Appeal from the Judgment Entered September 18, 2012 In the Court of Common Pleas of Chester County Civil Division at No(s): 2010-11565
BEFORE: BOWES, OTT, and STRASSBURGER, [*] JJ.
Upper Darby Sign Company, d/b/a Pro Signs ("Pro Signs") commenced the within action for breach of contract against TEH Enterprise, LLC and a/d/b/a Marketechs ("Marketechs") when Marketechs refused to pay the balance owing on a contract for custom-manufactured beer signs. In addition to the contract balance, Pro Signs also sought interest and attorneys' fees. Marketechs counterclaimed for return of its deposit and consequential damages incurred as a result of the defective signs. After a non-jury trial, the trial court issued extensive findings of fact and conclusions of law. The trial court concluded that Pro Signs breached the contract and ordered it to reimburse Marketechs the $41, 308.00 it had paid, together with interest and fees, but denied Marketechs' counterclaim for consequential damages. Pro Signs appealed; Marketechs cross-appealed, contending that the trial court erred in denying foreseeable incidental and consequential damages. The appeals were consolidated. After review, we affirm in part and reverse and remand in part.
The record reveals the following. In May 2010, Marketechs approached Pro Signs about designing and manufacturing 1, 542 signs in eight styles to be used in bars to advertise Heineken and Amstel brands of beer. Marketechs provided photographs of the types of signs it wanted, together with a sample A-Frame sign, for Pro Signs to use in preparing its shop drawings. Findings of Fact and Conclusions of Law, 4/4/12, Finding of Fact No. 10, at 5. Shop drawings dated June 22, 2010 were produced. On June 24, 2010, Marketechs completed a "Pro Signs Company Credit Application and Account Agreement" with Pro Signs. Five days later,
Marketechs entered into a contract with Jay Group in which it agreed to furnish these items. While the contract between Marketechs and Jay Group identified Pro Signs as the subcontractor, Marketechs did not inform Pro Signs of its contract with Jay Group.
As early as June 23, 2010, Becky Boyd, the project manager for Marketechs, told Pro Signs that it would be required to box the signs individually and that she would provide labels for each carton. N.T., 3/9/12, at 163-64. In a subsequent discussion with Pro Signs' Engineering Manager, Jamin Rosenfeld, Ms. Boyd confirmed that each sign had to be bubble wrapped for shipping. Id. at 166. It was also agreed that the products would be shipped directly to Jay Group's warehouse.
On June 30, 2010, Pro Signs received eight purchase orders from Marketechs for the eight different sign designs it agreed to produce. N.T., 3/8/12, at 14. Pro Signs prepared prototypes of several of the designs, and, at a meeting with Marketechs representatives on July 16, 2010, the parties discussed changes to the final products and the specific packaging. Id. at 15. A follow-up email was sent by Marketechs to Pro Signs confirming the changes. Id. at 18. On July 26, 2010, Marketechs paid Pro Signs $41, 308, representing one-half of the total contract price. Following delivery of the goods, Pro Signs invoiced Marketechs for $37, 177.20. Marketechs issued payment on that date, but subsequently stopped payment on the check.
Upon inspection, Jay Group discovered that the signs were defectively manufactured and notified Marketechs. Ms. Boyd and Mr. Ferdebar, one of Marketechs' two owners, immediately proceeded to Jay Group's warehouse and inspected random samples of the product. Ms. Boyd agreed that the quality was inferior and the products were improperly manufactured and packaged. N.T., 3/9/12, at 174. The changes agreed upon and confirmed after the prototype meeting were only partially incorporated into the finished products. Findings of Fact and Conclusions of Law, 4/4/12, Findings of Fact No. 19, at 7. Marketechs advised Pro Signs of the deficiencies, but Pro Signs was unwilling to make corrections on the terms offered by Marketechs. Id. No. 25, at 8. When Marketechs refused to tender payment, Pro Signs initiated the within action.
