Defendant seller appealed the decision from the Superior Court

Defendant seller appealed the decision from the Superior Court of Los Angeles County (California), which entered judgment for plaintiff buyer in its suit to recover for damages due to the seller’s failure to deliver on two asphalt contracts and which denied a motion for a new trial. The seller challenged the sufficiency of the complaint, the evidentiary rulings, the damages calculation, and it alleged a rescission of the contracts.

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Overview

The parties had two contracts. The seller allegedly refused to supply the full contract amount, and the buyer was forced to buy replacement asphalt at higher prices. The appellate court reversed. The fact that there were two separate contracts and one count in the complaint did not prejudice the seller in presenting its defense. The fact that the complaint did not state in what manner the asphalt was packaged was not an error when the evidence supported the type of packaging. Since the contracts were for monthly periods and since the parties stipulated to the amount delivered by a certain date, the trial court incorrectly calculated damages for amounts delivered after that certain date. By the terms of the contracts, the seller was only obligated to deliver a certain amount, and it could only be held liable for the difference between that amount and the amount delivered. Since the contracts were for monthly amounts, the seller was not constantly in arrears. Evidence of market price of asphalt should have been allowed. When both parties were in default by refusing to pay and to deliver, the seller’s alleged rescission of the contracts was invalid.

Outcome

The judgment for the buyer was reversed and remanded for a new trial. The complaint was sufficiently pled so as not to prejudice the seller. The evidentiary rulings were partially incorrect. Damages were improperly calculated. The seller was not entitled to the defense of rescission.

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