Lynx, Inc. v. Ordnance Products, Inc.

O’Donnell, J., delivered the opinion of the Court. The appellant, Lynx, Inc. (Lynx), revisits us in its efforts to avoid the finality of summary judgments entered against it in favor of Ordnance Products, Inc. (OPI) and Martin Electronics, Inc. (MEI). Its first incursion resulted in its appeal being dismissed since the order of June 1, 1973, granting summary judgment under the appellees’ counts Six, Seven and Eight, did not comply with Maryland Rule 605 a, requiring “an express determination that there is no just reason for delay and ... an express direction for the entry of judgment” where more than one claim for relief is presented in an action. Lynx, Inc. v. Ordnance Products, Inc. [No. 132, Sept. Term 1973, decided January 28, 1974] (unreported opinion). 1 ⁴ As a prime contractor for the United States government, Lynx, on August 27, 1971, entered into a contract with OPI for the manufacture and delivery to Lynx of 3,000,000 M-213 hand grenade fuzes (P. O. 1070); by addenda and amendments dated February 29 and August 28, 1972, the number of fuzes ordered by Lynx under P. O. 1070 was increased to 4,780,050.

In addition to the manufacture of the fuzes OPI agreed to provide labor and material for “strapping” government packing boxes (at $.0037 per fuze). Lynx similarly contracted on September 17, 1971, with MEI for the manufacture and delivery of 1,647,100 XM-228 hand grenade fuzes (P. O. 1074); that order was supplemented on May 3, 1972, to provide for the production of a total of 2,403,100 such fuzes. On July 19, 1972, Lynx entered into yet an additional contract with MEI (P. O. 1498) for the manufacture and delivery to it of 2,044,000 M-213 hand grenade fuzes. Each of the contracts provided for the delivery of the hand grenade fuzes to Perry, Florida; each provided for government inspection of the product prior to shipment from the respective plants „of OPI and MEI; and each provided that as payments were received from the United States government, under the prime contracts, by Lynx, or its assignee financing institution (Commercial Credit Business Loan, Inc.), that a portion of such receipts representing the respective billings by OPI and MEI were to be paid unto each of them “on the same day.” An appendage to the purchase orders provided a schedule for delivery of the fuzes commencing August 31, 1972, and terminating January 31,1973.

Both OPI and MEI on March 19, 1973, filed their declaration, 2 coupled with a motion for summary judgment, ⁵ against Lynx alleging inter sese that the hand grenade fuzes manufactured under the respective purchase orders were delivered to Lynx and accepted as tendered and that Lynx had refused to pay for the delivered and accepted units. OPI asserted that $46,854.72 was due and owing it; MEI claimed $67,066.41. On April 23,1973, Lynx filed its general issue plea, as well as an affidavit in opposition to the motion for summary judgment. Lynx’s affiant, its vice president, asserted that there was “a genuine dispute” between the parties which was “material to the plaintiffs’ claims; ” it asserted that purchase order No. 1070 had not been “fulfilled” by OPI in that 118,659 units [manufactured by it] had been rejected by the government; that as a result of the “poor quality of work done” by OPI and its failure to “rework” these rejected units, Lynx’s contract with the government was “in danger of being terminated.” Lynx similarly asserted in the affidavit that five lots totalling 244,800 of the units produced by OPI, although accepted at the plant, were found unacceptable “when tested further by the Government in the field due to poor quality and substandard materials used.” In connection with the claim by MEI, the affidavit on behalf of Lynx asserted that 317,200 units produced by MEI under purchase orders 1074 and 1498, although accepted by the government at the plant, were similarly later rejected after field testing and that Lynx was in “a position of having to rework or resupply these units to satisfy the Government, keep a good relationship and thereby preventing its contract or contracts from being terminated by the Government.. ..” Lynx additionally undertook to challenge in its affidavit the unit price payable to OPI under amended P. 0.1070 “for strapping the shipping boxes,” alleging that the government had found such price unacceptable. 3 ⁶ A supplemental affidavit in support of the motion for summary judgment was filed on May 25, 1973, on behalf of OPI and MEI, setting forth a letter dated March 5, 1973, from the vice president of Lynx (its affiant) to both appellees, which stated in pertinent part: “Our cash flow has been severely interrupted in the last 60 days, due in part to a quality problem at OPI and MEI resulting in 187,770 units being unacceptable to the Government with a subsequent delay in payments from the Government.

