Cite as 24 A.D. 989 (No. 9994) WADE HATCHER & D. C. HOLLAND v. BOSTON TOMATO Co., INC. PACA Docket No. 9647. Decided July 15, 1965. Acceptance Suitable shipping condition-Damages not established Where respondent accepted shipment of tomatoes and failed to establish damages for alleged breach of suitable shipping condition warranty, it is liable for balance of adjusted contract price. Complainant pro se. Mr. Salvatore E. Alvisi, Boston, Mass., for respondent. Decision by Thomas J. Flavin, Judicial Officer PRELIMINARY STATEMENT This is a reparation proceeding under the Perishable Agricultural Commodities Act, 1930, as amended (7 U.S.C. 499a et seq.). A timely complaint was filed in which complainant seeks reparation against respondent in connection with a transaction involving a carload of tomatoes in interstate commerce. A copy of the formal complaint and a copy of the Department's report of investigation were served upon respondent. A copy of the report of investigation was also served upon complainant. Respondent filed an answer and counterclaim. Since the amount of damages claimed, either in the formal complaint or the counterclaim, does not exceed $1,500, the evidence is submitted under the shortened procedure provided in the rules of practice (7 CFR 47.20). Pursuant to this procedure, complainant filed an opening statement. Respondent was given the opportunity to file an answering statement, but did not do so. Neither party filed a brief. FINDINGS OF FACT 1. Complainant is a partnership composed of Wade Hatcher and D.C. Holland, doing business in that name, whose address is P. O. Box 1288, Homestead, Florida. At the time of the transaction involved herein, complainant was licensed under the act. 2. Respondent is a corporation, Boston Tomato Co., Inc., whose address is 358 Congress Street, Boston, Massachusetts. At the Cite as 24 A.D. 989 time of the transaction involved herein, respondent was licensed under the act. 3. On June 19, 1964, in the course of interstate commerce, complainant sold to respondent one carload of mature green tomatoes, U. S. Combination Grade, 87% U. S. No. 1 quality, consisting of 280 40-pound cartons, size 5x6, and 680 40-pound cartons, size 6x6, or a total of 960 40-pound cartons, at an agreed contract price of $6.50 per carton, f.o.b. shipping point John's Island, South Carolina, or a total f.o.b. contract price of $6,240 for the carload. 4. The contract between the parties was negotiated by D. C. Holland, a partner in complainant firm, and Jack Nathman, a broker of John's Island, South Carolina, representing respondent as its agent. No memorandum or confirmation was drawn up in connection with the sale. 5. The subject tomatoes were loaded into car WFEX 68890 at John's Island, South Carolina, on the date of sale, June 19, 1964. The carload was then subjected to a Federal-State inspection, after which the tomatoes were certified as being U. S. Combination grade, 87% U. S. No. 1 quality, with defects within tolerance and with less than 1/2 of 1% decay being noted. 6. Complainant shipped car WFEX 68890 out of John's Island, South Carolina, on the evening of June 19, 1964, to respondent at Boston, Massachusetts. The tomatoes, upon arrival at Boston, were accepted by respondent, which unloaded the cartons from car WFEX 68890 and stacked them at its place of business on Congress Street. Respondent then obtained a Federal inspection of the produce at 12:45 p.m. on June 24, with the results, in relevant part, as follows: "Quality: ... Grade defects average 6% consisting mostly of scars and sunscald. “Condition: . . . Most samples 2 to 9, some none, Average 4% decay. Ranges from 10 to 26%. Average 19% damage by sunken discolored areas occurring generally over the shoulders, including 7% serious damage. "Grade: Meets quality requirements but fails to grade U.S. No. 1 only account of condition. Now averages approximately 70% U. S. No. 1 quality, 19% sunken discolored areas. "Remarks: Applicant states above shipment unloaded from car number WFEX 68890." Cite as 24 A.D. 989 7. A copy of the inspection certificate was sent to complainant by respondent in a letter dated July 6, 1964. In this letter respondent complained about the condition of the tomatoes upon arrival in Boston and, in effect, requested that complainant grant respondent an adjustment in the purchase price. Complainant, on or about July 9, in view of the results of the Federal inspection, reduced the f.o.b. contract price by $960, from $6,240 to $5,280. Complainant requested payment from respondent in this latter amount. Respondent, however, refused to comply with this request. 8. Respondent has paid complainant $4,800 as an undisputed amount, without prejudice to complainant's right to claim further damages against respondent in connection with this transaction. 