In 1969, the plaintiffs (referred to herein, in the singular, as NEP) entered into two contracts with the defendant (Riley) for the design, manufacture, and installation of two boilers for NEP's facilities at Salem and Brayton Point (Fall River). A detailed description of the boilers is unnecessary. It is sufficient to state, as did NEP in its amended complaint,
If NEP were to commence timely its action for breaches of warranties under the contract, it was required by G.L.c. 106, § 2-725(1), as appearing in St. 1957, c. 765, § 1, to bring its action "within four years after the cause of action has accrued." Paragraph (2) of § 2-725 provides, in full:
When Riley tendered delivery of the boilers is the issue in dispute. By way of definition, G.L.c. 106, § 2-503(1), as appearing in St. 1957, c. 765, § 1, provides that tender of delivery "requires that the seller put and hold conforming goods
NEP argues that there was no tender of delivery prior to March of 1976 and that, in fact, delivery has never been tendered. As support for this contention, NEP extracts two sentences from the first paragraph of the official comment to G.L.c. 106, § 2-503: "The term `tender' is used in this Article in two different senses. In one sense it refers to `due tender' which contemplates an offer coupled with a present ability to fulfil all the conditions resting on the tendering party and must be followed by actual performance if the other party shows himself ready to proceed."
A similar, if not identical, argument was unsuccessfully made is Standard Alliance Indus. v. Black Clawson Co., 587 F.2d 813,
We are not dissuaded from our conclusion by NEP's argument that acceptance of "due tender" as the controlling definition is compelling where the seller and buyer acknowledge at the time of delivery that the goods are defective. We see no reason to apply a more rigorous rule to an unwitting buyer than to a fully informed one. Simply put, although knowledge may be relevant to a buyer's acceptance of goods, see G.L.c. 106, § 2-607, it is irrelevant to the running of the time period set out in § 2-725, except where, unlike here, there is a warranty as to future performance. See Raymond-Dravo-Langenfelder v. Microdot, Inc., 425 F.Supp. 614, 617 (D. Del. 1977).
Both contracts entered into in 1969 contain the following clause:
NEP argues that language constitutes "a promise rather than a warranty," and that this cause of action could not have accrued until Riley, in 1978, refused or failed to repair the boilers. However, promises to repair or to replace are generally viewed as specifications of a remedy rather than as an independent or separate warranty. See Standard Alliance Indus. v. Black Clawson Co., 587 F.2d at 818 n. 10; Ontario Hydro v. Zallea Syss., Inc., 569 F. Supp. at 1266-1267; Centennial Ins. Co. v. General Elec. Co., 74 Mich.App. 169, 171-172 (1977); Commissioners of Fire Dist. No. 9 v. American La France, 176 N.J.Super. 566, 573 (1980); Owens v. Patent Scaffolding Co., 77 Misc.2d 992, 998-999 (Sup. Ct. 1974), rev'd on other grounds, 50 A.D.2d 866 (N.Y. 1975). Those cases instruct that when there are a warranty and a promise to repair, the remedy of first resort is the promise to repair. If that promise is not fulfilled, then the cause of action is the underlying breach of warranty.
The reasoning is sound and particularly pertinent here, where NEP's argument seems structured to avoid the consequences of its failure timely to commence suit. As pointed out in Centennial Ins. Co. v. General Elec. Co., 77 Mich. App. at 172:
III. TOLLING AND ESTOPPEL.
NEP next contends that Riley's repeated efforts to repair and assurances that the boilers would be fixed either tolled the running of § 2-725(1) or estopped Riley from relying upon it as a defense.
a. Tolling. Whether repeated repair efforts toll the running of § 2-725(1) depends upon our tolling statutes, as found in G.L.c. 260, §§ 7 through 12, since § 2-725 "does not alter the law on tolling of the statute of limitations...." G.L.c. 106, § 2-725(4), as appearing in St. 1957, c. 765, § 1. See Bedford v. James Leffel & Co., 558 F.2d 216, 217 (4th Cir.1977). There is nothing in our tolling statutes which would allow NEP to commence suit as late as sometime in 1982, in other words, four years after Riley ceased its efforts to repair the boilers. Nor is it open to us to enlarge upon those statutes.
b. Estoppel. If NEP is to escape the consequence of its lack of diligence in bringing its action, it must be by way of proof that Riley wrongfully lulled NEP into the delay. See White v. Peabody Constr. Co., 386 Mass. 121, 134 (1982) ("[E]stoppel would require proof that the defendants made representations they knew or should have known would induce the plaintiffs to put off bringing a suit and that the plaintiffs did in fact delay in reliance on the representations"). The judge concluded that the facts alleged by NEP to estop Riley, even if proved, were insufficient as matter of law because: (1) NEP made no allegation of fraud or misrepresentations by Riley which would show that Riley "purposely prolonged the time for repairs beyond the running of the statute of limitations"; (2) any assurance given by Riley that the boilers would be fixed did not rise to the level of "lulling" NEP into "foregoing suit"; and (3) "both parties are large corporations with equal access to legal advice."
