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Pittsley v. Houser - 125 Idaho 820, 875 P.2d 232 (Ct. App. 1994)


Under the predominant factor test for hybrid transactions involving both goods and services, the test for inclusion or exclusion under the Uniform Commercial Code is not whether they are mixed, but, granting that they are mixed, whether their predominant factor, their thrust, their purpose, reasonably stated, is the rendition of service, with goods incidentally involved or is a transaction of sale, with labor incidentally involved. 


Pittsley contracted with Hilton Contract Carpet Co. (Hilton) for the installation of carpet in her home. The total contract price was $ 4,402. Hilton paid the installers $ 700 to put the carpet in Pittsley's home. Following installation, Pittsley complained to Hilton that some seams were visible, that gaps appeared, that the carpet did not lay flat in all areas, and that it failed to reach the wall in certain locations. Although Hilton made various attempts to fix the installation, by attempting to stretch the carpet and other methods, Pittsley was not satisfied with the work. Eventually, Pittsley refused any further efforts to fix the carpet. Pittsley initially paid Hilton $ 3,500 on the contract, but refused to pay the remaining balance of $ 902. Pittsley later filed suit, seeking rescission of the contract, return of the $ 3,500 and incidental damages. Hilton answered and counterclaimed for the balance remaining on the contract. Although Pittsley had asked for recission of the contract and a refund of her money, the magistrate determined that recission, as an equitable remedy, was only available when one party committed a breach so material that it destroyed the entire purpose of the contract. Because the only estimate of damages was for $ 250, the magistrate ruled recission would not be a proper remedy. Instead, the magistrate awarded Pittsley $ 250 damages plus $ 150 she expended in moving furniture prior to Hilton's attempt to repair the carpet. On the counterclaim, the magistrate awarded Hilton the $ 902 remaining on the contract. Pittsley appealed to the district court, claiming that the transaction involved was governed by the Idaho Uniform Commercial Code (UCC). The district court agreed with Pittsley's argument, reversing and remanding the case to the magistrate to make additional findings of fact and to apply the UCC to the transaction. Hilton appealed the decision of the district court. 


Should the transaction be governed by the Idaho UCC?




The court found the predominant purpose of the contract was the sale of goods, the carpet, and that the installation service was ancillary to the sale. Thus, the UCC did control and should have been applied by the magistrate. As such, the court vacated the order of the magistrate and remanded the matter for further findings. The court directed that on remand, the magistrate could consider such issues as whether the carpet was properly rejected under I.C. § 28-2-602 or whether the actions of Pittsley constituted acceptance under I.C. § 28-2-606. If the goods were accepted, the magistrate could consider if the acceptance could have been revoked under I.C. § 28-2-608. The magistrate could then consider the various remedies that are available under the UCC and any other provisions of the code that the court deemed applicable.

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