Livingston Shirt Corp. v. Great Lakes Garment Manufacturing Co.

Citations: 88 N.W.2d 614; 351 Mich. 123Docket: Docket 44, Calendar 46,181

Court: Michigan Supreme Court; March 4, 1958; Michigan; State Supreme Court

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In *Livingston Shirt Corporation v. Great Lakes Garment Manufacturing Company*, the Michigan Supreme Court addressed a legal dispute arising from a contract for shirt manufacturing. The plaintiff, Livingston Shirt Corporation, initiated the lawsuit seeking $4,174.77 for labor and freight charges after manufacturing over 600 dozen shirts using material provided by the defendant. The defendant, Great Lakes Garment Manufacturing, challenged liability, alleging defects in the shirts, damages from canceled sales, and loss of goodwill.

The court determined that the transaction constituted a sale by sample, agreeing with the trial court's ruling. The defendant contended that the trial court improperly assessed whether the delivered shirts complied with the sample, arguing that the answer should have been an unqualified 'Yes.' However, based on testimony, the court found that while some shirts were defective, the overall loss was minimal, estimating that only 2 out of 6 shirts were unsatisfactory.

The defendant's claim of full rejection of the shipment lacked written evidence, with the sole testimony from Isadore Neiman, the proprietor of Great Lakes, indicating dissatisfaction with the quality of the shirts shortly after receipt. The court noted that section 44 of the Uniform Sales Act allows a buyer to accept a portion and reject the whole shipment, but no formal rejection was documented by the defendant. Thus, the court upheld the trial court's decision, highlighting the insufficiency of the defendant's evidence to support a claim of total unsatisfactory delivery.

Contact was made with Migliore, the president of the plaintiff corporation, regarding the quality of shirts after examination, with the communication being initiated collect due to frustration over the situation. During this conversation, the quality of the shirts was deemed unacceptable, and an offer was made to return them. The plaintiff contended that they never received complaints about the shirts’ quality, only a late delivery notice, and asserted that the defendant continued to place orders, indicating satisfaction with the work. The trial court's brief opinion did not support the defendant’s claim of rejecting the entire shipment, as it had the opportunity to evaluate both parties’ testimonies. The court found insufficient evidence to justify a reversal of its findings regarding the alleged defective shirts, noting that the defendant failed to prove the percentage of defects in the shirts. The plaintiff's claim included a detailed account of the shipments and amounts due, which the defendant denied, asserting the shirts did not conform to the provided samples and that customers rejected them. The defendant sought compensation for losses due to inferior workmanship but received a denial from the plaintiff. The excerpt references a related case, Saari v. George C. Dates, Associates, Inc., which established that once a plaintiff proves a prima facie case, the burden of proof shifts to the defendant to demonstrate a breach of contract justifying any discharge or rejection. The jury was instructed that the defendant had to show a fair preponderance of evidence to substantiate their claims.

The plaintiff bore the initial burden of proof to demonstrate his contract performance prior to discharge, which he successfully established. Consequently, the burden shifted to the defendant to present a legal justification for the discharge. The defendant's defense was affirmative, but he relied on the assertion that the shirts were defective, a claim he failed to substantiate. Although the trial court determined that one-third of the shirts were defective, the defendant could not contest the ruling regarding the costs of manufacturing those shirts due to insufficient evidence. The court referenced precedent stating that a buyer waives rejection of goods if they act inconsistently with that rejection, noting that the defendant's only evidence of rejection was a disputed statement by Mr. Neiman. Furthermore, the defendant attempted to sell the shirts, successfully selling a portion but ultimately choosing not to sell others due to low auction bids. The court affirmed the trial court's judgment, ruling that the defendant did not provide adequate proof for recovery on his counterclaim. No costs were awarded as the appellee did not submit a brief. All justices concurred with the decision, except for Justice Kavanagh, who did not participate.