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Flag Service and Maintenance, Inc. v. Kirchner Truck & Equipment

July 2, 2010

FLAG SERVICE AND MAINTENANCE, INC., PLAINTIFF-RESPONDENT/ CROSS-APPELLANT,
v.
KIRCHNER TRUCK & EQUIPMENT AND CHARLES KIRCHNER A/K/A RUSTY KIRCHNER, DEFENDANTS-APPELLANTS/CROSS-RESPONDENTS.



On appeal from the Superior Court of New Jersey, Law Division, Gloucester County, Docket No. L-1788-03.

Per curiam.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Submitted January 12, 2010

Before Judges Fuentes and Simonelli.

In this breach of contract action, defendants Kirchner Truck & Equipment and Charles Kirchner a/k/a Rusty Kirchner (collectively "Kirchner") appeal from the January 8, 2009 final judgment by default awarding plaintiff Flag Service & Maintenance, Inc. (Flag Service) $67,650 plus costs. Flag Service cross-appeals from the denial of an award for certain consequential damages. We affirm in part, reverse in part and remand for entry of an amended judgment.

I.

Flag Service is engaged in the business of repairing and selling used marine industrial generators. Kirchner is engaged in the business of buying, selling, and acting as a broker for the sale and purchase of used equipment, including generators.

Six years prior to the incident giving rise to the dispute in this case, the parties conducted the first of several informal business transactions involving the purchase and sale of generators. The first transaction involved a 600 kilowatt generator located in South Carolina, which Kirchner advised Flag Service's principal, Thomas Suchocki, was for sale. Prior to Flag Service's purchase of the generator, Suchocki and Kirchner traveled to South Carolina to inspect it. After inspecting the generator, Suchocki agreed to purchase it, and wired money to Kirchner for the purchase.

After this transaction, Kirchner called Suchocki frequently to advise him of other generators available for sale. On two occasions, Flag Service purchased small generator sets to be used for parts, and Suchocki wired Kirchner the money for the purchases. The parties conducted all of these transactions informally, with no written contracts.

On March 23, 2003, Kirchner advised Suchocki about a 1750 kilowatt generator for sale by Equipment Recyclers, Inc. (Equipment Recyclers) in Texas. On March 24, 2003, Suchocki traveled to Texas to inspect the generator. He then called Kirchner and agreed to purchase it. There was a dispute between the parties as to whether Kirchner told Suchocki that he owned the generator.

Suchocki contacted Philips Brothers Electrical Contractors, Inc. (Philips) on March 24, 2003, and offered to sell it the generator for $165,250. Flag Service memorialized Philips's acceptance of that offer in an invoice dated March 25, 2003 (the Philips contract). Philips, in turn, entered into a contract to supply the generator to a mushroom farm. Suchocki admitted that he never told Kirchner prior to May 1, 2003, that he intended to re-sell the generator or that he had entered into the Philips contract.

On May 1, 2003, Equipment Recyclers sent Kirchner an invoice to purchase the generator for $115,000. The invoice required a $15,000 deposit with the balance due ten days prior to the removal of the generator. Approximately $5,000 was added to the price for shipping costs.

That same day, Kirchner sent Flag Service an invoice, which was on letterhead containing Kirchner's name and address, and which included a description and number of items that were the subject of the transaction and the purchase price of $120,000 (the May 1 invoice). The invoice also indicated that the generator was being "Sold To" Flag Service by Kirchner, and that Comp USA would schedule the loading of the generator within ten days and ship it within thirty days.

The May 1 invoice did not include a $5,000 commission or indicate that Kirchner was a "broker" rather than a seller. Also, Kirchner admitted that the parties never discussed a broker fee, and ...


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