The opinion of the court was delivered by: Joyner, District Judge.
This breach of contract action was tried before the undersigned
in December, 1998. The parties have submitted their proposed
factual findings, legal conclusions and briefs and the matter is
now ripe for disposition. Accordingly, the Court now make the
1. Plaintiff, Aircraft Guaranty Corporation ("AGC"), is a
Delaware corporation with its principal place of business in
Heidelberg, Germany. The plaintiff also maintains a business
address in the office of its Vice President, William Walker, in
Houston, Texas. Plaintiff's President and Chairman of the Board
is Connie Wood.
2. AGC's principal business is providing title servicing and
management services to non-U.S. citizens who want to own U.S.
3. Defendant is Strato-Lift, Inc. ("SLI"), a Pennsylvania
corporation, with its principal place of business in Morgantown,
Pennsylvania. Strato-Lift is in the business of manufacturing
platform equipment. Although it has bought and sold various
aircraft since 1985, it is not in the business of buying and
selling aircraft but rather uses its planes for transporting its
customers, going to trade shows and training programs and
bringing people into its manufacturing plants.
5. B.Van Milders, N.V. ("Van Milders") acts as an officer of
several different companies, including Flying Partners, a Belgian
partnership which sells partnership interests in corporate jets
and planes to international businesses. The principal business of
B. Van Milders, N.V. is buying and selling airplanes, largely
through Flying Partners. There is no such entity as Bernard Van
Milders, B.V., B. Van Milders, b.v., Bernard Van Milders, b.v. or
B. Van Milders, B.V.
6. B. Van Milders, N.V. and Aircraft Guaranty Corporation have
a relationship whereby AGC sets up trusts and lease/operation
agreements to procure November (FAA) registrations for Flying
Partners aircraft in the United States. By utilizing an
American/FAA registration, Flying Partners is able to reduce its
operational costs in that it need only comply with the
registration requirements of one country, as opposed to many,
7. At all times material hereto, Connie Wood was acting in his
capacity as an officer, director, employee and agent of
Plaintiff, Aircraft Guaranty Corporation.
8. In the summer of 1995, Strato-Lift decided to expose the
1993 Cessna Citation II which it purchased in April, 1995 from
First of America Bank Corporation to the market. This was in
keeping with Strato-Lift's practice of buying late model, low
mileage aircraft, keeping and using them for a few months and
then re-selling them for the same or a slightly higher price than
that originally paid. In this fashion, SLI was able to avoid a
lot of the maintenance costs associated with flying a plane for a
lot of hours.
9. SLI thus retained Kenneth F. Goodrich, d/b/a K.F. Goodrich
Associates, Inc. ("Goodrich")*fn1, a sole proprietorship located
in New Milford, Connecticut, to broker the sale of its plane.
Goodrich thereafter advertised the plane in various trade
publications distributed both nationally and internationally.
10. At all times material hereto, Kenneth F. Goodrich and/or
K.F. Goodrich & Associates, Inc. was acting as the authorized
agent for Defendant, Strato-Lift, Inc.
11. In late October or early November, 1995, Mr. Van Milders
informed Mr. Wood that he was interested in obtaining a late
model Cessna Citation aircraft to be used in the Flying Partners
program. Specifically, Van Milders was looking for a plane which
was built no earlier than 1991 with less than 1500 hours of air
time and he authorized AGC to locate such a plane for him.
12. Although AGC was purportedly acting on behalf of its "trust
client," B. Van Milders, N.V., it was AGC — not Van Milders which
was to take title to the plane from Strato-Lift.
13. On or about December 18, 1995, Mr. Wood requested a
specification sheet on SLI's Citation II aircraft, which had a
serial number of "725" from Mr. Goodrich. That same date, Mr.
Goodrich responded via facsimile transmission with the requested
specification sheet and advised that the asking price for the
plane was $3,550,000.
14. Wood and Goodrich began negotiating for the sale of the
plane and following the exchange of various offers and
counter-offers, on December 27, 1995, Mr. Wood offered to
purchase the plane for the sum of $3.5 million subject to eleven
(11) listed conditions. Mr. Goodrich signed the letter agreement
and faxed it back to AGC that same day.
15. Among the conditions listed in the December 27, 1995 letter
4. Completion of a prepurchase inspection and test
flight prior to and after completion of all
maintenance and modifications performed. Prepurchase
inspection and test flights will be at purchaser's
expense and discretion. Items to be inspected and the
results of said inspection are to be to the sole
discretion and satisfaction of the purchaser.
Purchaser reserves the right to reject the aircraft
for any reason. Airworthiness discrepancies
discovered during the prepurchase inspection or test
flights must be corrected prior to delivery by seller
unless otherwise waived by purchaser.
5. Prepurchase inspection to be conducted at a
disinterested third party maintenance facility
mutually agreeable to both parties. Purchaser to bear
expense of fuel and pilot expense to move ...