Carlson v. Rysavy

Brief Fact Summary.

Plaintiffs sued Defendants for breach of warranty when Defendants did not cure the defects of a mobile home Plaintiffs bought. The jury ruled in favor of Plaintiffs for $9000. Defendants appealed.

Synopsis of Rule of Law.

A party may recover the difference between the value of the goods as accepted and the value of the goods as warranted, as determined by market value when repairs of defects relating to the quality of goods will not adequately place an aggrieved party in the position he would have been absent breach.

Facts.

The Carlsons (Plaintiffs) viewed a mobile home at the mobile home factory of Town & Country Mobile Homes, Inc. (Defendant). Plaintiffs purchased a similar mobile home from Donald Rysavy (Defendant), a mobile homes dealer. Upon delivery, Plaintiffs discovered myriad defects, including a defective heating system, leaking water, and inadequate insulation. Plaintiffs gave Defendants notice of the defects, but Defendants did not adequately cure them. Plaintiffs sued Defendants for breach of warranty. The trial court submitted the case to the jury. The jury determined, among other things, that Town & Country was liable to Plaintiffs for $9000. Town & Country appealed. 

Issue.

Whether a party may recover the difference between the value of the goods as accepted and the value of the goods as warranted, as determined by market value when repairs of defects relating to the quality of goods will not adequately place an aggrieved party in the position he would have been absent breach.

Held.

Yes. The trial court’s ruling is affirmed. A party may recover the difference between the value of the goods as accepted and the value of the goods as warranted, as determined by market value when repairs of defects relating to the quality of goods will not adequately place an aggrieved party in the position he would have been absent breach.

Discussion.

In cases involving defects relating to the quality of goods, the proper measure of damages is the difference between the value of the goods as accepted and the value of the goods as warranted. In determining the amount of such damages, the court first looks to the cost of repairs and must determine if such repairs will adequately place the aggrieved party in the position he would have been absent breach. Where repairs of such defects will not adequately place the aggrieved party in the position he would have been absent breach, the party may recover the difference between the value of the goods as accepted and the value of the goods as warranted, where value is determined by market value. In the case at bar, the defects in Plaintiffs’ mobile home are so substantial that repairing them will not adequately place Plaintiffs in the position they would have been absent Defendants’ breach. Accordingly, the appropriate measure of damages is the difference between the market value of the mobile home as accepted and the market value of the mobile home as warranted. The trial court did not err by entering judgment on the jury’s determination of this difference in value.