Washington Freightliner v. Shantytown Pier, Inc.

Shantytown Pier Inc. (Shantytown) (plaintiff) operated a business that offered fishing and recreational boating excursions. Shantytown entered into a contract with Lydia Yachts of Stuart, Inc. (Lydia), a boatyard, for the construction of a large boat for parties and fishing, named the Ocean City Princess (OCP). Subsequently, Shantytown purchased three engines to be used in the OCP from Washington Freightliner, Inc. (Washington) (defendant), an authorized dealer of MAN Roland, Inc. (MAN) (defendant), the manufacturer. Shantytown contracted for the “start up and commissioning” of the boat and paid a total of $163,000 for the engines. Marine Mechanical Systems (defendant), an authorized dealer of the engines, delivered the engines to Lydia no later than September 30, 1990. Lydia did not complete construction of the boat until April 20, 1991, the date on which the OCP was commissioned. The OCP experienced numerous failures over the course of the first four years of operation, most of which were due to faulty pistons in the engines. MAN performed numerous repairs, but problems kept reoccurring. Shantytown eventually purchased a new engine from MAN, but that engine, too, experienced problems. Shantytown filed suit against MAN, Washington, and Marine Mechanical Systems (collectively, the sellers), alleging breaches of various warranties and breach of contract. Shantytown dropped all but the implied-warranty claim. The sellers argued that the claim was barred by the statute of limitations in Uniform Commercial Code (UCC) § 2-725, which provided that an action for breach of any contract must be commenced within four years after the cause of action accrued. Shantytown argued that the statute of limitations did not begin to run until the boat was commissioned. A jury found in favor of Shantytown and awarded damages. The trial judge denied the sellers’ motion for judgment notwithstanding the verdict. The sellers appealed to the court of special appeals, which affirmed the trial court’s ruling, concluding that the sellers failed to satisfy the burden of proving that the statute of limitations began to run prior to commissioning. The sellers appealed again.