrate Judge has viewed the facts in the light most favorable to the plaintiff. Belcher v. City of Foley, 30 F.3d 1390, 1392 (11th Cir. 1994). Therefore, what the undersigned has stated the facts to be in this opinion may not be the facts that would be established at trial. See id. at 1393 (citation omitted).
B. Fraudulent Misrepresentation .
4. To establish a prima facie case of fraudulent misrepresentation, a plaintiff must show "1) that the defendant made a misrepresentation; 2) that th[e] misrepresentation concerned a material existing fact; 3) that the plaintiff relied on the misrepresentation; and 4) that the reliance was to the plaintiff's detriment." Jewell v. Seaboard Industrial, Inc., 667 So.2d 653, 657 (Ala. 1995), citing Ala. Code § 6-5-101 (other citation omitted); see also Mason v. Chrysler Corp., 653 So.2d 951, 953 (Ala. 1995). It is clear that legal fraud under § 6-5-101 includes "misrepresentations of material fact made `by mistake or innocently,' as well as misrepresentations made `willfully to deceive, or recklessly without knowledge.'" Id. (citation omitted).
5. The Alabama Supreme Court has held that "statements of opinion amounting to `puffery' or predictions as to events to occur in the future are not statements concerning material facts upon which individuals have a right to act and, therefore, will not support a fraud claim." Mason, supra, 653 So.2d at 953-954 (citations omitted).
6. The Court does not hesitate in determining that the statements made to Anthony and Joseph Ison by David Crouch, that the John Deere 648-E skidder was an excellent machine that could outperform the Caterpillar skidders plaintiff was then running by hauling more wood faster than the Cat skidders, were mere sales talk and "puffery" which do not support Ison Logging's claim of fraudulent misrepresentation. This conclusion is inescapable particularly in light of Anthony Ison's testimony that the machine performed as represented when not broken down, that he was "by no means" upset with Crouch, and that he was not presently buying equipment from Metrac not because Metrac told him anything that was not true but rather, because he did not want to buy another piece of John Deere equipment. C. Fraudulent Suppression .
Moreover, to the extent it is necessary, the Court finds that David Crouch was never the agent of John Deere, as plaintiff claims, and therefore, this defendant neither represented or misrepresented anything to the plaintiff. It is clear under Alabama law that though summary judgment on the issue of agency "is generally inappropriate because the issue is a question of fact to be determined by the trier of fact[,]" such disposition is not impossible because agency cannot be presumed and "the party asserting it has the burden of adducing sufficient evidence to prove its existence." Wood v. Shell Oil Co., 495 So.2d 1034, 1035-1036 (Ala. 1986) (citations omitted). In this case, plaintiff specifically argues only that "Crouch's statements are imputed to John Deere because there exists substantial evidence that he was their apparent agent." (Doc. 32, at 3; see also id. at 4-5) Plaintiff having conceded that there is no evidence to support a finding of an actual agency relationship between John Deere and Crouch, see Carlton v. Alabama Dairy Queen, Inc., 529 So.2d 921, 923 (Ala. 1988) ("The test to be applied in determining the existence of an agency relationship under the doctrine of respondeat superior is whether the alleged principal has control over the manner of the alleged agent's performance."), this Court need only address whether there is in fact substantial evidence that Crouch was John Deere's apparent agent. After a careful and complete review of the record, it is determined that such substantial evidence does not exist.
"[I]t is well established that the acts of the agent cannot form the basis for a finding of apparent authority. Rather, the doctrine of apparent authority is based upon the principal's holding the agent out to a third person as having the authority under which he acts." Bird v. Auto Owners Ins. Co., 572 So.2d 394, 398 (Ala. 1990); see Buchanan v. Collier, 555 So.2d 134, 136 (Ala. 1989) ("`Apparent authority of an agent arises from the acts of the principal, either by omission or commission, and such authority is implied where the principal passively permits the agent to have the authority to act on his behalf.'"). Moreover, "before there can be apparent authority that implies an agency relationship, the `authority' must be `apparent' to the complaining party and that party must have relied on the appearance of authority; he cannot rely on an appearance of authority that he was ignorant of." Watson v. Auto-Owners Ins. Co., 599 So.2d 1133, 1136 (Ala. 1992) (citation omitted). Plaintiff contends that the statements made by Crouch, admittedly the agent and salesman of Metrac, to plaintiff about the 648E skidder are imputed to John Deere because Paragraph E of the John Deere Security Warranty clearly indicates to all potential customers that the dealer (Metrac) is the authorized agent for all repair work done under the John Deere Warranty and therefore, it was reasonable for it to assume that Metrac and those with whom plaintiff dealt were acting with the permission and authority of John Deere. Stated differently, plaintiff contends that if Metrac did not have the authority to act on behalf of John Deere in selling its products it would not have been designated as an authorized John Deere dealer and it would not have been designated as the authorized servicing agent for John Deere equipment.
