Henningsen v. Bloomfield Motors, Inc.

Supreme Court of New Jersey · 1960 · Torts

products liabilityimplied warrantyprivityautomobileimplied warranty of merchantabilityprivitymanufacturer liabilitydealer liability

Facts

Claus Henningsen bought a new Plymouth from Bloomfield Motors, an authorized Chrysler dealer, intending it as a Mother's Day gift for his wife, Helen, and the dealer knew that purpose. The purchase order contained, in inconspicuous fine print, a manufacturer's warranty limiting obligation to replacement of defective parts at the factory for 90 days or 4,000 miles and purporting to exclude all other warranties and liabilities; neither the front-side fine print nor the back-side terms were called to Henningsen's attention. Ten days after delivery, with 468 miles on the car and no prior mishap or servicing need, Mrs. Henningsen was driving normally when she heard a loud noise, the steering wheel spun in her hands, and the car suddenly veered into a sign and wall, seriously injuring her. Because the front end was destroyed in the crash, the precise defective part could not be identified, but plaintiffs' evidence indicated a mechanical failure somewhere in the steering mechanism.

Issue

Whether an automobile manufacturer and dealer may be held liable for breach of an implied warranty of merchantability for personal injuries caused by a defect in a new car when the manufacturer sold through an independent dealer, the injured driver was the buyer's wife rather than the buyer, and the sales documents purported to disclaim implied warranties and limit liability to replacement of parts. The court also considered whether plaintiffs' circumstantial evidence was sufficient to permit a jury finding of breach.

Rule

Under modern marketing conditions, when a manufacturer places a new automobile in the stream of trade and promotes its purchase by the public, an implied warranty that the car is reasonably suitable for ordinary use accompanies it into the hands of the ultimate purchaser, and lack of privity between manufacturer and purchaser does not bar recovery. In the automobile sales context, a standardized disclaimer or limitation that negates implied warranty of merchantability and restricts the buyer to replacement of defective parts is void as against public policy where imposed through grossly unequal bargaining power. That implied warranty extends not only to the purchaser but also to members of the purchaser's family and other persons using or occupying the car with the purchaser's consent.

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Nina Ortiz bought a new sedan from Lakeview Auto Center in Cleveland. The car was manufactured by Meridian Vehicle Works, which advertised the model heavily to consumers but sold only through independent dealers. Three days later, while Nina was driving normally on a city street, the steering suddenly locked and she was injured.

If Nina sues Meridian for breach of the implied warranty of merchantability, Meridian's best defense is that it never sold directly to Nina. How should the court rule?

Explanation. The majority held that under modern marketing conditions, when a manufacturer puts a new automobile into the stream of trade and promotes its purchase by the public, an implied warranty of merchantability accompanies the car into the hands of the ultimate purchaser. Lack of privity between manufacturer and purchaser does not bar recovery, and absence of agency between manufacturer and dealer is immaterial.