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    "parties": [
      "BOWERS MANUFACTURING COMPANY, INC., Plaintiff-Appellant, v. CHICAGO MACHINE TOOL COMPANY et al., Defendants-Appellees."
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    "opinions": [
      {
        "text": "JUSTICE VAN DEUSEN\ndelivered the opinion of the court:\nPlaintiff, Bowers Manufacturing Company, Inc. (Bowers), appeals the dismissal with prejudice of its three-count amended complaint against defendant Chicago Machine Tool Company (CMTC), a division of EJ.M. Corporation; Di-Acro, a division of Houdaille Industries, Inc.; and Mateo Leasing, Ltd., an affiliate and wholly owned subsidiary of Chicago Machine Tool Company. On appeal, plaintiff contends that counts I and II of its amended complaint stated a cause of action against CMTC for breach of oral contract and breach of express warranty, that count III stated a cause of action for breach of express and implied warranty, and that the defendants\u2019 motion to dismiss did not assert affirmative matter sufficient to permit the dismissing of said complaint. Therefore, according to Bowers, the trial court erred in granting defendants\u2019 motion to dismiss.\nIn the first count of its amended complaint, Bowers alleged that CMTC orally represented to Bowers that a certain turret punch manufactured by Di-Acro would meet all the specifications and requirements as given by Bowers to CMTC; that plaintiff agreed to purchase the machine based upon these oral representations; that CMTC arranged for financing through Mateo, which defendant believed to be an affiliate and wholly owned subsidiary of CMTC; that Bowers and Mateo executed an \u201cEquipment Lease Purchase Agreement\u201d for the lease and ultimate purchase of the machine, a copy of which agreement was attached to the complaint; that the equipment was delivered to Bowers; that, pursuant to the contract, Bowers caused $94,663 to be paid to Mateo, which Bowers alleged to be the purchase price; that defendant knew the intended use and that Bowers relied on their expertise at the time of the negotiation, order and delivery; that Bowers found the equipment to be defective and unsound and not useable for the intended purpose; and that such failure constituted a breach of contract.\nCount II made basically the same factual allegations, but concluded that defendants expressly warranted that the machine would meet the specifications and. perform the work required and that the failure to do so constituted a breach of section 2 \u2014 313 of the Uniform Commercial Code (Ill. Rev. Stat. 1981, ch. 26, par. 2 \u2014 313). Count III realleged the same facts but concluded that the equipment failed in material respects to conform to the implied warranties of merchantability and of fitness for a particular purpose, in violation of sections 2\u2014 314 and 2 \u2014 315 of the Uniform Commercial Code (Ill. Rev. Stat. 1981, ch. 26, pars. 2 \u2014 314, 2 \u2014 315).\nDefendants Chicago Machine Tool Company and Di-Acro brought a motion to dismiss pursuant to section 2 \u2014 619 of the Code of Civil Procedure (Ill. Rev. Stat. 1981, ch. 110, par. 2 \u2014 619), formerly section 48 of the Civil Practice Act (Ill. Rev. Stat. 1981, ch. 110, par. 48). In their motion, defendants asserted that defendants had, as a matter of law, disclaimed all warranties upon which plaintiff relied. They claimed that, in conformity with section 2 \u2014 316(2) of the Uniform Commercial Code, they expressly excluded the implied warranty of fitness for a particular purpose, the express warranty of fitness for a particular purpose, and the implied warranty of merchantability. Defendants attached to their motion a copy of the Matco-Bowers \u201cEquipment Lease Purchase Agreement\u201d wherein all express and implied warranties of fitness and merchantability were purportedly disclaimed and the lessee was extended the same warranty given by the manufacturer to the lessor; a copy of the written warranty of DiAcro, the manufacturer, in which, inter alia, all express and implied warranties of fitness and merchantability were also purportedly disclaimed; and a copy of Bowers\u2019 sworn answers to interrogatories filed in an earlier suit over the same matter, which had been dismissed for want of prosecution. In those answers to interrogatories, John Bowers, the president of plaintiff, had stated that the warranties under which it was claiming were not oral but were written and furnished by Mateo Leasing on April 4, 1980, and Bowers also attached to these answers a copy of the Di-Acro warranty. Lastly, defendants alleged in their motion that section 2 \u2014 202 of the Uniform Commercial Code (Ill. Rev. Stat. 1981, ch. 26, par. 2 \u2014 202) forbids the introduction of parol evidence to contradict a written agreement such as the one under which plaintiff asserted to be claiming.