QUALITY AIR SERVICES, LLC v. Milwaukee Valve Co.QUALITY AIR SERVICES, LLC v. Milwaukee Valve Co.
MEMORANDUM OPINION
Plaintiff Quality Air Services, LLC (“Quality Air”) has sued defendant Milwaukee Valve Company, Inc. d/b/a Hammond Valve Company (“Hammond Valve”) for damages resulting from the purchase and installation of valves it claims were defectively manufactured. Hammond Valve now moves for partial summary judgment, and for the reasons stated herein, the motion will be granted in part and denied in part.
FACTUAL BACKGROUND
Quality Air is a limited liability company that installs and repairs heating, ventilation, and air conditioning (“HVAC”) units. (Compl. ¶ 1.) It specializes in the restoration, maintenance, and replacement of fan coil units for residential condominiums and rental units within multifamily housing buildings in the District of Columbia, Maryland, and Northern Virginia. (Id. ¶¶ 1-2.) Hammond Valve manufactures and sells valves used in various commercial and domestic applications, including HVAC systems for multi-family housing buildings. (Id. ¶ 4.) In particular, it manufactures the Hammond 8911 valves at issue in this case.
Defendant’s Motion for Partial Summary Judgment seeks to bar plaintiffs claims for expenses relating to replacement of valves that have not failed. (Mem. in Supp. of Def.’s Mot. for Partial Summ. J. [“Def.’s Mem.”] at 2.) Specifically, defendant argues that 1) plaintiff has failed to offer sufficient evidence that the installed, currently operating valves are nonconforming and/or defective, and 2) plaintiffs claims for damages based on the possibility that some or all of these valves might fail in the future are speculative. (Id.) Hammond Valve also argues that the plaintiff has not complied with the Court’s local rules because it did not provide a statement of genuine issues of fact supported by references to specific portions of the record. (Def.’s Mem. in Reply to Opp’n to Mot. for Partial Summ. J. [“Def.’s Reply”] at 2-3.) As such, defendant contends that the Court should strike plaintiffs opposition and assume as true all facts in its own Statement of Material Facts Not in Dispute. (Id. at 3.) Finally, defendant contends that plaintiffs claims of express and implied breaches of warranty are barred because plaintiff failed to notify the defendant within a “reasonable” time that it considered the installed and still-operating Hammond 8911 valves to be non-conforming. (Id. at 17-18.)
ANALYSIS
I. LEGAL STANDARD
A motion for summary judgment “should be rendered if the pleadings, the discovery and disclosure materials on file, and any affidavits show that there is no genuine issue as to any material fact and that the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(c);
see also Anderson v. Liberty Lobby, Inc.,
II. SUFFICIENCY OF PLAINTIFF’S OPPOSITION
Hammond Valve argues in its reply that Quality Air failed to provide a statement of genuine issues of fact with references to the record and that the Court should therefore strike Quality Air’s opposition and assume as true the facts in Hammond Valve’s statement of facts. (Def.’s Reply at 3.) The local rules provide that an opposition to a motion for summary judgment “shall be accompanied by a separate, concise statement of genuine issues setting forth all material facts as to which it is contended there exists a genuine issue necessary to be litigated, which shall include references to the parts of the record relied on to support the statement.” Local Civ. R. 7(h). This rule exists to “assist[] the district court to maintain docket control and to decide motions for summary judgment efficiently and effectively.”
Jackson v. Finnegan, Henderson, Farabow, Garrett & Dunner,
While failure to file a proper statement of facts under this rule “may be fatal to the delinquent party’s position,”
id.
at 151 (internal quotation marks omitted), the Court declines to strike plaintiffs opposition on this ground. Although Quality Air’s Statement of Material Facts in Dispute does not reference the record, plaintiffs memorandum in opposition includes extensive citations to various exhibits and deposition testimony.
(See, e.g.,
Pl.’s Opp’n at 10-19, 20-21.) As such, plaintiff effectively “isolate[d] the facts that the parties assert are material, distinguished] disputed from undisputed facts, and identified] the pertinent parts of the record.”
