Wilke v. Woodhouse Ford, Inc. - 278 Neb. 800, 774 N.W.2d 370 (2009)

Rule:

While a breach of warranty claim is based upon a seller's express or implied statements regarding the product, a negligence claim focuses on the seller's conduct. A common law duty exists to use due care so as not to negligently injure another person. Thus, the absence of implied warranties does not absolve one from any potential liability resulting from its failure to exercise reasonable care. In other words, nothing in the statutes dealing with exclusion of implied warranties allows for the exclusion of tort liability

Facts:

The buyers, Elizabeth A. Wilke and Mark Wilke, purchased a used van "as is" from the dealership. Elizabeth was injured when the couples' three-year-old daughter pulled the gear shift out of park and the van rolled backward, striking Elizabeth. The buyers filed suit, alleging breach of the implied warranty of merchantability and negligence. The district court granted summary judgment in favor of defendant car dealership. On appeal, the buyers argued that the district court erred in concluding that used car dealers could exclude implied warranties by selling vehicles in an "as is" condition. According to the buyers, the exclusion of the implied warranty of merchantability violated public policy.

Issue:

1. Could the dealers of used cars exclude implied warranties by selling vehicles in an "as is" condition? 
2. Did the absence of an implied warranty absolve the dealership of any liability resulting from negligence? 

Answer:

1) Yes. 2) No.

Conclusion:

On review of summary judgment, the court rejected the buyers' argument that exclusion of the implied warranty of merchantability violated public policy. The legislature declared what was the law and public policy of the state, and it provided in Neb. Rev. Stat. § 2-316 (Reissue 2001) that the implied warranty of merchantability could be disclaimed or excluded by expressions like "as is" or other language that made clear that there was no implied warranty. However, the absence of an implied warranty did not absolve the dealership of any liability resulting from negligence. The dealership had a duty to reasonably inspect the vehicle prior to sale to determine if there were any patent defects that would make the vehicle unsafe for ordinary operation and, upon discovery of such a defect, to either repair it or warn a prospective purchaser of its existence. Accordingly, summary judgment in favor of the car dealership on the buyers' claim of breach of implied warranty was affirmed, but summary judgment in favor of the car dealership on the buyers' claim of negligence was reversed.