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SOCIETY BRAND HAT CO. v. FELCO FABRICS CORP.

April 18, 1950

SOCIETY BRAND HAT CO.
v.
FELCO FABRICS CORPORATION



The opinion of the court was delivered by: GODDARD

This is an action for a breach of warranty in which plaintiff seeks to recover the sum of $ 3,763.38, representing the purchase price paid for 21 pieces of grey flannel sold by the defendant to the plaintiff, and which the plaintiff contends are of inferior quality and unmerchantable.

On September 18, 1946, the plaintiff, through its duly authorized agent, signed and submitted to the defendant an order form of the defendant for 25 pieces of grey flannel. Following a description of the goods contracted for and directly above the blank spaces for signatures, was printed in plain type: 'This order becomes a contract and effective only if, as and when a copy or confirmation signed by the seller is mailed to the buyer. Terms and all provisions, conditions printed on the reverse side of this order are expressly made part of this contract. All accounts are payable on due date.'

The sales contract was accepted and confirmed by the seller (defendant) on September 19, 1946. The representatives of both defendant and plaintiff signed just below this printed clause in the blank spaces indicated for signatures. Included in the printed provision on the reverse side of the order were the following pertinent provisions:

 '(1) Terms of sale and delivery are only as expressly set forth in this contract which contains the entire agreement of the parties and which is made without any oral warranties, conditions or agreements. No waiver of or change in any terms of this contract shall be binding on the Seller unless in writing signed by him. This contract shall be governed by the laws of the State of New York.

 '(4) The acceptance by common carrier shall constitute delivery. We do not insure safe delivery of goods, the Transportation Companies' receipt relieving us of all responsibilities, and any claim for damages in transit should be made immediately to the Agent at point of delivery.

 '(14) Merchandise shall not be returned nor allowance made after five (5) days from receipt, nor after goods are sponged, cut, or otherwise processed.'

 The goods were shipped in installments and payments were made upon receipt of each installment. On November 18, 1946, the plaintiff received from the defendant 10 pieces of flannel, 3 of which were allotted to the contract now in question. The plaintiff sent them to its sponger for examination on November 21st. On December 16, 1946 the sponger reported to plaintiff that 9 pieces, 2 of which were allotted to the contract now in dispute, were of inferior quality. On that day, December 16th, the plaintiff notified the defendant of the results of this report and on the next day returned the 9 pieces to the defendant. The defendant accepted return of these 9 pieces and its factor issued full credit for them to the plaintiff.

 The 21 pieces that are the subject matter of this action were included in two later deliveries. Ten pieces (shipped on December 6, 1946) were received by the plaintiff on December 19, 1946 and 12 pieces (shipped on December 19, 1946) were received on December 27, 1946. On January 2, 1947 plaintiff paid for them.

 The 22 pieces were all picked up by the plaintiff's sponger on January 9, 1947. On January 20, 1947 the sponger reported to the plaintiff. This report covered only 3 pieces and reported them all to be defective. The sponger's next report was received by the plaintiff on January 29th. It reported 18 additional pieces to be defective. On February 1, 1947 the plaintiff wrote to the defendant and offered to return these 21 pieces. The defendant replied on February 4th and refused to accept the return. In its refusal, the defendant called the plaintiff's attention to Paragraphs 4 and 14 of its order form. Despite this refusal, the plaintiff shipped the 21 defective pieces to the defendant who refused to accept them from the carrier. They were placed in a storage warehouse of the carrier awaiting the outcome of this litigation.

 The plaintiff, claiming a breach of an implied warranty of quality, brought this suit under Section 150 of the New York State Personal Property Law, Consol. Law, c. 41, to recover the purchase price. This court acquired jurisdiction through the diversity of citizenship of the parties.

 The plaintiff contends that (1) there was a breach of an implied warranty of quality; (2) the 5 day limitation period set up in Paragraph 14 of the contract was not really a part of the contract; (3) even if it were originally a part of the contract, it was waived by the defendant; and (4) the plaintiff made its return within a reasonable time as required by Section 150 of the Personal Property Law.

 The defendant contends that (1) there was no breach of warranty because the goods were not defective; (2) since the plaintiff's offer to return was not made within the 5 day limitation period established in the contract, the plaintiff waives any claim for breach of warranty; (3) there was no waiver by defendant of this limitation period; and (4) even if there were a waiver, the return was not made within a reasonable time as required by law.

 The accepted custom in the textile trade is that, unless otherwise specifically stated, piece goods are represented to be of first quality. Since the goods delivered were not of first quality, there was a breach of warranty.

 However, parties to a sales contract may provide a limitation upon the time during which the buyer may give notice of defects and that, in the event notice is not given within such specified time, the goods cannot be returned nor damages claimed for breach of warranty. Personal Property Law, Section 152; Lumbrazo v. Woodruff, 1931, ...


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