Court Error Damage Award Breach of Contract.

Byline: Derek Hawkins

7th Circuit Court of Appeals

Case Name: ARC Welding Supply Co., Inc., et al. v. American Welding & Gas, Inc.,

Case No.: 18-1546

Officials: EASTERBROOK, ROVNER, and ST. EVE, Circuit Judges.

Focus: Court Error Damage Award Breach of Contract

This case arises from an Asset Purchase Agreement (the "Agreement") entered into in October 2014 between the plaintiffs, ARC Welding Supply Co. and its owner Charles McCormick (collectively "ARC"), and the defendant American Welding & Gas, Inc. ("American"). ARC was a distributor of compressed gases and welding supplies in Vincennes, Indiana, and sold substantially all of its assets to American including its stock of asset cylinders. ARC filed a complaint alleging that American breached the terms of the Agreement for the purchase of the asset cylinders, and American filed a counterclaim for breach of contract. Following a bench trial, the district court entered judgment in favor of American and awarded damages in the amount of $33,765.52 plus interest, and ARC now appeals.

ARC now appeals the court's decision. In an appeal from a bench trial, we review the district court's findings of fact for clear error, and its conclusions of law de novo. Rain v. Rolls Royce Corp., 626 F.3d 372, 379 (7th Cir. 2010). "Under Indiana state law, the court's goal in interpreting a contract is to 'give effect to the parties' intent as reasonably manifested by the language of the agreement.'" Id., quoting Reuille v. E.E. Brandenberger Constr., Inc., 888 N.E.2d 770, 771 (Ind. 2008). Unless terms of a contract are ambiguous, the court will give the terms their ordinary and plain meaning. Id. The district court met that standard in this case, interpreting the contract consistent with the plain and ordinary meaning of the words.

ARC argues that the district court erred in determining that McCormick extended the deadline for the completion of the audit. According to ARC, the Agreement could not be extended by McCormick because it was fundamentally a contract for the sale of goods and the Uniform Commercial Code (UCC) prohibits the...

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