Glen Alden Corp. v. Duvall

Barnes, J., delivered the opinion of the Court. The appellee, R. Byng Duvall, operating Duvall Engineering Company (Duvall) as a sole proprietorship, filed an action at law against Glen Alden Corporation (Glen Alden) and its subsidiary corporation Republic-Transcon Industries, Inc. and Republic Air Conditioning Co. in the Circuit Court for Montgomery County on August 21, 1961. The declaration included the seven common counts in assumpsit and one special count in which recovery of $110,153.83 with interest from January, 1960 and costs was sought resulting from the alleged breach of contract between Duvall and The Mathes Company (Mathes), a subsidiary of Glen Alden, whose assets were subsequently acquired by Republic Air Conditioning Co., (Republic). On November 26, 1962, Republic filed an action at law in the same court against Duvall in two counts in addition to the seven common counts, to recover in count 1, $10,-099.55, the principal balance allegedly due on 16 promissory notes from Duvall to Mathes and assigned by Mathes to Republic, together with 6% interest of $928.30 from December 31, 1961 and attorneys’ fees of $1550.80 provided for in the notes and to recover in count 2 for a balance of $1,682.32 on an open account with interest of $84.00 from December 31, 1961.

In the exhibits attached to the declaration it appeared that the original note account was for $18,567.18 from which was deducted $8,467.63 consisting of the alleged market value of the various air conditioning units recovered from the custody of the Sheriff of $11,911.20 less the costs of $3,443.57 involved in an attachment on original process issued by Duvall, ⁴⁰⁹ but later quashed by Judge Shure on June 21, 1962. In both actions, the defendants filed the general issue pleas in assumpsit. The two cases were consolidated for trial and tried before Judge Shure, sitting without a jury. After much testimony and the introduction of a number of documentary exhibits, Judge Shure, after argument of counsel, filed an opinion and directed the entry of judgment for Duvall against Glen Alden and Republic for $27,735.00.

It is from the judgment for this amount that the present appeal was taken by Glen Alden and Republic. There was no cross appeal by Duvall. For convenience in the later consideration of the case we will indicate the particular claims alleged in Duvall’s declaration and the allowances (or disallowances) made by the lower court on those claims: Duvall’s claims Nature of claim claimed Result in lower court Freight on returned in-warranty parts 990.52 Disallowed Unpaid claims for labor allowances for in-warranty repairs 2,890.48 $ 1,445.00 Unpaid amounts for in-warranty parts returned to Mathes 13,079.63 6,540.00 Rent on warehouse housing equipment 2,430.00 3,000.00 Interest and insurance charges on warehouse equipment 2.083.12 Disallowed 20% down payment on equipment 4.287.13 4,287.13 Bonded warehouseman’s salary 4,427.95 Disallowed *Value of unexpired five year warranty 79,965.00 Disallowed $110,153.83 * Allowed by trial court: Additional credit allowed on returned equipment 14,321.04 29,593.17 ⁴¹⁰ Credit for attachment and repossession costs 3,427.47 26,165.70 Interest at 6% on balance 1,569.30 Judgment for $27,735.00 Duvall had entered the building, heating and air conditioning business in Montgomery County after the conclusion of World War II. In the latter part of 1957 he became interested in the air conditioning and heating equipment for Mathes.

Mathes at that time had its factory at Forth Worth, Texas and had a local representative, a Mr. Morton. Duvall’s original conversations were with Curtis Mathes, president of Mathes. Duvall visited the Mathes plant at Fort Worth and became familiar with its installation. Mathes had a warehousing subsidiary, the Maco Corporation (Maco) which had two warehouses in Montgomery County, one on Elkins Street in Wheaton and the other on Howard Avenue in Kensingston.

The Howard Avenue warehouse, of masonry construction 20 feet by 70 feet, was owned by Duvall. Maco and Duvall entered into a written warehousing contract, lease and unconditional guaranty by Duvall on November 19, 1957. The agreement provided for a non-recurring fee to the warehouseman (Maco) and for branch warehouse charges of 1/10 of 1 °/o of the stated value of the commodities stored. There was a minimum annual storage charge of $100.00.

Insurance charges were payable in advance as invoiced. The agreement was for 3 years from November 19, 1957, with a provision for subsequent 3 year renewals unless either party terminated upon 90 days’ written notice prior to the end of the 3 year period. The lease, however, provided for a term from year to year with a rental of $1.00, with the right of either party to terminate upon 30 days’ written notice with appropriate provisions to' protect existing warehouse receipts. The unconditional guaranty by Duvall indemnified Maco against loss resulting from the fraudulent or dishonest acts of any employees or agents of Duvall in connection with the warehousing agreement and lease.

