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at all times and under all like conditions. | brake test; that in February, 1904, the third Neither of the turbines, nor any part of unit had not yet been installed, and was them, were ever tested at the Holyoke testing flumes, either before or after their installation, nor were they ever tested by any mechanical or brake test at the Twin Branch dam, after being put in commission, or elsewhere; and such water wheels or turbines, either in whole or in part, were never tested by any kind or character of tests under the exact physical condition set forth in the contract; nor were they ever tested under an exact 15-foot or 18-foot head by any kind of test, by the appellants or by any other person for them. There never was any measurement made by the appellants, or any other persons for them, through weir, or any other approved form of device, or the volume of water available at the dam, or the water used by any of said lines of turbines. If a wheel of a given type and size is tested in testing flume, and the quantity of water discharged by it is ascertained, it would become the basis of a water meter, and the volume of water passing through it, or through any wheel made on the same form, at any given head could be computed. The power of the turbines was never read or ascertained by or through any mechanical or brake test, either at Twin Branch or else where and the only reading or statements of the power given by said wheels at any time since they were made were taken from electrical instruments, after the power had been developed electrically through generators, and transmitted to the switchboard, and then read in kilowatts, and then reduced to horse power.

lying upon the ground at Twin Branch, the fourth unit was not maufactured, and that the same was not delivered until June, 1905, thereafter; that thereafter appellants proposed and offered to compensate and reward appellee if it would concede the making of an electrical test, and agree to be bound by the same, but that appellee refused such offers, and insisted that they would stand upon the contract; that the appellants thereafter proposed and offered to make a mechanical test; that this offer of appellants was coupled with the condition by which in substance and effect appellants required of appellee that it agree to the finding of some third person in the capacity and character of an arbitrator, and further required of the appellee that it agree to be bound by the finding of such arbitrator; that appellee made no objection to the character of such test, but notified appellants that it refused to modify the contract, or to accept such third person as arbitrator and to agree to be bound by his finding; that thereupon the appellants refused to make any further tests whatever, or to pay any further sums due under said contract whatsoever until appellee would agree to abide by the result of any further test made. During the last half of the year 1906, and up to September, 1907, the date of the commencement of this action, and while the plant and turbines were in the control and possession of the St. Joseph & Elkhart Power Company, that company informed the parties that it could not at such time permit the use of said plant or wheels, by either appellee or appellants, on account of load conditions; and that in May, 1907, said operat-. ing company informed the appellee that they could probably have the use of a line of said turbines within a year for the purpose of making a test.

Prior to June 13, 1902, the parties through their representatives met at Springfield, Ohio, and the appellee then and there informed appellants that it would not sell any of its wheels or water turbines with any guaranty to depend upon any electrical test, or test made by any electrical device; that after In what is known as an electrical test of the execution of the contract or proposition water turbines, the power and the efficiency of July 19, 1902, nothing was said or written of the water turbines is necessarily measured by either party with reference to any test by the power and efficiency of the electrical clauses in the contract until March 9, 1904; generator or generators, and depends on the that from the fore part of July, 1904, at which accuracy of such electrical devices. The intime the appellants first informed appellee struments used for the measurement of elecof the result of switchboard readings of the trical currents, during the electrical test conJune, 1904, electrical test, appellee within a ducted at the Twin Branch dam, in June, reasonable time declared and maintained 1904, were not calibrated at the United that the provisions of the contract concern- States Bureau of Standards, in Washington, ing tests meant a Holyoke or mechanical D. C., before such test. The electrical genbrake test, and that appellee during all of erators in the Twin Branch dam were gensaid time maintained and declared the same erators manufactured by the Westinghouse position with reference to the test clauses Electric Manufacturing Company, of a voltin said contract, and maintained and insist- age of 13,500 volts; and said instruments ed that the wheels furnished gave all the were not returned to said Westinghouse power, speed, and efficiency guaranteed, and Electric Manufacturing Company to prove were furnished in full performance of their back their accuracy or variation at any time contract; that the appellants in all of their after such test. At the time of said eleccorrespondence and conversations with ap-trical test conducted at the Twin Branch pellee, during all of said time following, nev-| dam in June, 1904, the power of said gener disputed the construction of said contract erators was reduced through transformers,

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readings obtained, in order to measure the the same, without any such test; that unit full capacity of said generators, had to be 4 was not shipped to appellants until June, multiplied by 2,000. Prior to June, 1904, at 1905, but was thereafter received by appelleast two of the generators broke down, and lants and installed. On March 9, 1905, appelit was necessary to rewind the same, which lee had information that the operating comwas done at the power plant at Twin Branch, pany had not accepted units 1, 2 and 3. prior to June 1, 1904. At the electrical test made in June, 1904, there were only three generators on the ground; and during the test one generator was run as a motor, and another as a generator. After the two electric generators were rewound as aforesaid they were never tested as to their efficiency. The only basis of all statements as to the power of the turbines are the results of power generated through those Westinghouse electric generators.

