## Facts

- A manufacturer of pressure car-wash equipment sold a “Thrift-I-Matic” system to a newly formed corporation created to own and operate a car wash.
- The buyer relied on the seller’s sales presentation and promotional materials describing the system’s dependability, profitability, and cleaning performance.
- The buyer made a deposit, signed a written purchase agreement, and executed a promissory note to finance the purchase price.
- After installation, the buyer experienced operational problems and, within months, notified the seller that it rejected the equipment due to defects.
- After giving notice, the buyer continued using the system for several months, then replaced it with different equipment and modified the building to accommodate the replacement.
- The seller sued on the promissory note for the alleged unpaid balance.
- The buyer asserted defenses including failure of consideration and fraud, and counterclaimed for fraud and breach of implied warranties of merchantability and fitness for a particular purpose.
- A jury returned a $9,000 verdict for the buyer on its counterclaim; the trial court entered judgment and denied the seller’s motion for judgment notwithstanding the verdict.

## Issues

1. Whether the buyer’s post-notice conduct constituted acceptance of the goods as a matter of law, or whether acceptance/rejection was a jury question under the UCC.
2. Whether the buyer’s continued use of the equipment after notice of rejection barred recovery or could be treated as mitigation of damages.
3. Whether the evidence supported damages including amounts paid, renovation costs to install replacement equipment, and lost profits, and whether any elements were too speculative.
4. Whether challenged evidentiary rulings and jury instructions on damages required reversal.

## Decision

- The appellate court affirmed the judgment for the buyer on the counterclaim and upheld the $9,000 jury verdict.
- The court held that acceptance versus effective rejection was properly submitted to the jury on the record presented.
- The court ruled that continued use after notice of defects did not, as a matter of law, establish acceptance or bar recovery; the jury could view the use as mitigation.
- The court upheld submission of damages to the jury, including amounts paid toward the purchase, renovation costs as consequential damages, and lost profits supported by sufficient proof.
- The court found no reversible error in the trial court’s evidentiary decisions or in the instructions given on damages.

## Legal Principles

- Whether a buyer accepted goods or effectively rejected/revoked acceptance under the UCC may present a fact question for the jury when the evidence permits competing inferences.
- A buyer’s continued use of allegedly defective goods after giving notice of rejection does not automatically convert rejection into acceptance; continued use may be consistent with reasonable mitigation efforts.
- Consequential damages may include facility modification or renovation costs when the seller’s breach proximately causes the buyer to replace defective goods and adapt premises for replacement equipment.
- Lost profits are recoverable when supported by evidence allowing the factfinder to estimate the loss with reasonable certainty; they are not barred solely because some estimation is required.
- Trial courts have discretion over evidentiary rulings; absent abuse of discretion and resulting prejudice, such rulings do not warrant reversal.

## Conclusion

The court sustained a jury verdict for the buyer, holding that acceptance and damages issues were for the jury where the buyer timely complained of defects, continued limited use could be mitigation rather than acceptance, and consequential damages and lost profits were supported by sufficient proof.


Valley Die Cast Corp. v. A.C.W., Inc., 181 N.W.2d 303 (Mich. Ct. App. 1970)