Bracey v. Monsanto Co., Inc., No. 73301

CourtUnited States State Supreme Court of Missouri
Writing for the CourtBLACKMAR; ROBERTSON; RENDLEN; RENDLEN
Citation823 S.W.2d 946
Docket NumberNo. 73301
Decision Date28 January 1992
PartiesMike BRACEY, et al., Appellants, v. MONSANTO COMPANY, INC., Respondent.

Page 946

823 S.W.2d 946
Mike BRACEY, et al., Appellants,
v.
MONSANTO COMPANY, INC., Respondent.
No. 73301.
Supreme Court of Missouri,
En Banc.
Jan. 28, 1992.

Lynn N. Bock, New Madrid, for appellants.

P. Pierre Dominique, Jefferson City, R. Gerald Barris, Scott C. Helmholz, Springfield, Ill., James R. Reynolds, Kennett, for respondent.

BLACKMAR, Judge.

This case comes to the writer on recent reassignment, after a sinuous history in the appellate courts. This opinion makes use of some of the ideas, research and phraseology of draft opinions by other judges.

The plaintiffs sued for breach of warranty, following their purchase and use of a herbicide known as Lasso. The defendant filed a lengthy motion to dismiss. The trial court sustained this motion without specifying a reason and dismissed the petition with prejudice. The Court of Appeals, Southern District, remanded the case in order to permit the plaintiffs to amend their petition. Both parties then moved for transfer to this Court, the plaintiffs advising that they elected to stand on the petition as filed. We retransferred the case by order, directing the court of appeals to consider the merits of the appeal. That court then reversed and remanded for further proceedings. We again granted transfer

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because of the importance of the issue of the validity of a limitation on the right to recover damages for breach of warranty in a contract for the sale of goods governed by the Uniform Commercial Code, Chap. 400.2, RSMo 1986. We now reverse and remand, for reasons differing substantially from those adduced by the court of appeals.

The petition has two counts, Count I charging breach of express warranty and Count II breach of implied warranty. The plaintiffs are tenants of land in New Madrid and Pemiscot Counties, on a "cropyield" arrangement. Their petition states that they purchased 95 pounds of Lasso, a herbicide manufactured by the defendants, from an intermediate supplier; that the product did not conform to the defendant manufacturer's representations; and that as a result the plaintiffs' crop yield was greatly diminished. The petition specifically charged that the limitation of warranty described below "causes the warranty to fail of its essential purpose," borrowing the phraseology of § 400.2-719(2), RSMo 1986, a part of the Uniform Commercial Code. The petition is lacking in detail as to the precise failures of conformity to representations and the cause of the diminished crop yield. The plaintiffs took a substantial risk by electing to stand on the petition without amendment, but we find it minimally sufficient to present the issues we now consider.

The motion to dismiss is prolix, containing 17 paragraphs as to Count I and 14 as to Count II. The defendant also filed an alternative motion for more definite statement, on which a ruling was unnecessary once the motion to dismiss was sustained. This unruled motion should now be ruled on remand. The motion to dismiss asserts various substantive and procedural grounds for dismissal, but the defendant has not sought to justify the bulk of these in the briefing. We perceive no fatal procedural flaws in the petition, and so limit our consideration to the matters briefed.

An order dismissing a petition with prejudice is erroneous if the petition, reasonably construed, sets forth any theory supporting recovery. 1 Tested by this standard, the ruling of the trial court is clearly in error because the challenged warranty seeks only to limit damages and not to preclude all recovery. But the plaintiffs seek damages substantially in excess of the limitation, and so we must consider the issue of validity.

Necessary Parties

We deal first with a procedural issue. The defendant asserts in the motion to dismiss that there may be a want of "necessary parties" because the rights of the plaintiffs and their landlords are not clearly defined in the petition. This point is advanced in the briefing as an additional reason supporting the trial court's ruling.

Failure to join a necessary party, however, is not ground for dismissal. Rule 52.06. There is a recognized distinction between an "indispensable party," without whose presence a case may not be maintained, and a "necessary party," who should be made a party in order that there may be a complete determination of the controversy at hand, but whose presence is not essential to a determination of the issues between the parties. 2 If it is claimed that necessary parties who are subject to the processes of the court are not present, the remedy is not by a motion to dismiss but rather by motion to add the parties deemed to be necessary. Rules 52.06 and 55.27(a)(7). If the defendant is of the opinion that it may be subjected to multiple recovery if the landlords are not made parties, it may move to bring them in. Rules 52.04(a) and 57.