9. The formal complaint was filed on September 23, 1964, which was within 9 months after the cause of action herein accrued. CONCLUSIONS Respondent's acceptance of the tomatoes involved is undisputed. Accordingly, respondent is liable to complainant for the agreed purchase price thereof, as adjusted by complainant, less damages proved to have been sustained by respondent as the result of any breach of warranty on the part of complainant. Edward Dilatush & Co. v. Sacks Bros. Wholesale Fruit & Produce, Inc. 20 A.D. 626. The burden of proof with respect to the warranty, the breach, and the resulting damages rests upon respondent. O'Donnell Fruit Company of Pittsburgh v. Mathew Mercurio, 18 A.D. 1173. Respondent takes the position that the tomatoes were abnormally deteriorated upon arrival in Boston, in breach of the warranty of suitable shipping condition. Respondent relies upon the results of the Federal inspection made on June 24 in Boston to establish the alleged breach. The regulations in effect at this time, section 46.43 (i) and (j), provide that in an f.o.b. sale there is a warranty that the produce quoted or sold will be placed free on board the boat, car, or other agency of the through land transportation at shipping point, in suitable shipping condition, and that the buyer assumes all risk of damage and delay in transit not caused by the shipper. "Suitable shipping condition" in relation to direct shipments, is defined as meaning that the commodity, at time of billing, is Cite as 24 A.D. 989 in a condition which, if the shipment is handled under normal transportation service and conditions, will assure delivery without abnormal deterioration at contract destination. Assuming, without deciding, that the warranty of suitable shipping condition applies in this case and was breached by complainant, as alleged by respondent, there still remains the question of damages. The general measure of damages for a breach of warranty, where a buyer has accepted the goods, is the difference between the market value of the goods actually delivered, at the time and place of delivery, and the market value the goods would have had at that time and place if they had met the specifications of the contract. The buyer has the burden of proving both values, by a preponderance of the evidence. Northern Farms, Inc. v. Maine State Potato Co., Inc., 23 A.D. 1148. The actual market value of goods delivered may be evidenced by the resale price, when such goods are resold by the buyer in a prompt and proper manner. Kirby & Little Packing Co. v. United Fruit & Produce Co., 16 A.D. 1066. Respondent has furnished us with no details of the resale of the subject tomatoes so that we are in no position to determine whether the resale was prompt and proper. While there is an exhibit attached to the verified answer which appears to have been intended as an accounting, respondent shows disposition of only 22,130 pounds of the tomatoes out of the total of 38,400 pounds. On the whole, therefore, we conclude that respondent has failed to establish the value of the tomatoes actually delivered. Without this information it is unnecessary to consider whether respondent has established the other element of its damages, to wit, the value of tomatoes at Boston meeting contract requirements, since both values must be known to establish damages. Respondent, therefore, has failed to sustain its burden of proof with respect to damages resulting from the alleged breach by complainant. Accordingly, respondent's defense and counterclaim must fail for lack of proof of such damages. The f.o.b. contract price of the carload of tomatoes involved herein, as adjusted, is $5,280. Respondent has paid complainant $4,800, leaving a balance due of $480. Respondent's failure to pay this sum to complainant is in violation of section 2 of the act, for which reparation should be awarded with interest. Cite as 24 A.D. 993 ORDER Within 30 days from the date of this order, respondent shall pay to complainant, as reparation, $480, with interest thereon at the rate of 5 percent per annum from August 1, 1964, until paid. The counterclaim is dismissed. Copies of this order shall be served upon the parties. (No. 9995) CALIFORNIA FRUIT EXCHANGE v. THE GEORGE GORDON FRUIT & PRODUCE CO. PACA Docket No. 9821. Decided July 19, 1965. Motion to reopen after default-Denied Decision by Thomas J. Flavin, Judicial Officer ORDER DENYING MOTION TO REOPEN AFTER DEFAULT In this proceeding under the Perishable Agricultural Commodities Act, 1930, as amended (7 U.S.C. 499a et seq.), a default order was issued June 22, 1965, awarding reparation to complainant against respondent. On June 23, 1965, respondent was given time to file a motion to reopen the proceeding after default in the filing of an answer pursuant to section 47.25 (e) of the rules of practice (7 CFR 47.25 (e)) and the order of June 22, 1965, was stayed pending the issuance of a further order in this proceeding. Respondent filed such a motion and complainant filed a reply thereto. Respondent states, in its motion to reopen after default, that it failed to file a timely answer due to an oversight. Respondent's motion does not state a good reason for reopening the proceeding or even contain a statement of facts from which it could be determined whether good reason exists for granting the relief requested as required by section 47.25 (e) of the rules of practice. Accordingly, respondent's motion is denied, the stay order of June 23, 1965 is vacated and the order of June 22, 1965 is hereby reinstated with the reparation awarded in such order to be paid within 30 days from the date of this order. See, e.g., Farmers Exchange, Inc., of Ebensburg, Pennsylvania v. A. E. Albert & Sons, Inc., 23 A.D. 142 (1964). |