Chicago Business Litigation Lawyer Blog
A manufacturer of yachts was sued by a disgruntled buyer for breach of contract after the yacht he ordered was not usable in waters in the European Union as he originally specified. The buyer lost in court, however, because he argued that the yacht was a total loss, and the company presented evidence that the conversion to allow the yacht to operate in Europe would cost less than $2,000, and that it had repaired other small defects for free.
Porter, Inc. is an Indiana company that manufactures boats under the Formula and Thunderbird trade names. In September 2012, Erich Schwaiger attended a boat show in Friedrichshafen, Germany, and met Alfred Zurhausen, the owner of Poker-Run-Boats, one of Porter’s international dealers of Formula boats. Schwaiger expressed interest in ordering a Formula yacht with supercharged engines and high-end accessories and furnishings. Zurhausen later met Schwaiger in Munich to discuss the options and pricing in more detail. Schwaiger later, through one of his companies, SelectSun, executed a contract with Poker-Run-Boats in October 2012. The yacht and custom-built lift cost Schwaiger approximately $1 million.
The contract required that the boat be CE certified, so that it would be authorized for operation in the European Union. Porter did not, however, manufacture the boat to meet that specification due to a miscommunication during the ordering process that Porter had with one of its domestic dealers, International Nautic. Schwaiger took delivery of the yacht in Germany in May 2013. He used the boat throughout much of the 2013 season in Europe. During the first few months, Porter covered a series of minor warranty repairs at no charge to Schwaiger. By the end of August, however, Schwaiger was fed up with the yacht, complaining to Poker-Run-Boats of problems with the boat’s engines, steering column, exterior gel coating, and interior furnishings. Schwaiger then returned the yacht to Poker-Run-Boats with instructions to sell it. When the boat did not immediately sell, Schwaiger sued. Continue reading ›