\nOn August 26, 1982, after hearing argument on defendants\u2019 motion, the court ruled that defendants had conspicuously disclaimed the warranties upon which the complaint rested, that the relevant warranty language in the Mateo lease and purchase agreement was not fatally ambiguous, that Bowers\u2019 characterization of the negotiations leading up to the agreement as constituting an oral agreement was an attempt to avoid the terms of the Mateo lease and purchase agreement regarding warranties, and that the terms of the latter, written agreement did comply with the Uniform Commercial Code regarding warranty disclaimers. In response to Bowers\u2019 requests for clarification, the court stated that, while count I was framed as a breach of oral contract, such purported oral contract was, in essence, a negotiation or an oral undertaking or discussion between the parties made prior to the execution of the written agreement, and that written agreement was binding between the parties. The court therefore granted defendants\u2019 motion to dismiss as to all three counts. Plaintiff appealed.\nTo defeat a claim or demand, the alleged affirmative matter in a section 2 \u2014 619 motion (Ill. Rev. Stat. 1981, ch. 110, par. 2 \u2014 619) must be something more than evidence offered to refute a well-pleaded fact in the complaint, for such well-pleaded facts together with all reasonable inferences must be taken as true for purposes of the motion to dismiss; the alleged affirmative matter must negate the cause of action completely or refute a crucial conclusion of law or conclusions of material facts contained in or inferred from the complaint. (Hayna v. Arby\u2019s, Inc. (1981), 99 Ill. App. 3d 700, 709-10.) With these principles in mind we have reviewed plaintiff\u2019s contentions on appeal.\nTwo principal issues are present in this appeal: first, whether plaintiff can bring suit for breach of contract or breach of warranty arising out of an alleged oral contract to purchase a turret punch from CMTC or whether such an alleged agreement constituted preliminary matters which were superseded by its written contract with CMTC\u2019s wholly owned subsidiary Mateo Leasing; and second, whether Mateo and Di-Acro effectively disclaimed the warranties of fitness for use for a particular purpose and merchantability.\nIn making his ruling in favor of defendants, the trial judge recognized that plaintiff had alleged an oral agreement, but he found that there was a written agreement between the parties, the \u201cEquipment Lease Purchase Agreement,\u201d attached to and incorporated in the complaint and that, as asserted by defendants in their motion to dismiss, section 2 \u2014 202 of the Uniform Commercial Code (Ill. Rev. Stat. 1981, ch. 26, par. 2 \u2014 202) does not permit evidence of a prior agreement or contemporary oral agreement that would contradict the written agreement to be introduced. The trial judge observed that Bowers was attempting to avoid the tenets of the written agreement by maintaining that the prior negotiations constituted, in and of themselves, an enforceable agreement.\nSection 2 \u2014 202 of the Uniform Commercial Code provides as follows:\n\u201cSec. 202. Final Written Expression: Parol or Extrinsic Evidence. Terms with respect to which the confirmatory memoranda of the parties agree or which are otherwise set forth in a writing intended by the parties as a final expression of their agreement with respect to such terms as are included therein may not be contradicted by evidence of any prior agreement or of a contemporaneous oral agreement but may be explained or supplemented\n(a) by course of dealing or usage of trade (Section 1 \u2014 205) or by course of performance (Section 2 \u2014 208); and\n(b) by evidence or consistent additional terms unless the court finds the writing to have been intended also as a complete and exclusive statement of the terms of the agreement.\u201d (Ill. Rev. Stat. 1981, ch. 26, par. 2 \u2014 202.)\nClearly, if the alleged oral agreement in this case was a prior negotiation that contradicted the written contract, evidence regarding such oral agreement would be prohibited according to this provision.