We had a ‘past due’ amount owing OPI and/or MEI of approximately $114,000.” The letter additionally proposed a financial “arrangement” between Lynx and the appellees whereby from the balances paid to Lynx by the government it would remit certain amounts to both OPI and MEI on account of the balance due them, but left an unpaid balance in the amount of $36,876 — without any provision for payment. The Circuit Court for Cecil County (Roney, J.), holding that under the provisions of Maryland Code (1957,1964 Repl. Vol.) Art. 95B, § 2-606 and § 2-607, that there had been an acceptance of the goods by Lynx, entered summary judgment on June 1, 1973, in favor of both OPI and MEI in the total amount of $113,921.13, without apportionment to the respective plaintiffs. Following our remand, the trial court in compliance with the provisions of Rule 605 a, found that there was “no just reason for delay” and entered final amended summary judgments respectively in favor of OPI for $46,854.72 and in favor of MEI for $67,066.41. 4 ⁷ Lynx here again asserts that it was error for the trial court to have entered the final summary judgments (as amended) against it since a material question of fact — whether quantities of fuzes produced and delivered had been rejected — was raised in the pleadings and affidavits.

We do not see it that way and shall this time affirm. Rule 610 d 1 provides that summary judgment shall be rendered forthwith if the pleadings, depositions, and admissions on file, together with the affidavits, if any, show that there is no genuine dispute as to any material fact and that the moving party is entitled to a judgment as a matter of law. Gildenhorn v. Columbia Real Estate Title Ins. Co., 271 Md. 387, 408 , 317 A. 2d 836, 847 (1974).

The function of the summary judgment procedure is not to try the case or decide the issues of fact raised; it is merely to determine whether or not there is an issue of fact to be tried and if there is none, to cause judgment to be rendered accordingly. Brewer v. Mele, 267 Md. 437 , 298 A. 2d 156 (1972); Broadwater v. Arch, 267 Md. 329 , 297 A. 2d 671 (1972); Greenwell v. American Guaranty Corp., 262 Md. 102 , 277 A. 2d 70 (1971); Trustees of Broadfording Church of the Brethren v. Western Maryland Ry. Co., 262 Md. 84 , 277 A. 2d 276 (1971). At the trial level, the purpose of the hearing on the motion is to decide whether a real dispute as to material facts does exist; if the pleadings, depositions, admissions and affidavits (if any) show that there is no genuine dispute as to any material fact and that the movant is entitled to judgment as a matter of law, summary judgment should be granted.

Salisbury Beauty Schools v. State Bd. of Cosmetologists, 268 Md. 32 , 300 A. 2d 367 (1973); Brewer v. Mele, supra; Brown v. Suburban Cadillac, Inc., 260 Md. 251 , 272 A. 2d 42 (1971). A bare allegation in a general way that there is a dispute as to material facts is never sufficient to defeat a motion for summary judgment. James v. Tyler, 269 Md. 48 , 304 A. 2d 256 (1973); Shaffer v. Lohr, 264 Md. 397 , 287 A. 2d 42 (1972); Melbourne v. Griffith, 263 Md. 486 , 283 A. 2d 363 (1971). General allegations which do not show facts in detail and ⁸ with precision are insufficient to prevent the entry of summary judgment.

Davis v. Montgomery County, 267 Md. 456 , 298 A. 2d 178 (1972). Even where it is shown that there is a dispute as to a fact, when the resolution of that factual dispute is not material to the controversy, such dispute does not prevent the entry of summary judgment. Salisbury Beauty Schools v. State Bd. of Cosmetologists, supra; Shaffer v. Lohr, supra; S. L. Hammerman Organization, Inc. v. Community Health Facilities, Inc., 264 Md. 37, 50 , 284 A. 2d 599, 605 (1971); Meola v. Bethlehem Steel Co., 246 Md. 226, 239-40 , 228 A. 2d 254, 262 (1967). Such a material fact must be one, the resolution of which will somehow affect the outcome of the case.

