WARRANTIES AND WARRANTIES AND PRODUCTS LIABILITYPRODUCTS LIABILITY

WARRANTIES under the UCCWARRANTIES under the UCC

An assurance from seller that goods An assurance from seller that goods meet certain standardsmeet certain standards

May be Express or ImpliedMay be Express or Implied May relate to ownership or qualityMay relate to ownership or quality Part of the sales contractPart of the sales contract

WARRANTIES OF QUALITYWARRANTIES OF QUALITY

Express Warranties May include:Express Warranties May include: all affirmations of fact or promises made all affirmations of fact or promises made

about the goodsabout the goods description of goodsdescription of goods model or sample of goodsmodel or sample of goods

Warranty must have been part Warranty must have been part of the Basis of Bargainof the Basis of Bargain

Plaintiff must provePlaintiff must prove

Seller made an express warrantySeller made an express warranty The express warranty was breachedThe express warranty was breached The breach caused injury to plaintiffThe breach caused injury to plaintiff

Implied WarrantiesImplied Warranties

Merchantability: fit for the ordinary Merchantability: fit for the ordinary purpose for which the product was purpose for which the product was intendedintended

Must prove:Must prove: Merchant sold productMerchant sold product Product was not merchantable at the time of Product was not merchantable at the time of

salesale Plaintiff was injured by the productPlaintiff was injured by the product Defect was the cause of the injuryDefect was the cause of the injury

Implied WarrantiesImplied Warranties

Fitness for a Particular PurposeFitness for a Particular Purpose Must prove:Must prove:

B has a special needB has a special need S has reason to know of B’s particular S has reason to know of B’s particular

purposepurpose S makes statement that goods will the S makes statement that goods will the

serve this purposeserve this purpose B relies on S’s skill & judgment to B relies on S’s skill & judgment to

purchasepurchase

Comment 2, §2-315:Comment 2, §2-315:

A "particular purpose" differs from the A "particular purpose" differs from the "ordinary purpose" for which the goods are "ordinary purpose" for which the goods are used in that it envisages a specific use by the used in that it envisages a specific use by the buyer which is peculiar to the nature of his buyer which is peculiar to the nature of his business whereas the ordinary purposes for business whereas the ordinary purposes for which goods are used are those envisaged in which goods are used are those envisaged in the concept of merchantability and go to uses the concept of merchantability and go to uses which are customarily made of the goods in which are customarily made of the goods in question. For example, shoes are generally question. For example, shoes are generally used for the purpose of walking upon used for the purpose of walking upon ordinary ground, but a seller may know that a ordinary ground, but a seller may know that a particular pair was selected to be used for particular pair was selected to be used for climbing mountains.climbing mountains.

Implied Warranty could also Implied Warranty could also arise from:arise from:

Course of dealingCourse of dealing

OrOr Usage of tradeUsage of trade

Inconsistent warranties – Inconsistent warranties – Priorities:Priorities:

Fitness for a particular purposeFitness for a particular purpose Express warrantyExpress warranty Custom or usage of tradeCustom or usage of trade MerchantabilityMerchantability

Disclaimers are implied by Disclaimers are implied by

Exclusionary languageExclusionary language Inspection of goodsInspection of goods Condition is consistent with course Condition is consistent with course

of dealing or trade usageof dealing or trade usage

LIABILITY TO THIRD PARTIESLIABILITY TO THIRD PARTIES

Common Law: Privity of contractCommon Law: Privity of contract UCC alternatives-who can sue?UCC alternatives-who can sue?

Buyer, family, guests in home,Buyer, family, guests in home, Natural persons reasonably expected to Natural persons reasonably expected to

use (personal injury only)use (personal injury only) Any person (including corporation) who Any person (including corporation) who

would reasonably be expected to use would reasonably be expected to use (personal injury and property damage)(personal injury and property damage)

TORTS ACTIONS USED IN TORTS ACTIONS USED IN PRODUCTS LIABILITY CASESPRODUCTS LIABILITY CASES

NegligenceNegligence Strict LiabilityStrict Liability

NEGLIGENCENEGLIGENCE

ElementsElements Duty to use reasonable careDuty to use reasonable care Breach of dutyBreach of duty Injury or lossInjury or loss Proximate causeProximate cause

DefensesDefenses Assumption of riskAssumption of risk Contributory negligence Contributory negligence Comparative negligenceComparative negligence

STRICT LIABILITY STRICT LIABILITY §402A of the §402A of the Restatement of Torts 2dRestatement of Torts 2d

ElementsElements Defective productDefective product

Unreasonably dangerousUnreasonably dangerous Defective at time of saleDefective at time of sale Condition is substantially unchangedCondition is substantially unchanged Seller is in the business of selling the productSeller is in the business of selling the product

Injury or lossInjury or loss Proximate causeProximate cause

DefensesDefenses Assumption of riskAssumption of risk (Some states) comparative negligence(Some states) comparative negligence

WEBB V. ZERNWEBB V. ZERN

Webb purchased a quarter-keg of beer Webb purchased a quarter-keg of beer from distributor, Zern.from distributor, Zern.

