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Affinity Mutual Insurance v. NIDEC Avtron Automation Corp.

United States District Court, N.D. Indiana

August 14, 2017




         Plaintiff Affinity Mutual Insurance a/s/o Holmes & Company, Inc., filed a four-count subrogation action against Defendant Nidec Avtron Automation Corporation.[1] The theories of recovery included negligence, strict products liability, breach of contract, and breach of implied warranties. The Defendant has moved for summary judgment [ECF No. 42] on all four claims. In response, the Plaintiff asserts that it has a viable cause of action for breach of contract and breach of warranty based on lost income and other damages associated with replacing the Defendant's failed component parts. However, the Plaintiff is no longer pursuing the negligence and product liability claims.

         The Defendant has presented evidence that the parties' contract contained language that would defeat the Plaintiff's remaining claims, but the Plaintiff maintains that a jury must determine whether this language was part of the contract between Holmes and the Defendant. For the reasons stated in this Opinion and Order, the Court finds that this case cannot be resolved as a matter of law on the record that has been presented.


         Holmes & Company operates a lumber mill in Columbia City, Indiana. In April 2012, Holmes purchased an Active Front End motor drive system from the Defendant for use in conjunction with Holmes's saw carriage. Such drive systems control the speed and torque of a motor in an industrial setting.

         The Defendant provided Holmes with a thirteen-page quote dated April 5, 2012, and designated as “Quotation R12-00803.” It was signed by a regional sales manager for the Defendant. Among the Terms and Conditions set forth in Quotation R12-00803 was a term regarding warranties and disclaimers:

Company warrants that its products will be free from defects in material or workmanship for a period of one (1) year following installation, or fifteen (15) months after shipment from Company, whichever is shorter. NO OTHER WARRANTY, EXPRESS OR IMPLIED, INCLUDING ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE IS MADE FOR THESE PRODUCTS, AND ALL OTHER WARRANTIES ARE HEREBY EXPRESSLY EXCLUDED. In the event of a defect, the Company's obligation shall be limited to the supply of replacement parts free of charge. . . . COMPANY SHALL HAVE NO OTHER LIABILITY, DIRECT OR INDIRECT, OF ANY KIND, INCLUDING LIABILITY FOR SPECIAL, INCIDENTAL, OR CONSEQUENTIAL DAMAGES.

(Quotation, ECF No. 43-3 at 10.)

         On April 6, 2012, Holmes faxed a purchase order to the Defendant's regional sales manager regarding “Quote # R12-00803.” (Purchase Order, ECF No. 43-3 at 2.) The description of the item ordered is a “200 HP Standard Avtron Saw Carriage Electric Drive System per Quote.” (Id.) On the line reserved for indicating who approved the purchase order is the name Daniel Almendinger- he is the owner of the saw mill. In his Affidavit, Almendinger acknowledges that the parties agreed on price and general terms, that his company sent the purchase order, that the Defendant then installed the drive system, and that he received the written quote designated as R12-00803 (hereinafter “Quote R12-00803” or “the Quote”). However, he does not identify when he received the Quote (Almendinger Aff. ¶ 6, ECF No. 47-1 (stating that “[a]t some point, Holmes & Company, Inc. received the written quote” that the Defendant attached to its Summary Judgment Motion)), and maintains that there was never “any discussion between Defendant and anyone at Holmes about any of the terms contained in that Quote” (id. ¶ 7).

         In 2014, a filter within the Defendant's product failed to perform correctly and was damaged. Holmes submitted a claim to the Plaintiff insurance company for the profits it lost from April 14-28, 2014, while the necessary component part of the drive system was being commissioned. Holmes also incurred costs for building supplies required to build an addition to the electrical room so that it would house a larger filter. These costs are the subject of the Plaintiff's claims in this litigation.


         A. Summary Judgment Standard

         Summary judgment is warranted when “the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). A court should only deny a motion for summary judgment when the nonmoving party presents admissible evidence that creates a genuine issue of material fact. Luster v. Ill. Dep't of Corrs., 652 F.3d 726, 731 (7th Cir. 2011) (first citing United States v. 5443 Suffield Terrace, 607 F.3d 504, 510 (7th Cir. 2010); then citing Swearnigen-El v. Cook Cnty. Sheriff's Dep't, 602 F.3d 852, 859 (7th Cir. 2010)). A court's role in deciding a motion for summary judgment “is not to sift through the evidence, pondering the nuances and inconsistencies, and decide whom to believe. [A] court has one task and one task only: to decide, based on the evidence of record, whether there is any material dispute of fact that requires a trial.” Waldridge v. Am. Heochst Corp., 24 F.3d 918, 920 (7th Cir. 1994). Material facts are those that are outcome determinative under the applicable law. Smith v. Severn, 129 F.3d 419, 427 (7th Cir. 1997). Although a bare contention that an issue of material fact exists is insufficient to create a factual dispute, a court must construe all facts in a light most favorable to the nonmoving party, view all reasonable inferences in that party's favor, see Bellaver v. Quanex Corp., 200 F.3d 485, 491-92 (7th Cir. 2000), and avoid “the temptation to decide which party's version of the facts is more likely true, ” Payne v. Pauley, 337 F.3d 767, 770 (7th Cir. 2003).

         B. Negligence and Strict ...

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