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Pawnee Plastics, Inc. v. American Sav. Co.
Citations: 313 N.W.2d 262; 210 Neb. 131; 1981 Neb. LEXIS 1013Docket: 43579
Court: Nebraska Supreme Court; December 11, 1981; Nebraska; State Supreme Court
Pawnee Plastics, Inc. filed a lawsuit against American Savings Company claiming a guarantee for payments on materials supplied to Whitewater Marine Products, Inc., based on a letter from Wm. C. Ramsey, the president of both companies. The letter, dated February 19, 1975, confirmed a conversation in which American Savings Company agreed to guarantee payment for specific invoices related to purchase orders from Whitewater Marine Products, Inc. The trial court found the letter's language ambiguous and permitted parol evidence to clarify its terms. Ultimately, the court ruled that the guarantee only covered invoices expressly approved by the defendant, which the court determined were not met in this case, resulting in a judgment for American Savings Company. The plaintiff's appeal centers on whether the letter's terms are ambiguous. The court referenced precedents establishing that a contract is only open to interpretation if ambiguous, and noted that while the first paragraph suggests an unconditional guarantee, the second paragraph limits the guarantee to specific invoices and purchase orders, which remain undefined in the letter. The term "specific" indicates a need for precise details regarding the invoices and orders covered by the guarantee. The excerpt addresses the interpretation of a guarantee in a legal dispute, highlighting that the defendant intended to impose a limitation on the guarantee's scope. However, the language used was found to be vague and ambiguous, necessitating clarification. The trial court properly admitted evidence to elucidate the guarantee's terms. In cases of ambiguity, courts must ascertain the parties' intent and resolve the ambiguity accordingly. The trial court determined that the defendant was not required to make payments for materials until prior approval was granted for each transaction, and it concluded that the plaintiff had not received such approval. The case was tried without a jury, meaning the trial court's judgment functions as a jury verdict and is only overturned if clearly erroneous. The court found the trial court's decision well-supported by evidence, affirming the judgment.