\nBowers posits several reasons why the parol evidence rule should not apply in this case. First, Bowers argues that the only written agreement is the Mateo agreement, which is a lease and not a sale contract and to which CMTC was not even a party. Therefore, Bowers maintains, evidence of the oral agreement and express warranties relative thereto should have been admissible because the Mateo agreement was distinct from and collateral to the contract made with CMTC. (See Service Iron Foundry, Inc. v. M.A. Bell Co. (1978), 2 Kan. App. 2d 662, 588 P.2d 463; Harriss, Magill & Co. v. Rodgers & Co. (1925), 143 Va. 815, 129 S.E. 513.) Second, Bowers likens the Mateo agreement to the security agreement in Drier v. Perfection, Inc. (S.D. 1977), 259 N.W.2d 496, since both relate to financing, and maintains that the Mateo lease was not a writing intended by the parties as a final expression of the agreement so that evidence of the oral warranty was admissible.\nThese cases, however, are inapposite based on the facts of the case at bar. In its amended complaint, Bowers alleged that Mateo was an affiliate and wholly owned subsidiary of CMTC and that payments made on the purchase of the equipment were made to CMTC via Bowers\u2019 contractual arrangements with Mateo Leasing. Bowers cannot now claim that his dealings with CMTC were separate and apart from those with Mateo Leasing. Moreover, the \u201cEquipment Lease Purchase Agreement\u201d is not merely a financing document like a security agreement that is collateral to a contract of sale. By its terms, it establishes a 60-month lease and provides for the lessee, at its option, to purchase the subject equipment at the end of the lease term for $1.\nWe agree with the trial court. We conclude from our examination of the \u201cEquipment Lease Purchase Agreement\u201d that it constitutes a complete agreement for the lease and sale of the turret punch and explicitly covers the subject matter of warranties. We also conclude that it was intended by the parties to be a final expression of their agreement, and, therefore, under section 2 \u2014 202 of the Uniform Commercial Code, evidence of any oral agreement with CMTC would not be admissible to contradict the terms of the written agreement (Ill. Rev. Stat. 1981, ch. 26, par. 2 \u2014 202).\nTurning to what appears to be the more crucial issue in this case, Bowers maintains that both Mateo and Di-Acro failed to effectively disclaim the warranties upon which its claims rested. First, Bowers attacks the validity of the Mateo agreement on the basis that the warranty disclaimer therein is ambiguous because it first disclaims all express and implied warranties and then extends to the purchaser whatever warranties were extended by the manufacturer to Mateo. Therefore, according to Bowers, the disclaimer was not sufficiently clear and specific to apprise Bowers of what it was waiving (e.g., Imperial Stamp & Engraving Co. v. Bailey (1980), 82 Ill. App. 3d 835, 837).\nThe pertinent portion of the \u201cEquipment Lease Purchase Agreement\u201d is paragraph 4 which reads as follows:\n\u201c4. WARRANTIES. LESSOR MAKES NOT EXPRESS OR IMPLIED WARRANTY WHATSOEVER OF TITLE, MERCHANTABILITY, FITNESS FOR ANY PURPOSE OR OTHERWISE REGARDING THE EQUIPMENT OR ANY UNIT THEREOF except that [Lessor to delete (a) or (b)] (a) Lessor makes to Lessee the current manufacturer\u2019s warranty with respect to the Equipment as set forth on the warranty form to be delivered to the Lessee in connection therewith, or (b) Lessor shall, at Lessee\u2019s expense, make available to Lessee any rights of Lessor under any express or implied warranties of the manufacturer or vendor of the Equipment to the extent that any such rights are assignable. Lessee represents and warrants that it has full power and authority to execute, deliver and perform this Agreement and that this Agreement constitutes its legal, valid and binding obligation.\u201d\nSection 2 \u2014 316(1) of the Uniform Commercial Code requires that words or conduct creating warranty and words or conduct limiting or negating warranty must be construed whenever reasonable as consistent with one another. (Ill. Rev. Stat. 1981, ch. 26, par. 2 \u2014 316(1).) The trial court here found that Mateo\u2019s failure to delete phrase (a) or (b) from paragraph 4 of its agreement provided two modes by which comparable warranties could be passed from the manufacturer to the buyer but that there was no fatal inconsistency in the disclaimer. The interpretation, construction or legal effect of a contract is a matter to be determined by the court as a question of law, and a reviewing court may make an independent determination of such a question. Mazanek v. Rockford Drop Forge Co. (1981), 98 Ill. App. 3d 956, 959.