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An  unpublished  opinion  of  the  North  Carolina  Court  of  Appeals  does  not  constitute
controlling legal authority. Citation is disfavored, but may be permitted in accordance
with the provisions of Rule 30(e)(3) of the North Carolina Rules of Appellate Procedure.
NO. COA08-408
NORTH CAROLINA COURT OF APPEALS
Filed:                                                                                          2 December  2008
WELLIVER MCGUIRE, INC.,
Plaintiff,
v.
MEMBERS INTERIOR CONSTRUCTION, INC.,
Defendant and Third Party
Plaintiff,
v.
HUGHES SUPPLY, INC., THE HOME
DEPOT, INC., AND UNITED STATES                                                                  Mecklenburg County
FIDELITY AND GUA                                                                                CVS  6517
Third Party                                                                                     RDefendants,OpinNoo06n
HUGHES SUPPLY, INC.,
Additional Third Party
Plaintiff,
v.
TAMKO BUILDING PRODUCTS, INC.
f/k/a TAMKO ROOFING PRODUCTS, INC.,
Additional Third Party
Defendant.
Appeal by defendant Members Interior Construction, Inc., from
judgment  entered                                                                               5  February              2008  by  Judge  Timothy  L.  Patti  in
Mecklenburg County Superior Court.    Heard in the Court of Appeals
23 September  2008.




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Eisele, Ashburn, Greene & Chapman, P.A., by Douglas G. Eisele,
for defendant and third party plaintiff-appellant.
Poyner & Spruill, L.L.P., by Thomas L. Ogburn, III, for third
party defendant-appellee.
ELMORE, Judge.
I. Background
On  13  June  2000,  Welliver  McGuire,  Inc.  (Welliver),  entered
into a contract with the University of North Carolina at Charlotte
(UNCC) to build a science and technology building  (UNCC Project).
Pease  Associates  (Pease)  created  the  architectural  plans  for  the
multi-story  brick  building,  which  included  specifications  for  a
sheet  rubberized  air  barrier                                                (SRAB)  to  be  affixed  to  gypsum
sheathing  between  the  metal  studs  and  the  brick  exterior.    The
purpose  of  the  SRAB  was  to  prevent  moisture  from  entering  the
building.
Welliver  entered  into  a  subcontract  with  Members  Interior
Construction,   Inc.                                                           (plaintiff), 1 on                     29   January   2003   wherein
plaintiff agreed to install, inter alia, the SRAB specified for the
UNCC Project.   Plaintiff agreed to perform its duties in accordance
with  the  terms  of  Welliver’s  contract  with  UNCC,  which  specified
that  “[a]ll  related  accessories  [for  the  SRAB]  .  .  .  shall  be  as
recommended by or of the same manufacturer as the barrier material
used[]  [such  as]  Perm-A-Barrier  by  W.  R.  Grace  &  Company  [W.  R.
1
We  denominate  Members  Interior  Construction,  Inc.,  as
plaintiff  and  Hughes  Supply,  Inc.,  as  defendant  for  the  sake  of
clarity,  even  though  the  parties  assume  different  titles  with
respect to the overall cause of action not raised in this appeal.




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Grace]; Duramem 714 Dyna-Barrier by Pecora Corporation [Pecora], or
equal.”    On                                                               30  January                                      2003,  plaintiff  submitted  literature  to
Pease in order to gain approval for an alternate SRAB manufactured
by Tamko Roofing Products, Inc. (Tamko).   Pease informed plaintiff
that it took  “no exception” to the substitution the same day.
Before  plaintiff  became  part  of  the  UNCC  project,  Murray
Fater, a sales representative for Hughes Supply, Inc. (defendant),
reviewed Pease’s project specifications.    Using that information,
Mr.  Fater  compiled  market  packages  of  specific  materials  for
prospective  contractors  on  the  UNCC  Project.     Mr.  Fater  then
contacted   plaintiff   to   offer   a   price   quote   for   the   SRAB
manufactured by W.R. Grace, and defendant provided the quote on 17
October                                                                     2002.                                            Michael   Weber,   plaintiff’s   project   manager,
estimator,  and  vice  president  at  the  time,  responded  by  asking
whether defendant could supply the Tamko SRAB instead, because the
Tamko SRAB was more cost efficient than the SRAB’s manufactured by
W.  R.  Grace  and  Pecora.                                                 Mr.  Fater  responded  by  obtaining
information  and  pricing  for  the  required  Tamko  materials,  and
provided plaintiff with a price quote on  20 November  2002.    Prior
to  Mr.  Weber’s  inquiry,  defendant  had  not  sold  any  products
manufactured by Tamko.
Plaintiff and defendant’s business relationship predated the
SRAB  price  quotes  by  several  months.     In  July                      2002,  plaintiff
signed  a  written                                                          “Credit  Application/Billing  Instruction  and
Continuing Personal Guaranty” (Credit Agreement) with defendant for