There was an oral agreement between Mathes and Duvall whereby ⁴¹¹ Duvall became an “Associate Manufacturer” of Mathes and which provided that Duvall would supply a warehouse in Montgomery County (which was accomplished by the documents of November 19, 1957) ; that Duvall’s purchase terms for Mathes equipment would be subject to the customary discounts and would be paid for by a down-payment of 10% in cash and a promissory note or notes for the 90% balance. Mathes would prepay the freight from its plant to the warehouse in carload lots. Payment was made by Duvall at the time of receipt of the equipment from the warehouse for sale or installation. He would pay the warehouseman for such equipment in cash and the warehouseman would then send the funds to Mathes to be applied against the promissory note or notes theretofore given by Duvall.

The Mathes air conditioning equipment was sold under a written two-fold warranty. The first part of the warranty was entitled “One Year Complete Air Conditioning Warranty” (One Year Warranty) and warranted to the original purchaser that the described Mathes Air Conditioner would be “free from defects in material and workmanship under normal use and service for a period of one year from the date of installation.” It further provided that Mathes’ obligation under the One Year Warranty “shall be limited to furnishing, free of charge, F.O.B. factory, to the original purchaser a replacement part or parts of like or similar design and capacity in exchange for return to Mathes factory, freight collect, any part or parts of the Air Conditioner that in Mathes’ judgment show evidence of defect in material or workmanship.” The Five Year Warranty provided that, in addition to the One Year Warranty, Mathes warranted to the original purchaser as follows: “* * * [T]he base and the condenser coils, evaporator coils, and compressor to be free from defects in material and workmanship' for a period of six (6) years from date of shipment by the Mathes factory or five (5) years from date of original unit installation, whichever shall first occur. This additional warranty does not cover such items as (but is not limited to) refrigerant, electrical components, or electrical controls. ⁴¹² “The responsibility and obligation of The Mathes ' Company, Inc. under this warranty is limited to the actual repair and/or replacement, and/or the removal and reinstallation of any of the above components which in the judgment of Mathes show evidence of defects in material or workmanship. On defective parts Mathes will pay freight one way to its Fort Worth factory.

All new or repaired parts will be shipped freight collect by Mathes. This warranty does not obligate The Mathes Company, Inc. for any labor incurred for removal of ducts, partitions, etc., to permit replacement of any components in the unit.” The two warranties are declared to be in lieu of any other warranties express or implied, are limited to the continental United States and only apply if the enclosed Registration of Warranty Card is mailed within 30 days after installation. At the bottom of the warranty there is a provision for “Associate Manufacturer Warranty” which provides in effect that the Associate Manufacturer (who signs the warranty at the bottom of the document) gives an additional warranty as that of Mathes, and provides that: “[I]n addition it is understood that associate manufacturer’s obligation under this warranty is limited to the actual removal, reinstallation, repair and/or replacement of the Refrigerant System or a part thereof at the point of installation without cost to the purchaser, and the associate manufacturer does riot authorize anyone else to remove, repair, or replace this refrigerant system or incur any cost in connection therewith.” It was also provided that Mathes assumed no liability under the warranty unless the Associate Manufacturer signed the warranty in the place provided for his signature. The controlling interest in The Mathes Company was acquired by Glen Alden as of January 1, 1958.

Thereafter, Duvall and John J. Hildebridle, who was then the president of Mathes, had conversations at Forth Worth on March 15, 1958 and a telephone conversation with Robert B. Starnes (Starnes), ⁴¹³ a field sales representative of Mathes, in regard to Duvall’s purchasing arrangements with Mathes. These arrangements were confirmed in writing by Duvall in a letter to Mathes dated April 14, 1958. Certain difficulties between Duvall and Abbott Refrigeration were resolved as follows: “1. That I would continue as an Associate Manufacturer buying commercial equipment at 20% discount from Distributor Price. “2.

That my commercial equipment cost would be the same as Abbott’s and that Abbott would not be given a profit on my business. “3. That this arrangement would exist for one year. “4. That I would continue to operate a MACO Warehouse.” The future dealings with Mathes were outlined as follows: “1. That I will continue as an Associate Manufacturer buying at 20% discount from the Distributor price and with the same terms that prevailed on past orders. “2.

