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
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
Under UCC § 2-313(1)(a), “[a]ny affirmation of fact or promise made by the seller to the buyer which relates to the goods and becomes part of the basis of the bargain creates an express warranty that the goods shall conform to the affirmation or promise.”
The requirements of this section can be broken down into four elements:
The phrase “[a]ny affirmation of fact or promise” found in section 2-313(1)(a) is clearly intended to be very broad. In most cases, there is some explicit representation that is unquestionably an affirmation of fact or promise.
Statements about a product’s characteristics create express warranties.20 Courts have recognized express warranties in statements that a manufactured home was a particular size,21 that a car had never been wrecked,22 that a car or manufactured home was new or had only one other owner,23 that an odometer was correct,24 that a used car was still
Statements that the seller or previous owner repaired the car in a specific fashion or maintained it regularly, such as “this one has new brakes,” “we gave it a full inspection and tune-up,” or “it was driven only on Sundays to church,” are all affirmations of fact.41 A representation of energy efficiency is an affirmation of fact of the particular product’s characteristics, giving rise to an express warranty.42
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.
In most cases, the limitation that affirmations or promises must relate to the goods is of no consequence because the statements clearly pertain to product quality, characteristics, identity, condition, or performance. Some seller statements, however, probably do not relate to the goods and will not be express warranties.
An express warranty by description of the goods arises from any description of the goods which can reasonably be considered to have any role in the overall bargain of the parties. Section 2-313(1)(b) provides: “Any description of the goods which is made part of the basis of the bargain creates an express warranty that the goods shall conform to the description.”