Wednesday, January 1, 2014

International Products Co. v. Erie R.R. Co. case brief

International Products Co. v. Erie R.R. Co. case brief summary
155 N.E. 662 (N.Y. 1927)


CASE SYNOPSIS
Defendant appealed from an order of the Appellate Division of the Supreme Court in the First Judicial Department (New York), affirming a judgment in plaintiff's favor entered upon directed verdict, in an action for damages based on defendant's negligent misrepresentations with respect to where it stored plaintiff's goods. Plaintiff had insured its goods that defendant stored based upon the misinformation and had been denied coverage.

CASE FACTS
Plaintiff, expecting a valuable shipment consigned to arrive by steamer in New York, contacted defendant with respect to storing the goods prior to resale. While no formal contract was executed due to the complexities of the transaction, it was agreed that the goods would be stored by defendant upon arrival and that at some point a bill of lading would be issued. When plaintiff inquired of defendant where the goods were stored, defendant inadvertently informed plaintiff of the wrong location. Based on that information, plaintiff purchased insurance. The goods were subsequently destroyed in a fire and no insurance proceeds were available.

PROCEDURAL HISTORY
A unanimous verdict was entered in favor of plaintiff and defendant appealed.

DISCUSSION

  • The court affirmed judgment in plaintiff's favor because it found plaintiff had proved its cause of action on a theory of negligence based on its interpretation of defendant's conversation respecting the location of the stored goods. 
  • Thus, plaintiff was entitled to recover from defendant damages for the uninsured loss.

CONCLUSION
Judgment in favor of plaintiff was affirmed because the court found plaintiff proved a cause of action on a theory of negligence based on its interpretation of defendant's conversation respecting the location of storage of its goods and that plaintiff subsequently purchased insurance based on defendant's negligent misrepresentations.

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