2023 New Mexico Statutes › Chapter 55 - Uniform Commercial Code › Article 2A - Leases › Part 2 - FORMATION AND CONSTRUCTION OF LEASE CONTRACT › Section 55-2A-216 - Third-party beneficiaries of express and implied warranties.

A warranty to or for the benefit of a lessee under this article, whether express or implied, extends to any natural person who is in the family or household of the lessee or who is a guest in the lessee's home if it is reasonable to expect that such person may use, consume or be affected by the goods and who is injured in person by breach of the warranty. This section does not displace principles of law and equity that extend a warranty to or for the benefit of a lessee to other persons. The operation of this section may not be excluded, modified or limited, but an exclusion, modification or limitation of the warranty, including any with respect to rights and remedies, effective against the lessee is also effective against any beneficiary designated under this section.
History:
1978 Comp., § 55-2A-216, enacted by Laws 1992, ch. 114, § 32.
OFFICIAL COMMENTS
UCC Official Comments by ALI & the NCCUSL. Reproduced with permission of the PEB for the UCC. All rights reserved.
Uniform Statutory Source.
— Section 2-318 [55-2-318 NMSA 1978].
Changes.
— The provisions of Section 2-318 [55-2-318 NMSA 1978] have been included in this section, modified in two respects: first, to reflect leasing practice, including the special practices of the lessor under a finance lease; second, to reflect and thus codify elements of the official comment to Section 2-318 [55-2-318 NMSA 1978] with respect to the effect of disclaimers and limitations of remedies against third parties.
Purposes.
— Alternative A is based on the 1962 version of Section 2-318 and is least favorable to the injured person as the doctrine of privity imposed by other law is abrogated to only a limited extent. Alternatives B and C are based on later additions to Section 2-318 [55-2-318 NMSA 1978] and are more favorable to the injured person. In determining which alternative to select, the state legislature should consider making its choice parallel to the choice it made with respect to Section 2-318 [55-2-318 NMSA 1978], as interpreted by the courts.
The last sentence of each of Alternatives A, B and C does not preclude the lessor from excluding or modifying an express or implied warranty under a lease. Section 2A-214 [55-2A-214 NMSA 1978]. Further, that sentence does not preclude the lessor from limiting the rights and remedies of the lessee and from liquidating damages. Sections 2A-503 [55-2A-503 NMSA 1978] and 2A-504 [55-2A-504 NMSA 1978]. If the lease excludes or modifies warranties, limits remedies for breach, or liquidates damages with respect to the lessee, such provisions are enforceable against the beneficiaries designated under this section. However, this last sentence forbids selective discrimination against the beneficiaries designated under this section,
i.e.
, exclusion of the lessor's liability to the beneficiaries with respect to warranties made by the lessor to the lessee.
Other law, including the Article on Sales (Article 2), may apply in determining the extent to which a warranty to or for the benefit of the lessor extends to the lessee and third parties. This is in part a function of whether the lessor has bought or leased the goods.
This Article does not purport to change the development of the relationship of the common law, with respect to products liability, including strict liability in tort (as restated in Restatement (Second) of Torts, § 402A (1965)), to the provisions of this Act.
Compare Cline v. Prowler Indus. of Maryland
, 418 A.2d 968 (Del.1980) and
Hawkins Constr. Co. v. Matthews Co.
, 190 Neb. 546, 209 N.W.2d 643 (1973) with
Dippel v. Sciano
, 37 Wis.2d 443, 155 N.W.2d 55 (1967).
Cross References.
— Article 2, esp. Section 2-318, and Sections 2A-214, 2A-503 and 2A-504.
"Goods". Section 2A-103(1)(h) [55-2A-103 NMSA 1978].
"Lessee". Section 2A-103(1)(n) [55-2A-103 NMSA 1978].
"Person". Section 1-201(30) [55-1-201 NMSA 1978].
"Remedy". Section 1-201(34) [55-1-201 NMSA 1978].
"Rights". Section 1-201(36) [55-1-201 NMSA 1978].
ANNOTATIONS
Effective dates.
— Laws 1992, ch. 114, § 238 made Laws 1992, ch. 114, § 32 effective July 1, 1992.