Boud v. SDNCO, INC., 20001020.

• Citation: 54 P.3d 1131,2002 UT 83
• Decision Date: 13 August 2002
• Docket Number: No. 20001020.,20001020.
• Parties: Joseph R. BOUD, Trustee of the Diane Mansell Boud Revocable Trust, Plaintiff and Appellant, v. SDNCO, INC., dba Wasatch Marine, and KCS International Inc., dba Cruisers Yachts, Defendants and Appellees.
• Court: Supreme Court of Utah

54 P.3d 1131

2002 UT 83

Joseph R. BOUD, Trustee of the Diane Mansell Boud Revocable Trust, Plaintiff and Appellant, v. SDNCO, INC., dba Wasatch Marine, and KCS International Inc., dba Cruisers Yachts, Defendants and Appellees.

No. 20001020.

Supreme Court of Utah.

August 13, 2002.

Jon H. Rogers, Salt Lake City, for plaintiff.

John W. Call, Curtis C. Nesset, Salt Lake City, for defendant.

DURRANT, Associate Chief Justice:

INTRODUCTION

¶ 1 Appellant Joseph Boud seeks rescission of his contractual agreement to purchase a luxury yacht from appellee KCS International, Inc., dba Cruisers Yachts ("Cruisers"), because of mechanical and electrical problems with the yacht. Boud appeals the district court's grant of summary judgment in favor of Cruisers. This case presents three main questions. First, did a sales brochure containing a photograph of the model Boud purchased and an accompanying caption describing the yacht create an express warranty, and if so, was that express warranty disclaimed? Second, did Cruisers engage in deceptive sales practices by including the photograph and caption in its sales brochure? Third, did the photograph and accompanying caption constitute negligent misrepresentations?

¶ 2 We conclude that an express warranty was not created by the brochure and that even were this the case, the parties' written contract effectively disclaimed any warranty other than the limited warranty provided for in the contract itself. Because no express warranty was created, we further conclude that Boud's allegations that Cruisers engaged in deceptive sales practices or made negligent misrepresentations also fail. We therefore affirm the district court's decision granting summary judgment in favor of Cruisers.

BACKGROUND

¶ 3 It is well established that "in reviewing a grant of summary judgment, we view the facts and all reasonable inferences drawn therefrom in the light most favorable to the nonmoving party." Higgins v. Salt Lake County, 855 P.2d 231, 233 (Utah 1993). We recite the facts of this case accordingly.

¶ 4 In December 1998, Boud visited Wasatch Marine, a Salt Lake City retailer run by SDNCO, Inc., that sells yachts manufactured by Cruisers. Wasatch Marine gave Boud a copy of Cruisers' 1999 sales brochure. Boud read and reviewed this brochure, paying particular attention to a page that contained a photograph of Cruisers' 3375 Esprit model apparently moving at a high rate of speed. Accompanying the photograph was a caption that read as follows:

Offering the best performance and cruising accommodations in its class, the 3375 Esprit offers a choice of either stern drive or inboard power, superb handling and sleeping accommodations for six.

¶ 5 Due in part to the depictions in the brochure, Boud agreed to buy a 3375 Esprit model yacht for over $150,000. In late December 1998, he put down a $15,000 deposit and agreed to take delivery of the yacht in the spring of 1999. On May 10, 1999, Boud paid the balance of the sales price; he then took the yacht for a test drive and signed a sales contract on May 20. This contract indicated that Boud would receive a $476 refund, as he had overpaid. During the test drive on May 20, 1999, and a subsequent test drive approximately a week later, the yacht manifested several electrical and mechanical problems. Pursuant to a limited warranty that accompanied the written contract, Wasatch Marine serviced the yacht and attempted to fix the problems.

¶ 6 A subsequent test drive of the yacht in early June revealed that problems still existed with the yacht. Boud claims that these problems included (1) difficulty shifting gears, (2) the system alarm going off at idling speed, (3) partial failure of the air conditioning system, (4) unexplained sounding of the carbon monoxide detector, (5) a malfunctioning generator, and (6) misalignment of the rear door. Due to these mechanical problems, Boud sought to rescind the sales agreement. Cruisers responded by offering to repair or replace any defective parts as per the limited warranty. Boud then commenced this action.

¶ 7 In his amended complaint, Boud relied on three independent theories. First, he argued that the photograph and caption were themselves an express warranty, and that Cruisers and Wasatch Marine failed to provide him with a yacht that satisfied that warranty. Second, he asserted that, by putting forth the photograph and caption, Cruisers had engaged in deceptive sales practices in violation of section 13-11-4 of the Utah Code. Finally, Boud alleged that the photograph and accompanying language amounted to negligent misrepresentations made by Cruisers.

