Paul Stafford wanted to start a car-wash business. Stafford organized a corporation called A.C.W. Inc. (ACW) (defendant) and purchased car-wash equipment from Valley Die Cast Corp. (Valley) (plaintiff). In July 1966, ACW put a down payment on the equipment and executed a note with Valley for the remaining balance. ACW used the equipment for a few months and made five payments on the note. ACW then informed Valley that the equipment was defective. In January 1967, due to Valley’s breach of warranties, ACW asked Valley to remove the equipment and refund ACW’s payments. Valley did not remove the equipment or refund ACW’s payments. ACW continued using the equipment until May 1967, when ACW purchased new equipment. ACW had to renovate the car-wash building to accommodate the replacement equipment. ACW told Valley that ACW would be moving the old equipment into storage, except for a boiler, pump, and sign. ACW retained use of those three items. Valley sued ACW for the balance due on the note, and ACW counterclaimed for breach of warranty and fraud. The jury entered judgment in favor of ACW and awarded damages. Both parties appealed.