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If the buyer loses possession of the goods because the seller did not have good title to the goods, a literal reading of UCC § 2-714(2) would measure damages as the value of the goods as warranted (the purchase price) less the value of the goods as accepted (nothing, because the seller had no title). In other words, a consumer who uses goods for a period of time, and then loses possession because of a breach of warranty of title, would receive as damages the full purchase price, plus any incidental or consequential damages.¹⁷⁵

In addition to any other remedy and recoverable damages available to the aggrieved buyer, sections 2-712(2), 2-713(1), and 2-714(3) of the Code allow the buyer to recover any incidental or consequential damages suffered as a result of the seller’s breach. This recovery is allowed even if the buyer canceled the contract rather than keeping the goods.¹⁸⁰ The goal is to place the buyer in as good a position as if the breach had not occurred.¹⁸¹

The only requirement for recovery of incidental damages under section 2-715(1) is proof that the damage is incident to the breach. The section lists many expenses which are incidental damages. But comment 1 to the section emphasizes that the listed damages “are not intended to be exhaustive but are merely illustrative of the typical kinds of incidental damage.”¹⁹⁰

For economic loss consequential damages, that is, damages other than injury to person or property,²⁰⁵ the seller is liable only if the loss “result[ed] from general or particular requirements and needs of which the seller at the time of contracting had reason to know and which could not reasonably be prevented by cover or otherwise.”²⁰⁶ There need not be actual communication by the buyer to the seller of the buyer’s special circumstances to satisfy this “reason to know” requirement, however.

Economic loss damages may include the cost of temporary substitute goods, such as transportation costs for a defective car or housing costs for a defective manufactured home.²²⁴ The buyer should make sure to introduce evidence that the seller knew or had reason to know of the buyer’s particular or general needs and requirements. For car sales, this burden should not be difficult to establish. Dealers certainly understand most buyers’ general reasons for needing a car.

The buyer may be able to recover the expenses incurred from financing the purchase as consequential damages.²³³ The buyer should show that the seller had reason to know that the transaction was financed.²³⁴ This fact can be shown by evidence that the sale was financed by the seller, that the seller was asked to refer the buyer to a financer, that the buyer told the seller of financing or, perhaps, that the seller had reason to know of the buyer’s limited resources.

Consequential damages can include losses that result from a negative credit report that the creditor makes after the buyer rightfully revokes acceptance or withholds payments. For example, damage to the buyer’s credit rating may result in delay, denial, or an increase in the cost of financing. These costs are recoverable as consequential damages.²⁴⁶

When the goods are repossessed because the buyer stopped paying upon the seller’s breach, the losses from the repossession and deficiency judgment are also recoverable.²⁵³ The buyer must show that the repossession proximately resulted from the breach and that the seller knew or had reason to know of the financing arrangements.²⁵⁴ Presumably, if it can be shown that the seller’s breach forced the buyer to pay for repairs which left the buyer without funds to make payments, the buyer will recover

The only requirement specified in UCC § 2-715(2)(b) for recovery of consequential damages resulting from injury to person or property is that the injury proximately result from a breach of warranty. In contrast to the requirements for economic loss damages, the buyer need not establish that the injury was a foreseeable result of the breach.²⁵⁵ The UCC prohibits a seller from limiting its liability for personal injury caused by consumer goods.²⁵⁶

Section 2-313(1)(a) specifically provides that promises made by the seller to the buyer which relate to the goods create express warranties to which the goods must conform. Generally, promises can be viewed as either promises of future action by the seller or promises of future performance of the goods. Both types of promises generally present fewer proof problems to buyers in litigation than do affirmations of fact.⁵⁰

Promises of the seller’s future action are common in automobile and manufactured home cases. A seller’s promise to deliver and set up a manufactured home is an express warranty. In Boies v. Norton,⁵¹ for example, the seller promised to “deliver, block and level” a manufactured home and “connect the water and sewer” as part of the sale.

Promises of future performance, which are essentially promises that the goods will perform in a certain way in operation, are common for products sold for a specific purpose. For example, statements that a floor covering product will not crack or will seal out moisture, that paint will not fade or peel, or that windows or roofing will not leak are express warranties that the products will perform as represented.⁶⁶ Promises of energy savings from insulation, storm windows, or a new boiler are common express warranties of future performance.

The Code places no limitation on the form the affirmation or promise must take.

Affirmations of fact can arise from nonverbal conduct, as well as from oral or written statements. The most obvious example is pictorial representations. A picture on the box of a children’s product showing a boy applying the product to his eyelids was held to be an express warranty that the product could be used safely in the manner depicted.⁸⁹

Whether any given statement reasonably plays a role in the overall bargain of the parties depends on the nature of the statement. The reasonable buyer will certainly be influenced by statements of fact and promises. Mere opinion or general statements of value of the goods, however, should not influence the reasonable buyer in the overall bargain. Section 2-313(2) provides that “an affirmation merely of the value of the goods or a statement purporting to be merely the seller’s opinion or commendation of the goods does not create a warranty.”

In drawing the line between puffing and making express warranties, some courts have said that the key factor is whether the seller asserts facts on matters of which the buyer is ignorant or expresses opinions on matters about which the buyer may be expected to be able to form their own judgment.¹¹⁷ Although this interpretation cannot completely explain the conflicting decisions, it does strongly suggest that the buyer’s relative general sophistication and knowledge of the particular product may make the difference.

A relevant factor in determining the circumstances of the case is the bargaining context in which the statements were made.¹²¹ In Cagney v.

Section 2-313(2) states that “an affirmation merely of the value of the goods . . . does not create a warranty.” This language should not be interpreted strictly. Some statements of value clearly can and do create express warranties. Statements of value that are specific and certain are more fact than opinion and are understandably capable of playing a significant role in the bargain. For example, a statement that a machine is “worth $4250” is an express warranty,¹²⁴ even though it is a statement of value.

Section 2-313(1)(a) requires that affirmations or promises be made by the seller to the buyer in order for express warranties to arise. The statement need not be made by the immediate retail seller, however.

Injury to a person need not be physical injury. The buyer may be able to recover for aggravation, inconvenience, mental distress, discomfort, anxiety, depression, and pain and suffering resulting from the seller’s breach, at least when there is also economic loss from the breach.

Damages for inconvenience, aggravation, and loss of time may be recovered in a warranty case, at least when these types of damages are coupled with otherwise compensable damages and shown with reasonable certainty.²⁷²

The buyer should be careful to provide detailed testimony on the nature and extent of the incidental and consequential damages. Circumstantial evidence is acceptable.²⁷⁸ Although damages need not be proved with mathematical precision,²⁷⁹ the trier of fact cannot award damages on speculation or emotion.²⁸⁰

The Uniform Commercial Code (UCC) provides that punitive damages may be recovered only “as specifically provided in this Act or by other rule of law.”²⁸³ The general rule of contract law and the UCC is that punitive damages are unavailable.²⁸⁴ The purpose of punitive damages is to punish the wrongdoer and deter similar acts.²⁸⁵ Contract damages are designed to make the aggrieved party whole, not to punish another fo

Attorney fees are generally not recoverable absent contractual or statutory authority.²⁹⁵ Uniform Commercial Code (UCC) Article 2 does not provide for the recovery of attorney fees.

Express warranties are present to some extent in all transactions, and they cannot be disclaimed.¹ If a product does not conform fully to the express warranty, the buyer will have a claim for relief.² For certain express warranties—those that meet the Magnuson-Moss Warranty Act’s definition of “written warranty”—consumers have augmented remedies, specifically including attorney fees.³