Mosinski Enterprises, LLC v. Star Auto Company, Inc

IN THE COURT OF APPEALS OF IOWA

No. 23-0769
Filed February 19, 2025

MOSINSKI ENTERPRISES, LLC,
Plaintiff-Appellee,

vs.

STAR AUTO COMPANY, INC.,
Defendant-Appellant.
________________________________________________________________

Appeal from the Iowa District Court for Jefferson County, Myron Gookin,

Judge.

A truck-repair business appeals a judgment for damages for breach of

contract. AFFIRMED.

Joel Waters of Kaplan & Frese, LLP, Marshalltown, for appellant.

Lucas C. Helling of Foss, Kuiken, Cochran, Helling & Willman, P.C.,

Fairfield, for appellee.

Considered by Greer, P.J., and Ahlers and Badding, JJ.
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AHLERS, Judge.

Mosinski Enterprises, LLC (Mosinski) filed suit against Star Auto Company,

Inc. (Star Auto) for breach of written warranty, breach of implied warranty of fitness

for a particular purpose, breach of contract, professional negligence, and fraud and

misrepresentation related to the rebuilding of an engine in Mosinski’s semi-truck.

Following a bench trial, the district court entered judgment in favor of Mosinski on

its breach-of-contract claim for $55,645.28. Star Auto appeals.

I. Background Facts

The record supports the following facts. In 2018, Mosinski contacted Star

Auto to rebuild the engine in Mosinski’s semi-truck, which had a Caterpillar engine.

Mosinski wanted the work done at Star Auto because it is a Caterpillar-certified

shop that could provide a Caterpillar-backed warranty on the engine rebuild. The

two parties discussed the details of the engine rebuild, and after being told a

Caterpillar warranty was not obtainable for this type of engine, Mosinski accepted

Star Auto’s offer to warranty the engine itself. The warranty read:

Star Auto has placed a 3 year warranty on this engine. It will
be limited if the engine is determined to have run out of oil or
overheated. Or any modifications to the timing or fuel system.
Injectors are a one year warranty. And the rods and mains and
sleeves and pistons will be a 3 year.
Repairs must be done in this location at Star Auto otherwise
labor will not be covered.

Soon after this discussion, Star Auto rebuilt the engine, and Mosinski paid the

$43,407.95 invoice amount and received the signed warranty. The invoice did not

note the timing or fuel settings on the engine.

After picking up the truck from the first rebuild, Mosinski immediately began

experiencing problems that resulted in repeated trips back to Star Auto for repair
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work under the warranty. About a year after the original rebuild, the engine was

still not working well, but Mosinski operated under the assumption that the engine

was just going through a “breaking in” period. But about six months later, the truck

broke down again in the middle of its route. The truck was towed to Star Auto,

where the shop agreed to rebuild the engine for a second time. However, one of

Star Auto’s co-owners informed Mosinski that this would be the last time Star Auto

worked on the engine. On the invoice following the second rebuild, Star Auto noted

the timing and fuel settings of the engine. When employees of Mosinski picked up

the truck, a heated conversation took place in which another of Star Auto’s co-

owners repeated that Star Auto was no longer going to work on the engine, even

though the three-year warranty on the engine work had not expired.

Less than three months later, the truck broke down again. Because Star

Auto told Mosinski it would no longer work on the truck, Mosinski took the truck to

a different repair place where repairs were made for which Mosinski paid. The

repairs included changing the turbo and retiming the engine.

A few months later, still well within the three-year warranty period, the truck

broke down again. Despite Star Auto’s prior refusal to work on the engine,

Mosinski called Star Auto to seek repairs under the warranty. Star Auto reminded

Mosinski it had decided to part ways and Mosinski would have to find someone

else to work on the engine.

Following the failed efforts to get Star Auto to work on the engine, Mosinski

took the truck back to the second repair shop, where it was determined the

crankshaft had broken. Based on this news, Mosinski decided to take the truck to

a third engine repair shop for another engine overhaul. When the third shop was
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inspecting and rebuilding the engine, it noted the timing and fuel settings of the

engine were different than those Star Auto included on the invoice for the second

rebuild. The third shop completed the work, and Mosinski paid for the repairs. The

truck has run well since the third shop’s rebuild of the engine.

Mosinski sued Star Auto seeking to recover the amounts it paid to the

second and third repair shops. Following trial and posttrial motions, the district

court ruled that Star Auto had repudiated the warranty by refusing to do any

additional work on the engine after the second rebuild and entered judgment in

Mosinski’s favor for the amount claimed based on breach of contract.1

II. Standard of Review

When a breach-of-contract claim is tried at law, we review for corrections of

errors at law. Dolly Invs., LLC v. MMG Sioux City, LLC, 984 N.W.2d 168, 173

(Iowa 2023). The district court’s fact findings bind us if supported by substantial

