Michigan Supreme Court 

# Order

Lansing, Michigan

December 19, 2008 Clifford W. Taylor,
Chief Justice

136114 Michael F. Cavanag h

Elizabeth A. Weave r Marilyn Kell y Maura D. Corriga n Robert P. Young, Jr. KEITH GAYLE DAVIS, Stephen J. Markman, Plaintiff-Appellee, J ustices

v SC: 136114 COA: 270478 Ingham CC: 04-000064-CP FOREST RIVER, INC., Defendant-Appellant, and

KITSMILLER RV, INC., Defendant.

________________ _________________________/

On order of the Court, leav e to appeal having been gran ted, and the briefs and oral arguments of the parties havi ng been considered by the C ourt, we hereby REVERSE the judgment of the Court of Appeals. For th e reasons stated in the Court of Appeals dissenting opinion, the remedy of rescission under Michigan law is unavailable in this case. Further, this case is governed by the Uniform Commercial Code (UCC) as it involves a sale of goods. MCL 440.2102. We REMAND this case to the Court of Appeals for reconsideration of the issues involving the Magnuson-Moss Warranty Act,

15 USC 2301 et seq ., that the court found it unnecessary to reach in light of its decision and to reconsider the applic ability of the economic loss doc trine and the availability of revocation of acceptance under MCL 440.2608 in light of our holding that the UCC applies in this case.

C AVANAGH , J. ( dissenting ).

I dissent from the majority’s hasty dispatch of this case through an order. I find this disposition wholly inad equate given the complexity of the jurisprudentially significant issues on which this Court granted leave to appeal. The order is so unclear that I am unable to detect whether I disagr ee with its holdings, let alone its reasoning.

First, the order reverses the Court of Appeals and states that the remedy of

rescission is unavailable in th is case for the reasons stated in the Court of Appeals2

dissent. This is the only statement in the order bearing any resemblance to judicial reasoning, and even this is more confusing than illuminati ng. It is unclear if the majority is reversing the entire Court of Appeals holding or just its remedy. 1 It is also unclear which part of the Cour t of Appeals dissent the majo rity intends to incorporate. 2
The order cannot be read as adopting the Cour t of Appeals dissent in its entirety because the dissent argued that the UCC does not a pply to this transaction and the order expressly rejects that proposition in its next sentence. This provis ion provides the Court of Appeals and the parties with insufficien t guidance on what law, if any, the order

establishes in these areas. 3

Second, the order states that “this case is governed by the Uniform Commercial Code (UCC) as it involves a sale of goods.” It then provides a bare citation of MCL

440.2102. Section 2102 states that “[u]nless the context othe rwise requires, this article applies to transactions in goods.” This stat ement and the citation of this statute add no

value to this case as neither the lower courts nor the parties have contested that this action involves a sale of goods. The statement also fails to pr ovide the parties any useful guidance on the issues in this case pertaining to th e UCC, including whether the relevant UCC provisions requir e privity and to what exte nt plaintiff’s third-party beneficiary status enables him to seek relief under the UCC.

1 The Court of Appeals held that plainti ff was entitled to rescis sion for defendant’s breach of implied warranty because (1) Mi chigan law long ago established that purchasers may seek the remedy of resc ission against remote, out-of-privity manufacturers for breach of implied warrant y; (2) the Uniform Co mmercial Code (UCC)

and the economic loss doctrine ar e inapplicable to this case because the parties were not in privity; and (3) the UCC only abolished re scission as a remedy where the parties have

a contract. Davis v Forest River

, Inc , 278 Mich App 76, 91 (2008).

2 The Court of Appeals dissent reasoned that: (1) a plaintiff cannot seek rescission as a remedy for an implied warranty because there is no contract to rescind; (2) the UCC remedy of revocation of acceptance replaced resc ission for out-of-priv ity plaintiffs; and (3) the UCC only applies if the parties are in privity. Davis , 278 Mich App at 92-94 (Bandstra, J., dissenting).

3 The order fails to provide guidance or reso lution on several questi ons that may have an effect on the outcome of this case and that were already addressed by the Court of Appeals. For example: Do es Michigan statutory or co mmon law provide a cause of action for a breach of warranty wh en the parties are not in priv ity? Is rescission available as a remedy for defendant’s breach of its express warranty? Did the UCC’s remedy of revocation of acceptance supplant the equitable remedy of resc ission? If so, did it do so only when parties are in privity, whenever the UCC applies, or in general?_______________________________________ __ 3

Third, the order directs the Court of Appeals to consider if revocation of acceptance is available “in light of our holding that the UCC applies in this case.” I am unclear what purpose this instruction serves. Both the majority a nd the dissent in the Court of Appeals already stated that the UC C remedy of revocation of acceptance is not available absent privity. As stated earlier, the order’s inadequate statement that “the UCC applies” provides no usef ul guidance on how to apply th e provisions of the UCC at issue in this case. Therefore, the order essentially directs the Court of Appeals to answer a question that it has already answered, without providing any new holding or legal reasoning that would give the Court of Appeals reason to reconsider its original holding. Apparently the effort s that the parties and lower courts already expended on

this issue were a waste of their time as well as of this State’s limited judicial resources.

I find it unacceptable for this Court to dir ect the Court of Appeals and the parties

to readdress these issues w ith only the confusing and inad equate “guidance” this order provides. This Court should provide clarity, not confusion, to the courts below. The questions this order fails to address are not theoretical; to the cont rary, the questions are directly necessary for resolution of this case. 4 Accordingly, I dissent.

W EAVER and K ELLY , JJ., join the statement of C AVANAGH , J.

4 Indeed, many are the questions this Court asked the parties to address in its order granting leave to appeal. Davis v Forest River, Inc , 481 Mich 918 (2008).

1215 I, Corbin R. Davis, Clerk of the Mi chigan Supreme Cour t, certify that the foregoing is a true and complete copy of the order entered at the direction of the Court.

December 19, 2008

Clerk