Votaw Precision Tool Co. v. Air Canada

Opinion

ROTH, P. J.

Votaw Precision Tool Co., Inc., a California corporation (appellant), appeals from a judgment denying its request for declaratory relief against Air Canada, a corporation (respondent).

On or about July 17, 1970, Air Canada contracted with Inca Engineering Company (Inca) whereby Inca agreed to supply respondent with a thrust bed and adapter (thrust bed) to enable respondent to measure the pounds of thrust of jet aircraft engines in return for a consideration in the amount of $395,377.12.

As a part of said contract, Inca supplied respondent with a performance bond in the sum of $193,798.50 issued by Reliance Insurance Company of Canada.

Inca subcontracted with appellant which had agreed to furnish the - fabrication for the thrust bed, and make the superstructure for the stand of the thrust bed in return for $106,000.'

When respondent received the thrust bed, it had paid Inca the sum of $352,262.70, and Inca had paid to appellant all of the consideration it had promised except the sum of $17,723.40. Respondent discovered that the thrust bed failed to perform as required; specifically it failed to measure the thrust of the engines up to 100,000 pounds as required by the specifications of respondent’s contract with Inca.

When respondent discovered that the thrust bed did not meet the specifications as required, it elected to withhold $43,114.42 as partial damages which it had suffered under its contract with Inca.

At the time of said withholding, Inca was indebted to appellant in the sum of $17,723.40 on its subcontract with appellant and Inca was in receivership, Appellant by this action asserts that respondent is

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legally responsible to it under one of the provisions of respondent’s contract with Inca which provides: “Before making any payment on any progress or final estimate, the airline [respondent] may require the contractor [Inca] to satisfy the architect or other authorized representatives of. . . [respondent] that all claims against. . . [Inca] ... for labor, services, plant, equipment, materials or things employed, hired or supplied upon or for .. . [thrust bed] have been paid or satisfied or, if any such claims are found to exist,. .. [Inca] shall pay the same forwith ....”