\nHere, it is evident that Mateo\u2019s disclaimer apprised Bowers that Mateo was disclaiming all warranties subject to the stated exceptions allowing the manufacturer\u2019s warranty, if any, to be extended to the buyer. The manufacturer\u2019s (Di-Acro\u2019s) warranty provision likewise disclaimed all warranties and limited its liability to repair or replacement of parts it determined to be defective, or, at its option, replacing the product or refunding the price. In fact, in its brief on appeal, Bowers admits that \u201cMateo\u2019s obligation under the contract was to supply the same implied and express warranties as those given by Di-Acro.\u201d Contrary to Bowers\u2019 position, the Mateo warranty provision does not create a warranty in one breath and surreptitiously deny it in another (Alan Wood Steel Co. v. Capital Equipment Enterprises, Inc. (1976), 39 Ill. App. 3d 48, 58), and the trial court appears to have properly found no fatal ambiguity or inconsistency in that provision.\nA disclaimer similar to Mateo\u2019s was upheld in Walter E. Heller & Co. v. Convalescent Home (1977), 49 Ill. App. 3d 213, on the basis of conspicuousness. However, it is also important to note that, like the Mateo agreement, the disclaimer upheld in Heller appears after the word \u201cWarranties\u201d and passed on warranties made by the supplier of the goods while disclaiming all other express and implied warranties. In Blankenship v. Northtown Ford, Inc. (1981), 95 Ill. App. 3d 303, cited by Bowers, the court found a disclaimer of all warranties by an automobile dealer following the phrase \u201cFactory Warranty\u201d to be misleading in a consumer transaction. The transaction in Heller was between two business entities while that in Blankenship was a consumer transaction, and the courts are less reluctant to hold educated businessmen to the terms of contracts to which they have entered than consumers dealing with skilled corporate sellers. Cf. Dillman & Associates, Inc. v. Capitol Leasing Co. (1982), 110 Ill. App. 3d 335, 341; Walter E. Heller & Co. v. Convalescent Home (1977), 49 Ill. App. 3d 213, 219-20 (\u201c[c]ourts are generally reluctant to use the unconscionability doctrine to rewrite the terms of negotiated contracts into which businessmen have entered\u201d).\nNext, Bowers asserts that Di-Acro did not effectively disclaim its warranties. Initially, Bowers makes a similar argument to the one raised against the Mateo agreement, that Di-Acro gave a warranty on one side of its warranty card and took it away on the other. The face of the warranty card states that any part found defective within one year of purchase will be replaced free of charge \u201cper the complete warranty contract on the reverse side\u201d (emphasis added), and the reverse side clearly sets forth Di-Acro\u2019s liability including, in bold-face type, a statement that the warranty is in lieu of any other warranty express or implied including those of merchantability and fitness for use. A similar restrictive warranty has been held to be authorized and proper. Adams v. J.I. Case Co. (1970), 125 Ill. App. 2d 388.\nBowers inaccurately quotes the face of the warranty card in its brief on appeal as \u201cthe \u2018complete warranty on the reverse side.\u2019 \u201d If the card had the wording quoted by Bowers, an argument might legitimately be made that Di-Acro stated that there was a \u201ccomplete warranty\u201d on the reverse side and, in fact, did not furnish such a complete warranty. However, the face of the warranty card informed the buyer that the \u201ccomplete warranty contract\u201d was on the reverse side and that the extent of Di-Acro\u2019s warranty liability would be determined by its terms. The ambiguity and inconsistency Bowers seeks to find in the Di-Acro disclaimer simply is not present.\nRegarding the implied warranties of merchantability and of fitness, Bowers contends that the Di-Acro disclaimer was not \u201cconspicuous,\u201d as required by the Uniform Commercial Code (Ill. Rev. Stat. 1981, ch. 26, par. 2 \u2014 316(2)). Section 1 \u2014 201(10) of the Uniform Commercial Code provides as follows:\n\u201cA term or clause is conspicuous when it is so written that a reasonable person against whom it is to operate ought to have noticed it. A printed heading in capitals (as: NONNEGOTIABLE BILL OF LADING) is conspicuous. Language in the body of a form is \u2018conspicuous\u2019 if it is in larger or other contrasting type or color. *** Whether a term or clause is \u2018conspicuous\u2019 or not is for decision by the court.\u201d (Ill. Rev. Stat. 1981, ch. 26, par. 1-201(10).)\nBowers contends that \u201ca reasonable person's attention would not have been drawn to the fine print on the reverse side of what appears to be a warranty.