That I would continue to maintain my MACO Warehouse. “3. That Abbott Refrigeration Company will have a five percent price advantage over me and that they will realize 5% profit on all my business. “4. That in consideration of this 5% override on my business, Abbott Refrigeration Company will sell commercial equipment to me at 15% off of Distributor price, which is 113.34% of their cost, F.O.B. their warehouse, Washington, D.C. Abbott will also maintain a complete stock of parts which will be available to me at factory price. “5. I cannot buy Window Units from the Mathes Company direct. “6.

That I would not set up any more Dealers in the territory given to Abbott Refrigeration Company. This territory includes the District of Columbia, Counties of Montgomery and Prince George’s in Maryland, and Arlington, Fairfax, and London, including the City of Arlington, in the State of Virginia.” ⁴¹⁴ Duvall requested that “in line with your recent bulletin” he would appreciate an early -written confirmation of the terms outlined in the letter. This was forthcoming in a letter of April 23, 1958 from the president of Mathes to Duvall in which it was stated in part: “This letter will confirm our working agreement with you as outlined in your letter of April 14th. “The only thing that I would add is a clause in which this arrangement can be terminated by either party with a 30 days’ written notice.” After this exchange of correspondence, Mathes on May 9, 1958 issued to Duvall, Bulletin, Register No. 622, which has the general heading “Marketing-Mathes Air Conditioning Products.” It has the index number C:14.0 and in the blank provided “Replaces No.........,” there is no entry, so that it is apparently the original form of this type so far as Duvall is concerned. It is quite a substantial document consisting of 34 letter-size pages of single-spaced printing.

Some of the pages are printed on both sides of the page. It is generally divided into five principal headings: I, Marketing Plan for 1958, II, The Product (further subdivided into A, The 1958 Commercial and Residential Line, and B, The remote air conditioning equipment line), III, The Distribution Pattern (including selling methods and distribution), IV, General Conditions of Sale, Prices, Discounts and Terms of Payment, and V, Orders, Warehousing, Stock Shipping and Transportation Costs. So far as relevant here, the Bulletin provides: 1. That the marketing plan shall apply for the calendar year 1958 unless terminated sooner. 2.

That Duvall as a Distributor-Dealer’ (which encompasses the Associate Manufacturer) shall provide room air conditioner installation and service and the Distributor-Dealer will be bound by the policy and procedure set forth in the plan, and that “Any revision, modification, or abrogation of the policies, methods and procedures delineated in this plan will be issued in writing by The MATHES Company at its Home Office in Fort Worth, Texas.” 3. “Title of ownership” passes to the Distributor-Dealer up ⁴¹⁵ on delivery of the merchandise by Mathes to the carrier at the Mathes shipping point; Mathes retains a lien on all merchandise to secure payment in full. 4. Commercial equipment may be purchased by the Distributor-Dealer on the basis of the Mathes price list dated March 1, 1958 and is entitled to a 20% discount of the prices shown on that list. 5. As to all Mathes products: Effective on and after February 20, 1958, the commercial units ordered under the Maco Warehousing or Public Warehousing Plan from Mathes will be billed on the basis of a 10% down payment in cash to be returned with an executed 90% note, tally sheet and warehouse receipt. The interest rate is 6% per annum on the notes. 6.

All orders are to be signed by the customer and mailed to the Fort Worth office on a Mathes form; “Orders signed by a Mathes Sales Representative will not be accepted as bona fide orders.” 7. The territory in which Duvall is located is “Territory No. 62 (Washington, D. C. — Baltimore, Maryland),” in which John T. Bennett, Falls Road, Cockeysville, Maryland, is designated as Sales Representative. The Bulletin sent to Duvall on May 9, 1958 was supplemented by a Bulletin dated July 1, 1958 in regard to Residential and Commercial Equipment and received by Duvall, which confirmed the existing warranty (the One Year and the Five Year Warranty — called in the Bulletin of July 1, 1958 an “Extended Four Year Warranty”). The extended warranty covers the sealed refrigeration system, the phenolic base and phenolic mid-section against defects in material and workmanship, and repairs of these portions of the units are to be handled in the field in the same manner as during the One Year Warranty.

