Dougall v. Brown Bay Boat Works & Sales, Inc.

• Decision Date: 12 June 1970
• Docket Number: No. 41934,41934
• Citation: 178 N.W.2d 217,287 Minn. 290
• Parties: , 7 UCC Rep.Serv. 1160 P. McA. DOUGALL, Respondent, v. BROWN BAY BOAT WORKS AND SALES, INC., and Jonas Marine and Boat Works, Inc., Respondents, Evinrude Motors, a division of Outboard Marine Corporation, Appellant.
• Court: Minnesota Supreme Court

Page 217

178 N.W.2d 217

287 Minn. 290, 7 UCC Rep.Serv. 1160

P. McA. DOUGALL, Respondent, v. BROWN BAY BOAT WORKS AND SALES, INC., and Jonas Marine and Boat Works, Inc., Respondents Evinrude Motors, a division of Outboard Marine Corporation, Appellant.

No. 41934.

Supreme Court of Minnesota.

June 12, 1970.

Syllabus by the Court

1. Provision of Uniform Sales Act, Minn.St.1961, § 512.15(4), which provides that where an article is sold under its trade name there can be no implied warranty as to its fitness for any particular purpose must be construed in light of § 512.15(2), which provides that an implied warranty of merchantability arises where goods are bought by description from a seller, in which case 'there is an implied warranty that the goods shall be of merchantable quality.' The sale of an article by a trade name does not negate an implied warranty of merchantable quality, which means that the product is reasonably fit for the general purpose for which it is manufactured and sold.

2. This court has been reluctant to give literal application to language found in written warranties which would eliminate from the transaction warranties as to fitness and merchantability. The implied warranty is imposed by law for the protection of the buyer and does not depend upon the affirmative intention of the parties. The court seeks to protect the buyer from obscure and inconspicuous disclaimers by giving the buyer the benefit of implied warranties where it is reasonable to do so.

3. While attempts are being made to repair a defect of the subject of a sale, the reasonable time within which a buyer may rescind does not run. Beck v. Spindler, 256 Minn. 543, 99 N.W.2d 670.

Johnson & Sands and Maurice Lizee, Minneapolis, for appellant.

O. A. Brecke and J. Robert Nygren, Minneapolis, for P. McA. Dougall.

Samuel Bellman, Minneapolis, for Brown Bay Boat Works.

Heard before KNUTSON, C.J., and NELSON, MURPHY, OTIS, and THEODORE B. KNUDSON, JJ.

OPINION

MURPHY, Justice.

This action to recover damages growing out of an alleged breach of warranty in the sale of a motorboat was brought by the purchaser, P. McA. Dougall, against the dealer, Jonas Marine and Boat Works, Inc. (formerly Brown Bay Boat Works and Sales, Inc.), and the manufacturer, Evinrude Motors, a division of Outboard Marine Corporation. The trial court awarded judgment against both defendants, and the manufacturer, Evinrude Motors, appeals. The manufacturer contends that the record does not establish a breach of warranty or a valid rescission.

From the record it appears that plaintiff purchased an Evinrude Sport 16 inboardoutboard motorboat from defendant boat works on April 22, 1965. The purchase price was $3,395. After credit for a trade-in boat and payment of $1,400, there remained a balance due of $50. It appears that sometime after the sale transaction was completed on April 22, 1965, and before delivery was made on May 22, 1965, plaintiff was provided with a brochure or owner's manual prepared by the manufacturer. The manual was a 34-page booklet of instructions covering the operation and maintenance of the boat. On the inside of the back cover, the following warranty was printed:

'We warrant, to the original purchaser, each new Evinrude boat for one year and new Evinrude engine of our manufacture for two years, to be free from defects in material and workmanship under normal use and service, our obligation under this warranty being limited to making good at the factory any part or parts thereof which shall, within the warranty period from date of original purchase, be returned to us with transportation charges prepaid, and which our examination shall disclose to our satisfaction to have been thus defective; this warranty being expressly in lieu of all other warranties and representations expressed or implied and of all other liabilities in connection with the sale or use of any engine or boat.'

According to the testimony of plaintiff, he encountered a great deal of difficulty in the operation of the boat during the summer of 1965. The boat proved to be completely unreliable, frequently failed to start, and stalled at inopportune times stranding the plaintiff in the middle of the lake on four occasions. When it did run, the motor's performance was rough. A power lift, designed to life the drive mechanism from the water when the boat was docked, occasionally froze midway through its operation. The gas gauge proved to be defective. Plaintiff testified that he managed to operate the boat for only 23 hours' running time during the summer of 1965, and half of that time was devoted to trips to defendant boat works for repair. Plaintiff was never able to operate the boat for more than 1 1/2 hours at a time without problems.

