Inglis v. American Motors Corp.

Citation209 N.E.2d 583,3 Ohio St.2d 132
Decision Date21 July 1965
Docket NumberNo. 38916,38916
Parties, 32 O.O.2d 136, 2 UCC Rep.Serv. 961 INGLIS, Appellee and Cross-Appellant, v. AMERICAN MOTORS CORP. et al., Appellants and Cross-Appellees.
CourtUnited States State Supreme Court of Ohio

Syllabus by the Court

1. In an action involving product liability based on negligence against the manufacturer of the product by a buyer of the product not in privity of contract with the manufacturer, there is no liability for pecuniary loss of bargain.

2. Where express warranties are alleged as to a given subject matter, fact, claim or proposition there is no need for the law to imply a warranty.

3. Privity of contract is not necessary in an action based on breach of warranty where one purchases an automobile in reasonable reliance upon representations made in advertising of the manufacturer of such automobile in mass communications media to the effect that its automobiles are trouble-free, economical in operation and built and manufactured with a high quality of workmanship and such purchaser suffers damage in the form of diminution of value of the automobile attributable to latent defects not ascertainable at the time of purchase.

This action was instituted in the Cleveland Municipal Court. Irvin S. Inglis, plaintiff, purchased a Rambler automobile from the defendant Sheffler Rambler, Inc. The American Motors Corporation, manufacturer of Rambler automobiles, the American Motor Sales Corporation, a distributor of Rambler automobiles and Sheffler Rambler, Inc., an authorized agent and dealer in Rambler automobiles, were joined as defendants.

The Rambler automobile purchased by the plaintiff was delivered to the plaintiff by the defendant Sheffler Rambler, Inc.

FIRST CAUSE OF ACTION

The petition alleged that said purchase was induced by the express warranties and representations of the defendants made to the plaintiff by advertising in mass communications media that Rambler automobiles were trouble-free, economical in operation and built and manufactured with high quality of workmanship. Plaintiff alleged further that the defendants breached the aforesaid warranties in that the Rambler automobile purchased by the plaintiff was not trouble-free, not free from defects in material and workmanship, not economical in operation, and was not manufactured with a high degree of quality in workmanship and craftsmanship.

It was alleged further that after delivery of said automobile to the plaintiff he discovered that the cargo-area door was out of line, could not be opened, and continually squeaked and rattled; that the trimming about the door was torn; that the doors were out of line and squeaked and rattled, and that the door handles were loose; that the motor was extremely noisy, had been defectively cast and seeped substantial quantities of oil; that the steering gear was improperly set and creaked when turned: that the transmission emitted a groaning noise; that the brakes squeaked and grated; that the oil pump assembly was defective; that the front seat squeaked and rocked; and that loose parts inside of the car fell out from time to time endangering occupants of the car. Plaintiffs made further allegations of numerous defects.

It was alleged further that the plaintiff called the attention of the defendants to these defects but the latter failed and refused to correct them.

Plaintiff alleged further that he paid $2,700 for the automobile, but that by reason of its defects it had a value of no more than $1,200 at the time of the purchase.

SECOND CAUSE OF ACTION

Plaintiff adopted as if fully rewritten all of the allegations set out in the first cause of action and alleged further that the defendants knew the purpose for which said Rambler was to be used by plaintiff; that plaintiff relied upon defendants' skill, judgment and superior knowledge as to the quality and fitness of said automobile; and that defendants impliedly warranted the quality and fitness of said automobile.

THIRD CAUSE OF ACTION

Plaintiff adopted all allegations set out in his first and second causes of action and alleged further that the defendants were negligent in failing to inspect the automobile prior to its delivery to plaintiff and failed to correct said defects which should and could have been discovered by defendants with the exercise of reasonable care.

As the fourth cause of action and the status of the defendant Sheffler Rambler, Inc., are not relevant to this appeal no further reference will be made to either.

