HENRY HEIBEL v. UNITED STATES AIR CONDITIONING CORPORATION

Minnesota Supreme Court1939-11-17No. No. 32,178

206 Minn. 288

Summary · law.co

Holding. The court reversed the judgment for rescission because the owner's notice of intent to rescind came too late under the applicable sales statute. The case was remanded for determination of other available remedies for breach of warranty.

A restaurant owner sought rescission of a purchase and installation of air-cooling equipment after the defendant manufacturer failed to meet its warranty obligations. The equipment was installed in spring-summer 1935 and did not perform as warranted. The manufacturer's engineers attempted repairs through August 1935, but the owner did not formally request rescission and a refund until March 1936—nearly eight months after the manufacturer completed its remedial efforts. The trial court ruled for the owner, but the manufacturer appealed, challenging both the timeliness of the rescission notice and the sufficiency of evidence regarding the continued breach.

The appellate court found that under the applicable sales statute, a buyer must notify the seller of an intent to rescind within a reasonable time. While the period for rescission does not run while the seller is actively attempting repairs, once repair efforts are complete, the clock begins. The owner's eight-month delay in notifying the manufacturer of rescission was unreasonable as a matter of law. However, the court recognized that rescission is only one remedy available to a buyer for breach of warranty, and the owner's failed attempt to rescind does not bar him from pursuing other remedies.

Summary generated by law.co from the public-domain opinion. The opinion text itself is public domain.

Key issues

Whether notice of rescission was timely under the sales statute
Whether the reasonable period for rescission notice runs during seller's repair attempts
Whether failure to rescind bars pursuit of alternative remedies for breach of warranty

Procedural posture

The manufacturer appealed the trial court's judgment for rescission and refund, challenging the timeliness of rescission and sufficiency of evidence of continued breach.

Authorities cited

No cited authorities resolved to law.co cases yet.

Opinion · public domain

majority opinion

Stone, Justice.

Action, in rescission, for breach of Avarranty of air-cooling equipment installed by defendant in plaintiff’s restaurant. Defendant counterclaimed for a balance of the price. After findings of fact, conclusions of laAv, and order for judgment for plaintiff, defendant appeals from the order denying its alternative motion for amended findings or a neAV trial.

Defendant makes and installs air-cooling units. In March, 1935, it contracted to put one into plaintiff’s Chicago restaurant. It Avarranted that the equipment Avould reduce inside temperature a certain number of degrees beloAv that outside. The unit Avas installed during the spring and summer of 1935. On the price plain tiff made a down payment of $571.35, which he seeks to recover herein.

During the early summer of 1935 the mechanism did not fulfill the warranty. Until August 22, defendant’s engineers tried to remedy the defects. Not until March, 1936, did plaintiff give notice of rescission and request defendant to remove its equipment and refund the money paid. Defendant did remove the equipment, but without prejudice to its rights under the contract.

There is a finding of breach of warranty but none that it had been remedied in August, 1935.

This appeal is based upon two grounds: (1) That tender of rescission Avas not timely, and (2) that the evidence is insufficient to sustain a finding that the breach of warranty continued after August 22, 1935.

The uniform sales act, § 69(3), 2 Mason Minn. St. 1927, § 8443(3), provides:

“Where the goods have been delivered to the buyer, he cannot rescind the sale if he kneAv of the breach of warranty when he accepted the goods, or if he fails to notify the seller within a reasonable time of the election to rescind, * *

That the unit first installed was defective is admitted. The seller’s agents Avorked during the early summer of 1935 to remedy the defects. While the seller is engaged in such an effort, “the reasonable time within Avhich the buyer could rescind” does not run. Federal M. T. Sales Corp. v. Shanus, 190 Minn. 5, 250 N. W. 713. But here the seller had completed his remedial work by August 22, 1935. If defect there Avas, it existed at that time. Nevertheless, the record reveals no attempt by plaintiff to rescind until eight months later. Such delay is unreasonable as matter of law. Stewart v. B. R. Menzel & Co. 181 Minn. 347, 232 N. W. 522; Holcomb & Hoke Mfg. Co. v. Osterberg, 181 Minn. 547, 233 N. W. 302, 72 A. L. R. 722; Laundry Service Co. v. Fidelity L. M. & E. Co. Inc. 187 Minn. 180, 245 N. W. 36. Plaintiff’s attempt to rescind came too late to be effective.

Plaintiff asserts that as early as October, 1935, he demanded return of his money. However, the record discloses that his only demand related to a pump which plaintiff had purchased at defendant’s request and which was installed to make the equipment function more effectively. Plaintiff’s claim then did not even suggest rescission.

This decision is the trail’s end for plaintiff’s attempt to rescind. But we cannot order judgment for defendant on its counterclaim for unpaid purchase price. That is because rescission is but one of the buyer’s remedies for breach of warranty. See 2 Mason Minn. St. 1927, § 8443. His unsuccessful attempt to rescind is not such an election of remedies as to bar any other. Holcomb & Hoke Mfg. Co. v. Osterberg, 181 Minn. 547, 233 N. W. 302, 72 A. L. R. 722. Such a frustrated attempt to pursue a wrong remedy is not an election which will bar one otherwise right. In re Van Norman, 41 Minn. 494, 43 N. W. 334; Ross v. Amiret Farmers Elev. Co. 178 Minn. 93, 226 N. W. 417.

The order must be reversed and the case remanded for the trial of issues other than that of rescission.

So ordered.