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Florida Appeals Court Reverses Summary Judgment in Defective Goods Case

ContractDispute

On October 24th, 2018, the Fourth District Court of Appeals for the State of Florida reversed summary judgment in a contract lawsuit that was filed after a buyer decline to pay for goods that they alleged were defective.

In the case of Twin Rivers Engineering, Inc. v. Pacer USA, LLC, the court determined that there was still an issue of material fact that had to be resolved. Thus, the lower court’s ruling of summary judgment in favor of the seller was reversed and the case was remanded for further proceedings.

The Buyer’s Claim: The Products Were Defective 

The seller (Pacer USA) shipped 6,000 pyroelectric detectors to the buyer (Twin Rivers Engineering). The total price of the shipment was $87,780, approximately $14.63 per unit. This was the quoted price that the two companies had previously agreed upon, and the price is not in dispute. However, according to Pacer USA, Twin Rivers neither paid for the shipment nor gave proper notification to that they were rejecting the shipment.

According to Twin Rivers, the products that were shipped were defective. They did not comply with the standards that the company needed to use in its business. In addition, Twin Rivers argued that the products did not meet the level of quality that they had been shown when offered samples. Therefore, Twin Rivers stated that it had the right to reject the shipment. 

The Seller’s Response: The Buyer Waited Too Long to Reject the Shipment 

In its lawsuit seeking payment, Pacer USA stated that the buyer had 30 days to reject the shipment. In supporting this argument, the seller contends that this option was clearly included in the terms and conditions page that was attached to the shipment of the goods. As the buyer did not reject shipment in time, they were responsible for paying for the products.

However, Twin Rivers denied that it ever received such a condition. While they do not contend that they took longer than 30 days to reject the shipment, they argue that they were justified in taking more time. The products were rejected after the company did some testing, and they contend that it was done within a wholly reasonable period of time. 

The Appeals Court: This is a Question for the Jury  

The lower court in this case ruled in favor of the seller. However, the Fourth District Court of Appeals overturned that decision. The appeals court highlighted the fact that there is still a key dispute whether or not the buyer ever actually received the terms and conditions that called for a 30 day rejection period. As such, the appeals states that this question should be resolved by a jury. A jury must review all of the relevant facts and must decide if the buyer’s rejection of the goods was reasonable.

Speak to a South Florida Commercial Litigation Attorney Today

At Pike & Lustig, LLP, our Florida contract law attorneys have deep experience representing businesses in the full range of commercial disputes. To find out more about what we can do for your company, please contact us today. With law offices in West Palm Beach, Miami, and Palm Beach Gardens, we serve companies throughout the region, including in Broward County, Miami-Dade County, and Palm Beach County.

Resource:

4dca.org/content/download/404426/3468376/file/173730_1709_10242018_09220888_i.pdf

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