While the dealer contended that the asserted defects were minor and normally incidental to a new craft, nevertheless its records disclose that the boat was towed to the boat works on two occasions and, further, that the boat was serviced at plaintiff's lake home on two other occasions during the summer of 1965. A 'Request for Warranty Replacement Parts Or Motor' from the dealer to the manufacturer lists the following information:

'Stern drive stuck in 'up' position, gas gauge read Full under weigh regardless of amount of gas in tank, motor missed at high speed--points loose in distributor.'

The report contains the following information with reference to parts required:

'1 tilt solenoid--we have received, 1 new gauge and gas tank sender from factory--we made 3 service calls to his home and customer brought boat back for other adjustments twice.'

The president of defendant boat works testified that company mechanics had worked on the boat and that the work was of a minor tuneup variety. The record indicates that plaintiff repeatedly called defendants' attention to the difficulties he was having with the boat, and while defendants' mechanics did some work on the boat, the defects were not corrected.

The trial court found that plaintiff was unable to use the boat, that it required constant repair, and that it did not meet standards of fitness or merchantability for use as a pleasure craft. The trial court's finding that defendants were notified of the condition of the boat and 'failed and refused to repair and put said boat in proper working condition' is supported by the record. Written correspondence, which is part of the record, establishes that the manufacturer had ample notice of the defects complained of. The relationship of the parties with reference to the transaction in the spring of 1966 is not entirely clear from the record. There was talk of plaintiff trading the boat in for a new one, but nothing came of it. Plaintiff did not consider that the allowance on the trade-in proposal by the seller was reasonable. He felt that the amount he would have to pay in addition was far in excess of the negligible benefit he had derived from the previous transaction. It appears that the boat had been stored by plaintiff at the boat works over the winter of 1965--66. Plaintiff never regained possession except for a test run in May 1966. The boat works refused to release the boat until plaintiff had paid a $50 balance on the purchase price. This action was thereafter commenced.

The trial court further found that defendants had warranted the boat to be of good workmanlike quality and that it would be acceptable and fit for use as a pleasure craft, that there had been a breach of such warranties, and that plaintiff had sustained damages in the amount of $3,395.

1. The first point raised by Evinrude is that the transaction is governed by Minn.St.1961, § 512.15(4), which provides that where an article is sold under its trade name, there can be no implied warranty as to its fitness for any particular purpose. ¹ Our decisions prior to the adoption of the current Uniform Commercial Code favor the view that § 512.15(4) does not necessarily operate effectively to deprive the buyer of the benefits of implied warranties as to fitness and merchantability. Iron Fireman Coal Stoker Co. v. Brown, 182 Minn. 399, 234 N.W. 685; Federal Motor Truck Sales Corp. v. Shanus, 190 Minn. 5, 250 N.W. 713; Bekkevold v. Potts, 173 Minn. 87, 216 N.W. 790, 59 A.L.R. 1164. We find no authority which would indicate that § 512.15(4) would negate the implied warranties of fitness or merchantability in a substantial sale involving motor-powered equipment bearing the name of a well-known manufacturer. On the contrary, § 512.15(2) provides that where goods are bought by description from a seller, whether he be the grower or manufacturer, 'there is an implied warranty that the goods shall be of merchantable quality.' This warranty of merchantability simply means that the product is reasonably fit for the general purpose for which it is manufactured and sold. 1 Williston Sales (Rev. ed.) § 243. ² Other authorities to the effect that the sale of an article by a trade name does not negate an implied warranty of merchantable quality under the provisions of the Uniform Sales Act relating to sale of goods by description are George v. Willman (Alaska) 379 P.2d 103; Henningsen v. Bloomfield Motors, Inc., 32 N.J. 358, 161 A.2d 69, 75 A.L.R.2d 1; Kohn v. Ball, 36 Tenn.App. 281, 254 S.W.2d 755; Pabellon v. Grace Line, Inc. (2 Cir.) 191 F.2d 169, certiorari denied, 342 U.S. 893, 72 S.Ct. 201, 96 L.Ed. 669. See, also, 17 Dunnell, Dig. (3 ed.) §§ 8570 to 8576.

2. Defendant points to the language contained in the printed warranty which says that it is given 'in lieu of all other warranties * * * expressed or implied.' Defendant also calls attention to Minn.St.1961, § 512.71, which provides that, where a liability would arise under a sale by implication of law, 'it may be negatived or varied by express agreement or by the course of dealing between the parties.' Defendant argues that, by applying this statute to defendant's asserted warranty, which it characterizes as an 'express...