Jackson,
III. BREACH AND DAMAGES UNDER THE UNIFORM COMMERCIAL CODE
Defendant’s primary argument is that plaintiff is not entitled to future damages
(i.e.,
the cost of replacing valves that have not actually broken) because it has not “establish[ed] that those damages are reasonably certain to occur.” (Def.’s Mem. at 2.) Plaintiff maintains that all of the valves
A. The Uniform Commercial Code
The Uniform Commercial Code (“UCC”), codified in the District of Columbia 2 in sections 28:1-101 through 28:11-108 of the D.C.Code, details the origins and applicability of express and implied warranties. Express warranties by the seller are created as follows:
(a) Any affirmation of fact or promise made by the seller to the buyer which relates to the goods and becomes part of the basis of the bargain creates an express warranty that the goods shall conform to the affirmation or promise.
(b) Any description of the goods which is made part of the basis of the bargain creates an express warranty that the goods shall conform to the description.
(c) Any sample or model which is made part of the basis of the bargain creates an express warranty that the whole of the goods shall conform to the sample or model.
D.C.Code § 28:2-313(1) (2001). Further, “a warranty that the goods shall be merchantable is implied in a contract for their sale if the seller is a merchant with respect to goods of that kind.” Id. § 28:2-314(1). And finally, “[w]here the seller at the time of contracting has reason to know any particular purpose for which the goods are required and that the buyer is relying on the seller’s skill or judgment to select or furnish suitable goods, there is ... an implied warranty that the goods shall be fit for such purpose.” Id. § 28:2-315.
If a seller breaches one or more of these warranties, a buyer who has accepted the goods and given notification “may recover
B. Applicable Warranties
The parties dispute exactly which warranties applied to the Hammond 8911 valves. Quality Air maintains that Hammond Valve breached the following express warranties: 1) that the valves were fit for the particular purpose utilized; 2) that the valves were certified to comply with Underwriters Laboratories (“UL”) and ANSI standards; and 3) that the valves were designed and manufactured to withstand 600 pounds per square inch (“PSI”) of water pressure at temperatures up to 250 degrees Fahrenheit. (Compl. ¶ 28.) Regarding UL and ANSI standards, plaintiff argues that defendant expressly warranted the valves as complying with the “ANSI/ASTM standards for brass.” (Pl.’s Opp’n at 19.) Defendant does not contest for purposes of its motion that the Hammond 8911 valves were “proper for the sort of use for which it was employed by Plaintiff,” and it concedes that it represented that the Hammond 8911 valve “is designed to withstand up to 600 pounds of pressure at 250 [degrees].” (Def.’s Reply at 6-7). However, with respect to UL and ANSI certification, Hammond Valve argues that “UL ... certified that the water passing through the valve is safe for drinking” and that the valve was designed to meet ANSI/NSF 61, which “pertains to water quality.” (Id. at 6.) As for implied warranties, defendant does not dispute plaintiffs allegation that an implied warranty of merchantability applies to the valves. (Id. at 11.) However, it challenges plaintiffs claim that there existed an implied warranty of fitness for a particular purpose. (Id.) Defendant argues that there is no evidence that plaintiff “in any way relied upon the Defendant in selecting the valves” and that such reliance is required in order for such a warranty to arise. (Id. at 12); see also D.C.Code § 28:2-315.
Despite the arguments in defendant’s reply, the focus of the instant motion is not on which warranties apply to the Hammond 8911 valves, but rather, whether plaintiff may recover damages under any warranty or negligence theory for valves that did not break. As such, the Court need not decide at this time which express warranties applied to the Hammond 8911 valves and will accept for purposes of deciding the instant motion that defendant expressly warranted the valves regarding water quality and/or brass standards. However, the Court finds that as a matter of law, an implied warranty of fitness for a particular purpose is not applicable in this
C. Cognizable Damages Under the UCC
With respect to both express and implied warranties, the issue before the Court is “whether a plaintiff can make a valid warranty claim for a product that has not actually failed to perform.” (Def.’s Reply at 8.) That is, can a plaintiff incur damages under the UCC when it receives an allegedly defective product but the product has not failed to perform as intended?
