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Toyomenka v. Combined Metals Corp.

OPINION FILED DECEMBER 31, 1985.

TOYOMENKA (AMERICA), INC., PLAINTIFF-APPELLANT,

v.

COMBINED METALS CORPORATION, DEFENDANT-APPELLEE.



Appeal from the Circuit Court of Cook County; the Hon. Gerald T. Winiecki, Judge, presiding.

JUSTICE LORENZ DELIVERED THE OPINION OF THE COURT:

Counterdefendant Toyomenka (America), Incorporated, appeals from a $7,589.65 judgment entered against it following a trial on the counterclaim of counterplaintiff Combined Metals Corporation alleging Toyomenka's breach of certain express and implied warranties concerning steel sold to Combined. On appeal Toyomenka contends: (1) Combined failed to establish that it had properly revoked its acceptance of the steel; (2) Combined failed to establish that Toyomenka breached any express or implied warranties concerning the steel; (3) even assuming such a breach, Combined was not entitled to recover the price of the steel.

We affirm.

At trial the following pertinent testimony was adduced. Walter Hauk, president of Combined, testified that Combined was in the business of processing and distributing stainless steel. He had purchased over 1,000 tons of stainless steel from Toyomenka since 1972, dealing primarily with Casey Yawata, the manager of Toyomenka's stainless steel department.

In February 1979, the steel at issue was ordered from Toyomenka at a price of $5,589.65. Confirmation of sale was received in March, and delivery was accepted in September 1979. At a cost of $2,000, Combined had a processor cut the steel into sheets and then shear it into narrow strips, all according to the specifications of its customer, Teletype Corporation.

In October 1979 the processed steel was shipped to Teletype. Subsequently a letter was received from Teletype and Combined notified Casey Yawata that the steel was too soft. Teletype subsequently rejected the steel in a letter sent in February 1980.

Walter Hauk testified that it was the custom in the industry for general application commercial quality 409 stainless steel (the type at issue here) to have a hardness rating of 70 to 80 on a Rockwell B scale. Hauk also testified that Casey Yawata knew of these requirements.

According to Hauk, it was also the custom and practice in the industry to send with the first shipment of steel a certification of the physical and chemical properties of the steel. It was industry practice that each subsequent shipment would meet the specifications of the certificate. Hauk testified that in past dealings Toyomenka had followed this practice and had sent shipments which absolutely conformed to those specifications. This testimony as to general industry practice was corroborated at trial by Brandon Jacobson, who had worked in the stainless steel industry for 25 years as a marketing and product manager.

According to Walter Hauk, the certification sent by Toyomenka with its first shipment indicated that the hardness of the steel was 128 on a Vickers scale. After Combined reported its customer's complaint to Toyomenka, Casey Yawata sent Combined a letter indicating that a hardness of 128 Vickers was equivalent to 71.3 Rockwell B. Yawata subsequently sent Combined an industry conversion chart with this same conversion from Vickers to Rockwell B underlined.

John Kitson, manager of a physical testing laboratory, testified that he tested samples of the steel in March 1982, and found hardness values from 61 to 62.5 on a Rockwell B scale.

Walter Hauk had also testified that Toyomenka rejected Combined's demand that they accept the material back and credit Combined for its cost. The steel remained in a Combined warehouse at the time of trial. Toyomenka has conceded on appeal that this steel, as processed, was worthless if not suited to the needs of Combined's customer.

Toyomenka established at trial that its March 1979 sale-confirmation letter had stated that the chemistry and mechanical properties of the steel was subject to specifications contained in an attached brochure. According to John Sirovi, the brochure then in effect stated that the hardness of the steel was no greater than 80 Rockwell B. However, Walter Hauk testified that although he was familiar with the brochure, he was not certain whether it had been attached to the confirmation received by Combined. John Sirovi also conceded that it was industry practice for products to conform to the mill certificates issued which showed typical mechanical properties such as hardness.

Toyomenka's final witness was Lyle Jacobs, a metallurgical engineer with 27 years' experience in the field. Jacobs testified that to an engineer the two most important properties of steel were tensile strength (the load required to break the metal by pulling it apart) and yield strength (the force required to produce a permanent deformation in the metal). It is undisputed that his tests established that the steel in question met the requisite specifications for these two properties.

Jacobs also testified that another generally accepted quality control test in the industry was for hardness, the metal's resistance to penetration. This could be tested on a Rockwell machine, yielding values on various scales including Rockwell B. Testing samples of the steel on ...


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