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an  unrelated  construction  project  at  East  Lincoln  High  School.
The Credit Agreement’s terms and conditions stated in part:
All  sales  made  by  Seller                                                  [defendant]  are
subject to the Terms and Conditions of Sale[.]
Goods not manufactured by Seller are warranted
and  guaranteed  only  to  the  extent  and  in  the
manner  warranted  and  guaranteed  to  Purchaser
by the original manufacturer of such goods.
ALL  OTHER  WARRANTIES  ARE  EXCLUDED,  WHETHER
EXPRESS  OR  IMPLIED  BY  OPERATION  OF  LAW  OR
OTHERWISE INCLUDING ALL IMPLIED WARRANTIES OF
MERCHANTABILITY  OR  FITNESS  FOR  A  PARTICULAR
PURPOSE.
(Capitalization in original).
On  29  April  2003,  plaintiff  placed  its  first  order  for  the
Tamko SRAB with defendant.   The goods arrived on the job site on  7
May  2003,  and  Members  received  an  invoice  from  defendant  for  the
order  on  12  May  2003.    The  goods  supplied  to  the  job  site  were
accompanied  by  delivery  tickets  containing  the  same  disclaimer
within  its  terms  and  conditions;  the  invoice  also  contained
identical  disclaimer  language.     Plaintiff  paid  defendant  after
receiving  the  invoice,  and  subsequent  orders  were  placed  by
plaintiff for the Tamko SRAB on  3 October and  22 October  2003.
Plaintiff began installing the Tamko SRAB on  7 May  2003, and
defects  surfaced  shortly  thereafter.    The  seams  of  the  installed
Tamko  SRAB  developed  wrinkles  and  gaps,  which  prompted  Pease  to
halt  installation  on  or  after  30  July  2003.    On  21  August  2003,
Welliver  ordered  the  removal  of  the  gypsum  sheathing,  the  Tamko
SRAB, and other components affected by the defects such that only




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the metal studs remained.    The gypsum sheathing was then replaced
by  another  sheathing  material,  and  on  4  December  2003,  the  SRAB
manufactured by W.R. Grace was installed on the project.
On  29  March  2006,  Welliver  filed  a  breach  of  contract  claim
against  plaintiff.    On  28  April  2006,  plaintiff  filed  an  answer
with  a  counterclaim  against  Welliver  and  third-party  complaint
against defendant, The Home Depot, and United States Fidelity and
Guaranty Company.   Plaintiff’s complaint against defendant alleged
breaches  of:                                                               (1)  express  warranty,                        (2)  implied  warranty  of
merchantability,  and                                                       (3)   implied  warranty  of  fitness  for  a
particular purpose.   On 17 July 2006, defendant filed an answer to
plaintiff’s complaint, and asserted that:                                   (1) no express warranty
was  made  to  plaintiff  and                                               (2)   all  implied  warranties  were
disclaimed  per  the  terms  and  conditions  of  the  Credit  Agreement.
Defendant filed an amended answer on  26 June  2007.
Defendant filed a motion for summary judgment on 22 June 2007
and an amended motion for summary judgment on  6 August  2007.      On
29  January  2008,  defendant’s  motion  was  granted  by  the  Honorable
Timothy L. Patti as to all of plaintiff’s claims.    From the trial
court’s order granting defendant’s motion, plaintiff appeals.
II. Summary Judgment
In  reviewing  an  order  granting  summary  judgment,  we  examine
the  record  to  determine                                                  “whether  there  is  any  genuine  issue  of
material  fact  and  whether  the  moving  party  is  entitled  to  a
judgment as a matter of law.”   Taylor v. Coats,  180 N.C. App.  210,
212, 636 S.E.2d 581, 583 (2006); N.C. Gen. Stat. § 1A-1, Rule 56(c)




