National Heater Company v. Corrigan Company Mechanical

In 1969, Corrigan Company (defendant) (Corrigan) contracted with National Heater Company (National Heater) (plaintiff) to purchase heaters to be used in the construction of an automobile plant in Fenton, Missouri. National Heater initially provided a proposal with pricing that indicated the shipment would be F.O.B. St. Paul, Minnesota, “with freight allowed.” Corrigan sent a purchase order to National Heater for the proposed heaters, and for the price, Corrigan printed “Price $275,640—Delivered.” National Heater responded with a letter that acknowledged the purchase order and that had a printed statement, “Sale Price Total,” followed by the typewritten statement “$275,640.00 Total Delivered to Rail Siding.” The acknowledgement letter also said in printed terms that “delivery of equipment hereunder shall be made f.o.b. point of shipment unless otherwise stated.” The heaters were shipped to Corrigan, but there was damage to the heaters during transit, the shipment arrived late, and Corrigan had to expend labor in order to make the heaters work according to the purchase specifications. Corrigan did not pay National Heater the full amount for the heaters, and National Heater sued to recover the unpaid amount. National Heater argued that based on the negotiated terms, Corrigan bore all risks for the shipment during transit. The trial court disagreed and held that the parties had agreed that National Heater would bear the risks until the goods had been delivered to the rail siding at the construction site. National Heater appealed.