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STEWART HALL CHEM. CORP. v. IDEAL TRUCKING CO.

November 5, 1982

STEWART HALL CHEMICAL CORP., Plaintiff,
v.
IDEAL TRUCKING CO., Defendant



The opinion of the court was delivered by: SAND

SAND, J.

 This diversity action which has been tried to the Court involves the purchase by plaintiff, a New York corporation, of acrylic scrap from defendant, a New Jersey corporation. The following Opinion constitutes our findings of fact and conclusions of law pursuant to F.R.Civ.P. 52(a).

 Plaintiff's main activity is the manufacture of chemicals for the heating and cooling industry and prior to the summer of 1979, plaintiff had not engaged in the sale of acrylic materials. In 1979, plaintiff's agent in Korea asked if a particular type of acrylic scrap could be obtained here for export to that country. Plaintiff's general manager, Harold H. Hessel, testified that he attempted to locate such scrap and located a source in Brooklyn, the Rayall Plastics Company. Plaintiff purchased 1100 pounds of scrap from Rayall which was shipped to Korea. Plaintiff next learned from their agent in Korea that the customer wished to purchase comparable scrap in volume. Hessel learned that Rayall was not able to furnish the scrap in the quantities required and he sought other sources, a search which ultimately led him to the defendant.

 Defendant Ideal Trucking Company is engaged in accumulating various types of scrap material from a variety of sources and reselling the scrap in bulk for recycling.

 Hessel testified that he first spoke to an Ideal employee named Sam Barry and explained to him that he was looking for 30,000 pounds of acrylic scrap that could be melted to its monomer form.

 [As plaintiff's expert witness, Arthur S. Nyquist, testified, acrylic scrap made from poly methyl methacrylate ("pmm") is a long chain of polymers joined together to form a clear plastic used as window glass, for molding as in lenses, for automobile dashboards and like products. Its most relevant characteristic for purposes of this proceeding is that a fabricated piece of pmm scrap can be melted back to its monomer form -- a process known as "cracking." In other words, the process of uniting the components into the polymer form of the plastic can be reversed so that the salvager ends up with the basic building block of the chemical process, the monomer. This monomer may then be utilized to fabricate new polymonomer forms.

 This plastic is to be contrasted with another acrylic, XT polymer, which contains styrene and which cannot be reduced to a monomer form. XT polymer scrap may be reground and refashioned (and this is sometimes done to make low quality discardable items like flower pots) but it is impossible to reduce the product to its basic monomer form so that it may be reused as if it had never before been combined in a polymer form with styrene.]

 After his conversation with Barry, plaintiff next spoke on the telephone with William Bolton, the defendant's principal. According to Hessel, Bolton said that he knew what kind of scrap plaintiff wanted and that it would take some time to accumulate. Hessel stated that he repeated that the scrap desired was of a type that could be melted to monomers and Bolton repeated that he was aware of this.

 According to Hessel, some week or two later he heard from defendant that the 30,000 pounds of scrap had been accumulated and the paper work which we will detail in a moment began.

 Defendant's version of the early dealings with Hessel differs radically from the foregoing. Bolton testified that he gave Hessel a sample of the virgin and reground scrap which he had on hand. He thereafter heard from Hessel who said ship the material.

 Hessel emphatically denies that he received a sample prior to this first shipment or, contrary to Bolton's testimony, the three ensuing shipments. The first two of the four shipments were in fact of the pmm desired by the Korean customer. The third and fourth shipments were of XT acrylic mixed with pmm. The first shipment is therefore relevant not because it is itself in dispute but because it furnishes the background for the parties' later dealings and understandings.

 Resolution of the clear conflict in the testimony as to sampling is not an easy matter. Both Hessel and Bolton disclaim any expertise in the field of acrylic plastic. Hessel testified that he only once visited defendant's premises and this was on November 14, 1980. He stated that the purpose of his visit was to look over the defendant's operation because the Korean customer had indicated that he wanted larger quantities and more frequent shipments and Hessel thought he should see firsthand with whom he was dealing. He denies that he returned from this single visit with any scrap sample or that at any prior time, the defendant had delivered any scrap sample to him.

 Our determination based on an observation of the witnesses and all of the facts and circumstances of the case is that defendant did not furnish samples of the scrap to plaintiff prior to each of the four shipments but that the parties relied on the oral conversations recited above and the paper documentation as to which issues of credibility are also present.

 Hessel testified that when Bolton advised him that he had the required 30,000 pounds of scrap available, he advised his Korean agent to have the customer proceed to process a letter of credit which would also serve as an order, and on August 26, 1979, he had prepared and sent to defendant a purchase order for "30,000 Lbs. Reground Acrylic Scrap" (Ex. 10). According to Hessel, the next day a second purchase order was sent because he learned there had been an incorrect shipping date and because the description of the goods purchased was not as it should have been. The amended purchase order lists a different vessel for carriage of the shipment and describes the goods as "30,000 lbs. Acrylic Scrap made from MMA Monomer." Defendant denies ever receiving the amended purchase order. Plaintiff is unable to produce any of the original multiple copies of the purchase order which should have remained in its files and has produced only a photocopy of the purported amended purchase ...


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