Rooney v. Statewide Plumbing and Heating-Gen. Contractors, Inc., 265 Md. 559 , 290 A. 2d 496 (1972); Parklawn, Inc. v. Nee, 243 Md. 249 , 220 A. 2d 563 (1966). In connection with a ruling to be made on a motion for summary judgment the function of the trial court is much the same as that which it performs at the close of all the evidence in a jury trial when motions for directed verdict or requests for peremptory instructions require a decision as to whether an issue requires resolution by a jury or is to be decided by the court as a matter of law. Salisbury Beauty Schools v. State Bd. of Cosmetologists, supra; Rooney v. Statewide Plumbing and Heating-Gen.

Contractors, Inc., supra. In reviewing the propriety of the grant of a summary judgment we are concerned primarily with deciding whether a factual issue which was material to the resolution of the controversy existed and whether the trial judge was legally correct. Brewer v. Mele, supra; Rooney v. Statewide Plumbing and Heating-Gen. Contractors, Inc., supra; Brown v. Suburban Cadillac, Inc., supra.

Where the record shows that there was no such genuine dispute as to any material fact necessary to resolve the controversy as a matter of law, and it is shown that the movant is entitled to judgment, the entry of summary judgment is proper. Selected Risks Ins. Co. v. Willis, 266 Md. 674 , 296 A. 2d 424 (1972); S. L. ⁹ Hammerman Organization, Inc. v. Community Health Facilities, Inc., supra. The right of the appellees to judgments against the appellant is clearly controlled by the Maryland version of the Uniform Commercial Code (the UCC), Code (1957, 1964 Repl.

Vol.) Art. 95B. Section 2-709 (1)(a) of the UCC provides that “[w]hen the buyer fails to pay the price as it becomes due the seller may recover . . . the price ... of goods accepted ....” See Clark v. Zaid, Inc., 263 Md. 127 , 282 A. 2d 483 (1971). Section 2-606 pertains to the acceptance of goods and provides as follows: “ (1) Acceptance of goods occurs when the buyer (b) Fails to make an effective rejection (subsection (1) of § 2-602), but such acceptance does not occur until the buyer has had a reasonable opportunity to inspect them;. . . (2) Acceptance of a part of any commercial unit is acceptance of that entire unit.” 5 Section 2-602 (1) provides: “ (1) Rejection of goods must be within a reasonable time after their delivery or tender.

It is ineffective unless the buyer seasonably notifies the seller.” (Emphasis supplied.) In Fred J. Miller, Inc. v. Raymond Metal Products Co., 265 Md. 523 , 290 A. 2d 527 (1972), we held that the continued use of a number of lengths of dredging pipe purchased by Miller ¹⁰ constituted an acceptance. Judge Singley, who delivered the opinion of the Court, stated: “Acceptance of goods may result under § 2-606 (1) when a buyer, after reasonable opportunity to inspect, notifies the seller that the goods are conforming or that he will retain them despite their non-conformity. Webb v. Chevy Chase Cars, Inc., 259 Md. 284, 287 , 269 A. 2d 810 (1970), or fails effectively to reject the goods, or does any act inconsistent with the seller’s ownership. It is unnecessary to determine whether Miller’s letter of 17 March amounted to an acceptance or rejection of the non-conforming pipe because its continued use of 83 lengths of the pipe after the defect had become apparent.. . was clearly an acceptance, § 2-602 (2)(a); § 2-606 (1)(c).” 265 Md. at 527-28, 290 A. 2d at 529.

(Emphasis supplied.) In Webb v. Chevy Chase Cars, Inc., 259 Md. 284 , 269 A. 2d 810 (1970), cited in Miller, supra, we held § 2-606 applicable where the appellant had inspected the truck which was the subject of the sale and thereafter accepted it and used it in his business. In Clark v. Zaid, Inc., supra, we held that the entry of summary judgment in favor of the appellee should not have been granted because there existed a genuine dispute of material fact as to whether or not the appellant had effectively rejected furniture which was allegedly severely damaged at the time of delivery. Factually in issue was whether the appellant on the day of the delivery of the furniture had notified the appellee that because of its damaged condition it was entirely unacceptable and demanded that it be taken back, or whether she in making claim upon a linoleum company for damage to the buffet exercised such dominion, control and authority over the furniture as to constitute an acceptance as a matter of law, despite her earlier rejection of it. ¹¹ Chief Judge Hammond, who delivered the opinion for the Court, stated: “ [I]t is significantly material whether Miss Clark did or did not make an effective rejection of the furniture, and the facts on which the answer would turn are in genuine dispute. [Involved in a determination of the buyer’s right to reject the furniture as nonconforming goods would be its original quality, the nature and extent of the damage it suffered, whether the damage could be repaired so as to restore the original quality and appearance, and similar factors. The buyer’s judgment would have to be exercised in good faith, Code (1964 Repl.