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(2007).                                                                      “A                                                           ‘genuine  issue’  is  one  that  can  be  maintained  by
                                                                                                                                          substantial  evidence.”    Dobson  v.  Harris,             352  N.C.   77,                                     83,   530
S.E.2d 829, 835 (2000).                                                      “[E]vidence presented by the parties must
be  viewed  in  the  light  most  favorable  to  the  non-movant.”
Bruce-Terminix Co. v. Zurich Ins. Co., 130 N.C. App. 729, 733,  504
S.E.2d  574,  577  (1998).
A.
As a preliminary matter, we note that the trial court’s order
granting partial summary judgment does not dispose of  “the entire
controversy between all parties,” and is therefore interlocutory.
Hudson-Cole  Dev.  Corp.  v.  Beemer,                                        132  N.C.  App.                                              341,                                                       344,        511
S.E.2d  309,  311  (1999).    However,  an  interlocutory  appeal  may  be
heard  if                                                                    “a  substantial  right  of  the  appellant”  is  affected.
Plummer  v.  Kearney,  108  N.C.  App.  310,  313,  423  S.E.2d  526,  529
(1992); see N.C. Gen. Stat.  §  7A-27  (2007).
The North Carolina Supreme Court has stated that “the right to
avoid the possibility of two trials on the same issues can be such
a substantial right.”   Green v. Duke Power Co.,  305 N.C.  603,  606,
290  S.E.2d                                                                  593,                                                         595                                                        (1982)      (quotations  and  citation  omitted).
Where the same factual issues may possibly be litigated twice, this
Court “has created a two-part test to show that a substantial right
is affected, requiring a party to show (1) the same factual issues
would  be  present  in  both  trials  and                                    (2)  the  possibility  of
inconsistent verdicts on those issues exist[s].”   Camp v. Leonard,
133 N.C. App. 554, 558, 515 S.E.2d 909, 912 (1999) (quotations and
citation omitted).




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The  overlap  of  factual   issues  in  this  case  poses  the
possibility  of  inconsistent  verdicts:                                      Members’  defenses  to
Welliver’s pending claims parallel its claims against Hughes based
on the same alleged representations.    If Members were required to
wait  until  a  final  judgment  was  entered  to  appeal  the  summary
judgment  order  and  then  prevailed  as  to  that  order,  then  Members
could  potentially  be  “prejudiced  by  different  juries  in  separate
trials rendering inconsistent verdicts on the same factual issue.”
Davidson  v.  Knauff  Ins.  Agency,  Inc.,                                    93  N.C.  App.           20,    25,            376
S.E.2d 488, 491 (1989).   Accordingly, we conclude that this appeal
is  properly  before  this  Court.    See  Bowman  v.  Alan  Vester  Ford
Lincoln  Mercury,                                                             151   N.C.  App.         603,   566   S.E.2d   818   (2002)
(substantial  right  affected  when  summary  judgment  granted  to
third-party defendant where third-party defendant’s representations
presented  common  factual  issues  in  plaintiff’s  claim  against
defendant and defendant’s claim against third-party defendant).
B.
Plaintiff  first  argues  that  the  record  is  sufficient  to
support a finding that defendant expressly warranted the Tamko SRAB
to  conform  to  the  specifications  for  the  UNCC  project.     We
disagree.
Under the Uniform Commercial Code  (UCC), a seller may create
an  express  warranty  through  “any  affirmation  of  fact  or  promise
made  by  the  seller  to  the  buyer  which  relates  to  the  goods  and
becomes  part  of  the  basis  of  the  bargain[.]”    N.C.  Gen.  Stat.  §
25-2-313(1)(a)  (2007).




