We have all experienced the excitement of a new purchase, followed closely by the sting of disappointment when that new gadget simply does not do what it claimed. Whether it is a household item or a big-ticket purchase, consumers expect that a company’s representations they relied upon are actually true. So, when that new “thing” doesn’t work, what’s next? Consumers are often left scratching their heads at this question.
One cause of action that is often underutilized by consumers caught in this circumstance is the ever-elusive breach of warranty claim. Now, warranties come in a number of different flavors and styles, but for the purposes of this discussion, we will look at “express” warranties and a recent development in Ohio law.
Express warranties are governed by the Uniform Commercial Code (UCC codified as Title 13 of the Ohio Revised Code) and do not require use of the word “warrant” for creation. Instead, they are created by an “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.” In plain terms, let’s imagine that our consumer is interested in today’s newest gadget which promises that it can be worn on the wrist and will alert the customer whenever it will rain in his general vicinity.
Inevitably, our consumer discovers that the gadget does not work. It cannot identify impending rain and he finds himself constantly soaked on his morning walk to work. In terms of our consumer’s potential breach of warranty claim, we must ask: (1) did a warranty exist; (2) did the product fail to perform as warranted; (3) did the customer suffer an injury as a result of the defect; and (4) was there reasonable notice of the defect given to the manufacturer? The answers to the first three elements are clear – the consumer bought a product that promised it could identify when it would rain, the product did not work, and the customer is now out of his money because of that.
However, the issue of reasonable notice has been at the center of some recent developments in Ohio. While, the UCC traditionally requires that notice of the defect be given to the manufacturer prior to the initiation of any action, the Ohio Supreme Court had held in Chemtrol Adhesives, Inc. v. American Manufacturers Mutual Insurance Co. (1989), that such a requirement was not absolute. The Chemtrol court specifically left open the possibility that filing a civil complaint could provide sufficient notice: “we believe in a proper case the filing of a civil complaint could serve as notice of breach.” While the Chemtrol court noted the existence of the potential for a “proper case,” it, of course, did not define or expound upon what that case might look like.
Recently, courts have agreed that the pre-suit notice requirement is not absolute, and one dove into what may constitute the “proper case” where the filing of a civil complaint satisfies the element of pre-suit notice. In Galoski v. Applica Consumer Products, Inc., the consumer purchased a product which represented that it could repel pests through the use of ultrasonic waves. The consumer alleged that (1) the product could not actually repel pests; (2) the defect was not in any individual product but all of the defendant’s repellers; and (3) the defendant knew about the defect. While the consumer lodged a breach of warranty claim, she did not attempt any direct presuit notice to the manufacturer.
The Galoski court held that pre-suit notice, in that instance, was not required where: (1) the plaintiff was a private consumer; (2) the plaintiff had presented some evidence that the defendant had constructive or actual knowledge of the alleged defect; and (3) the defect is not in the individual item, but within the design of the product line. Put simply, “if Plaintiff’s claims are true, no repair would cure the defect, and no replacement would solve the problem. Therefore, requiring notice and a prior opportunity to cure the defect would be wholly futile.”
So, while our rain-hating consumer would likely have a claim for breach of an express warranty, the uncertainty over whether pre-suit notice is required to perfect such a claim has undoubtedly cleared. And with this newfound clarity, consumer advocates have a better-defined path to recovery for their clients. Frank Bartela