If the facts stated are true, moreover, the plaintiffs are entitled to recover the full damages allowable for the breach of warranty.

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They purchased and used the product. There is no showing of a contractual relation between the landlords and the supplier of the herbicide. It is of no moment to the defendant that the plaintiffs might be obliged to account to others for any part of their recovery, (if, indeed, they are so obliged, about which we express no opinion).

Unconscionability

The "LIMIT OF WARRANTY AND LIABILITY" attacked as unconscionable reads as follows:

This company warrants that this product conforms to the chemical description on the label and is reasonably fit for the purposes set forth in the complete Directions for Use label booklet ("Directions") when used in accordance with those Directions under the conditions described therein. NO OTHER EXPRESS OR IMPLIED WARRANTY OF FITNESS FOR PARTICULAR PURPOSE OR MERCHANTABILITY IS MADE. This warranty is also subject to the conditions and limitations stated herein.

Buyer and all users shall promptly notify this company of any claims whether based in contract, negligence, strict liability, other tort or otherwise.

* * * * * *

THE EXCLUSIVE REMEDY OF THE USER OR BUYER AND THE LIMIT OF THE LIABILITY OF THIS COMPANY OR ANY OTHER SELLER FROM ANY AND ALL LOSSES, INJURIES OR DAMAGES RESULTING FROM THE USE OR HANDLING OF THIS PRODUCT (INCLUDING CLAIMS BASED IN CONTRACT NEGLIGENCE, STRICT LIABILITY, OTHER TORT OR OTHERWISE) SHALL BE THE PURCHASE PRICE PAID BY THE USER OR BUYER FOR THE QUANTITY OF THIS PRODUCT INVOLVED, OR, AT THE ELECTION OF THIS COMPANY OR ANY OTHER SELLER, THE REPLACEMENT OF SUCH QUANTITY, OR, IF NOT ACQUIRED BY PURCHASE, REPLACEMENT OF SUCH QUANTITY IN NO EVENT SHALL THIS COMPANY OR ANY OTHER SELLER BE LIABLE FOR ANY INCIDENTAL OR CONSEQUENTIAL DAMAGES.

The buyer and all users are deemed to have accepted the terms of this LIMIT OF WARRANTY AND LIABILITY which may not be varied by any verbal or written agreement.

Section 400.2-719, RSMo 1986, is part of the Uniform Commercial Code, adopted in Missouri in 1963. It authorizes contractual modifications or limitations of remedies for breach of warranty, in the following terms:

(1) Subject to the provisions of subsections (2) and (3) of this section and of section 400.2-718 on liquidation and limitation of damages,

(a) the agreement may provide for remedies in addition to or in substitution for those provided in this article and may limit or alter the measure of damages recoverable under this article, as by limiting the buyer's remedies to return of the goods and repayment of the price or to repair and replacement of nonconforming goods or parts; and

(b) resort to a remedy as provided is optional unless the remedy is expressly agreed to be exclusive, in which case it is the sole remedy.

(2) Where circumstances cause an exclusive or limited remedy to fail of its essential purpose, remedy may be had as provided in this chapter.

(3) Consequential damages may be limited or excluded unless the limitation or exclusion is unconscionable. Limitation of consequential damages for injury to the person in the case of consumer goods is prima facie unconscionable but limitation of damages where the loss is commercial is not.

Any such modifications or limitations, then, are expressly subject to being tested for unconscionability. This brings into play another UCC section; 400.2-302, RSMo 1986. Section 400.2-302, reading as follows:

(1) If the court as a matter of law finds the contract or any clause of the contract to have been unconscionable at

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the time it was made the court may refuse to enforce the contract, or it may enforce the remainder of the contract without the unconscionable clause, or it may so limit the application of any unconscionable clause as to avoid any unconscionable result.

(2) When it is claimed or appears to the court that the contract or any clause thereof may be unconscionable the parties shall be afforded a reasonable opportunity to present evidence as to its commercial setting, purpose and effect to aid the court in making the determination.

The petition does not allege unconscionability in express terms. It takes notice of the limitation provisions and charges that this limitation "causes the warranty to fail of its essential purpose," thus invoking the provisions of § 400.2-719(2). Subsection (3) of Section 719 states that a limitation of remedy may be invalid if it is unconscionable. We conclude, nevertheless, that the purpose of the action is to challenge the limitation, and that challenges under Subsection (2) and Subseciton (3) must be considered.