At trial, Marketechs opened sealed boxes that were randomly pulled from the more than 1, 500 boxes of products and introduced into evidence. The fact finder was able to examine and compare the final products with the prototypes, as modified by the parties at the July 16, 2010 meeting, and confirmed in Ms. Boyd's email. The court found "marked differences between the qualities of workmanship" on those products "versus the prototypes" that Marketechs approved. Id., No. 27, at 9-10. The court noted: the edges were not smooth; the paint was not a gloss finish, as described in the drawings and as used on the prototypes; A-frame designs had only one hinge instead of the two hinges depicted in the shop drawings and prototypes; the surfaces were covered with glue, nail holes, scratches, and handprints; bubble wrap was not used to package the product, although it was discussed at the prototype meeting and confirmed in the email. Id. Generally, the items did not conform to specifications and were sloppily made. The court concluded that Pro Signs' breach was material, that it was not entitled to recover the balance owing on the contract, and ordered it to return Marketechs' initial payment for the signs. Id., Conclusions of Law Nos. 8 and 15, at 19-20.
Pro Signs presents nine issues for our review, many of which overlap.
I. The Lower/Trial Court should have granted the Plaintiff's/Appellant's Motion in Limine to exclude the testimony of The Jay Group representative, Megan Hemple, for the reasons set forth in the Motion.
II. The Appellees/Defendants accepted the design, services, material and/or products provided by the Appellant/Plaintiff.
III. The Appellees/Defendants possessed the right to inspect at any time and in fact inspected the signage without notice of objection or to order the shut down of production; Consequently, the Appellees/Defendants acquiesced and waived any right of breach of contract.
IV. Appellees are not entitled to damages which were not directly foreseeable and or contemplated by the Appellant/Plaintiff in respect to the expectations of the Appellees/Defendants customer, the Jay Group.
V. The Defendants/Appellees own actions were a substantial and material contributing factor, preventing and/or hindering Plaintiff's/Appellant's performance of the contract; Therefore, Appellees/Defendants can not take advantage of its own actions and allege a breach on the part of the Appellant/Plaintiff for the signage purportedly not being in conformity to Shop Drawings, Prototypes and or expectation of Appellees/Defendants and or its customer, The Jay Group; Consequently, the Appellees/Defendants waived any right to a breach of contract on the part of the Appellant/Plaintiff.
VI. The Appellees/Defendants failed to exercise a duty to mitigate damages.
VII. The weight of the evidence established the signage provided by Appellant/Plaintiff were in conformity with the Shop Drawings, Prototypes and issued Purchase Orders, particularly where the Shop Drawings and Prototypes were approved by the Appellees/Defendants. Therefore, verdict was against the weight of evidence.
VIII. The Defendants'/Appellees' payments after approving the Shop Drawings, Prototypes, opportunity to inspect and actual inspections and acceptance of multiple deliveries of the signs over a span of several weeks, was accord and satisfaction of the monies owed by the Appellees/Defendants.
IX. The Lower/Trial Court's finding of facts and conclusions of law and Opinion And Order erroneously and materially found a contractual obligation was created by the Plaintiff/Appellant failure to protest an email wherein no meeting of the minds and or consideration existed and the requirements were not part of the Shop Drawings, Prototypes or Purchase Orders.
Pro Signs' brief at 3-4 (footnote omitted).
Pro Signs filed post-trial motions seeking judgment notwithstanding the verdict ("nov") or, in the alternative, a new trial.
We begin with our standard and scope of review in an appeal from a non-jury verdict. Our appellate role in cases arising from non-jury trial verdicts is to determine whether the findings of the trial court are supported by competent evidence and whether the trial court committed error in any application of the law. The findings of fact of the trial judge must be given the same weight and effect on appeal as the verdict of a jury. We consider the evidence in a light most favorable to the verdict winner. We will reverse the trial ...