Thermal Equipment Sales, Inc. v. A & A Mechanical, Inc.

Breach of contract - In 1992 the University of Kentucky (UK) undertook
the renovation of some of the laboratory buildings on its
Lexington campus. It awarded a contract for work on the
laboratories' ventilation systems to A & A Mechanical, Inc. (A & A ),
the appellant. A & A in turn subcontracted with the appellee,
Thermal Equipment Sales, Inc. (TES), which was to supply A & A with
duct work and other materials. In April 1994, TES sued A & A for
the alleged breach of their agreement, and by order entered March
24, 1998,[fn1] the Franklin Circuit Court awarded TES damages
and attorney fees. Insisting that the trial court misconstrued,
factually and legally, its agreement with TES, A & A appeals. We
affirm.

In January 1993, during the bidding phase of UK's
renovation project, TES sent a price list to A & A that included,
among other prices, a quote of fifty-three thousand seventy-four
dollars ($53,074.00) plus tax, for approximately nineteen thousand
pounds (19,000 lbs.) of PVC coated duct and fittings and five
hundred pounds (500 lbs.) of PVC coated "radioisotope stack and
fittings." Soon thereafter, in February 1993, UK awarded the
ventilation contract to A & A, and A & A in turn sent a purchase order
to TES that provided in part as follows:

Provide per plans, specs, addenda 1 and 2 and alternates
1 and 2 all round PVC coated ductwork and fittings
including the radioisotope stack and fittings as found
in but not exclusively in spec section 15810 for a total
lump sum price of 53,074. [plus] Tax 3,184. [total]
56,238.

A sales representative of TES and A & A's project manager then met
to discuss ordering and shipping details. They agreed that A & A
would order specific sections of duct work as its needs became
known, but would attempt to allow sufficient lead time for
manufacturing. During the course of their discussion, the two (2)
men realized that each had based his estimate of the quantity of
duct work that would be required on plans prepared by UK's
engineers and that the estimates were in close agreement. Both
were aware, moreover, that this was a rehabilitation project and
so was certain to require some deviation from the plans in order
to accommodate pipes, wiring, and other fixtures the plans did not
represent.

A & A ordered duct work in May, July, and October 1993.
TES passed the orders along to its manufacturer, who shipped the
goods directly to A & A and billed TES. TES apparently then billed
A & A. Following completion of the second order and shipment, A & A
had been billed and had payed slightly less than forty thousand
dollars ($40,000.00). In the course of sending A & A's third order
to the manufacturer, TES realized that the order would exhaust and
slightly exceed the fifty-six thousand dollar ($56,000.00) total
price provided for in the purchase agreement. Concerned, TES
contacted A & A to find out how near completion the project was.
A & A then, in November and December 1993, prepared a fourth order
listing its remaining requirements. That order, TES calculated,
would add nearly nineteen thousand dollars ($19,000.00) to the
estimated total cost of the duct work. TES thereupon informed A & A
that it would not fill the fourth order without additional
payment. In response, A & A insisted that its fourth order was
contemplated by the original contract and demanded that TES supply
the remaining goods. The ensuing stalemate culminated in A & A's
obtaining duct work to complete the project from a third party and
TES's filing suit.

Judgment for plaintiff after bench trial for an unknown sum.

Unknown

Unknown

Affirmed by the
Court of Appeals of Kentucky on July 23, 1999.