The court further found that the log sheets in evidence indicating the power and efficiency of the turbines are the records of the operating company, and were not made by, or on behalf of, or under the supervision of the appellants; that the records or log sheets were made from electrical or switchboard readings, after the power of the water wheels had been transformed into electrical energy through the Westinghouse generators; and that the operating company, in making said readings from such electrical meters measuring devices, did not check or correct said meters by the use of any calibrated instruments, either immediately before or immediately after the readings; that all of such measurements and readings were made and recorded by operators in the employ of the operating company; that the log sheets in themselves do not show at what gate openings the wheels were operated during any of the readings recorded therein.


Within a reasonable time after delivery appellants notified appellee that trials of the turbines indicated that they were not in accordance with the contract, and on December 31, 1903, they notified appellee that they would withhold acceptance of units 1 and 2 until a test could be made, and that in case of any shortage or deficiency, appellants would look to appellee to correct it at appellee's expense, regardless of payments made to it.

The court further found the total amount of the agreed purchase price of the four generator lines and two exciter lines to be $32,420, with payments as follows: June 3, 1903, $8,000; August 27, 1903, $3,000; September 23, 1903, $2,261.70; January 4, 1904, $4,448.30; March 15, 1905, $1,838.75; May 27, 1905, $3,000, making a total of $22,548.75,. and leaving a balance unpaid of $9,871.25.

The finding further shows that the four units were installed in accordance with the terms of the contract and as shown by blueprint drawings accompanying it, and that the reasonable cost and expense incurred by appellants in making the installation was $11,580; that the four generator lines of turbine wheels delivered to appellee were not so constructed that they would develop 1,750 horse power per line of five wheels, under a working head of 18 feet, and make 120 revolutions per minute, and were not so constructed that they would develop 1,200 horse power per line of five wheels, under a working head of 15 feet, and make 120 revolutions per minute; that each of the four generator lines had the capacity to develop 1,523 horse power, and no more, under a working head of 18 feet and make 120 revolutions per minute; and each of them had the capacity to develop 1,044 horse power, and no more, under a working head of 15 feet, and make 120 revolutions per minute; that the four generator lines were not so constructed that they would develop an efficiency of not less than 75 per cent. under actual working conditions, at a constant speed of 120 revolutions per minute, under an effective head of 18 feet, with three-fourths gate opening; that if each of the four generator lines had developed the power and shown the efficiency which appellee by its contract with appellants agreed and represented that they would develop and show, the value of the four lines installed in the power house, in working condition, with an electric generator attached to the shaft of each of the four lines of wheels of sufficient capacity to generate and transmit all of the power from them, the four generator lines, in such working condition, together with the generators attached thereto, would have been of the fair and reasonable value of $132,000; and said four generator lines of turbine wheels, together with the generators attached to the lines as aforesaid, after being installed in the power

Immediately after the installation of units 1 and 2 and before the installation of unit 3, and while unit 3 was lying upon the ground at Twin Branch dam, and before any work was done thereon preparatory for its installation, appellee advised appellants by letter of March 9, 1904, which letter was received by appellants, that if they were not satisfied as to power to ship unit 3, or one of the wheels thereof, to the testing flume at Holyoke, Mass., to be there tested in regard to power, as they had that privilege under the contract, before any further units were in-house, and in good working condition, were stalled at Twin Branch dam; but that appellants wholly failed and neglected to send either said unit 3 or unit 4, or any parts thereof, to the testing flume at Holyoke, but

of the fair and reasonable value of $114,840, and no more; that if the four generator lines had been so constructed as to develop the horse power and show the efficiency specified

the contract between the parties, their value | to evade this rule by the claim that the proinstalled in the power house, in working vision contained in that part of the concondition, exclusive of the generators attached to the shafts of the lines, would have been $44,000; that the four generator lines, as delivered and installed in the power house, in working condition, exclusive of the generators, are of the value of not to exceed $38,280.

