Will Idaho enforce this clause limiting the buyer's remedy or excluding consequential damages?
Yes, subject to two statutory limits. Idaho Code § 28-2-719(1) lets the agreement "provide for remedies in addition to or in substitution for those provided in this chapter and... limit or alter the measure of damages recoverable... 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 resort to that remedy is optional "unless the remedy is expressly agreed to be exclusive, in which case it is the sole remedy." The first limit is failure of essential purpose: § 28-2-719(2), "[w]here circumstances cause an exclusive or limited remedy to fail of its essential purpose, remedy may be had as provided in this act": the limitation stops protecting the seller once the promised remedy (repair, replacement) does not actually work. The second limit is unconscionability, and it is asymmetric by its own terms: § 28-2-719(3), "[c]onsequential damages may be limited or excluded unless the limitation or exclusion is unconscionable. Limitation of consequential damages for injury to the person in the case of consumer goods is prima facie unconscionable but limitation of damages where the loss is commercial is not." Walker v. American Cyanamid Co. applied exactly this standard to hold a herbicide-label limitation-of-liability clause unenforceable, and confirms Idaho reads §§ 28-2-302 and 28-2-719 together for the unconscionability inquiry. The buyer kept its judgment: the Court affirmed the damages award, resting it on the breach of express warranties rather than on the tort theories the trial court had dismissed.
The trap
Subsection (3)'s asymmetry is the trap: a consumer-goods personal-injury consequential-damages exclusion starts out PRESUMED unconscionable, while the identical clause in a commercial-loss setting starts out presumed valid. A drafter cannot rely on Idaho's general unconscionability standard being neutral as between consumer and commercial deals. Separately, and this is an unresolved textual wrinkle this rule does not paper over: Walker's own opinion quotes the consequential-damages-limitation rule as arising under "I.C. § 28-2-719(8)" ("I.C. § 28-2-719(8), a portion of the Uniform Commercial Code (UCC), provides: Consequential damages may be limited or excluded unless the limitation or exclusion is unconscionable"), while the statute's text as published here places that identical sentence in subsection (3) of a section that runs only to subsection (3). This is recorded here as an unresolved disagreement between the 1997 opinion's own subsection numbering and the current statutory text used here: not resolved from memory, and not assumed to be a typo. A reviewer relying on Walker's citation form should independently confirm the current subsection number before citing it. Finally, an "exclusive remedy" clause is not automatically read to also exclude consequential damages, and vice versa: § 28-2-719(1)(b) and (3) are separate mechanisms operating on separate questions (which remedy is available, versus what categories of damages are recoverable), and a clause meant to do both should say so expressly.
7 authorities
- statuteIdaho Code § 28-2-719enactment date not established
The words that state the rule
Subject to the provisions of subsections (2) and (3) of this section and of the preceding section on liquidation and limitation of damages, (a) the agreement may provide for remedies in addition to or in substitution for those provided in this chapter and may limit or alter the measure of damages recoverable under this chapter, 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 (b) resort to a remedy as provided is optional unless the remedy is expressly agreed to be exclusive, in which case it is the sole remedy.
- statuteIdaho Code § 28-2-719enactment date not established
The words that state the rule
Where circumstances cause an exclusive or limited remedy to fail of its essential purpose, remedy may be had as provided in this act.
- statuteIdaho Code § 28-2-719enactment date not established
The words that state the rule
Consequential damages may be limited or excluded unless the limitation or exclusion is unconscionable. Limitation of consequential damages for injury to the person in the case of consumer goods is prima facie unconscionable but limitation of damages where the loss is commercial is not.
The words that state the rule
I.C. § 28-2-719(8), a portion of the Uniform Commercial Code (UCC), provides: Consequential damages may be limited or excluded unless the limitation or exclusion is unconscionable.
The words that state the rule
Cyanamid asserts that the trial court should not have ruled that the limitation of liability on the ASSERT product label is unconscionable, and, therefore unenforceable. We disagree.
The words that state the rule
I.C. § 28-2-302 sets forth the procedure and standard courts are to use when addressing issues of unconscionability and provides: (1) If the court as a matter of law finds the contract or any clause of the contract to have been unconscionable at the time it was made the court may refuse to enforce the contract, or it may enforce the remainder of the contract without the unconscionable clause, or it may so limit the application of any unconscionable clause as to avoid any unconscionable result.
The words that state the rule
Because we have upheld the award of damages to Walker based on the breach of express warranties, it is unnecessary for us to address the trial court’s refusal to dismiss Walker’s claim pursuant to the Idaho Consumer Protection Act and the trial court’s dismissal of Walker’s claims based on tort theories. We affirm the judgment awarding Walker damages.
“Defective” means that reading found something to correct. What you are reading is the rule as it stands after that reading.