Hector Martinez & Co. v. Southern Pacific Transp. Co.
606 F.2d 106 (5th Cir. 1979), cert. denied, 446 U.S. 982 (1980).
Facts: The defendant delivered a dragline a month late. The plaintiff sued for the fair rental value of the dragline for the period it was delayed. The trial court dismissed the claim.
Issue: Can the plaintiff recover for the rental cost of the dragline?
Rule: Hadley requires notice only when it is not obvious that a delayed item has use value.
Analysis: The dragline has use value. It was being purchased to be used, not to be sold. It is foreseeable that if its delivery is delayed, the plaintiff will have to rent a replacement. Furthermore, even though it was also a possibility that the plaintiff was purchasing the dragline to sell it, the plaintiff need not prove that their injury was “the most foreseeable of all possible harms”.
Conclusion: The trial court’s decision was reversed. It is suggested that the defendant was liable to the plaintiff for the rental cost of the dragline for the period of the delay.