\u201d However, unlike the situation in Anderson v. Farmers Hybrid Cos. (1980), 87 Ill. App. 3d 493, cited by Bowers, the face of Di-Acro\u2019s warranty card specifically states that the warranty contract is on the reverse side; it does not simply state that the order is \u201csubject to conditions on the reverse side\u201d (87 Ill. App. 3d 493, 495). A reasonable person in Bowers\u2019 position would have read the reverse side. Further, as defendants maintain, the conspicuousness of the disclaimers complies with the terms of the aforesaid section 1\u2014 201(10) of the Uniform Commercial Code because the Mateo disclaimer is in larger type and capitalized, and the Di-Acro disclaimer is in bold-face type.\nWhether a term or clause is \u201cconspicuous\u201d or not is for decision by the court. (Ill. Rev. Stat. 1981, ch. 26, par. 1 \u2014 201(10).) The trial court properly found that the disclaimers in both agreements in question were conspicuous.\nBowers also argues that defendants\u2019 motion to dismiss was insufficient to sustain a dismissal under section 2 \u2014 619 of the Code of Civil Procedure because defendants failed to allege the timeliness of Di-Acro\u2019s disclaimer. Bowers did not raise the issue of timeliness either in its complaint or by way of a counteraffidavit filed in response to defendants\u2019 motion to dismiss. Bowers nevertheless insists that the defendants have the burden of proving the affirmative matters upon which their motion rests and have failed to do so regarding the timeliness issue.\nIn their motion to dismiss, defendants alleged that Di-Acro expressly excluded any express warranty of fitness or implied warranty of fitness or merchantability pursuant to section 2 \u2014 316 of the Uniform Commercial Code (Ill. Rev. Stat. 1981, ch. 26, par. 2 \u2014 316). That provision does not specify when such a disclaimer of warranties must be made, and defendants\u2019 motion appears to meet the requirements that are set forth therein. Bowers has not cited authority for the proposition that the movant in this type of case must allege timeliness in the motion to dismiss.\nThe court in Gideon Service Division v. Dunham-Bush, Inc. (1980), 80 Ill. App. 3d 633, cited by Bowers, did not find that the motion to dismiss in that case was insufficient for failure to allege timeliness of the disclaimer. In Gideon, the affidavit in support of the motion to dismiss stated that the seller transmitted the sales order bearing its written disclaimer to the buyer about one month after the order and that it was the seller\u2019s custom to transmit such order to the buyer when the goods were shipped. The court found that the record before it established that the seller attempted to disclaim warranties after the contract of sale was made, and the disclaimer, as alleged by the movant, was therefore ineffective.\nThe court in Gideon found that the record showed no assertion that any similar disclaimer was made at the time the goods were ordered or any indication that the buyer assented or even knew of the disclaimer and its conditions. Similarly, in Midland Supply Co. v. Ehret Plumbing & Heating Co. (1982), 108 Ill. App. 3d 1120, the seller could not rely on the manufacturer\u2019s warranty disclaimer submitted to the buyer on delivery of the goods where no similar disclaimer was made by the seller when the goods were ordered. In this case, by contrast, defendants\u2019 motion incorporated by reference the terms of the attached Mateo sales contract warranty disclaimer showing that Bowers was aware at the time of the agreement that its remedies would be limited to those not disclaimed by the manufacturer.\nIn sum, the disclaimers of Mateo and Di-Acro constituted affirmative matter which was a defense that negated Bowers\u2019 cause of action completely and was a proper grounds for dismissal of Bowers\u2019 amended complaint under section 2 \u2014 619(a)(9). See Austin View Civic Association v. City of Palos Heights (1980), 85 Ill. App. 3d 89, 93.\nThe order of the trial court dismissing the complaint with prejudice is affirmed.\nAffirmed.\nNASH and UNVERZAGT, JJ., concur.",
        "type": "majority",
        "author": "JUSTICE VAN DEUSEN"
      }
    ],
    "attorneys": [
      "Richard L. Lucas, of Breen, Lucas & Boris, of Addison, for appellant.",
      "Brigitte Schmit Bell and Gerald G. Saltarelli, both of Butler, Rubin, Newcomer & Saltarelli, of Chicago, for appellees."
    ],
    "corrections": "",
    "head_matter": "BOWERS MANUFACTURING COMPANY, INC., Plaintiff-Appellant, v. CHICAGO MACHINE TOOL COMPANY et al., Defendants-Appellees.\nSecond District\nNo. 82 \u2014 820\nOpinion filed August 17, 1983.\nRichard L. Lucas, of Breen, Lucas & Boris, of Addison, for appellant.\nBrigitte Schmit Bell and Gerald G. Saltarelli, both of Butler, Rubin, Newcomer & Saltarelli, of Chicago, for appellees."
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