tract involved in the specifications presented by appellants, which reserved to them the right "to have, at their discretion, any or all of the turbines tested after being put into commission to determine the fulfillment of guaranty as to strength of parts, amount of power developed, and efficiency of units beThe contention of appellant's counsel that fore final settlement is made," when taken the court erred in stating the first and third together with the fact that the turbines were conclusions of law in favor of the right of to become incorporated in a hydro-electric appellee to recover the balance of the pur-power plant, which would make a return of chase price is based upon the assumption them practically impossible after a test, that the burden was upon appellee to aver and prove performance of the contract by it by showing not only that it delivered to appellants the turbines and appurtenances contracted for, but also that they complied in every particular with the terms of the contract. In other words, as we understand counsel, they claim that the burden was on appellee to aver and prove, as a condition precedent to a recovery of the balance of the purchase price, that the articles contracted for and delivered to appellants fulfilled in every respect, including power and efficiency, the stipulations of the contract. And it is contended that as this burden rested on appellee and the court found that the turbines did not show the power and efficiency provided for, and failed to find as to their compliance with the terms of the contract in other respects, this was a finding against appellee on all, and the appellee was not entitled to recover the balance of the purchase price, and the first and third conclusions of law were therefore erroneous.

made the stipulations in the specifications as to the quality, capacity and efficiency of the turbines dependent conditions or conditions precedent which appellee was bound to show performance of before it could recover the balance of the purchase price. But the claim is not permissible. On the contrary, it seems obvious that the intention of the parties was that the title should vest in appellants on delivery and that these stipulations were independent agreements or warranties. There is nothing to indicate any possible intention of the parties to rescind the contract and return the turbines after they had been delivered, placed in position, and tested. But the nature of the articles sold and the disposition of them, together with the provision of the contract just above quoted, shows clearly the intention on the part of appellants to rely upon these stipulations as warranties.

"Where from a consideration of the whole instrument it is clear that the one party relied upon his remedy, and not upon the performance of the condition by the other, such condition is not a condition precedent." Benj. on Sales, Bennett's (7th Ed.) § 562. It is said by the author that the dependence or independence of covenants in a contract of sale is to be collected from the evident sense and meaning of the parties and that in applying the rule of construction quoted, the circumstances under which the contract was made, and the purpose for which it was made, are to be taken into consideration. Assuming that nothing had been paid and this were an action for the entire contract price, it could not well be believed that appellee could have had it in mind to sell to appellants the turbines to be fixedly installed on the condition that he was to exact nothing from appellants if there was found a small measure of failure to comply with the covenants as to quality, power and efficiency.

[1] A warranty in a sale of goods is not an essential element of the contract, for a sale is complete without it. It is an independent agreement forming part of the contract, but collateral thereto; and the rule is that in an action on a contract of sale to recover the purchase price of goods sold and delivered, the seller is not bound to show fulfillment of warranties, the burden of showing the existence of a warranty and the breach of it being on the buyer whether he sues for the breach of warranty directly or sets it up by way of set-off or counterclaim. Neal v. Shewalter (1892) 5 Ind. App. 147, 31 N. E. 848; Seiberling v. Rodman (1896) 14 Ind. App. 460, 466, 43 N. E. 38; Plano Manufacturing Co. v. Root (1893) 3 N. D. 165, 54 N. W. 924; Reynolds v. Cleveland, 4 Cow. (N. Y.) 282, 15 Am. Dec. 369; Buckstaff v. Russell (1894) 151 U. S. 626, 14 Sup. Ct. 448, 38 L. Ed. 292; Noble v. Fagnant [3] Moreover, if it should be conceded that (1894) 162 Mass. 275, 38 N. E. 507; Burt v. these stipulations are conditions precedent, Garden City Sand Co. (1909) 237 Ill. 473, 86 it would not save counsel's contention that a N. E. 1055; 19 Encyc. of Pl. & Pr; 35 Cyc. failure of appellee to show a perfect performp. 549 et seq; Keystone Mfg. Co. v. Forsyth ance of the conditions must defeat this ac(1903) 123 Mich. 626, 82 N. W. 521; Stillwell tion. A rule well founded in justice is to the Co. v. Beloxi Co. (1901) 78 Miss. 779, 29 contrary: "Although a man may refuse to South. 513. perform his promise till the other party has