There are no rigid criteria to apply in determining whether a defendant's conduct was such as to give rise to an estoppel. The test, if it can be so called, is that the "doctrine of estoppel is not applied except when to refuse it would be inequitable." Boston & A.R.R. v. Reardon, 226 Mass. 286, 291 (1917). See also McLearn v. Hill, 276 Mass. 519, 524 (1931). We think it appropriate then, when looking to the facts offered by NEP to show an estoppel, that they be viewed in the context in which they took place, i.e., "Here ... we have two corporate behemoths, well able to look out for themselves...." Standard Alliance Indus. v. Black Clawson Co., 587 F.2d at 882.
NEP contends that whether it was lulled into inaction by Riley presents a material factual dispute. The conduct NEP relies upon is correspondence between NEP and Riley in 1974. NEP wrote to Riley suggesting that arbitration would be a reasonable course of action "at this time." NEP's letter pointed
Reading this correspondence as favorably as possible to NEP, we do not see how, in the absence of distortion, Riley's statements could give rise to an estoppel.
That NEP may have behaved in a commercially reasonable manner in relying upon Riley's efforts (in the belief that because Riley designed, manufactured, and installed the boilers, it was best able to repair them) does not become material until it is first shown that Riley engaged in some conduct, such as insincere effort, which would make it unfair to allow Riley to rely upon § 2-725(1). We do not view the fact of honest, genuine repair efforts, standing alone, as sufficient basis for application of the doctrine of estoppel. In our view, to conclude otherwise would be to hold that repair efforts toll § 2-725.
IV. SUBSEQUENT AGREEMENT.
Because Riley's efforts to repair the Salem boiler were not meeting with success, NEP began to withhold payments due under that contract. Riley, in September of 1973, informed NEP that many of the problems with the boiler were caused by NEP's improper operation of the equipment, and Riley demanded payment. NEP refused the request for payment as well as Riley's second demand in February, 1974.
On February 5, 1974, Riley and NEP's engineers and consultants met to discuss possible repairs and use of a "stringer support system." Riley disputed that such a system was necessary and suggested, instead, installation of "sinuous bracelets." Those disputes, repairs, and payments, continued until July 9, 1974, when the parties entered into an agreement, which was amended in October of that year. Counts three and four of NEP's amended complaint allege breaches of express and implied warranties under the 1974 agreement, as amended.
As we read that agreement, however, it is not a contract for the sale of goods, see G.L.c. 106, § 2-106(1), nor does it modify the original contract, see G.L.c. 106, § 2-209, thereby bringing it under the umbrella of any warranties therein given. Cf. Skinner v. Tober Foreign Motors, Inc., 345 Mass. 429, 433 (1963).
The 1974 document is labelled a "Settlement Agreement," not a modification agreement as NEP characterizes it. The October amendment specifically refers to amendment of the
As all of NEP's claims relating to express warranties are based upon oral statements made prior to the agreement and its amendment, they are, even if proved, unenforceable as matter of law as they were "superseded by the unambiguous provisions of the integrated written agreement." Buker v. National Management Corp., 16 Mass.App.Ct. 36, 42 (1983).
The remaining counts of NEP's amended complaint allege that Riley performed various obligations under the contracts and 1974 agreement negligently. Even assuming (but specifically not concluding) that these claims are not precluded under G.L.c. 260, § 2A, these claims seek relief for economic loss and damage to the boilers, injuries for which there is no recovery. See Marcil v. John Deere Industrial Equip. Co., 9 Mass.App.Ct. 625, 629-632 (1980), and cases cited. There is no merit to NEP's contention that because Riley limited its liability in negligence, see G.L.c. 106, § 2-719(1), to the "cost of repair or replacement of defective parts on a straight time basis," Riley, in effect, consented to be sued for a cause of action not recognized in Massachusetts.