Vol.), Art. 95B, § 1-203, whether there is used the buyer’s personal judgment test or a reasonable man’s judgment test. See a discussion of the point in 2 Anderson, Uniform Commercial Code, p. 158, § 2-601:13 et seq. (2d ed. 1971), and compare First National Realty Corp. v. Warren-Ehret, 247 Md. 652 .] If the rejection was warranted and effective, the Code imposes on Miss Clark certain duties (footnote omitted) as well as giving her various privileges and optional rights which could result in her prevailing as defendant and counterclaimant; if the rejection was unwarranted and ineffective she could become liable for the balance of the purchase price, and a trier of fact should determine the issue of rightful rejection on evidence presented to it.” 263 Md. at 129-30, 282 A. 2d at 484-85 . Article 95B, § 2-607, in pertinent part, provides as follows: “ (1) The buyer must pay at the contract rate for any goods accepted.

(2) Acceptance of goods by the buyer precludes rejection of the goods accepted and if made with knowledge of a non-conformity cannot be revoked because of it unless the acceptance was on the ¹² reasonable assumption that the non-conformity would be seasonably cured but acceptance does not of itself impair any other remedy provided by this subtitle for non-conformity. (3) Where a tender has been accepted (a) The buyer must within a reasonable time after he discovers or should have discovered any breach notify the seller of breach or be barred from any remedy; 6 ... (4) The burden is on the buyer to establish any breach with respect to the goods accepted.” Although the UCC imposes the requirement of notice within a reasonable time of a breach, it does not prescribe any form or content for such notice. 7 Official Comment No. 4 under § 2-607 provides that the content of the notification “need merely be sufficient to let the seller know that the transaction is still troublesome and must be watched. . . . The notification .. . need only be such as informs the seller that the transaction is claimed to involve a breach, and thus opens the way for normal settlement through negotiation.” See Smith v. Butler, 19 Md. App. 467 , 311 A. 2d 813 (1973); Warrens Kiddie Shoppe, Inc. v. Casual Slacks, Inc., 120 Ga.

App. 578 , 171 S.E.2d 643 (1969); Nugent v. Popular Markets, Inc., 353 Mass. 45 , 228 N.E.2d 91 (1967). See also 67 Am.Jur.2d Sales § 730 (1973); 2 Anderson, Uniform Commercial Code § 2-607:25 (2d ed. 1971). ¹³ Where there has been more than one transaction between the parties some identification of the particular sale or transaction as to which the complaint is made by the buyer must be contained in the notice or the notice would fail of its purpose because the seller then would not understand to what the notice referred. Where there have been multiple transactions between the seller and the buyer the notice of a breach should, as far as it is practical, identify the particular transaction concerning which notification is made. See Annot., 53 A.L.R.2d 270 , 276 § 6 (1957).

This is all the more true when considered with the provisions of § 2-605 (l)(a) which states: “The buyer’s failure to state in connection with rejection a particular defect which is ascertainable by reasonable inspection precludes him from relying on the unstated defect to justify rejection or to establish breach [w]here the seller could have cured it if stated seasonably . ...” See 2 Anderson, supra, § 2-607:31. Where notice of rejection or of breach has been given by the buyer, the sufficiency of the notice and whether it was given within a reasonable time are ordinarily questions of fact based upon all the surrounding circumstances. Victorson v. Albert M. Green Hosiery Mills, Inc., 202 F. 2d 717 (3d Cir. 1953); Smith v. Butler, supra; L. A. Green Seed Co. of Ark. v. Williams, 246 Ark. 463 , 438 S.W.2d 717 (1969). See also Annot., 17 A.L.R.3d 1010 , 1102-04 (1968); 2 Anderson, supra, § 2-607:24.

Where, however, the facts are undisputed and but one inference can be drawn therefrom as to the reasonableness of the notice, the question is one of law. See Tinius Olsen Testing Machine Co. v. Wolf Co., 297 Pa. 153 ,