The Court refuses to find apparent authority under such bare facts and tenuous argument particularly since Metrac was the authorized selling agent for other manufacturers as well and plaintiff has offered nothing showing that John Deere trained dealer salesmen regarding how to sell its products or that this defendant was otherwise involved in the daily operation of Metrac. Far from suggesting to customers that Metrac and those with whom those customers dealt were acting with the permission and authority of John Deere, the John Deere Warranty provision which specifies that Metrac is its authorized agent for repair of John Deere products actually puts customers, like the experienced Anthony and Joseph Ison, on notice that they were dealing solely with Metrac with respect to the purchase and operation/repair of all John Deere products purchased from Metrac. In other words, this language in fact distances John Deere from the point of sale and any of the statements made by Crouch to the plaintiff. The Court is throughly convinced from the foregoing, and Anthony Ison's testimony that he never spoke or dealt with anyone from John Deere, that John Deere exercised no control over the manner in which Metrac sold John Deere equipment, that any alleged authority was apparent to the plaintiff or that it relied on this appearance of authority. Accordingly, John Deere would be entitled to summary judgment on this basis as well.
7. "In order to establish a cause of action for fraudulent suppression, the plaintiff must show 1) that the defendant had a duty to disclose material facts, 2) that the defendant concealed or failed to disclose those facts, 3) that the concealment or failure to disclose induced the plaintiff to act[,] and 4) that the defendant's action resulted in harm to the plaintiff." Jewell, supra, 667 So.2d at 658 (citation omitted); Mason, 653 So.2d at 954; see also Foremost Ins. Co. v. Parham, 693 So.2d 409, 423 (Ala. 1997) ("The elements of a suppression claim are 1) a duty to disclose the facts, 2) concealment or nondisclosure of material facts by the defendant, 3) inducement of the plaintiff to act, and 4) action by the plaintiff to his injury.").
Silence is not fraud unless an obligation to communicate a material fact exists. Such an obligation may arise where a confidential relation or "particular circumstances" exist. Under § 6-5-102, the particular circumstances that impose upon a party a duty to speak may arise from the relationship of the parties; the relative knowledge of the parties; the value of the particular fact; and other factors.Parham, 693 So.2d at 423 (internal citations omitted); see also Jewell, supra, 667 So.2d at 658 ("A duty to communicate can arise from a confidential relationship between the plaintiff and the defendant, from the particular circumstances of the case, or from a request for information, but mere silence in the absence of a duty to disclose is not fraudulent."); Mason, 653 So.2d at 954-955 ("This Court has stated that whether one has a duty to speak depends upon a fiduciary, or other, relationship of the parties, the value of the particular fact, the relative knowledge of the parties, and other circumstances of the case. When the parties to a transaction deal with each other at arm's length, with no confidential relationship, no obligation to disclose information arises when the information is not requested.").
8. It is all too clear in this case that there is no evidence of a confidential relationship between Ison Logging and either John Deere or Metrac. Anthony Ison, nor his brother, spoke to anyone with John Deere prior to purchasing the 648-E skidder; they simply looked over John Deere's spec sheet on the skidder prior to the purchase and liked the looks of the machine on the sheet. Certainly, therefore, there existed no confidential relationship between John Deere and plaintiff nor any special circumstances giving rise to a duty to speak by John Deere about potential problems plaintiff might face with the hydraulic system on the 648-E skidder particulary since John Deere had passed along to its dealers, like Metrac, all information it possessed to fix the hydraulic problems, including the update kit.
9. The Court also finds no confidential relationship between Ison Logging and Metrac nor any special circumstances giving rise to a duty to speak inasmuch as the transaction between the John Deere dealer and the plaintiff was nothing if not at arm's length. Anthony Ison had been in the logging business well over twenty years when he and his brother purchased the 648-E skidder at issue in this case and, along with his father and brother over those years, had been involved in the negotiation and purchase of skidders and other logging machinery, albeit never before from Metrac. ( See Doc. 21, Exhibit A, Ison depo., at 12-25 47-49) Moreover, Anthony and Joseph Ison spoke to David Crouch on numerous occasions over the course of several months and had the use of a 648-E skidder for three or four days prior to the purchase of the John Deere skidder by Ison Logging. Finally, Crouch never specifically said anything to the Isons about the skidder's hydraulic system nor did the Isons ask specifically about the hydraulic system prior to the purchase of the skidder nor, after experiencing hydraulic problems, did the brothers inquire whether Metrac had encountered similar problems with other 648-E skidders. Accordingly, the Court finds no evidence of a confidential relationship between Ison Logging and Metrac nor any special circumstances giving rise to a duty to speak. Summary judgment therefore, is due to be granted in the defendants' favor on plaintiff's fraudulent suppression claim.