Charges for hermetic repairs may be billed to Mathes at any time during the five year period, but will not be honored if made within the one year period from date of installation. This Bulletin also states that Mathes will honor in-warranty charges by Authorized Mathes Installing Dealers after one year from the original installation for change-out of compressors, condenser coils, evaporator coils, and reversing valves being contained within the housing of Mathes units — “as a re- ⁴¹⁶ suit of mechanical failure due to faulty material or workmanship,” as follows: “Models 24-28-34 Units $30.00 Models 40-50-62 Units 37.50 Models 90 and 120 Units 47.50” The Distributor-Dealer was responsible for transportation costs one-way only during the first one year warranty period; Mathes paid the transportation costs one-way during the second to fifth year of the warranty. A similar Bulletin, dated June 1, 1958 in regard to Room Air Conditioners had also been received by Duvall. After the first year of the warranty period, all field service reports, including both parts and labor, are to be charged to the customer.

Mathes prepared two forms for use by Duvall in returning parts. One of these was a “Return Parts Tag,” attached to the specific part returned. It bears a number, and has spaces in which the name of that part, its number, its form model, and its serial number, the dates of installation and replacement, the customer’s name, address and the name of the person by whom the part is returned. There is also a space for designation of “Nature of Defect.” At the bottom of the form, the user of it is warned that “No credit issued without this tag completely filled out” and “Allow 30 days minimum for factory processing and issuance of credit.” The ¡Second form is entitled “Material Return Tag Tally Sheet.” This has spaces in which are to be inserted the number of the form, its date, the name and address of the sender, and then three columns, one for the Return Parts tag number, the second for a description of the part, the third for the cost of the returned part.

Using plaintiff’s Exhibit No. 45 as a typical example of the Return Parts Tag, we find that it bears number 18225, involved a “Compressor,” Part No. 4426416 from Model No. 5HAR3BHP, with Serial No. 475185. The compressor was installed in October 1957 and was replaced on October 16, 1959. The customer’s name and address is given, as well as Duvall’s name and address as the person by whom the compressor is returned. The Nature of Defect is stated to be “Grounded Windings.” ⁴¹⁷ Using plaintiff’s Exhibit No. 44 as a typical example of a “Material Return Tag Tally Sheet,” we find that it bears number 6, and is dated November 25, 1959.

It has Duvall’s name and address and under the three columns mentioned there are 14 separate items headed by the compressor mentioned in the Return Parts Tag above described (plaintiff’s Exhibit 45) as follows: “18225 4426416 Compressor $429.66 [The remaining 13 separate items follow with their dollar amounts; then follows:] Total 3,384.75 Less 40% 1,353.90 Net Credit Due $2,030.85” It is seen from these forms, prepared by Mathes, that the Associate Manufacturer/Distributor-Dealer (Duvall), who installed the equipment and who serviced the equipment for the ultimate purchaser, certified in regard to the nature of the defect in the part, which, prima facie, was a defect covered by the warranty. The specific part was then returned to Mathes, with other parts, with their cost price as the value for credit, less the 40% discount, given to Duvall as a Distributor-Dealer, and the net amount is stated to be the amount of the credit to which Duvall, as Distributor-Dealer is entitled. This procedure for the return of equipment under the warranty was regularly followed by both Mathes and Duvall. Duvall testified, without contradiction, that the relationships between him and Mathes were mutually satisfactory from the beginning of his agreement until the middle part of 1959.

He had a competent service manager and adequate technical help and equipment. Although not required to do so under the agreement, he purchased a Mathes “charging board” to test each installation. During this period, at the oral request of an officer of Glen Alden, Duvall acted as Mathes’ field representative in the area. Its former field representative had been withdrawn.

This additional service was performed by Duvall without compensation. During this same period practically none of the credits requested by Duvall for returned equipment and parts was denied by Mathes. Out of 54 compressors returned (compres ⁴¹⁸ sors are the most essential portion of the refrigeration unit and most likely to give the most trouble), there was only one denial which Duvall could recall. In the latter part of 1959, an abrupt change in the pleasant relations between the parties occurred.

Duvall’s requests for returned equipment and parts were ignored for substantial periods of time, in some instances a period of 6 months or more, and after much correspondence. Duvall, in November 1959, was approached by Mathes to increase his 10% down payment to 20%. In order to “avoid unpleasantness,” Duvall agreed to do this, and paid $3,128.98 on equipment already received. Duvall also discovered that he was being shipped new equipment with old compressors.

