Cimco Refrigeration, Inc. v. Bartush-Schnitzius Foods Co.
518 S.W.3d 57
Tex. App.2015Background
- Bartush, a food manufacturer, contracted with Cimco to supply and install industrial refrigeration; Bartush paid $306,758 but withheld final $113,400 alleging system failed to reach required 35°F.
- Cimco contended the contract did not require 35°F and blamed inadequate insulation and Bartush’s operation (failure to allow defrost cycles); Bartush bought an additional defrost system from another vendor for $168,079.
- Cimco sued to recover the $113,400 balance; Bartush counterclaimed for breach and sought damages and attorneys’ fees.
- A jury found both parties breached, answered that Cimco breached first, but also found Bartush’s failure to pay was not excused by a prior material breach by Cimco (and rejected other excuse grounds).
- The trial court entered judgment for Bartush (awarding $168,079, interest, and attorneys’ fees); Cimco appealed arguing the jury’s findings rendered the “Cimco breached first” answer immaterial and required judgment for Cimco.
Issues
| Issue | Bartush’s Argument | Cimco’s Argument | Held |
|---|---|---|---|
| Whether a jury finding that defendant’s breach was not excused by a prior material breach of plaintiff implicitly finds plaintiff’s first breach was not material and thus renders a finding that plaintiff breached first immaterial | The jury question asking who failed first properly determined order of breaches; question 3 asked who failed first and should stand | The jury’s explicit finding that Bartush’s failure was not excused by a prior material breach of Cimco means Cimco’s earlier breach was not material, so the “Cimco breached first” answer is immaterial and judgment should be for Cimco | Court held the jury’s “no” to excuse meant Cimco’s earlier breach was not material, making the “Cimco breached first” finding immaterial; judgment reversed and remanded for judgment for Cimco for $113,400 |
| Whether the charge was fatally defective for not following Mustang Pipeline pipeline-first-material breach format | Bartush argued the charge was permissible; no objection to question 4 and any charge problems were not outcome-determinative | Cimco argued the charge could create conflicting answers and should have required explicit finding of first material breach | Court concluded, despite not following the preferred Mustang Pipeline format, the combination of questions forced the jury to decide materiality and excusal, so the verdict as a whole favored Cimco |
| Whether Bartush could recover damages and attorneys’ fees given the jury’s unexcused finding | Bartush sought damages and fees based on jury award | Cimco argued unexcused material breach by Bartush precluded recovery | Court held Bartush’s unexcused material breach precluded recovery of damages and attorneys’ fees; trial judgment awarding Bartush was reversed |
Key Cases Cited
- Mustang Pipeline Co. v. Driver Pipeline Co., 134 S.W.3d 195 (Tex. 2004) (discusses proper jury submission when both parties are found to have breached and recommends determining who committed the first material breach)
- Hernandez v. Gulf Grp. Lloyds, 875 S.W.2d 691 (Tex. 1994) (states that a material breach by one party excuses the other party from further performance)
- Cont’l Dredging, Inc. v. De-Kaizered, Inc., 120 S.W.3d 380 (Tex. App.—Texarkana 2003) (holds unchallenged finding that defendant’s later breach was not excused by plaintiff’s prior material breach implies plaintiff’s breach was not material)
- Green Int’l, Inc. v. Solis, 951 S.W.2d 384 (Tex. 1997) (addresses recovery and limitations when a party commits an unexcused material breach)
- Advance Components, Inc. v. Goodstein, 608 S.W.2d 737 (Tex. Civ. App.—Dallas 1980) (explains materiality determinations turn on facts of each case)
- Spencer v. Eagle Star Ins. Co. of Am., 876 S.W.2d 154 (Tex. 1994) (a properly submitted jury question is immaterial when rendered so by other findings)