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Car Wash Management Inc. v. Equipment Marketers

March 16, 2010

CAR WASH MANAGEMENT INC., TRADING AS ON THE GO, PLAINTIFF-APPELLANT,
v.
EQUIPMENT MARKETERS AND ADC DRYER CORPORATION, DEFENDANTS-RESPONDENTS, AND EQUIPMENT MARKETERS, THIRD-PARTY PLAINTIFF,
v.
FRED BARREN, INDIVIDUALLY T/A AFFORDABLE HEATING & AIR CONDITIONING; AND AFFORDABLE HEATING & AIR CONDITIONING CORPORATION, THIRD-PARTY DEFENDANTS.



On appeal from the Superior Court of New Jersey, Law Division, Burlington County, Docket No. L-1239-07.

Per curiam.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Argued: November 5, 2009

Before Judges Axelrad and Fisher.

Plaintiff Car Wash Management, Inc., t/a On the Go, the owner and operator of four coin laundromat facilities, appeals from summary judgment dismissal of its complaint against the seller/distributor and the manufacturer of allegedly defective dryers. In separate orders, the trial court dismissed plaintiff's claims asserting breach of Uniform Commercial Code (UCC) (revocation of acceptance) against both defendants, breach of contract against the seller/distributor, and breach of implied warranty against both defendants. We affirm.

Viewed most favorably for plaintiff, Brill v. Guardian Life Ins. Co. of Am., 142 N.J. 520, 523 (1995), the motion record reveals the following. Early in 2004, an Equipment Marketers' sales representative visited plaintiff's laundromat in Burlington and recommended that plaintiff purchase seven Maytag MLG32 commercial dryers that were manufactured by defendant ADC. Plaintiff purchased the dryers from Equipment Marketers at a cost of $4775 each. Equipment Marketers delivered the machines to plaintiff's Burlington facility around October 26, 2004, and pursuant to plaintiff's instruction, the dryers were installed by third-party defendant, Fred Barren individually and t/a Affordable Heating and Air Conditioning (collectively referred to as Barren). The record does not reflect how many other dryers were in the facility during the relevant period.

Starting about eight months later, four dryers each caught fire on separate dates, causing clothing or towels within the tumbler to burn, necessitating responses by the fire department. The fires occurred on June 6, 2005, April l8, 2006, September 21, 2006, and February 4, 2007. The record is not clear whether defendants were informed of the first two fires, or what their responses were. However, it is clear both defendants were notified after the third fire. According to Steven Platt, plaintiff's president, he spoke on the phone and exchanged emails with representatives of ADC in an effort to find a solution. Equipment Marketers sent service technicians to check the machines and there were discussions with plaintiff regarding venting of the machines and cleaning lint from them, but nothing was definitively resolved.

Albert Maugeri, plaintiff's service manager, testified in depositions on September 4, 2008, that plaintiff's regular maintenance for these machines that was in effect at the time of all four fires consisted of taking off the front panel and removing the lint from the drums and wherever else it had accumulated, and cleaning the lint from the stacks.*fn1 This maintenance program was performed by plaintiff every six months. After the third fire, maintenance was increased to a minimum monthly schedule and, if staffing permitted, it was performed every two weeks. As of Maugeri's deposition, there had been no further fires, which he attributed to plaintiff's increased maintenance and keeping the lint out of the dryers.

On March 29, 2007, plaintiff's counsel sent correspondence to Equipment Marketers' president, demanding the dryers be removed and plaintiff be reimbursed for the purchase price of the equipment and other damages. A consultant's report was attached, and as represented by the letter, "[t]his report makes clear that the four fires that have occurred at the laundromat were caused by a malfunction of [the] dryers[, which] pose a very real threat, not only to the laundromat itself, but also to patrons who use the dryers."*fn2 The letter further requested a response by April 4, 2007, as to when Equipment Marketers would make arrangements to remove the dryers so that new dryers could be installed, and included the threat to have the equipment "removed and placed in storage at [Equipment Marketers'] expense" if a response setting forth a date for the removal within a reasonable time was not forthcoming. A copy of the letter was sent to ADC's president.

On April 11, 2007, plaintiff's counsel spoke with ADC's president, again asserting that the dryers manufactured by ADC were defective and non-conforming, and requesting their removal. Neither defendant removed the dryers from plaintiff's facility.

On May 8, 2007, plaintiff filed suit against both defendants, alleging: Count I - UCC Breach - revocation of acceptance of non-conforming goods (both defendants); Count II -breach of contract (Equipment Marketers only); and Count III -breach of implied warranty due to defective dryers causing fires to clothing in the dryer drums (both defendants).*fn3

Throughout litigation, plaintiff continued to use the dryers. Platt acknowledged in depositions on September 4, 2008, that his intention as a businessman was to "make money" so his plan was to use the dryers and keep them running whenever he could. There had been no further fires and the only time the dryers were not used was when the maintenance program work was performed or they were getting serviced for items such as broken belts. Platt qualified, however, that he attempted to minimize the use of these dryers by having his attendants steer customers away from them if the laundromat was not that busy because he was worried about another incident. He explained that he did not want to mark the dryers "out of order," however, because it "looks bad" as plaintiff's operations were known "for hardly ever having equipment down for more than as long as it takes to get a part." If the laundromat was busy, Platt would "keep all the units... operational but keep an eye on them from a maintenance standpoint and aggressively clean them."

On September 24, 2008, Equipment Marketers filed a motion for summary judgment to dismiss the first count, arguing that plaintiff's continued use of the dryers in its commercial operation, after giving purported notice of revocation under UCC 2-608, constituted confirmation of its continued acceptance of them. In other words, no material issue of fact existed that plaintiff accepted the dryers and continued to perform acts inconsistent with the seller's ownership that made its revocation ineffective. See N.J.S.A. 12A:2-606(1)(c).

In response, plaintiff admitted that it continued to use the dryers, albeit in a restricted fashion, but contended it was a necessary means to mitigate its damages and maintain its business. Plaintiff referenced Platt's testimony that the dryers were used as a last resort as backup dryers and if the laundromat was crowded, the attendants kept a careful eye on the dryers rather than turning away business. He also referenced Maugeri's testimony that plaintiff constantly cleaned the dryers, more so than any other dryer in any of plaintiff's locations, in an effort to use the dryers and minimize the risk of incidence. Plaintiff also discussed the procedural history of the fires, lack of satisfactory responses from defendants, the determination by its consultant that the dryers were defective*fn4, and notification to defendants of ...


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