Hammond Valve argues that this question was answered by
Feinstein v. Firestone Tire & Rubber Co.,
The case at bar does not turn on the adequacy of plaintiffs’ pleading, but rather upon the actual performance of Firestone’s tires, as revealed by the record developed between filing the complaint and moving for certification. The majority of the tires sold to putative class members, by doing what they were supposed to do for as long as they were supposed to do it, clearly lived up to that “minimum level of quality” which is all U.C.C. [§,] 2-314(2)(c) requires. Thus no claim for breach of an implied warranty is maintainable in respect of such tires. Plaintiffs’ bald assertion that a “common” defect which never manifests itself “ipso facto caused economic loss” and breach of implied warranty is simply not the law.
Id.; see also Am. Suzuki Motor Corp. v. Superior Court,
Hammond Valve argues that the reasoning in
Feinstein,
which has been cited with approval by this Court and others, governs the instant case and requires dismissal of plaintiffs claims for damages based on valves that have not broken. (Defi’s Reply at 8-10.)
See also Barbarin v. General Motors Corp.,
No. 84-0888,
The Court finds that the Hammond 8911 valves are more like the foundations in Hicks than the tires in Feinstein. Quality Air alleges that the valves have an “expected life of 50-60 years” (Compl. ¶ 25), and the record contains expert testimony that the “expected service life of one of these ball valves before corrosion failure should be somewhere between 35 and 55 years.” (Def.’s Mem., Ex. G at 7; see also Pl.’s Mot. Ex. 4, at 10) The first Hammond 8911 valves purchased by Quality Air were installed in late 2004, meaning that the longest any of the valves has been in service is five years. (Compl. ¶ 8.) As such, the valves should have at least another thirty, and possibly fifty, years of “useful life.” If plaintiff were to establish that the Hammond 8911 valves are defective, even if they have not yet failed, it could show that defendant breached the implied warranty of merchantability with respect to still-functioning valves. Plaintiff could also state a valid claim for breach of express warranties concerning installed valves if it can prove that those valves, despite their apparent functionality, do not conform to defendant’s promised specifications.
D. Plaintiffs Implied Warranty of Merchantability Claim
The Court finds that plaintiff has presented sufficient evidence to permit a jury to conclude that the valves were unfit for their ordinary purpose of carrying water under high pressure at high temperatures. The issue here is whether plaintiff has received a product that is “free from defect,” not what damages might result from that defect.
Hicks,
E. Plaintiffs Express Warranty Claims
Defendant argues that plaintiff cannot make a valid express warranty claim with respect to still-functioning valves because “[t]he presence of a particular ingredient does not de facto make a product ‘non-conforming’ unless the presence of that product manifests in the product’s failure to perform the purposes for which it was manufactured and causes damages.” (Def.’s Reply at 7-8, 15.) However, to succeed on a breach of express warranty claim, a plaintiff must show only that “the defendant breached an express promise made about the product sold” and notice was given,
Witherspoon v. Philip Morris Inc.,
The Court finds that plaintiff may be able to show that the valves did not conform to the alleged express warranties
8
regarding fitness for a particular purpose, UL and ANSI certification, and the claim that the valves were designed and manufactured to withstand 600 PSI of water pressure at temperatures up to 250 degrees Fahrenheit even if most of them are still working. There is evidence that suggests that the composition of all of the Hammond 8911 valves might have been inconsistent with the ANSI standard for brass, breakages notwithstanding. (Def.’s Mot., Ex. G, at 5). There is also evidence to support plaintiffs claim that defendant’s manufacturing process made the valves “overly brittle” and unlikely to withstand 600 PSI of pressure.
(Id.
at 9;
see also
PL’s Opp’n at 14-16). And there is testimony that the valves, whether failed or
F. Damages
The Court need not decide if plaintiff has proven that defendant breached applicable express or implied warranties or that the appropriate damages, in the event that breaches occurred, would be the cost of replacing all 13,200 valves. Indeed, as defendant notes, plaintiff must “prove any loss resulting from [a] breach” in order to recover damages under section 28:2-714.
