Breach of contract for business machines; Contract interpretation; Village of Edmore v Crystal Automation Sys Inc; Incorporation of drawings; MCL 440.2202 & 440.2209(2); Express warranty & failure of limited remedy; Repair-or-replace clause under MCL 440.2719; Anticipatory repudiation; Fraudulent inducement/innocent misrepresentation; Particularity; Reasonable reliance; Contractual attorney-fee clause; Zeeland Farm Servs, Inc v JBL Enters, Inc

The court held that the trial court erred in finding plaintiff-Bekum did not breach the parties’ H-121S contract or its express warranty, but did not err by finding that defendant-Scantibodies anticipatorily breached the three 707D contracts, failed to prove misrepresentation, and that Bekum may recover its contractual “actual attorneys’ fees and expenses” pursuant to the contracts Thus, the court affirmed in part, vacated in part, and remanded. Scantibodies bought one H-121S and three 707D machines to make pipettes. Disputes arose over whether the machines had to meet the dimensions in Scantibodies’ technical drawing (the SLI drawing) and dispense a specified volume of liquid. On appeal, the court held “that the SLI drawing was a part of the parties’ H-121S contract[,]” and the record presented a triable issue whether the machine “consistently met the requirements of the SLI drawing.” Because that fact issue also bore on whether the written limited remedy warranty was breached, the court directed reconsideration of the warranty issue. It noted that a repair-or-replace clause is enforceable under MCL 440.2719, but “‘commendable efforts alone do not relieve a seller of his obligation to repair[,]’” and a limited remedy may fail of its essential purpose. However, the court affirmed summary disposition on the 707D contracts, concluding the SLI drawing and volume term could not be added to these contracts and that Scantibodies “anticipatorily breached the 707D contracts by unequivocally cancelling its purchase of” those machines. Its fraud and innocent-misrepresentation theories failed because they were not pleaded with particularity. Finally, the attorney-fee award stood because “the contracts’ plain language unambiguously provided for the recovery [of] ‘actual attorneys’ fees and expenses’” and the trial court properly enforced them as written.