Docteroff v. Barra Corp. of America, Inc.

• Decision Date: 21 June 1995
• Citation: 659 A.2d 948,282 N.J.Super. 230
• Parties: , 27 UCC Rep.Serv.2d 1238 Norman DOCTEROFF and Corina Docteroff, Plaintiffs-Appellants, v. BARRA CORPORATION OF AMERICA, INC., Braas Systems, Inc. and "John Doe," Defendants-Respondents.
• Court: New Jersey Superior Court — Appellate Division

Page 230

282 N.J.Super. 230

659 A.2d 948, 27 UCC Rep.Serv.2d 1238

Norman DOCTEROFF and Corina Docteroff, Plaintiffs-Appellants, v. BARRA CORPORATION OF AMERICA, INC., Braas Systems, Inc. and "John Doe," Defendants-Respondents.

Superior Court of New Jersey,

Appellate Division.

Argued Jan. 18, 1995.

Decided June 21, 1995.

Jeffrey Barton Cahn, Newark, for appellants (Sills Cummis Zuckerman Radin Tischman Epstein & Gross, attorneys; Mr. Cahn, of counsel and on the brief and reply brief; Joshua D. Goodman, on the brief and reply brief).

Jeffrey M. Garrod, Roseland, for respondents (Orloff, Lowenbach, Stifelman & Siegel, attorneys; Mr. Garrod, of counsel; David B. Katz, on the brief).

Before Judges STERN, KEEFE and HUMPHREYS.

The opinion of the court was delivered by

STERN, J.A.D.

Plaintiffs claimed that their roof leaked and was in need of repair before the expiration of a written five-year guarantee. After defendant Barra Corporation of America (Barra) declined to remedy the problem, plaintiffs commenced this action. The trial judge granted summary judgment on the ground that plaintiffs' suit was barred by the four-year statute of limitations in the Uniform Commercial Code (UCC), N.J.S.A. 12A:2-725. Plaintiffs appeal.

We agree with the motion judge that this case is governed by the four-year UCC statute of limitations, N.J.S.A. 12A:2-725, and not the six-year statute governing contract claims, N.J.S.A. 2A:14-1. However, the warranty here explicitly extended to future performance and therefore under the circumstances the statute of limitations did not begin to run until the breach was or should have been discovered. See N.J.S.A. 12A:2-725(2).

The facts are unclear as to whether this suit was brought within four years after the breach was or should have been discovered. Hence, summary judgment should not have been granted in favor of the defendant guarantor.

I.

Plaintiffs purchased their home on January 17, 1985. The roof had been installed in the fall of 1981 by the prior homeowners. Barra had supplied the roofing material to the installing contractor, and gave the owner, Helene Kessler, a written five-year "Guarantee" dated November 3, 1981. ¹ The "Guarantee" stated, in part:

Barra Corporation of America (hereinafter Barra) guarantees that Braas Rhenofol plastic roof sheets, roof covers and Braas Rhenofol roofing system accessories will maintain the roof of the following structure:

Kessler Residence

[address]

In a watertight condition at Barra's expense for (5) five years from the date hereof.

. . . . .

This guarantee covers only those defects occurring during the term of the guarantee and which defects are due to defective Braas Rhenofol material and/or Braas Rhenofol roofing systems accessories, or which defects originate from defective workmanship. It shall be at Barra's obligation to repair such defects or, at Barra's option, replace such defective material at no charge to the owner for labor and material. Any such repair or replacement shall be done by a licensed Barra applicator.

. . . . .

THIS GUARANTEE IS IN LIEU OF ALL OTHER WARRANTIES OR GUARANTEES WHETHER EXPRESSED OR IMPLIED, INCLUDING WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.

[ (Emphasis added.) ]

For purposes of our review of the grant of summary judgment, we must accept plaintiffs' factual contentions. Plaintiffs assert that, upon discovery of the roof leaks, they first notified Barra by telephone on September 17, 1985, and notified it on numerous occasions thereafter. When defendants' attempts to fix the roof failed to remedy the problem, plaintiffs hired an independent roofing expert who reported in June 1986 that there were various "problems" which would fall under the "manufacturer[']s warranty," including "[f]asteners are above the roof plane in various areas," "[m]etal splicing is severely bridging and in some areas cracking," and "[m]echanical terminations are missing from wall details." "Membrane failure" and "[m]etal failure" were also noted. This expert attributed no reason or cause for these "items of major concern," and concluded:

The repairs ... recommended are fairly extensive and in [our] estimation would entail reroofing 30% of the roof area.

This roof[']s usable life is coming to a close[. O]ver the course of time problems will [c]ertainly occur at an accelerated rate[. T]his roof should be replaced in the next 2 years.

Above stated repairs would certai[ ]nly extend that usable life.

[ (Emphasis added.) ]

Plaintiffs acknowledge that Barra "patched" the roof on three occasions before June 11, 1986. However, the leaks continued.