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To  support  a  finding  of  an  express  warranty  under  this
section, plaintiff cites portions of Mr. Weber’s deposition, which
provide in relevant part:
Q. Was there anything that Mr. Fater told you
that made up part of your decision to purchase
the Tamko product?
A. The fact that [defendant] was going to sell
the product would have given me some assurance
that  the  product  would  perform.    I  would  not
think [defendant] would have put their name on
it if it wouldn’t.
Q. Did he expressly say anything?
A. No, I don’t remember that expression.
Q.                                                                            [Y]ou   don’t   believe   a   company   like
[defendant] would deliberately sell a product
that wouldn’t work?
A.  [T]hat’s what I believe, yes[] sir.
Q. Mr. Fater didn’t expressly say anything to
you?
A. Not that I can remember.
While  defendant’s  willingness  to  order  and  supply  Tamko
materials  might  have  been  part  of  plaintiff’s  motivation  to
purchase the Tamko SRAB from defendant, this fact alone falls short
of  satisfying  the  cornerstone  element  for  the  creation  of  an
express  warranty  under  the  UCC.    In  particular,  this  fact  is  not
substantial  evidence  that  defendant  made  a  promise  or  factual
affirmation  with  regard  to  the  Tamko  SRAB  upon  which  plaintiff
relied.    See Westover Products, Inc. v. Gateway Roofing, Inc.,  94
N.C.  App.  63,  72,  380  S.E.2d  369,  375  (1989)  (defining  “critical




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inquiry”  as  whether  buyer  relied  upon  seller’s  statements).
Accordingly, this assignment of error is overruled.2
C.
Plaintiff next argues that the record is sufficient to support
findings   that   defendant   breached   the   implied   warranties   of
merchantability and fitness for a particular purpose.   We disagree.
“Unless excluded or modified . . ., a warranty that the goods
shall  be  merchantable  is  implied  in  a  contract  for  their  sale  if
the seller is a merchant with respect to goods of that kind.”   N.C.
Gen. Stat. § 25-2-314(1) (2007).   A warranty that goods will be fit
for a particular purpose is implied in a contract for the sale of
such goods where:                                                             (1) the  “seller at the time of contracting has
reason  to  know  any  particular  purpose  for  which  the  goods  are
required[,]” and (2) “the buyer is relying on the seller’s skill or
judgment to select or furnish suitable goods[.]”    N.C. Gen. Stat.
§ 25-2-315 (2007).                                                            “[T]o exclude or modify the implied warranty of
merchantability  or  any  part  of  it  the  language  must  mention
merchantability  and  in  case  of  a  writing  must  be  conspicuous[.]”
N.C.  Gen.  Stat.  §  25-2-316(2)  (2007).    Exclusions  of  the  implied
warranty  of  fitness  for  a  particular  purpose  must  also  be  in
writing and conspicuous.    Id.
2
Plaintiff  additionally  offers  evidence  of  conversations
defendant conducted with representatives at Tamko.    To the extent
defendant might have discussed plaintiff’s installation of the SRAB
with  Tamko,  these  discussions  were  not  conducted  with  plaintiff,
and  plaintiff  does  not  present  evidence  demonstrating  that  the
content  of  these  exchanges  formed  the  basis  of  its  bargain  with
defendant.    Thus, this evidence is also insufficient to show that
defendant made an express warranty to plaintiff under the UCC.




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The  disclaimer  in  the  parties’  written  Credit  Agreement
states:
ALL  OTHER  WARRANTIES  ARE  EXCLUDED,  WHETHER
EXPRESS  OR  IMPLIED  BY  OPERATION  OF  LAW  OR
OTHERWISE INCLUDING ALL IMPLIED WARRANTIES OF
MERCHANTABILITY  OR  FITNESS  FOR  A  PARTICULAR
PURPOSE.
(Capitalization in original.)
This  disclaimer  mentions  merchantability  and  fitness  for  a
particular  purpose.    Since  plaintiff  does  not  dispute  that  this
writing is conspicuous, the disclaimer satisfies the requirements
for excluding the implied warranties of merchantability and fitness
for a particular purpose under N.C.G.S.  §  25-2-316(2).    Thus, our
only  task  is  to  determine  whether  the  disclaimer  applies  to
plaintiff’s purchases of the Tamko SRAB.
Plaintiff  first  claims  that  it  never  intended  the  Credit
Agreement  to  apply  to  transactions  with  defendant  beyond  the
completion of its work at East Lincoln High School in  2002.
We have long adhered to the rule that  “[t]he duty to read an
instrument[,] or to have it read before signing it, is a positive
one, and the failure to do so, in the absence of any mistake, fraud
or  oppression,  is  a  circumstance  against  which  no  relief  may  be
had,  either  at  law  or  in  equity.”    Mills  v.  Lynch,  259  N.C.  359,
362,                                                                            130  S.E.2d                                      541,   543-44   (1963)   (citation  and  quotations
omitted).
In this case, the Credit Agreement unequivocally states that
“[a]ll  sales  made  by                                                         [defendant]  are  subject  to  the  Terms  and
Conditions of Sale[.]” (Emphasis added.)   As a result, plaintiff’s




