Dynamic Machine Works, Inc. v. Machine & Electrical Consultants, Inc.

Dynamic Machine Works, Inc. (DMW) (plaintiff) built precision components for a variety of industries. Machine & Electrical Consultants, Inc. (MEC) (defendant) distributed heavy machinery. In January 2003, DMW issued a purchase order to MEC for a lathe machine. MEC, in turn, ordered the lathe machine from a third-party company. The lathe machine’s delivery date was scheduled for May 2003, and the contract provided for an initial down payment prior to delivery, a second payment upon delivery, and a third payment upon the lathe machine being fully commissioned. DMW made the initial down payment, but multiple delays hindered the delivery of the lathe machine, and DMW agreed to multiple extensions of the delivery date. After DMW received delivery of the lathe machine, multiple problems were noted with it. DMW accordingly, on December 9, 2003, agreed to a revised commissioning date of December 19, 2003. But on December 10, DMW discovered additional problems with the lathe machine. On December 11, DMW wrote to MEC that it was rejecting the lathe. As of December 11,when DMW rejected the lathe, MEC had not done anything in reliance on DMW’s earlier extension of the commissioning date to December 19. Upon rejecting the lathe machine, DMW demanded that MEC return both the down payment and all subsequent payments made on the machine. MEC refused, and DMW brought suit against MEC.