On July 3, 1986, Barra performed a "water test" and "thoroughly inspected the roof in question." In a letter sent to plaintiffs describing the inspection, Barra stated that "no water [had] penetrated the building and no leaks were found." Barra agreed to repair some "fasteners" and "flashings," but concluded that "the condition of the material in no way warrants the replacement of 30% of the roof," as plaintiffs' expert recommended. The report of plaintiffs' expert was called "totally inaccurate." In November 1986, Barra ceased discussion about further repairing the roof.

Plaintiffs had the entire roof replaced in 1990 at a cost of $117,000, after having commenced this action against Barra and the "John Doe" manufacturer in December 1989. They ultimately filed an amended complaint against both Barra and Braas Systems, Inc. (BSI) in July 1991. ² Summary judgment was granted in favor of BSI as an inappropriate party and in favor of both defendants because the controlling UCC four-year limitations period had not been satisfied.

II.

Plaintiffs first assert that dismissal of BSI was improper because BSI was responsible for distribution of the defective roofing material. See Spring Motors Distributors, Inc. v. Ford Motor Company, 98 N.J. 555, 561, 489 A.2d 660 (1985) (commercial buyer "in a distributive chain" may bring breach of warranty action under UCC). Plaintiffs contend:

Although the BSI president states unequivocally that Braas Systems, Inc. "did not participate in any way in the distribution chain regarding the materials at issue in this litigation," (Pa51, para. 4 [Heim Certification] ), the same certification attaches a copy of the admitted Guarantee, which identifies the materials as "Braas Rhenofol plastic roof sheets." Pa52, first unnumbered paragraph. The coincidence of the name "Braas" and the trademark including the word "Braas" should not go unnoticed because it raises a credibility issue which cannot be resolved on summary judgment.

However, according to the certification of BSI's president, Joseph D. Heim, BSI is a "holding company" which merely owns the stock of Barra, and "did not manufacture, purchase, transfer, distribute, sell or install any of the roofing material at issue in this litigation." He also certified that "BSI did not issue any guarantee for this roofing material." No proofs were presented to contest Heim's certification. Thus, plaintiffs have failed to present any facts to substantiate their claim against BSI.

Furthermore, we need not examine whether the "parent" company of a manufacturing entity can be said to be involved in the "chain of distribution" of a defective product. Here there was simply insufficient evidence, even given the report of plaintiffs' expert which relates to the material as installed, to hold that the problems with the roof were attributable to a defect at the time of sale or distribution of the product by the manufacturer. See Michalko v. Cooke Color & Chemical Corporation, 91 N.J. 386, 394, 451 A.2d 179 (1982); McLaughlin v. Acme Pallet Co., 281 N.J.Super. 565, 568, 658 A.2d 1314 (App.Div.1995). Nor could sufficient inferences be drawn of such a defect. See Consalo v. General Motors Corporation, 258 N.J.Super. 60, 64-67, 609 A.2d 75 (App.Div.), certif. denied, 130 N.J. 597, 617 A.2d 1220 (1992). Thus, we find no basis for recovery against BSI, irrespective of whether in a case such as this the concept of strict liability in tort survives the UCC. See Santor v. A. & M. Karagheusian, Inc., 44 N.J. 52, 207 A.2d 305 (1965) (pre-UCC purchaser of defective goods has strict liability cause of action against manufacturer for economic loss); D'Angelo v. Miller Yacht Sales, 261 N.J.Super. 683, 687-88, 619 A.2d 689 (App.Div.1993) (UCC provides exclusive consumer breach of warranty remedy for economic loss). Compare Delgozzo v. Kenny, 266 N.J.Super. 169, 182 n. 8, 628 A.2d 1080 (App.Div.1993). See also Spring Motor, supra, 98 N.J. at 577-79, 489 A.2d 660. ³

III.

The more significant question before us is whether the four-year UCC statute of limitations bars the action against Barra. Plaintiffs assert that the UCC does not control and that the case is governed by the general six-year statute of limitations embodied in N.J.S.A. 2A:14-1. On that theory, this action was timely, as it was commenced in 1989 within six-years of the alleged breach of contract. Defendants insist, however, that we cannot consider plaintiffs' present contention because it was not asserted in the trial court. Before the Law Division, plaintiffs did "not dispute that the U.C.C. action accrued on November 3, 1981." Rather, they contended that the four-year limitation was "tolled" until at least September 17, 1985, when "Barra was first informed by plaintiffs that the roof was in need of repair." However, they also asserted below that this was a "defect" case governed by the six-year statute of limitations for strict liability claims under Santor, and that the limitations period runs "from the time the defect was noticed in June of 1986."

Defendants are correct that we will not ordinarily consider an issue raised for the first time on appeal unless it relates to "jurisdiction of the trial court or concern[s] matters of great public interest," or otherwise constitutes "plain error." See Nieder v. Royal Indemnity Insurance Company, 62 N.J....