This summary was computer-generated without any editorial revision. It is not official, has not been checked for accuracy, and is NOT citable.
Facts
A physician purchased a used x-ray machine from a sales representative, with the understanding that it was a 100/100 machine capable of producing high-quality images. The machine, however, performed as a 100/60 machine, limiting its use to small children and thin individuals. Despite repeated requests for repair and assurances from the seller, the machine was not fixed, leading the buyer to file a lawsuit for breach of warranty (paras 2-5).
Procedural History
- District Court: The buyer initially obtained a default judgment, which was later set aside. After a bench trial, the court awarded the buyer $4,400 in damages, including $1,900 for direct damages and $2,500 for consequential damages (para 6).
Parties' Submissions
- Appellant (Defendant/Seller): Argued that venue was improper, direct damages for repair costs were unsupported by evidence, and consequential damages were unwarranted because they could have been avoided, were unforeseeable, and lacked sufficient proof (para 1).
- Appellee (Plaintiff/Buyer): Claimed breach of warranty, sought damages for the defective machine, and argued that the seller's failure to repair caused consequential losses, including lost business income (paras 1, 6, 16-17).
Legal Issues
- Was the venue for the trial proper?
- Were the direct damages for repair costs supported by evidence?
- Were the consequential damages for lost business income foreseeable, avoidable, and sufficiently proven?
Disposition
- The Court of Appeals affirmed the district court's judgment, upholding the award of $4,400 in damages (para 27).
Reasons
Per Hartz CJ (Pickard and Armijo JJ. concurring):
Venue: The seller's challenge to venue was untimely, as it was raised after filing an answer. Additionally, New Mexico law does not allow venue changes based on forum non conveniens, rendering the argument invalid (paras 7-8).
Direct Damages: Although there was no evidence of repair costs, the court affirmed the $1,900 award as the difference between the machine's value as warranted and its actual value. The district court's finding that the machine had no residual value to the buyer was unchallenged on appeal (paras 11-15).
Consequential Damages: The $2,500 award for lost business income was upheld. The court found that the buyer reasonably relied on the seller's assurances of repair, making it unnecessary to immediately seek a replacement machine. The lost profits were foreseeable, as the seller knew the machine's intended use. While the buyer's evidence of lost income lacked detailed documentation, it was deemed sufficient given the modest amount awarded (paras 16-26).