Opinion ID: 2615233
Heading Depth: 1
Heading Rank: 1

Heading: right to revoke acceptance

Text: The Jensens concede that they accepted their mobile home, but assert that breaches of contract and warranty substantially impaired the value of the mobile home to them and, therefore, they may rightfully revoke their acceptance. There are five preconditions to effective revocation of acceptance relevant to the facts in this case: A. Notice of revocation; B. A nonconformity which substantially impairs the value of the mobile home; C. Acceptance on the reasonable assumption that known defects would be cured or that acceptance was reasonably induced by the difficulty of discovery of defects; D. Revocation occurs within a reasonable time after the nonconformity was discovered or should have been discovered; and E. Revocation occurs before a substantial change in the condition of the goods which is not caused by their own defects. J. White and R. Summers, Uniform Commercial Code, p. 303 (2d ed. 1980); I.C. § 28-2-608. A notice of revocation of acceptance clearly is not effective until a buyer gives a seller notice thereof. I.C. § 28-2-608(2). While here the Jensens did not give a notice of revocation as such, they did give notice of rescission, and it is not argued that such notice was inadequate. It is consistently held that a notice of rescission operates as notice of revocation of acceptance for the purpose of that statute. See, e.g., Peckham v. Larsen Chevrolet-Buick-Oldsmobile, Inc., 99 Idaho 675, 587 P.2d 816 (1978); Jorgensen v. Pressnall, 274 Or. 285, 545 P.2d 1382 (Or. 1976). Therefore, we hold that there was sufficient notice. The standard for permitting revocation requires that nonconformity substantially impairs the value of the goods to the buyer and reflects the theory that one who has used goods for a significant amount of time should not be allowed to force used goods back on the seller unless the defect in the goods is substantial, as opposed to technical. See J. White and R. Summers, supra, at 301. There appears to be confusion as to the meaning of substantially impairs and it has been called a subjective test. Jorgensen v. Pressnall, 274 Or. 285, 545 P.2d 1382 (Or. 1976); Keen v. Modern Trailer Sales, Inc., 40 Colo. App. 527, 578 P.2d 668 (Colo.Ct. App. 1978). It is subjective in that the test is whether the nonconformities substantially impaired the value of the home to the actual buyer and not whether the nonconformities substantially impaired the value of the home to a reasonable person. J. White and R. Summers, supra, at 308-09; see I.C. § 28-2-608, Official Comment 2. As illustrated in Jorgensen, a two-step determination is required to resolve the question of the existence of substantial impairment. The court must first determine the purpose for which the Jensens purchased the home and, secondly, determine whether the nonconformities substantially impaired their ability to use the home for the purpose intended. Here the Jensens purchased the home for use as a retirement residence and hence the jury, on remand, must determine whether the defects in the home substantially impaired the Jensens' ability to use the home for that purpose.