D. Implied Warranty .
10. Plaintiff concedes that it has no implied warranty cause of action against John Deere (Doc. 32, at 9) and therefore, the sole question is whether summary judgment should be granted in favor of Metrac on plaintiff's implied warranty claim asserted against it. It is clear under Alabama law that "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." Ala. Code § 7-2-316(2). "A term or clause is conspicuous when it is so written that a reasonable person against whom it is to operate ought to have noticed it. A printed heading in capitals (as: NONNEGOTIABLE BILL OF LADING) is conspicuous. Language in the body of a form is `conspicuous' if it is in larger or other contrasting type or color." Ala. Code § 7-1-201(10). It is for the court to decided whether a particular term or clause is conspicuous. Id.
"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.'" Id.
11. In Fincher v. Robinson Bros. Lincoln-Mercury, Inc., 583 So.2d 256, 258 (Ala. 1991), the Alabama Supreme Court held that language on an order form signed by the buyer and on a copy of the invoice received by the buyer which was printed in a type and color which contrasted with the type and color used in the remainder of the documents and disclaimed any implied warranties was conspicuous under § 7-1-201(10) thus requiring affirmance of summary judgment granted in favor of the car seller on buyer's breach of warranty claim. One year later, in Ricwil, Inc. v. S.L. Pappas Co., 599 So.2d 1126, 1130 (Ala. 1992), the Alabama Supreme Court found the following exclusion of warranty language on an installation manual not conspicuous: "`This express warranty is in lieu of and excludes all other warranties expressed or implied, including, without limitation, merchantability or fitness for a particular purpose.'" The court reached this particular conclusion based upon several enumerated reasons. Id.
Here, the exclusion is on the front page of the installation manual in a section labeled "Warranty." Although the label "Warranty" is conspicuous, the actual exclusion is merely in normal type. The exclusion is not in "larger or other contrasting type or color," and it is not "so written that a reasonable person against whom it is to operate ought to have noticed it." The exclusion here, then, was clearly inconspicuous, and thus, did not work to exclude any warranty of fitness for a particular purpose.Id.
12. This Court finds the following language contained on the face of the purchase order sufficiently satisfies the requirements of §§ 7-2-316(2) and 7-1-201(10) that Metrac is entitled to summary judgment on this claim:
IMPORTANT WARRANTY NOTICE: The written new equipment warranty for John Deere industrial products, "Secure Warranty", is printed on the back of this Purchase Order and is part of this contract. Please read it carefully before signing. No express warranty is made unless identified on this Purchase Order. YOUR RIGHTS AND REMEDIES PERTAINING TO THIS PURCHASE ARE LIMITED AS INDICATED ON BOTH SIDES OF THIS PURCHASE ORDER. WHERE PERMITTED BY LAW, NO IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS IS MADE.
(Doc. 24, Exhibit B) Clearly this is exclusionary language which specifically mentions "merchantability" and "fitness," contrary to the argument of the plaintiff, and such language is conspicuous because it is in larger type and contrasting color compared to the remaining language on the face of the purchase order. Moreover, this language is right in the middle of the purchase order and therefore, the Court finds that it was written so that plaintiff should have noticed it. Finally, the Court rejects plaintiff's contention that this exclusionary language pertains solely to John Deere and not Metrac. It is disingenuous for plaintiff to make this argument since this particular exclusionary language appears on the face of the purchase order which was signed not by John Deere and plaintiff but rather, by Metrac and plaintiff. Because it is clear that the conspicuous exclusionary language appearing on the face of the purchase order pertains to Metrac, Metrac is entitled to summary judgment on plaintiff's breach of implied warranty claim.
E. Express Warranty .
13. Plaintiff claims that both defendants gave plaintiff express warranties at the time of sale but failed to timely repair the skidder when it failed to operate in the capacity for which it was intended.
14. Under Alabama law, "[a]n action for breach of any contract for sale must be commenced within four years after the cause of action has accrued[,]" Ala. Code § 7-2-725(1), and "[a] cause of action accrues when the breach occurs, regardless of the aggrieved party's lack of knowledge of the breach." Ala. Code § 7-2-725(2). It is also clear that "[a] breach of warranty occurs when tender of delivery is made, except that where a warranty explicitly extends to future performance of the goods and discovery of the breach must await the time of such performance the cause of action accrues when the breach is or should have been discovered[.]" Id.; see also Tittle v. Steel City Oldsmobile GMC Truck, Inc., 544 So.2d 883, 887-888 (Ala. 1989) ("Under § 7-2-725(2), a cause of action for breach of warranty accrues when the seller tenders to the buyer the goods made the basis of the warranty."). A "repair and replace" warranty is not a warranty that extends to future performance of goods and therefore, such a warranty does not fall within the limited exception set forth in § 7-2-725(2). Id. at 888-891; see also id. at 889 ("`[A] repair or replacement warranty merely provides a remedy if the product becomes defective, while a warranty for future performance guarantees the performance of the product itself for a stated period of time.'").
