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Alloway v. General Marine Industries6/30/1997
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Consequently, the U.C.C. provides for express warranties regarding the quality of goods, N.J.S.A. 12A:2-313, as well as an implied warranty of merchantability, N.J.S.A. 12A:2-314, and an implied warranty of fitness for a particular purpose, N.J.S.A. 12A:2-315. When a seller delivers goods that are not as warranted, the buyer may recover the difference between the value of the defective goods and their value if they had been as warranted. Furthermore, a provision in a merchant's form is not binding on a consumer unless the consumer has signed the form. N.J.S.A. 12A:2-209(2). A consumer, moreover, may recover incidental and consequential damages. N.J.S.A. 12A:2-715(1), (2); N.J.S.A. 12A:2-714. In addition, the Legislature has directed courts to construe the U.C.C. liberally and to promote the U.C.C.'s underlying purposes and policies. N.J.S.A. 12A:1-102(1).
As a counterbalance, the U.C.C. allows manufacturers to limit their liability through disclaimers, except for personal injuries. N.J.S.A. 12A:2-316. Further, the U.C.C. allows parties to modify or limit damages by agreement. N.J.S.A. 12A:2-719. Finally, the U.C.C. provides a four-year statute of limitations to institute an action under its provisions. N.J.S.A. 12A:2-725. This comprehensive scheme offers significant protection to consumers while insuring that merchants are not saddled with substantial and uncertain liability. See East River, (supra) , 476 U.S. at 874, 106 S. Ct. at 2303-04, 90 L. Ed. 2d 865.
Over thirty years ago, before the U.C.C. took effect, this Court ruled that strict liability in tort provided more suitable relief than an action for breach of an implied warranty of merchantability. Santor, (supra) , 44 N.J. 53. The Court reached this unprecedented result notwithstanding that an action for breach of implied warranty, like one in strict liability, did not require privity between the purchaser and the manufacturer. See id. at 60-63.
Disagreement with Santor was not long in coming. In Seely, (supra) , 403 P. 2d 145, which was decided four months after Santor, the purchaser of a defective truck sued for damage to the truck and lost profits from his inability to use it in his heavy-duty hauling business. Writing for the California Supreme Court, Chief Justice Roger Traynor recognized the purchaser's claim for breach of an express warranty, but rejected his claim in strict liability. In reaching that result, Chief Justice Traynor reasoned that absent personal injury or property damage, strict liability in tort was not designed "to undermine the warranty provisions of the . . . Uniform Commercial Code but, rather, to govern the distinct problem of physical injuries." Id. at 149.
Twenty years later, we addressed "the rights of a commercial buyer to recover for economic loss caused by the purchase of defective goods." Spring Motors, (supra) , 98 N.J. at 560. In that case, Spring Motors Distributors ("Spring Motors"), a commercial lessor of vehicles, bought a fleet of trucks from Ford Motor Co. ("Ford"). Id. at 562. Pursuant to the sales, Ford issued an express warranty on transmissions manufactured by Clark Equipment Co. ("Clark"), which had issued express warranties to Ford. Spring Motors' lessee experienced difficulties with the transmissions. Id. at 563. Consequently, Spring Motors suffered economic losses, which included costs of repair, lost profits, and a decrease in the market value of the trucks. Id. at 564. Thereafter, Spring Motors sued Ford under theories of negligence, strict liability and breach of warranty. Ibid. The basic issue was whether the applicable statute of limitations was the four-year statute in the U.C.C., N.J.S.A. 12A:2-725, or the six-year statute of limitations pertai
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