Eor several months as the result of an attachment issued in connection with an action of the Eastover Corporation against Glen Alden and Mathes (Duvall was not a party to the case), Duvall’s warehouse was padlocked and he could obtain no equipment from it. Duvall could not pay Mathes any money because his funds had been garnished. Mathes then put Duvall on a C.O.D. basis and claimed that Duvall owed Mathes $9000 on the note account when, according to Duvall’s records, Mathes owed Duvall a small balance. On March 8, 1960 Duvall shipped to Mathes three compressors and miscellaneous parts weighing in excess of 100 pounds, freight collect.

Mathes refused to accept the shipment and Duvall sent a telegram on March 22 to inquire why the, shipment had been refused. Mathes, in its telegram of March 25 advised that the shipment was refused in accordance with its Bulletin MX206-5, dated January 25, 1960, revised January 27, 1960. On the same day Duvall wired back that he had received no such Bulletin and to send the Bulletin to him. The Bulletin and revision reached Duvall on April 12, 1960, which the evidence establishes, was the first time Duvall had seen these documents.

The Bulletin of January 25, 1960, as revised on January 27, 1960 purported to make substantial changes in Mathes’ relations with its Distributor-Dealers. The labor allowance was discontinued entirely. Mathes would no longer pay for freight one-way and the Five Year Warranty was terminated. In lieu of it, for units installed after January 25, 1960, there was a Four Year Compressor Replacement Warranty Agreement, which ⁴¹⁹ applied only to compressors returned with freight prepaid to be replaced by Mathes, freight collect, if inspection revealed that a defect actually existed in material and workmanship.

In a letter, dated May 16, 1960, to Mathes (received by Mathes on May 19), Duvall wrote, in part, as follows: “With your new restrictive warranties and the changes you created, the value of the equipment has decreased. It places a financial burden upon me which was previously your burden and was included in the original transaction between us. Based on my service records, the previous warranty is worth in excess of 50% of the original factory price of the equipment purchased under it. Incidentally, the equipment I sold was sold with the prior warranty in effect. “As a result of your policy or warranty changes, I have no alternative but to demand that I be returned to a status quo position.

By this I mean that any and all equipment ordered from you prior to your policy and warranty change, be returned to the factory (at your expense) and any notes or charges incurred by me be cancelled, and that my payments be returned and expenses incurred by me be reimbursed. Naturally, your warranty on the equipment I sold under pre-existing contracts will continue in full force and effect as originally made by you. “Until I definitely know that the attachment levied by the Sheriff is dissolved, I have no alternative but to retain in my possession any chattel or credits which I might have or which might accrue to you during the course of normal business.” There were conferences and correspondence between Duvall and Mathes in an effort to settle these differences but these efforts were unavailing. On June 1, 1961, Republic acquired the assets of Mathes and on July 7, 1961, Duvall was advised of this and was further advised that, in regard to the warranty, any obligation of Republic “is limited to the replacement ‘exchange’ of defective component parts, provided such defective component parts were, ⁴²⁰ in Mathes’ final judgment, actually defective in original material and workmanship.” It further stated that “We cannot be responsible for labor, freight, or the price or cost of parts furnished by any distributor, jobber, dealer or others.” Republic denied any credits claimed by Duvall on in-warranty replacements on the ground that Republic had purchased “assets only.” On July 29, 1961, Republic made demand on Duvall for payment of Duvall’s open account and notes to Mathes in an alleged balance of $19,631.62. Duvall wrote Mathes on August 9, 1961 and advised it of the receipt on August 4 of the Republic letter of July 29; that Mathes had breached its contract with Duvall on January 25, 1960 by its drastic change in its warranty; and, demanded 14 items of damages in the total amount of $110,153.83.

(These are the same items which were later set forth in Duvall’s declaration.) Duvall ordered no new equipment from Mathes subsequent to April 12, 1960. After Duvall’s attachment was discharged on June 21, 1962, Republic had the Sheriff release all of the equipment in the warehouse to it and took possession of it on July 24,1962. Glen Alden and Republic, the appellants, urge a number of alleged errors by the lower court. These may be considered under three general headings: I. There is no liability at all on the part of Glen Alden and Republic because (a) Duvall failed in its proof to show any breach of the contract by them (b) Duvall first breached the contract himself, (c) Duvall waived any breach, and (d) Mathes had the right to modify the contract which prevented liability for a breach.

II

The trial court erred in admitting certain testimony.

III

The damages were erroneously calculated by the trial court (a) in theory and (b) upon the facts in the case. We will state facts in addition to those already stated as we consider the issues raised. Before considering the issues specifically, we should point out two principles which generally apply in this case. These are: 1) As the case was tried by the lower court without a jury, we will not reverse the decision of the lower court upon the facts unless that determination is clearly erroneous, and due consideration will be given to the ⁴²¹ opportunity of the lower court to judge the credibility of the witnesses.

