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Mira Plastics Company, Inc. v. Molds by Kiss, Inc.

A-5571-98T3 (N.J. Super. App. Div. 2000) (Unpublished)

UCC; USAGE OF TRADE; FORCE MAJEURE—Usage of trade can not vary expressed terms of a contract and “force majeure” provisions are to be narrowly construed.

An injection molder of plastic parts ordered a custom mold from a mold and die maker. The mold was to be delivered in 10-12 weeks. The purchase contract stated that the “material is guaranteed to be as specified. All work to be completed in a workmanlike manner according to standard practices. ... all agreements contingent upon strikes, accidents, or delays beyond our control.” The mold was delivered in 20 weeks and did not work properly. It took five more weeks for the mold maker to try to fix the mold. On a motion of summary judgment, the injection molder obtained a judgment against the mold maker. On appeal, the mold maker argued that summary judgment was inappropriate. The Court disagreed. It found that the lower court, “simply concluded that no reasonable factfinder could conclude on this record that [the mold maker] had not breached its contract with [its customer].” On that point, the lower court judge observed: “[D]elivery, whether production ready or not, was not made for twenty weeks after the purchase order was placed, and only then pursuant to a court order.” The mold maker also contended that the force majeure clause in the contract excused the late delivery. It argued that there was a delay in the delivery of a critical component, that the mold was mis-cut by a subcontractor, and that an important mold making machine had broken down in the process. It was further alleged that it took “unexpectedly long” to hand finish the mold surfaces. The Court disagreed that these constituted force majeure. “A force majeure clause ‘is not to be construed to its widest extent; rather such language is to be narrowly interpreted as contemplating only events or things of the same general nature or class as those specifically enumerated ‘in a clause used by the parties.’” The mold maker also argued that according to trade usage or common practice, it is not uncommon to test a mold six or more times before it is production ready. The Appellate Division agreed with the lower court when the lower court judgment stated, “‘Standard practices’ cannot possibly include delivery eight weeks after the contract date, and ‘fine tuning’ the mold by [the mold maker] claims to be part of the ‘standard practices’ cannot reasonably mean another five weeks beyond the already late delivery… .” In addition, the UCC specifically provides that “[t]he express terms of an agreement and an applicable course of dealing or usage of trade shall be construed wherever reasonable as consistent with each other; but when such construction is unreasonable, express terms control both course of dealing and usage of trade.” The Appellate Division agreed with the lower court that the usage of trade could not support “an unreasonably long delivery period beyond the agreed-upon delivery date… .” Therefore, it would not allow the “liberal recognition of the needs of commerce in regard to usage of trade” to be made into an “instrument of abuse.” The mold maker also argued that it should have been given a right to cure, but the lower court and the Appellate Division both believed that what constituted a “further reasonable time” was a fact sensitive issue dependent on the “surrounding circumstances,” and that in this case, the mold maker had already used up an unreasonable amount of time.

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