Court Rules in Favor of Allmetal, R.O.W. Window Co.
Appeal in Breaches of Implied Warranty Case Denied
Judges with the Third District Appellate Court of Illinois have
denied R.O.W. Window Co.'s appeal of a trial court's ruling that
Allmetal Inc. had disclaimed implied warranties in a case that could
have further implications across the industry.
R.O.W. filed a lawsuit against Allmetal in 2003, alleging "breach
of implied warranty of fitness for a particular purpose and breach
of implied warranty of merchantability" stemming from the purchase
corner keys and spacers from Allmetal, which it said failed to perform
in R.O.W. products as anticipated and consequently forced R.O.W.
insulating glass windows to fail during the 10-year warranty period
offered by the company. R.O.W. sought more than $1 million in damages
in its original lawsuit.
In 2005, Allmetal filed a motion to dismiss the complaint presenting
the argument that its catalog and invoices included a disclaimer
disavowing liability for "warranties either express or implied,
including any implied warranty of merchantability or fitness for
a particular purpose." R.O.W. responded to the motion to dismiss,
with three counter arguments of its own: that the disclaimers were
not conspicuous, that the company was not bound by them because
they were not part of the sales contract-R.O.W. ordered on recommendation,
not from the catalog and generated invoices from its own computers
rather than receiving them from Allmetal-and that "former sales
manager and president … was not aware of the disclaimer or limitation
of warranty," while the employee in charge of ordering the corner
keys and spacers "did not have the authority to waive any warranty
for the items he had purchased." The trial court ruled in its favor
of Allmetal and R.O.W. subsequently filed an appeal of the ruling.
The appeals court ruled that the "disclaimers were presented in
a manner reasonably sufficient to draw attention to them" as they
were set off either by open space above and below it (on the invoice)
or in a separate text box with a boarder or shading to set it off
from the rest of the page (in the catalog).
The court also ruled that R.O.W. could not claim lack of knowledge
about the disclaimer based the argument that it was not part of
the sales contract, stating that "there was a course of dealing
that took place over several years" and "that course of dealing
supplements the terms of the parties' agreement and establishes
that the exclusion of implied warranties was a part of the bargain."
Additionally, the judges overseeing the case ruled that, "the plaintiff
accepted and used those products, paid out on the invoices, and
allowed the purchasing employee to order more products without objection
and without ever communicating any limitations to the defendant.
The facts establish that the purchasing employee had, at the very
least, apparent authority to enter into transactions with the defendant"
and dismissed R.O.W's appeal.
HERE to read the decision in its entirety.