Alcan Aluminum Corp. v. Carlton Aluminum of New England, Inc.,
IV. NOTICE
Defendant contends that even if plaintiff can state claims for breach of warranty, plaintiff cannot seek damages because it failed to timely notify defendant once it discovered the alleged breaches. (Def.’s Reply at 17-18.) The UCC requires a buyer who has accepted goods to “within a reasonable time after he discovers or should have discovered any breach notify the seller of the breach or be barred from any remedy.” D.C.Code § 28:2-607(3). Defendant argues that although plaintiff was aware of the breaches at issue at least as early as 2005, it did not notify defendant until it filed the instant suit in April 2008. (Def.’s Reply at 17.) Yet, plaintiff has presented an affidavit from Edward Donaghue, its vice president of marketing and sales, stating that he notified Hammond Valve of valve failures as early as 2004. (PL’s Supp. Opp’n at 3-4; Aff. of Edward Donaghue [“Donaghue Aff.”] ¶¶ 10-11.) Mr. Donaghue further attests that Hammond Valve received additional notice of failures in 2007. (Donaghue Aff. ¶ 16.) Although Mr. Donaghue does not state that he notified defendant explicitly that plaintiff considered all of the Hammond 8911 valves, not just the broken ones, to be defective, express notice is not mandated by the statute. Constructive notice, if established, will also satisfy the notice requirement under section 28:2-607.
Witherspoon,
CONCLUSION
For the foregoing reasons, defendant’s motion for partial summary judgment is granted in part and denied in part. Defendant’s motion is granted with respect to plaintiffs claims for replacement damages based on defendant’s alleged breach of the implied warranty of fitness for a particular purpose. With respect to plaintiffs claims for replacement damages based on defendant’s alleged breach of express warranties and an implied warranty of merchantability, defendant’s motion is denied. A separate order accompanies this Memorandum Opinion.
SO ORDERED.
Notes
. Plaintiff also alleged that defendant’s sale of the Hammond 8911 valves violated the Consumer Protection Act, D.C.Code § 28-3904(d)-(e), constituted fraud and deceit, and warranted a declaratory judgment holding Hammond Valve liable for all potential losses and damages suffered or incurred by Quality Air as a result of the defective valves. (Compl. ¶¶ 50-51, 55, 59.) These claims were dismissed in July 2008. (Mem. Op. & Order,
. As this case is before the Court pursuant to diversity jurisdiction, the law of the District of Columbia shall govern all substantive issues.
A.I. Trade Fin., Inc. v. Petra Int’l Banking Corp.,
. Quality Air states in its complaint that it purchased the Hammond 8911 valves from the Noland Company, an authorized distributor of Hammond valves. (Compl. ¶ 14.) Hammond Valve confirms that it sold the valves “through an independent distributor in Maryland.” (Def.’s Statement of Material Facts Not in Dispute in Support of Mot. for Partial Summ. J. ¶ 2.)
. Even where the purpose of the buyer is not "special” but is the same as the ordinary purpose for which the product is used, a plaintiff must still demonstrate that the seller knew that the buyer was relying on its skill and judgment. D.C.Code. § 28:2-315.
.Although in some situations, a manufacturer may be held to the implied warranty of fitness for a particular purpose, these cases involve direct dealings between the manufacturer and the buyer such that the manufacturer becomes, in effect, the seller.
See, e.g., Chrysler Corp. v. Miller,
. The court in
Feinstein
cited comment 13 to UCC § 2-314, which observes that "[i]n an action based on breach of warranty, it is of course necessary to show not only the existence of the warranty but the fact that the warranty was broken and that the breach of the warranty was the proximate cause of the loss sustained.”
Feinstein,
.
See, e.g., In re Bridgestone/Firestone, Inc. Tires Prods. Liab. Litig.,
. The Court reiterates that it does not decide herein whether the express warranties alleged by Quality Air were in fact made by Hammond Valve. Rather, it holds only that the non-failure of most of the installed valves does not preclude successful claims under these warranties.