Gindy Mfg. Corp. v. Cardinale Trucking Corp. - 111 N.J. Super. 383, 268 A.2d 345 (Super. Ct. 1970)

Rule:

The express terms of an agreement should be construed where reasonable as consistent with the custom of the trade or a course of dealing evidenced by previous conduct of the parties. N.J. Stat. Ann. § 12A:1-205. A course of performance is relevant to the interpretation of an agreement. N.J. Stat. Ann. § 12A:2-208. The express terms of an agreement and a course of performance, course of dealing and usage of trade shall be construed whenever reasonable as consistent with each other. N.J. Stat. Ann. § 12A:2-208(2). 

Facts:

This was an action by the seller (Gindy) of twenty-five 1967 semi-trailers for a deficiency of $13,052.37 after repossession and resale following Cardinale Trucking Corp.’s (Cardinale) default in payment under a conditional sales contract. The defense and counterclaim were based on the assertion that the trailers were delivered with faulty radius rods which caused premature tire wear and consequent monetary loss. Gindy contended that the installment sales contract expressly excluded all warranties. Accordingly, Gindy sought a judgment for the amount of the deficiency, with interest and costs, and a dismissal of the counterclaim.

Issue:

Was the "as is" clause in the contract with Cardinale effective to disclaim an implied warranty of merchantability?

Answer:

No.

Conclusion:

The court denied summary judgment, holding that Gindy had not excluded the implied warranty of merchantability in conformity with N.J. Stat. Ann. § 12A:2-316(2). The court reasoned that the "as is" clause used by Gindy was inconsistent with the prevailing usage and trade and with the previous course of dealing between the parties.