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ex  post  facto  assertion  that  no  meeting  of  the  minds  existed
regarding  the  Credit  Agreement’s  duration  is  invalid,  because
plaintiff  was  under  an  affirmative  duty  to  inspect  the  contract
before agreeing to its terms and conditions.   See, e.g., Massey v.
Duke Univ.,  130 N.C. App.  461,  503 S.E.2d  155  (1998).
We  therefore  conclude  that  the  Credit  Agreement  applied  to
plaintiff’s  purchases  of  the  Tamko  SRAB  in  accordance  with  its
stated  terms,  and  that  defendant  properly  excluded  the  implied
warranties of merchantability and fitness for a particular purpose.
Plaintiff also contends that defendant invalidated the Credit
Agreement  by  making  representations  that  invoked  the  implied
warranties of merchantability and fitness for a particular purpose.
The  implied  warranties  of  merchantability  and  fitness  for  a
particular  purpose  may  be  implied  in  a  contract  by  law  unless
properly excluded or modified by agreement.   See N.C.G.S. §§ 25-2-
314 to  -316  (2007).    In this case, the Credit Agreement precludes
the  inclusion  of  the  implied  warranties  in  issue.    As  a  result,
even  assuming  representations  by  defendant  could  be  construed  to
support an implied warranty, the Credit Agreement bars the implied
warranties of merchantability and fitness for a particular purpose
from becoming part of the contract.
Accordingly,  the  record  shows  that  defendant  effectively
disclaimed  the  implied  warranties  of  merchantability  and  fitness
for a particular purpose through the parties’ Credit Agreement, and
we  conclude  that  no  genuine  issue  of  material  fact  exists  with




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respect  to  plaintiff’s  claims  under  these  warranties.     This
assignment of error is overruled.3
D.
Plaintiff   lastly   argues   that   defendant   is   bound   by
representations  made  by  Tamko  employees  because  Tamko  employees
were acting as agents of defendant.    We disagree.
Two  elements  must  be  shown  to  establish  a  principal-agent
relationship:                                                                “(1) [a]uthority, either express or implied, of the
agent  to  act  for  the  principal,  and  (2)  the  principal’s  control
over the agent.”   Colony Associates v. Fred L. Clapp & Co., 60 N.C.
App.  634,  637,  300  S.E.2d  37,  39  (1983)  (quotations  and  citation
omitted).
In its brief, plaintiff declines to cite even one instance in
the  record  to  support  its  agency  theory.    Instead,  it  generally
reiterates  its  contention  that  defendant  made                           “representations
about  the  Tamko  SRAB”  and  claims  further  that  defendant  referred
plaintiff to Tamko “both for [the] initial description of the Tamko
SRAB  and  later  for  instructions  on  the  proper  application  of  the
Tamko product.”
3
Our conclusion as to the validity of the Credit Agreement’s
disclaimer  of  implied  warranties  obviates  our  need  to  address
plaintiff’s further argument that the implied warranty disclaimers
in  the  invoices  are  unenforceable.     Moreover,  because  summary
judgment  was  proper  as  to  plaintiff’s  claims  for  breaches  of
express and implied warranties, we decline to address plaintiff’s
remaining arguments as to:                                                   (1) whether the limitation of buyer’s
remedy  contained  in  the  Credit  Agreement  fails  of  its  essential
purpose,  or  (2)  whether  defendant’s  defenses  based  on  the  North
Carolina Products Liability Act are without merit.




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Even  assuming  these  general  averments  are  true,  they  do  not
establish  that  defendant  had  either  authority  or  control  over
Tamko’s employees.    This assignment of error is overruled.
III. Conclusion
Based  on  the  foregoing  reasons,  we  affirm  the  trial  court’s
order granting defendant summary judgment.
Affirmed.
Judges HUNTER and GEER concur.
Report per Rule  30(e).

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