he has received and accepted a substantial | them, and were utterly inconsistent with the part of that which was to be performed in claim that the contract had not been exehis favor, the condition precedent changes cuted by their acceptance. Benj. on Sales its character and becomes a warranty, or in- (5th Eng. Ed.) p. 1013; Benj. on Sales, Bendependent agreement, affording no defense nett's (7th Ed.) §§ 703, 901; 2 Mechem on to an action, but giving right to a (counter- Sales, §§ 1380, 1387, 1395, and cases there claim) for damages. The reason is, that it cited; Tiffany on Sales, §§ 94, 120, 121; would be unjust under such circumstances Stillwell Co. v. Beloxi Co., supra; C. & C. that a party who has received a part of the Electric Motor Co. v. D. Frisbie & Co. (1895) consideration for which he bargained should 66 Conn. 67, 93, 33 Atl. 604; Fred W. Wolf keep it and pay nothing because he did not v. Monarch Refrigerating Co. (1911) 252 Ill. receive the whole. The law, therefore, oblig- 491, 96 N. E. 1063. es him to perform his part of the agreement, and leaves him to his action of (or counterclaim for) damages against the other side for the imperfect performance of the condition." Benj. on Sales, Bennett's (7th Ed.) § 564.

In Beach on Contracts, vol. 1, § 107, it is said: "Conditions precedent must be performed in order to make the conditional promise absolute. But after one party has performed the contract in a substantial part, and the other party has accepted and had the benefit of the part performance, the latter may thereby be precluded from relying upon the performance of the residue as a condition precedent to his liability; and in such case he must perform the contract on his part, and must rely upon his claim for damages in respect of the defective performance." See, also, Clark on Contracts (2d Ed.) p. 466; Tiedeman on Sales, § 197; Young Bros. Mȧchine Co. v. Young (1896) 111 Mich. 118, 69 N. W. 152.

[5] It is also contended that the conclusions of law favorable to appellee are erroneous in that they allowed interest of 6 per cent. on the balance of the purchase price from the date when the payments on the units in controversy were due under the terms of the proposal to the date of the finding. The conclusions were not erroneous in this respect. Appellants having accepted the delivery of the turbines were bound to perform their part of the contract by payment according to its terms. The statute provides that money due on any instrument in writing shall bear interest at the rate of 6 per cent. Burns 1908, § 7952. The general rule in this country is that interest as damages for the breach of a contract to pay money, where the amount due and the time of payment are certain, is recoverable as a matter of right. 22 Cyc. 1579. See, also, Skehan v. Rummel (1890) 124 Ind. 347, 24 N. E. 1089; Killian v. Eigenmann (1877) 57 Ind. 480; Burke v. Keystone Mfg. Co. (1898) 19 Ind. App. 556, 561, 48 N. E. 382.

[6] The provision in the specifications reserving to appellants the right to test the turbines after being put in commission, to determine the fulfillment of guaranty as to strength of parts and power and efficiency of units before final settlement, did not, as contended by counsel, have the effect of postponing and making uncertain the time of payment, and the findings show that the parties did not so consider it. The terms of payment were fixed by the proposal of appellee at one-half cash on receipt of goods at destination, one-fourth in 90 days from date of shipment, and the balance in six months from the same date. Payment according to these terms was an essential condition of the contract of sale to be performed by appellants. The very terms of the provision of the specifications show that it had reference to the collateral agreement of warranty.

[4] In the case before us delivery and acceptance were alleged, and the court found that the turbine units were completely set up in appellee's factory and inspected by appellants' engineer and general superintendent of construction; that they were standard Trump turbines of the type, size, dimensions, and material, and constructed and arranged with appurtenances as described in the contract, and that they were delivered to appellants; that appellants installed them in the hydro-electric power plant of a third person and that person dealt with them as their own by using them, mortgaging and transferring them as an integral part of their plant to others and that they were in constant use as a part of the power plant for several years with no offer to return them. After the two units first delivered were installed by appellants and, as they claimed, found to be lacking in power and efficiency they received and installed the third and fourth units. The facts so found established substantial performance by appellee and such an acceptance as would preclude appellants from rescinding and returning the articles delivered or from relying upon exact performance as a condition precedent to their liability to pay the purchase price, but not from asserting their claim for damages for defective performance. The acts of appellants and the owners of the plant in dealing with the turbines were of such a character that they could only be Counsel for appellee, in support of the as

It follows that the court did not commit error against appellants in its conclusions of law 1 and 3.

The findings and conclusions of law being favorable to appellee on the issues presented by the third paragraph of answer, appellee's assignment of cross-error on the action of the trial court in overruling their demurrer to it does not demand consideration.