A demurrer was filed by each of the two remaining defendants to the three causes of action on the ground that the petition did not state facts sufficient to constitute causes of action against these defendants. The trial court sustained the demurrer. The plaintiff, not desiring to plead further, the trial court entered final judgment against the plaintiff and for the two defendants.

The Court of Appeals for Cuyahoga County reversed the judgment of the trial court entered in the first cause of action wherein the trial court sustained the demurrer of the defendants to the first cause of action. The Court of Appeals affirmed the judgment of the trial court entered in the second and third causes of action.

The defendants appealed the judgment of the Court of Appeals to this court for review and final determination and the plaintiff cross-appealed upon the judgment entered by the Court of Appeals to the second and third caused of action.

This court allowed the motions to certify filed by each of the parties, plaintiff and defendants, and the cause is now here for review and final determination.

Ulmer, Berne, Laronge, Glickman & Curtis and Marvin L. Karp, Cleveland, for appellee and cross-appellant.

Jones, Day, Cockley & Reavis, Patrick F. McCartan and Robert K. Scott, Cleveland, for appellant and cross-appellees.

HERBERT, Judge.

No less an authority than Dean Prosser, pre-eminent, especially, in the law of torts, has yielded to the temptation to tilt his lance of legal learning into the mass of difficult questions that have arisen during the last century in the field of products liability cases.

Over a hundred years ago, in 1842, The Court of the Exchequer, in the case of Winterbottom v. Wright, 10 M. & W. 109, 152 Eng.Rep. 402, 405, 11 L.J.Ex. 415, fashioned the rule that no manufacturer or seller of a product was ever liable to anyone with whom he had made no contract and Lord Abinger of the court had the following to say:

'Unless we confine the operation of such contracts as this to the parties who entered into them, the most absurd and outrageous consequences, to which I can see no limit, would ensue.'

Dean Prosser, writing in the May 1965 issue of the Cleveland Bar Association Journal speaks of the changes in the products liability law as follows:

'Since the year 1900 there has been no other set of cases which have so rapidly and violently overthrown the existing law as those which involve products liability.'

It would be of little benefit or aid in the solution of the questions here presented to review the history of the development of the law of products liability from Winterbottom to the present day. Hence we will consider the questions raised in the case at bar, with emphasis upon Ohio adjudications.

The question here may be stated in this language:

'Is privity of contract essential in an action based on breach of warranty where the purchaser of an automobile relies upon representations made in advertising of the manufacturer of the automobile in mass communications media to the effect that its automobiles are trouble-free, economical in operation and built and manufactured with a high quality of workmanship, and the purchaser suffers damage in the form of diminution of value of the automobile attributable to latent defects not readily ascertainable at the time of the purchase?'

The defendants' demurrer to the petition admits as true all facts properly pleaded. It follows, therefore, that the automobile manufactured and sold by the defendants to the plaintiff was defective as alleged in the petition to the extent that its value, instead of being $2,700--the price paid for it by the purchaser--was $1,200 thereby causing a pecuniary loss to the plaintiff in the sum of $1,500. There was no privity of contract between the defendant manufacturer and the plaintiff.

Rogers v. Toni Home Permanent Co., 167 Ohio St. 244, 147 N.E.2d 612, 75 A.L.R.2d 103, is a landmark case in the development of the law of products liability. It is widely recognized and the reasoning therein is generally respected. The syllabus reads:

'1. Originally, an action grounded on breach of warranty sounded in tort rather than contract.

'2. An express warranty is an affirmation of fact by the seller as to a product or commodity to induce the purchase thereof, on which affirmation the buyer relies in making the purchase.

'3. Under modern merchandising practices, where the manufacturer of a product in his advertising makes representations as to the quality and merit of his product aimed directly at the ultimate consumer and urges the latter to purchase the product from a retailer, and such ultimate consumer does so in reliance on and pursuant to the inducements of the manufacturer and suffers harm...

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