Cowin Equipment Co. v. General Motors Corp.

734 F.2d 1581 (1984)

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Cowin Equipment Co. v. General Motors Corp.

United States Court of Appeals for the Eleventh Circuit
734 F.2d 1581 (1984)

Facts

Cowin Equipment Company (Cowin) (plaintiff) sold Terex-brand heavy equipment manufactured by General Motors Corporation (GMC) (defendant). In 1978, anticipating an increase in demand for Terex equipment, GMC required Cowin and other Terex dealers to place advance orders for Terex equipment under a new sales contract stating that such orders were noncancelable. Previously, GMC had allowed liberal cancellation. Cowin ordered 44 Terex machines following the imposition of the noncancellation provision but then attempted to cancel some orders due to an economic downturn. GMC refused to allow cancellation and delivered all of the machines as ordered, leaving Cowin with excess inventory. Cowin sued GMC in December 1980 and sought damages on the ground that the contract terms were unconscionable. As damages, Cowin sought compensation for interest incurred on the loans to buy the equipment, insurance payments, storage and maintenance fees, and losses incurred from selling the equipment below purchase price. GMC moved for summary judgment. The district court viewed the case as a Uniform Commercial Code (UCC) unconscionability action for damages. The court concluded that the contract was unconscionable as a matter of law and therefore denied GMC’s motion for summary judgment. GMC appealed.

Rule of Law

Issue

Holding and Reasoning (Roney, J.)

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