47 Ind. 259; Robinson Machine Works v. Chandler (1877) 56 Ind. 575; Johnston Harvester Co. v. Bartley (1882) 81 Ind. 407; McClamrock v. Flint (1885) 101 Ind. 278; Shirk v. Mitchell (1894) 137 Ind. 185, 36 N. E. 850; Osborne & Co. v. Hanlin (1902) 158 Ind. 325, 329, 63 N. E. 572; McKendry v. Sinker, Davis Co. (1891) 1 Ind. App. 263, 27 N. E. 506; Brower v. Nellis (1893) 6 Ind. App. 323, 331, 33 N. E. 672; H. B. Smith Co. v. Williams (1902) 29 Ind. App. 336, 342, 63 N. E. 318; Mack v. Sloteman (1884) 21 Fed. 109; International Bow & Stern Dock Co. v. U. S. (O. C. 1894) 60 Fed. 523; F. D. Cummer & Sons v. Marine Sugar Co. (1906) 146 Fed. 240, 76 C. C. A. 606.

[8] The finding of facts is either directly against appellants or silent on all the various specifications of warranty except as to the amount of horse power to be developed and the per cent. of efficiency of the four generator line units. The rule is too familiar to require the citation of precedents that a fail

the court in overruling their demurrers to the fourth and fifth paragraphs of appellants' answer which were by way of counterclaim, urge that these pleadings were clearly deficient in certain essential allegations. As the warranties went to the performance of the turbines as to power and efficiency after installation, and as appellee had nothing to do with the installation, that duty resting wholly upon appellants, and as the power and efficiency of the turbines in actual operation after being installed depended upon the manner of installation, the character of the draft tubes, the volume of water available, the opening of the gates, the amount of the fall, obstructions, and retardations to the flow of the water in the tailrace, and other things incident to their situation which would affect their performance, and as the fulfillment of the warranties of the turbines under the terms of the contract could only be determined by a test, it was therefore, it is claimed by appellee, incumbent upon appellants either to allege generally a perform-ure to find the existence of essential facts ance of conditions on their part or to allege is equivalent to a finding against the party facts showing a proper installation and an having the burden of establishing such facts. efficient test. As this was not done it is The conclusion of law that appellants were claimed that the fourth and fifth paragraphs entitled to recover damages for breach of are bad. It is also contended that the war- warranty must therefore rest upon the failranties as averred in these pleadings are not ure of the four generator line units to fulfill in terms coextensive with the written con- the specifications of the warranty that they tract and that the breach of them is not suffi- would develop the power and efficiency reciently negatived. From this claim of the in- quired by the terms of the contract when sufficiency of those paragraphs of counter-properly installed and tested under proper claim on the warranties the further claim of counsel for appellee arises-that the findings upon which the conclusions of law that appellants are entitled to recover damages for the breach of the warranties are outside the issues and the conclusions erroneous.

As we have seen, the burden of establishing the warranty and breach of it is on the buyer whether presented in an action or counterclaim. Involved in this burden is the duty of showing a performance of all material conditions upon which the right to assert the warranty depends. 35 Cyc. 445, 457.


[9] It is, of course, true, as claimed by counsel for appellee, that, in determining whether the facts found justify the conclusion of law in this respect, only the facts found within the issues can be considered. It is contended by counsel that the findings of the court relating to the installation and test of the turbines by appellants are without the issues and cannot be considered in support of the conclusions of law favorable to appellants. But assuming that the facts found are within the issues we think that they fall short of sustaining the conclusions. It is true that the finding states that appellants installed all of the turbines in accordance with the terms of the contract between appellee and appellants, but it is not shown that the structure in which they were installed and of which they became a part and which had a relation to them was of a character which would permit the turbines properly to demonstrate their power and efficiency.

[7] It was for appellants to show in some adequate way a breach of the warranties in the particulars relied upon. They chose, by the terms of that part of the contract prepared by them, to make the fulfillment of the warranties depend upon a test to be made after the installation by them. Indeed it is perhaps true that, from their very nature, the power and efficiency of the turbines could only be accurately determined by some definite recognized test. As appellants had reserved to themselves and assumed the duty There is no express finding that any test of making a test, and as the duty of showing was ever made but it may be gathered from a breach of warranty rested upon them, they various parts of the finding that appellants were therefore bound to show a proper in- made what was claimed to be an electrical stallation and an efficient and accurate test, test in June, 1904. As it also appears from within a reasonable time, under actual work- the finding that the fourth unit was not deing conditions which would have demonstrat-livered and installed until 1905, obviously ed that the warranties had been broken. La- this test was not applied to it, and it no

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