Riegel Power Corp. v. Voith Hydro

On February 12, 1982, Riegel Power Corporation and Mount Vernon Mills, Inc. (Riegel) (plaintiffs) agreed in writing to purchase a hydroelectric turbine from Voith Hydro (Voith) (defendant). The contract included a warranty that limited Voith’s liability to making repairs or replacing the turbine. The warranty was good for 18 months after the date of delivery or tender of delivery. Voith tendered delivery of the turbine in January 1983, but Riegel was ready to accept only some of the preliminary parts and requested that most of the shipment be delayed. Riegel delayed the installation of the turbine until June 11, 1984. The 18-month warranty was set to expire in July 1984, so Voith offered to extend the warranty for a fee, but Riegel refused. In July 1984, while the warranty was still in effect, the turbine had a problem that required it to be shut down and repaired by Voith. The turbine was fully operational at the time the warranty expired. On three more occasions from 1984 to 1987, after the warranty period, the turbine had to be shut down and repaired again. Voith promptly made those repairs at no cost. However, Riegel sued Voith to recover damages for lost operation time. Riegel argued that the warranty had failed in its essential purpose, which invalidated the limitations in it, so that all remedies were available. Voith moved for summary judgment, which the district court granted. Riegel appealed.