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Lovely v. Burroughs Corp., 165 Mont. 209, 527 P.2d 557 (1974) (full-text).
Factual Background Edit
In a non-jury trial in the district court, plaintiffs were awarded damages of $16,760.82 for losses resulting from the defective operation of electronic accounting equipment supplied by the defendant. Defendant appeals from the judgment. Plaintiffs cross-appeal from the damages awarded.
State Supreme Court Proceedings Edit
The court found that Burroughs had violated the implied warranty of fitness for a particular purpose, since Burroughs had worked closely with the plaintiffs and "that plaintiffs were relying on defendant's judgement in furnishing suitable goods.”
The court also held that, although the plaintiff had retained the computer system for eight months, it had not "accepted" the computer system and its "actions amount to a good faith attempt to permit defendant to remedy the defects. . . .”
The court also found that a clause limiting consequential damages referred only to damages for delays in delivery of the computer equipment. Since the plaintiff’s losses were a result of the failure of the computer equipment to function properly, recovery for the damages due to the computer malfunction was not precluded by the limitation of liability clause.