Subtronic Corporation v. Weco Industries CA1/1
Appellant Subtronic Corporation (Subtronic) agreed to purchase an Electro Scan, Inc. (Electro Scan) pipeline leak detection system from its distributor Weco Industries, LLC (Weco). Three years after the purchase, Subtronic claimed it agreed to the purchase based on the mistaken belief that there was a one-time fee, rather than an annual charge, for the software support and processing it acquired in connection with the system, and brought this action to rescind the contract and for alleged unfair business practices.
During the bench trial, the court admitted extrinsic evidence to interpret the contract, which it found was ambiguous. The court concluded that while the contract did not explicitly state the software support and processing fee was an annual charge, rather than a one-time fee, the evidence established that it was, indeed, an annual charge and that Subtronic was not mistaken about the nature of the charge.
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