There has been much discussion of the interrelation between Subsections (2) and (3). 3 Subsection (3) appears to permit the parties to a commercial transaction to agree on the allocation of the risk of failure of the product. To complete the picture, § 400.2-316 permits the total exclusion of express and implied warranties, by conspicuous contract provisions. Because of the inadequacy of the record before us, we...

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25 practice notes
  • Whitney v. Alltel Communications, Inc., No. WD 64196.
    • United States
    • United States State Supreme Court of Missouri
    • November 1, 2005
    ...former relating to the formalities of the making of the contract and the latter to the specific contract terms." Bracey v. Monsanto Co., 823 S.W.2d 946, 950 (Mo. banc 1992). "[P]rocedural unconscionability in general is involved with the contract formation process, and focuses on high press......
  • Brewer v. Mo. Title Loans Inc, No. SC90647
    • United States
    • Missouri Supreme Court
    • August 31, 2010
    ...a matter of public policy. State ex rel. Vincent v. Schneider, 194 S.W.3d 853, 858 (Mo. banc 2006) (citing Bracey v. Monsanto Co. Inc., 823 S.W.2d 946, 950 (Mo. banc 1992)).2 Courts are rightly hesitant to substitute their judgment for that of freely acting parties. That is why a showing of......
  • Sprague v. Household Intern., No. 04-0106-CV-W-NKL.
    • United States
    • United States District Courts. 8th Circuit. Western District of Missouri
    • June 15, 2005
    ...116 S.Ct. 1652, 134 L.Ed.2d 902 (1996). Missouri cases "give little guidance on the subject of unconscionability." Bracey v. Monsanto Co. 823 S.W.2d 946, 949 (Mo.1992) (en banc). However, Missouri courts have noted that unconscionability has both a procedural and a substantive component. Wo......
  • Purcell Tire & Rubber Co. v. Executive Beechcraft, SC83383
    • United States
    • United States State Supreme Court of Missouri
    • November 20, 2001
    ...See Elam Masonry, 922 S.W.2d at 790; World Enters., 713 S.W.2d at 610-11; Liberty Fin., 670 S.W.2d at 49-50; cf. Bracey v. Monsanto Co., 823 S.W.2d 946, 948-50 (Mo. banc 1992). In this case, the liability limitation is not Purcell Tire contends that the liability limitation is ambiguous. In......
  • Request a trial to view additional results
25 cases
  • Whitney v. Alltel Communications, Inc., No. WD 64196.
    • United States
    • United States State Supreme Court of Missouri
    • November 1, 2005
    ...former relating to the formalities of the making of the contract and the latter to the specific contract terms." Bracey v. Monsanto Co., 823 S.W.2d 946, 950 (Mo. banc 1992). "[P]rocedural unconscionability in general is involved with the contract formation process, and focuses on high press......
  • Brewer v. Mo. Title Loans Inc, No. SC90647
    • United States
    • Missouri Supreme Court
    • August 31, 2010
    ...a matter of public policy. State ex rel. Vincent v. Schneider, 194 S.W.3d 853, 858 (Mo. banc 2006) (citing Bracey v. Monsanto Co. Inc., 823 S.W.2d 946, 950 (Mo. banc 1992)).2 Courts are rightly hesitant to substitute their judgment for that of freely acting parties. That is why a showing of......
  • Sprague v. Household Intern., No. 04-0106-CV-W-NKL.
    • United States
    • United States District Courts. 8th Circuit. Western District of Missouri
    • June 15, 2005
    ...116 S.Ct. 1652, 134 L.Ed.2d 902 (1996). Missouri cases "give little guidance on the subject of unconscionability." Bracey v. Monsanto Co. 823 S.W.2d 946, 949 (Mo.1992) (en banc). However, Missouri courts have noted that unconscionability has both a procedural and a substantive component. Wo......
  • Purcell Tire & Rubber Co. v. Executive Beechcraft, SC83383
    • United States
    • United States State Supreme Court of Missouri
    • November 20, 2001
    ...See Elam Masonry, 922 S.W.2d at 790; World Enters., 713 S.W.2d at 610-11; Liberty Fin., 670 S.W.2d at 49-50; cf. Bracey v. Monsanto Co., 823 S.W.2d 946, 948-50 (Mo. banc 1992). In this case, the liability limitation is not Purcell Tire contends that the liability limitation is ambiguous. In......
  • Request a trial to view additional results

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