Will a Maine court hold our counterparty to a repair-or-replace remedy and a consequential-damages exclusion?
Between businesses, yes; for a sale of consumer goods or services, no. 11 M.R.S. § 2-719(1) opens "[s]ubject to the provisions of subsections (2) and (3) of this section and of section 2-718 on liquidation and limitation of damages", and then lets the agreement substitute remedies, "as by limiting the buyer's remedies to return of the goods and repayment of the price or to repair and replacement of nonconforming goods or parts"; paragraph (b) makes a remedy exclusive only where it is "expressly agreed to be exclusive". The two subsections that condition all of it: "[w]here circumstances cause an exclusive or limited remedy to fail of its essential purpose, remedy may be had as provided in this Title", and "[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." The Maine-specific override is § 2-316(5): subsections (2), (3) and (4) "do not apply to sales of consumer goods or services", and any language by a seller or manufacturer of consumer goods and services attempting "to exclude or modify the consumer's remedies for breach of those warranties is unenforceable".
The trap
Maine's § 2-316(5) is the trap, and it is not a warranty-only rule: by its own words it also voids an attempt to modify the CONSUMER'S REMEDIES, which is exactly what a repair-or-replace-is-your-sole-remedy clause does. "Consumer goods and services are those new or used goods and services, including mobile homes, that are used or bought primarily for personal, family or household purposes", so the line is the buyer's purpose, not the product. The per-se consequence has a boundary worth knowing: § 2-316(5)(a) makes a violation arising from a retail consumer sale a Unfair Trade Practices Act violation, which carries mandatory attorney's fees under 5 M.R.S. § 213(2), but § 2-316(5)(b) says a violation "arising from an attempt by a prior seller or manufacturer ... to exclude or modify the warranty or reimbursement remedy of a retail seller ... does not constitute a violation" of the Act. So the per-se rule runs down the chain to the consumer, not up it between sellers. On the authority for the per-se point, read State ex rel. Tierney v. Ford Motor Co. carefully: the Law Court did note "that Maine is the only jurisdiction to adopt a Uniform Commercial Code provision which provides that 'violations' of the Code constitute per se violations of the Unfair Trade Practices Act", and then REVERSED IN PART and remanded for dismissal of the Act counts, because of what was then § 208(2) of Title 5, an interstate-commerce exception that has since been repealed and survives only as a heading. Finally, do not read S.H. Nevers Corp. v. Husky Hydraulics, Inc. as Maine authority on exclusivity: the Court said "[i]t becomes unnecessary for us to decide whether that form was effective under 11 M.R.S.A. § 2-719", because the jury could have found the buyer never received the form and that the signature on the seller's copy "was a forgery". The $17,000 verdict for the buyer was affirmed.
14 authorities
- statute11 M.R.S. § 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 section 2‑718 on liquidation and limitation of damages: (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 nonconforming goods or parts; and
- statute11 M.R.S. § 2-719enactment date not established
The words that state the rule
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.
- statute11 M.R.S. § 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 Title.
- statute11 M.R.S. § 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.
- statute11 M.R.S. § 2-316enactment date not established
The words that state the rule
The provisions of subsections (2) , (3) and (4) do not apply to sales of consumer goods or services. Any language, oral or written, used by a seller or manufacturer of consumer goods and services that attempts to exclude or modify any implied warranties of merchantability and fitness for a particular purpose or to exclude or modify the consumer's remedies for breach of those warranties is unenforceable.
- statute11 M.R.S. § 2-316enactment date not established
The words that state the rule
Consumer goods and services are those new or used goods and services, including mobile homes, that are used or bought primarily for personal, family or household purposes.
- statute11 M.R.S. § 2-316enactment date not established
The words that state the rule
A violation of section 2‑314 , 2‑315 or 2‑316 arising from the retail sale of consumer goods and services constitutes a violation of Title 5, chapter 10 , Unfair Trade Practices Act.
- statute11 M.R.S. § 2-316enactment date not established
The words that state the rule
A violation of section 2‑316 arising from an attempt by a prior seller or manufacturer of consumer goods and services to exclude or modify the warranty or reimbursement remedy of a retail seller of consumer goods and services who provides reimbursement or return to a consumer as required to honor an implied warranty of merchantability due to a defect for which that prior seller or manufacturer is liable under section 2‑314 or 2‑315 does not constitute a violation of Title 5, chapter 10 , Unfair Trade Practices Act.
The words that state the rule
We note at the outset that Maine is the only jurisdiction to adopt a Uniform Commercial Code provision which provides that “violations” of the Code constitute per se violations of the Unfair Trade Practices Act.
The words that state the rule
Accordingly, we reverse the decision of the Superior Court insofar as it relates to the applicability of section 208(2) of Title 5 and remand the case to that Court for dismissal of Counts One, Two and Four of CV 79 — 415 and Counts One and Three of CV 79-737 insofar as those counts allege a cause of action under the Unfair Trade Practices Act. The entry is: Judgment of the Superior Court reversed in part.
The words that state the rule
It becomes unnecessary for us to decide whether that form was effective under 11 M.R.S.A. § 2-719 to *681 make the specified remedy exclusive or under 11 M.R.S.A. § 2-316 to disclaim all other warranties
The words that state the rule
since there was testimony from which the jury could have found that the purchaser never received a copy of the warranty form at the time of purchase and that what purported to be the purchaser’s signature on Husky’s copy of the form was a forgery.
The words that state the rule
Thus, the award of $17,000.00 is fully supported by the evidence. The entry is: Appeal denied. Judgment affirmed.
- statute5 M.R.S. § 213enactment date not established
The words that state the rule
If the court finds, in any action commenced under this section that there has been a violation of section 207 , the petitioner shall, in addition to other relief provided for by this section and irrespective of the amount in controversy, be awarded reasonable attorney's fees and costs incurred in connection with said action.
“Defective” means that reading found something to correct. What you are reading is the rule as it stands after that reading.