Monday, April 22, 2013

'United Concrete & Construction v. Red-D-Mix Concrete' argument preview

United Concrete & Construction, Inc. v. Red-D-Mix Concrete, Inc. (2011AP1566) is scheduled for argument before the Wisconsin Supreme Court April 23, 2013. The case is before the court on review of the Court of Appeals. The synopsis states:
"This case examines who (judge as a matter of law or jury as a matter of fact) determines whether a representation made by a seller of a product is mere 'puffery' or is legally sufficient to support a misrepresentation claim, including one brought under Wis. Stat. §100.18. 'Puffery' is defined as the expression of an exaggerated opinion, as opposed to a factual representation, regarding the quality of a good or service that cannot be proven true or false and is intended to sell the product or service.

"Some background: Defendant Red-D-Mix is a maker and distributor of concrete. Plaintiff United Concrete & Construction, Inc. (United) is a concrete contractor that contracts with end-users for the installation of concrete 'flatwork,' such as patios and driveways. United had used Red-D-Mix as a supplier for several years, including 2002 and 2003. United says it then switched to another supplier after it experienced pitting, scaling and crumbling of the concrete it installed due to Red-D-Mix’s concrete containing excessive amounts of 'bleed water.' Bleed water emerges from the concrete after it is poured and water is forced up as sand and aggregate settles downward.

"After allegedly receiving assurances from a Red-D-Mix sales representative that the bleed-water problem had been resolved, United decided to resume purchasing concrete from Red-D-Mix for the 2007 season. United claims that it once again suffered from the same excessive bleed water problems.

"Customers began to complain about the problems to United. Red-D-Mix claims that only a few customers actually complained and that United unilaterally decided to approach all of its customers even if they had not complained.

"United advised its 2007 customers that the problems with their patios or driveways resulted from defective concrete supplied by Red-D-Mix and that United intended to pursue legal action against Red-D-Mix. United told its customers that it would attempt to obtain damages from Red-D-Mix and that it would allocate any money received among those individuals who had signed Assignment of Rights to Sue, which purported to assign the customers’ rights against Red-D-Mix to United. A portion of United’s customers signed and returned the assignment documents.

"Red-D-Mix asserts that the assignment was, in reality, a release of claims against United, which means that United will not be liable for any damages related to fixing or replacing those customers’ concrete work.

"In 2008, United did file suit against Red-D-Mix and two of its insurers in Outagamie County Circuit Court. Its most recent complaint alleged claims for breach of contract, breach of express and implied warranties, negligence, indemnification, contribution, and violation of Wis. Stat. §100.18. Red-D-Mix moved for summary judgment on all claims, which the circuit court granted.

"The Court of Appeals reversed and remanded for further proceedings. The Court of Appeals rejected the circuit court’s conclusion that United’s claim under Wis. Stat. §100.18 was defective because, as a matter of law, all of the misrepresentations alleged in United’s complaint were mere 'puffery.' It held that the question of whether the alleged misrepresentations constituted puffery was a question of fact to be decided by the jury at trial, not a question of law to be decided by the court.

"The Court of Appeals also ruled that United could proceed with its contract claims against Red-D-Mix, concluding that United had produced sufficient evidence of its damages and that the Assignments signed by United’s customers did not strip United of its right to sue Red-D-Mix or protect it from the claims of its customers.

"Red-D-Mix seeks Supreme Court review of the issue of whether the court or the jury should determine whether a defendant’s alleged misrepresentations are mere puffery. It also asks the Supreme Court to review whether its decision in Linden v. Cascade Stone Co., 2005 WI 113, 283 Wis. 2d 606, 639 N.W.2d 189, precludes a contractor from attempting to obtain its customers’ claims against a subcontractor through an assignment and from then suing the subcontractor on those customer claims. From Outagamie County."