## Facts

- Cannon owned and operated a restaurant.
- For a number of years, Cannon regularly purchased peas from Yankee Products Co., Inc. to serve to restaurant patrons.
- Cannon bought the peas based on the Yankee Products salesman’s representation that the peas were of good quality.
- During service, a patron discovered a worm among the peas, cried out, and attracted the attention of other patrons.
- After the incident, other patrons walked out; Cannon refunded meals to those affected.
- Cannon claimed word of the incident spread in the community and that his business declined afterward.
- Cannon testified that he attempted to counter the decline, including staying open longer hours and hiring extra staff.
- Cannon sued Yankee Products for breach of express warranty, breach of implied warranties, and negligence.
- To support damages, Cannon presented evidence at trial of diminished sales following the incident.
- The trial court found for Cannon on all counts and awarded damages that included lost profits.
- Yankee Products appealed.

## Issues

1. Whether a restaurant that served peas containing a worm could recover lost profits as consequential damages on claims for breach of warranty and negligence, based on evidence that business declined after the incident.

## Decision

- The appellate court affirmed the judgment for Cannon.
- The court upheld findings of liability on Cannon’s theories (express and implied warranty and negligence).
- The court upheld the lost-profits award, concluding that the claimed diminution of business could be treated as a foreseeable result of supplying defective food to a restaurant and that Cannon’s sales evidence provided a sufficiently reliable basis for the award.

## Legal Principles

- A seller’s statement about product quality, made to induce purchase and relied on by the buyer, can create an express warranty.
- Food sold for human consumption is generally subject to implied warranties, including merchantability (fit for ordinary use as food) and fitness when the seller knows the buyer will serve the product to patrons.
- Supplying unwholesome or contaminated food can also support negligence liability when reasonable care is not used in preparing or providing food fit to eat.
- Consequential damages for breach of warranty may include lost profits tied to reputational harm and reduced patronage when such losses are a natural and probable result of the breach in the restaurant setting.
- Lost profits need not be proven with mathematical precision, but they must be supported by evidence that permits a reasonable estimate; comparative sales figures before and after the incident can satisfy that requirement.
- A factfinder may consider the plaintiff’s efforts to limit loss when assessing both causation and the amount of damages.

## Conclusion

Cannon v. Yankee Products Co., Inc. affirmed a restaurant owner’s recovery after a patron found a worm in peas supplied by the defendant. The court upheld liability on warranty and negligence theories and permitted consequential damages in the form of lost profits where the restaurant presented evidence of a post-incident sales decline and the resulting business loss was treated as a foreseeable outcome of supplying contaminated food for service to patrons.


Cannon v. Yankee Products Co., Inc., 59 Mass. App. Dec. 169 (1977)