1 We note that, after the district court issued its initial ruling, Mosinski filed a motion

seeking modification of the ruling pursuant to Iowa Rule of Civil Procedure
1.904(2). Before the district court ruled on the motion, Star Auto filed notice of
appeal. A few days later, the district court granted Mosinski’s posttrial motion.
Because a posttrial motion was pending and the nonmoving party filed notice of
appeal, the district court's initial ruling was interlocutory until it ruled on the posttrial
motion. IBP, Inc. v. Al-Gharib, 604 N.W.2d 621, 628 (Iowa 2000). Because the
ruling was interlocutory, no appellate court had granted interlocutory appeal, and
no appellate court had stayed the district court proceedings, the district court was
not deprived of jurisdiction to rule on Mosinski’s rule 1.904(2) motion. Id. at 629.
Though Star Auto had no right to appeal as a matter of right when it filed its notice
of appeal, we regard the notice as an application for interlocutory appeal. See
Iowa R. App. P. 6.151(1); see also IBP, Inc., 604 N.W.2d at 628. We grant Star
Auto’s application. Because the district court still had jurisdiction and ruled on
Mosinski’s posttrial motion before we granted Star Auto’s application for
interlocutory appeal, there is no need for us to remand, and we consider the district
court’s ruling on the rule 1.904(2) motion to be part of the record and part of the
district court’s ruling being reviewed on appeal. See IBP, Inc., 604 N.W.2d at 629–
30.
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evidence. Id. Evidence is substantial if a reasonable person would accept it as

adequate to reach a conclusion. NevadaCare, Inc. v. Dep’t of Hum. Servs., 783

N.W.2d 459, 468 (Iowa 2010). In assessing whether evidence is substantial, we

view it in the light most favorable to the district court’s judgment. Id. The question

on appellate review is whether the evidence supports the conclusion reached, not

whether it would support a different one. Id.

III. Analysis

On appeal, Star Auto argues the district court erred in finding their

repudiation of the warranty was definite or unequivocal. Star Auto also asserts

there was substantial evidence submitted to show that Mosinski had breached the

warranty terms by adjusting the fuel and timing settings on the engine.

A. Repudiation

“Anticipatory breach requires a definite and unequivocal repudiation of the

contract.” Lane v. Crescent Beach Lodge & Resort, Inc., 199 N.W.2d 78, 82 (Iowa

1972). “Repudiation is accomplished by words or acts before the time of

performance evidencing an intention to refuse to perform in the future.” Pavone v.

Kirke, 807 N.W.2d 828, 833 (Iowa 2011). A party’s statement of repudiation must

be sufficiently clear that the other party reasonably understands that the breach

will occur; repudiation is not established merely by a negative attitude or a request

for further negotiations. Id.

Star Auto’s claim that it did not definitely and unequivocally repudiate the

warranty is based on selected pieces of evidence it contends show that Star Auto

simply suggested that Mosinski get a second opinion rather than Star Auto

repudiating the warranty. But the evidence Star Auto highlights was contradicted
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by Mosinski’s evidence. More importantly, the evidence Star Auto highlights is

contradicted by the district court’s finding that repudiation occurred. As the district

court’s finding resolved the conflict in the evidence in Mosinski’s favor, we are

bound by its findings if they are supported by substantial evidence. See Dolly

Invs., 984 N.W.2d at 173.

We find the district court’s findings are supported by substantial evidence.

Mosinski presented evidence that, after the second rebuild, Star Auto told Mosinski

that Star Auto would do no more work on the engine and the parties should part

ways. There is evidence that this sentiment was repeated when Mosinski’s

employees went to pick up the truck and were told by the co-owner of Star Auto

that Star Auto would no longer work on the engine. Further, there was evidence

that, despite Star Auto’s apparent repudiation, when the truck broke down a

second time, Mosinski reached out to Star Auto for repairs but was told that Star

Auto would not work on it because they had parted ways. The district court found

this evidence persuasive and concluded that Star Auto repudiated the warranty.

This evidence constitutes substantial evidence supporting the district court’s

finding, so we are bound by it on appeal. See id. Accordingly, we reject Star

Auto’s challenge to the finding of repudiation.

B. Star Auto’s Claim that Mosinski Breached

Next, Star Auto asserts that its performance was excused because Mosinski

breached the terms of the warranty by altering the fuel and timing settings on the

engine. Yet, it has long been established that when one party repudiates a contract

before the time of performance, the other party is relieved from its obligation to

perform. Conrad Bros. v. John Deere Ins., 640 N.W.2d 231, 241 (Iowa 2001).
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The district court found Star Auto refused to work on the engine following

the second rebuild, leaving Mosinski no choice but to seek service elsewhere after

the engine failed again. Since Star Auto had already repudiated the contract,

Mosinski was no longer bound by the terms of the warranty. See id. The district

court found no persuasive evidence that Mosinski altered the timing or fuel settings

on the engine prior to the repudiation. It was only after Star Auto refused to

continue working on the truck that Mosinski sought service from the second repair

shop, where adjustment to the timing or fuel settings occurred in an attempt to

improve the truck’s functionality. Substantial evidence supports the district court’s

finding that no adjustments to the timing or fuel settings occurred prior to Star

Auto’s repudiation, so we reject Star Auto’s challenge based on the claim that

Mosinski breached the warranty.

IV. Conclusion

Substantial evidence supports the district court’s findings that Star Auto’s

repudiation was definite and unequivocal and Mosinski did not breach the terms of

the warranty prior to Star Auto’s repudiation. As a result, we affirm the district

court’s entry of judgment in favor of Mosinski on its breach-of-contract claim.

AFFIRMED.