¶ 8 The district court heard arguments on Cruisers' motion for summary judgment and granted the motion on the ground that the materials in the brochure amounted to mere sales talk, or puffery, which could not give rise to an express warranty. The court further concluded that because the referenced portion of the brochure was not specific enough to create an express warranty, Boud's alternative arguments also failed. Boud appeals these rulings, and we have jurisdiction pursuant to Utah Code section 78-2-2(3)(j) (1996).

ANALYSIS

I. ISSUES PRESENTED/STANDARD OF REVIEW

¶ 9 On appeal, Boud claims that the district court erred in three respects. First, he argues that the district court erred in ruling that the photograph and caption in Cruisers' sales brochure did not amount to an express warranty. Second, he maintains that the district court should have found that Cruisers engaged in deceptive sales practices in violation of section 13-11-4 of the Utah Commercial Code. Finally, Boud contends that the district court incorrectly concluded that the photograph and caption did not constitute negligent misrepresentations.

¶ 10 Three distinct principles govern the applicable standard of review in this case. To begin with, when reviewing a grant of summary judgment by a trial court, "we review the court's legal decisions for correctness, giving no deference." J.R. Simplot Co. v. Sales King Int'l, 2000 UT 92, ¶ 13, 17 P.3d 1100 (Utah 2000). Second, summary judgment is appropriate where "there is no genuine issue as to any material fact and . . . the moving party is entitled to a judgment as a matter of law." Utah R. Civ. P. 56(c). Finally, "an appellate court may affirm a `judgment, order, or decree appealed from if it is sustainable on any legal ground or theory apparent on the record,' even though that ground or theory was not identified by the lower court as the basis of its ruling." Orton v. Carter, 970 P.2d 1254, 1260 (Utah 1998) (quoting Limb v. Federated Milk Producers Ass'n, 23 Utah 2d 222, 225 n. 2, 461 P.2d 290, 293 n. 2 (1969)).

II. BOUD MAY NOT RELY ON THE PHOTOGRAPH AND CAPTION AS AN EXPRESS WARRANTY

¶ 11 The district court concluded that the photograph and caption contained in Cruisers' brochure did not provide an express warranty on which Boud could rely. We agree for two reasons.

A. The Photograph and Accompanying Caption Did Not Create an Express Warranty

¶ 12 The creation of express warranties by affirmation or promise is governed by section 70A-2-313 of the Utah Code, which adopts the Uniform Commercial Code's provisions governing express warranties. Subsection 70A-2-313(1)(a), which governs promotional materials, states that an "affirmation of fact or promise made by [a] seller . . . [that] becomes part of the basis of [a] bargain creates an express warranty." Utah Code Ann. § 70A-2-313(1)(a) (1999). The next subsection places a limitation on this rule, however; it states 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 [an express] warranty."¹ Id. § 70A-2-313(2) (emphasis added). Thus, the determination of whether an express warranty has been created ultimately hinges upon an examination of whether representations made by the seller were mere statements of opinion or were, rather, promises or affirmations of fact. In order to make this determination, we must examine the actual language and images set forth in Cruisers' brochure.

¶ 13 To qualify as an affirmation of fact, a statement must be objective in nature, i.e., verifiable or capable of being proven true or false.² Similarly, to be relied upon as a promise, a statement must be highly specific or definite. The photograph and caption contained in Cruisers' brochure are not objective or specific enough to qualify as either facts or promises; the statements made in the caption are merely opinions, and the photograph makes no additional assertions with regard to the problems of which Boud has complained.

¶ 14 Cruisers' brochure contains language characteristic of an opinion. Specifically, its assertions that the 3375 Esprit offers the "best performance" and "superb handling" rely on inherently subjective words. See Royal Bus. Machs., Inc. v. Lorraine Corp., 633 F.2d 34, 42 (7th Cir.1980) ("General statements to the effect that goods are the best' . . . are generally regarded as expressions of the seller's opinion or the puffing of his wares' and do not create an express warranty." (internal citations omitted)). While representations that a boat is "fastest in its class" or "most powerful in its class" could be objectively tested for their truth and could therefore qualify as affirmations of fact, an assertion that a boat is "best in its class" cannot. See id. The word "best" is a description that must ultimately be measured against some opinion or other imprecise standard, and "superb" is a near synonym subject to the same qualification. Cf. Martin Rispens & Son v. Hall Farms, Inc., 621 N.E.2d 1078, 1083 (Ind.1993) ("[T]he statement `top quality seeds' is a `classic example of puffery.'" (citation omitted)). Similarly, "performance" is not a single quality, but rather embodies numerous qualities a boat may possess, and different people may place different weight on each individual...