15. The warranty in this case is clearly a repair and replace warranty, the John Deere New Equipment Warranty specifically providing that "[u]nder the below-described `Secure Warranty Full Machine' or `Secure Warranty Power Train' coverage, whichever applies, John Deere will repair or replace, at its option, any parts. . . of a new John Deere Industrial product that, as delivered to the original retail purchaser, are defective in material or workmanship." The parties agree that plaintiff's complaints about the hydraulic system fall under the full machine warranty which covers all parts of the John Deere product for a period of six (6) months from the date of delivery of the product to its original purchaser and also agree that the date of the delivery of the skidder was March 24, 1994. Because the warranty in this case is a repair and replace warranty that does not extend to the skidder's future performance, the four-year statute of limitations set forth in § 7-2-725 commenced upon the delivery of the skidder on March 24, 1994 and expired on March 24, 1998. Inasmuch as the complaint was not filed in this case until August 6, 1999, plaintiff's breach of warranty claim is time-barred.
F. Negligence/Wantonness .
16. Plaintiff contends that the defendants made negligent and/or wanton representations to it about the 648E skidder, negligently and/or wantonly suppressed material facts known to them about the skidder, and negligently and/or wantonly failed to act on their express and implied warranties.
17. "The elements required for recovery under a negligence theory are: (1) duty, (2) breach of duty, (3) proximate cause, and (4) injury. The existence of a legal duty is a question of law for the court; where there is no duty, there can be no negligence." Albert v. Hsu, 602 So.2d 895, 897 (Ala. 1992) (internal citation and quotation marks omitted). Moreover, "one is guilty of wanton misconduct when, with reckless indifference to the consequences, he consciously does some act that results in damage to another or when he has undertaken conduct with a reckless or conscious disregard of the rights of another." Barber v. Business Products Center, Inc., 677 So.2d 223, 228 (Ala. 1996) (citation omitted); see also Wright v. Terry, 646 So.2d 11, 14 (Ala. 1994) ("Wantonness occurs where a person intends to inflict an injury to another; it also occurs where one acts, or fails to act, with a knowledge and consciousness that his action or failure to act will likely result in injury to another."); Hamme v. CSX Transp., Inc., 621 So.2d 281, 283 (Ala. 1993) ("Wantonness does not require an intent to injure another, but may consist of an inadvertent act or failure to act, when the one acting or failing to act has knowledge that another is probably imperiled by the act or the failure to act and the act or failure to act is in reckless disregard of the consequences.").
18. Plaintiff's negligence and wantonness claims against the defendants must fail for the same reason that its fraud claims fail and that is because David Crouch made no material misrepresentations to the plaintiff about the skidder. In addition, with respect to John Deere, no one from that company spoke with anyone from the plaintiff and therefore, this defendant owed no duty to plaintiff. Because there was no duty there was no negligence on John Deere's part and obviously no wantonness.
G. Negligent Repair .
19. Plaintiff's claim of negligent repair is asserted solely against Metrac ( see Doc. 1, COMPLAINT, at ¶¶ 38-39), plaintiff contending that Metrac negligently failed to repair the hydraulic problems it was having with the John Deere 648E skidder ( see id.). This Court simply cannot find breach of a legal duty by Metrac in this case, Bryant v. Morley, 406 So.2d 394, 396 (Ala. 1981) ("There can be no actionable negligence . . . without breach of a legal duty."); see Lowe's Home Centers, Inc. v. Laxson, 655 So.2d 943, 945-946 (Ala. 1994) ("It is a well-established rule of law in this state that in order to prove a claim of negligence a plaintiff must establish that the defendant breached a duty owed by the defendant to the plaintiff and that the breach proximately caused injury or damage to the plaintiff."), in light of Anthony Ison's testimony that on the first occasion plaintiff experienced hydraulic problems with the skidder, David Crouch replaced some hydraulic lines and that he was in no manner unhappy with Crouch's attempts to fix any of the problems associated with the skidder. Moreover, on the only other occasion plaintiff sought repair of hydraulic problems, Metrac put the update kit on the machine and thereafter, plaintiff experienced no further hydraulic problems. Accordingly, this Court cannot find that Metrac breached any legal duty owed to plaintiff.
CONCLUSION
For the reasons stated above, the defendants' motions for summary judgment are due to be GRANTED and therefore, plaintiff's complaint is due to be DISMISSED WITH PREJUDICE.
DONE and ORDERED this the 12th day of October, 20