Norman Gershman's Things to Wear, Inc. v. Mercedes-Benz of North America, Inc.

558 A.2d 1066, 9 U.C.C. Rep. Serv. 2d (West) 541, 1989 Del. Super. LEXIS 106
CourtSuperior Court of Delaware
DecidedFebruary 10, 1989
StatusPublished
Cited by22 cases

This text of 558 A.2d 1066 (Norman Gershman's Things to Wear, Inc. v. Mercedes-Benz of North America, Inc.) is published on Counsel Stack Legal Research, covering Superior Court of Delaware primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Norman Gershman's Things to Wear, Inc. v. Mercedes-Benz of North America, Inc., 558 A.2d 1066, 9 U.C.C. Rep. Serv. 2d (West) 541, 1989 Del. Super. LEXIS 106 (Del. Ct. App. 1989).

Opinion

TAYLOR, Judge.

This suit involves the sale of an allegedly defective automobile to plaintiff Norman Gershman’s Things to Wear, Inc. [Gersh-man’s]. The car was distributed by defendant Mercedes-Benz of North America, Inc. [Mercedes] and sold to Gershman’s by defendant I.G. Burton & Co., Inc. [Burton]. In its complaint Gershman’s has alleged against both defendants breach of numerous warranties; failure of the essential purpose of the warranties; violation of Delaware’s “Lemon Law”; violation of Delaware’s Consumer Fraud and Deceptive Trade Practices Acts; negligent repair; and violation of the Magnuson-Moss Federal Consumer Products Warranties Act. Defendants have each moved for summary judgment on various of the above issues. In addition, Burton has also moved for summary judgment against Mercedes seeking indemnification for any damages which might be awarded to plaintiff against Burton and also for attorney’s fees incurred in defending this action.

Gershman’s purchased from Burton, a dealer in Mercedes-Benz automobiles, a new 1984 Mercedes-Benz 500 SEC which was distributed by Mercedes. Approximately six months after the purchase, the car’s engine overheated and had to be repaired. The car was taken to Burton for repairs. Upon inspection it was determined that the overheating was caused by a hairline crack in the short block portion of the engine. This information was conveyed to Mercedes. Pursuant to instructions from Mercedes, Burton replaced the short block without expense to Gersh-man’s.

*1069 Less than two years later the car again overheated causing extensive damage to the engine. The car was again taken to Burton for repairs. Mercedes was informed of the problem and authorized the replacement of the entire engine assembly as a covered warranty repair. Following this repair, Gershman’s refused to accept redelivery of the vehicle and notified Mercedes and Burton that it was revoking its acceptance of the vehicle and demanding a full refund of the purchase price. The defendants refused to refund Gershman’s the purchase price and this suit was instigated. In 1987 the car was sold at auction by agreement of the parties.

I

Count I of the complaint alleges breach of express warranties by both Burton and Mercedes. Count II of the complaint alleges breach of implied warranty of merchantability. Burton has moved for summary judgment on these issues, arguing that it had effectively disclaimed any express or implied warranties in its “Sales Contract” with Gershman’s. These are governed by Article 2 of the Uniform Commercial Code, 6 Del. C. Subtitle I. “Any affirmation of fact or promise made by the seller to the buyer which relates to the goods and becomes part of the basis of the bargain” is an express warranty of the contract. 6 Del. C. § 2-313. In addition, there is an implied warranty in the contract that the goods are merchantable, unless this warranty is excluded or modified. 6 Del.C. § 2-314. Goods are “merchantable” if they are “fit for the ordinary purposes for which such goods are used.” 6 Del.C. § 2-314(2)(c). In order to exclude or modify the implied warranty of merchantability, the language of the exclusion or modification must mention merchantability and in the case of a writing must be conspicuous. 6 Del.C. § 2-316(2). “Conspicuous” is defined at 6 Del.C. § 1-201(10) as follows:

A term or clause is conspicuous when it is so written that a reasonable person against whom it is to operate ought to have noticed it. A printed heading in capitals (as: NON-NEGOTIABLE BILL OF LADING) is conspicuous. Language in the body of a form is “conspicuous” if it is in larger or other contrasting type or color.... Whether a term or clause is “conspicuous” or not is for decision by the court.

The touchstone of conspicuousness is “whether a person’s attention can reasonably be expected to be called to the disclaimer language.” Lecates v. Hertrich Pontiac Buick Co., Del.Super., 515 A.2d 163, 169 (1986).

The sales contract by which Burton sold the car to Gershman’s was a one-page document with writing on both the front and back. The following paragraph appears on the reverse side of the page:

The only warranties applying to this vehicle are those offered by the Manufacturer. Dealer hereby expressly disclaims all warranties, either expressed or implied, including any implied warranties of merchantability or fitness for a particular purpose, and Dealer neither assumes nor authorizes any other person to assume for it any liability in connection with the sale of this vehicle. Purchaser shall not be entitled to recover from Dealer any consequential damages, damages to property, damages for loss of use, loss of time, loss of profits, or income, or any other incidental damages. ...

This paragraph is one of eight paragraphs on the back page of type which is significantly smaller than type appearing elsewhere in the document. In bold type that is slightly larger than some of the other type on the front of the document is written “DISCLAIMER OF WARRANTIES — SEE REVERSE SIDE”. This is the only reference to a disclaimer of warranties which appears on the front of the document. On the back of the document is a section with the bold heading “ADDITIONAL TERMS AND CONDITIONS”.

The Court concludes that this warranty disclaimer does not meet the statutory requirement that the disclaimer must be con-spicious. The attempt on the front of the contract was to alert the purchaser that a disclaimer of warranty of merchantability *1070 was inserted on the back of the contract. It did not identify which of the eight paragraphs on the back page contained the disclaimer. The disclaimer paragraph is in no way set off “in larger or contrasting type or color” from the other paragraphs on the back of the contract. This Court cannot say as a matter of law that “a reasonable person ought to have noticed it”. As such, Burton’s attempted disclaimer of both express and implied warranties is ineffective, and, therefore, Burton is not entitled to summary judgment with respect to Counts I and II of the complaint.

II

Mercedes has moved for summary judgment on Counts I and II on the ground that its exclusive express written warranty limited its obligation to repair or replacement of defective parts. It contends that its exclusive express written warranty complies with 6 Del. C. § 2-719 and that it had fulfilled its obligation under this warranty by satisfactorily repairing the ear. 6 Del. C. § 2-719 provides:

(1) Subject to the provisions of subsections (2) and (3) of this section ...,
(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 non-conforming goods or parts; and

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Bluebook (online)
558 A.2d 1066, 9 U.C.C. Rep. Serv. 2d (West) 541, 1989 Del. Super. LEXIS 106, Counsel Stack Legal Research, https://law.counselstack.com/opinion/norman-gershmans-things-to-wear-inc-v-mercedes-benz-of-north-america-delsuperct-1989.