Maryland Rule 886 a. Johns v. Director, 239 Md. 411 , 211 A. 2d 751 (1965). 2) Duvall, the appellee, took no cross appeal in this case so that we will not reverse upon rulings of the trial court adverse to Duvall which we might otherwise consider erroneous and prejudicial to him. Reece v. Reece, 239 Md. 649 , 212 A. 2d 468 (1965); Harrison v. Robinette, 167 Md. 73, 83 , 173 Atl. 60 (1934). See Mezzanotte Constr.

Co. v. Gibons, 219 Md. 178, 183 , 148 A. 2d 399 (1959). See also the cases collected in 2 M.L.E., Appeals, section 353. I. We are of the opinion that the ruling of the trial court that Glen Alden and Republic had breached the contract with Duvall was not clearly erroneous. A. The appellants contend that the evidence was insufficient to* establish a breach of the contract because of the refusal by Mathes to give him credit for returned parts, claimed to- be defective, to give Duvall the labor allowance for service in connection with those parts and because of the change in the warranty by the Bulletin of January 25, 1960.

In our opinion there was sufficient evidence to establish the breach of contract for those reasons. Although the contractual relationships between Duvall and Mathes were partly oral, partly written, and partly evidenced by the business practices between the parties, the trial court accepted Duvall’s testimony in regard to the contract between the parties. His testimony is supported in substantial measure by the correspondence, documents and business practice under the arrangement. We have already stated the contractual arrangement and need not repeat it here.

There is no doubt that Duvall was to be given credit by Mathes for defective parts, was to be paid the labor allowance in connection with these parts, Mathes was to pay the freight one-way and that the original warranty was of the essence in the contract as it was essential to Duvall, as Distributor-Dealer, in the marketing of the product. Duvall testified that the original warranty was ⁴²² worth 50% of the list cost of the equipment and that without it, as originally given, he could not sell the equipment. The appellant is correct in stating that the burden of proof was on Duvall to establish the breach of contract. Duvall had the burden of showing that the returned parts returned by him were defective before he could recover from Mathes.

See Slaska v. Idzi, 186 Md. 530, 534 , 47 A. 2d 503, 504-505 (1946). In our opinion, Duvall established the defects by his testimony, the testimony of William C. Sutton, the service manager of Duvall, the Return Parts Tags and Material Return Tag Tally Sheets, and the business practice between Duvall and Mathes in connection with the return of parts, the giving of credit for them and the giving of the labor allowance. As we have noted, the forms and the procedure for the return of defective parts were established by Mathes. There was a section of the Return Parts Tag in which the Distributor-Dealer set out the nature of the defect.

This was done after the examination of the part by Duvall or his employees experienced in detecting these defects, upon its removal from the customer’s installation, and this notation in this record kept in the ordinary course of business established, prima jade, that this was the defect. Warczynski v. Barnycz, 208 Md. 222, 230 , 117 A. 2d 573, 576 (1955) ; Bethlehem-Sparrows Point Shipyard v. Scherpenisse, 187 Md. 375, 380-381 , 50 A. 2d 256, 259-260 (1946). The evidence accepted by the trial court shows that for more than a year of actual operation under the contract, Mathes accepted in almost every instance, the determination by the Distributor-Dealer in regard to the defective character of the part. In other words, Mathes considered the determination by the Distributor-Dealer to be accurate and reliable.

After a change in ownership of Mathes stock and some financial strain upon Mathes, refusals of credit because of alleged lack of defects under the warranty began to occur, but in our opinion, the trial court could properly find from all the evidence that Duvall had established the defective character of the parts and Mathes’ refusals of credit for these parts and for the labor allowance were a breach of the contract. The forms were kept in the regular course of business and were properly received into evidence as we will indicate later. The appellants complain ⁴²³ that Duvall only had personal knowledge as to the condition of two items and that he should have offered an expert to testify in regard to the condition of the other items returned. This, however, goes to the weight of the evidence and the trial court could and did find that the evidence established the defective character of the returned parts.

We cannot say that this finding was clearly erroneous. The same comments are applicable to the contention of the appellants that there was no proof of a breach of the warranty. It is true that Mathes had the right to examine the returned part to determine whether it was defective under the warranty and, if