Waldinger Corp. v. CRS Group Engineers, Inc.

CRS Group Engineers, Inc., Clark Dietz Division (Dietz) (defendant) prepared engineering specifications for a waste-treatment facility. Waldinger Corporation (Waldinger) (plaintiff) was the project’s mechanical subcontractor. Waldinger obtained an offer from Ashbrook-Simon-Hartley, Inc. (Ashbrook) (defendant) to provide sludge-dewatering equipment according to Dietz’s engineering specifications. Ashbrook began working with Dietz. Ashbrook discovered that Dietz’s engineering specifications were based on sludge-dewatering equipment exclusively made by Carter, one of Ashbrook’s competitors. As a result, Ashbrook needed to depart from Dietz’s specifications in some ways. It was common industry practice to allow flexibility of this sort to allow different subcontractors to compete for the same project. Additionally, federal regulations required Dietz to interpret the specifications in a procompetitive and non-restrictive manner. Ashbrook demonstrated that, despite some engineering departures, the equipment still met Dietz’s performance requirements. Dietz initially led Ashbrook to believe that Ashbrook’s equipment was workable, but Dietz ultimately rejected Ashbrook’s equipment. As a result of Dietz’s rejection, Ashbrook could not provide the equipment to Waldinger. Waldinger purchased the equipment from Carter instead and sued Ashbrook for breach of contract. Ashbrook raised the defense of impracticability, arguing that Dietz’s specifications were impossible to accommodate. The district court found that Dietz intentionally prepared specifications that were impossible to follow for any company but Carter. The court held that Ashbrook was excused from performance due to impracticability. Waldinger appealed, arguing that Ashbrook was not excused from performance.