That same day his brother tapped the keg That same day his brother tapped the keg & about a gallon of beer was drawn from & about a gallon of beer was drawn from it.it.

Later that evening when Webb entered the Later that evening when Webb entered the room, the keg exploded, severely injuring room, the keg exploded, severely injuring him.him.

Which tort actions?Which tort actions?

WEBB V. ZERN- Add to the WEBB V. ZERN- Add to the factsfacts

Assume the manufacturer of the keg is out Assume the manufacturer of the keg is out of business.of business.

This is an action against the distributor.This is an action against the distributor. Assume the keg was manufactured in a Assume the keg was manufactured in a

defective manner.defective manner. Assume this was not the distributor’s faultAssume this was not the distributor’s fault

He handled the keg in a proper mannerHe handled the keg in a proper manner He could not have prevented this.He could not have prevented this. Latent defect-inspection would not have Latent defect-inspection would not have

revealed.revealed. Which tort actions?Which tort actions?

WHAT MAKES A PRODUCT WHAT MAKES A PRODUCT DEFECTIVE?DEFECTIVE?

A manufacturing defectA manufacturing defect A design defectA design defect Defects caused by inadequate Defects caused by inadequate

warnings or instructionswarnings or instructions

WARNINGS, LABELS AND WARNINGS, LABELS AND INSTRUCTIONSINSTRUCTIONS

Courts have held that a product is Courts have held that a product is defective if adequate warnings are not defective if adequate warnings are not provided with the product upon sale.provided with the product upon sale.

This extends to all written materials This extends to all written materials connected with the product including connected with the product including instructions for use and maintenance.instructions for use and maintenance.

There is a clear duty to warn of There is a clear duty to warn of a danger in that product if:a danger in that product if: 1. The product is dangerous1. The product is dangerous 2. This fact is or should be known to 2. This fact is or should be known to

the manufacturer or seller the manufacturer or seller 3. The danger is not one which is 3. The danger is not one which is

obvious or known, or readily obvious or known, or readily discoverable by the user and is not discoverable by the user and is not one which arises only because the one which arises only because the product is put to some unforeseeable product is put to some unforeseeable unexpected useunexpected use

NEGLIGENCNEGLIGENCEE

STRICT STRICT LIABILITYLIABILITY

BREACH BREACH OF OF WARRANTWARRANTYY

(Express)(Express)

BREACH BREACH OF OF WARRANTWARRANTYY

(Implied)(Implied)

SOURCE SOURCE OF LAW?OF LAW?

WHO CAN WHO CAN SUE?SUE?

WHO CAN WHO CAN BE HELD BE HELD LIABLE?LIABLE?STATUTE STATUTE OF OF LIMITATIONLIMITATIONSS

DEFENSESDEFENSES

PRODUCTS LIABILITY PROBLEMPRODUCTS LIABILITY PROBLEM Waldo purchased a toaster from Acme Waldo purchased a toaster from Acme

Appliances. It was manufactured by Appliances. It was manufactured by Testy Toaster Co. When Waldo used the Testy Toaster Co. When Waldo used the toaster, it caught fire, causing injury & toaster, it caught fire, causing injury & damage. From whom can Waldo recover damage. From whom can Waldo recover in a negligence action? A strict liability in a negligence action? A strict liability action? A breach of warranty action in action? A breach of warranty action in each of the following independent each of the following independent scenarios?scenarios? Assume the toaster was manufactured in a Assume the toaster was manufactured in a

defective manner, and that Acme carefully defective manner, and that Acme carefully inspected the toaster, handled it properly, inspected the toaster, handled it properly, and did nothing to alter its condition.and did nothing to alter its condition.

Assume that the toaster was Assume that the toaster was manufactured properly, but Acme made manufactured properly, but Acme made adjustments to it. adjustments to it.

Assume the toaster was manufactured Assume the toaster was manufactured properly, and Acme made no properly, and Acme made no adjustments to it, but Waldo adjusted it adjustments to it, but Waldo adjusted it so that it would get hotter.so that it would get hotter.

You think this is Waldo’s fault, but is there You think this is Waldo’s fault, but is there still an argument he can make?still an argument he can make?