Court Opinion

ID: 9470695
Source: CourtListenerOpinion
Date Created: 2023-08-05 03:13:39.883202+00
Date Added: 2024-06-11T17:42:03.655477
License: Public Domain

R. LANIER ANDERSON, III, Circuit Judge,
concurring in part and dissenting in part:
I reluctantly concur in the majority’s reversal of the directed verdict on the breach of warranty claim, but I dissent from that portion of the majority opinion which reverses the directed verdict on the fraud claim.
With respect to the fraud claim, the majority opinion indicates that the district court should not have directed a verdict because the jury “could have found that Kehoe recklessly or mistakenly represented the coins to be genuine and that Neff relied to his detriment on such representations.” At 643. The majority opinion fails to discuss whether the jury could have found that Neff’s reliance was reasonable.
Under Alabama law, a plaintiff must have reasonably relied on a false representation in order to maintain an action for fraud. See, e.g., Bedwell Lumber Co. v. T & T Corp., 386 So.2d 413, 415 (Ala.1980) (recognizing “the basic legal proposition that the representee’s reliance must be reasonable under the circumstances”); Cook v. Brown, 393 So.2d 1016, 1019 (Ala.Civ.App. 1981) (stating that when plaintiff “cannot be said to have reasonably relied upon the misrepresentation ... [he] cannot obtain damages or other relief from defendant”). In this case, Neff had some familiarity with coin collecting and was given several opportunities to carefully examine the coins before he purchased them. More importantly, it is undisputed that Neff knew that the seller, Kehoe, was not an experienced coin collector and had no experience in evaluating the genuineness of coins. Neff also knew that Kehoe had not personally purchased the coins, but merely had received them from the estate of her late husband. Under such circumstances, I agree with the district judge that no reasonable jury could find that Neff reasonably relied on Kehoe’s statements that the coins were genuine.1
With respect to the claim for breach of express warranty, I reluctantly concur in the reversal of the directed verdict. I believe the most reasonable interpretation of all of the evidence, viewed in the light most favorable to Neff, is that Kehoe’s state*646ments regarding the genuineness of the coins were merely an expression of opinion based on her knowledge of her late husband’s coin collecting experience.2 Nevertheless, because I am unable to conclude that no reasonable jury could reach the contrary conclusion, finding that Kehoe’s statements were affirmations of fact which created an express warranty, I concur in the reversal of the directed verdict on this issue.3

. Arguably, the jury could have found that Neffs reliance on Kehoe’s representation was reasonable because Kehoe’s late husband was a serious coin collector. In other words, the jury could have inferred that when Kehoe said the coins were genuine, she actually meant, and Neff reasonably understood her to mean, that she believed the coins were genuine because her late husband had coin collecting experience and would not have purchased anything except genuine coins. In fact, Neffs reliance apparently was based on this construction of Kehoe’s statement, because when the court asked Neff whether Kehoe had ever claimed to be an expert on gold coins, he responded: “No, but she indicated to me that her husband was an extensive coin collector, which from the evidence he was, and so I just assumed that all of those coins were definitely authentic.” Record on Appeal, vol. 2, at 110 (emphasis added). Even if we assume that Neff reasonably could have relied on Kehoe’s statement as construed, however, Neff cannot prevail. Nothing in the record indicates that the statement, as construed, was false. Kehoe’s late husband apparently was a serious and knowledgeable coin collector, and Kehoe had no reason to believe that her late husband had purchased anything except genuine coins. Thus, although the jury might have found reasonable reliance inferentially, the required inference negates another element of Neff’s prima facie case for fraud, the falsity of the representation, and a directed verdict still would be proper.

. Neff’s own testimony supports this interpretation. For example, when Neff was asked on direct examination whether Kehoe had made any statements regarding the authenticity of the coins, he responded: “She repeated again that they were genuine, it was a genuine coin collection. Her husband was a coin collector and, you know, they were genuine coins.” See Record on Appeal, vol. 2, at 17. See also the portion of Neff’s testimony quoted in note 1 supra.

. My reluctance to join the majority opinion is based primarily on my belief that the warranty issue is close factually. As noted in the text, I have difficulty concluding, on this record, that Kehoe’s statements created an express warranty. Thus, although the district judge should have let this issue go to the jury, particularly after all of the evidence had been presented, it may well have been within the district judge’s discretion to grant a new trial, on the ground that the verdict was against the great weight of the evidence, if the jury had found in Neff’s favor. Moreover, in the absence of any Alabama decisions on the issue, I am not as confident as the majority that reliance plays no role in express warranty cases under UCC § 2-313. Compare at 644 (flatly stating that “[n]o reliance need be shown”), with J. White & R. Summers, Uniform Commercial Code § 9-4, at 335 n. 36 (2d ed. 1980) (arguing that “once the seller presents evidence of nonreliance, it is doubtful that the buyer can get to the jury on proof of seller’s affirmation alone”); Hagen-buch v. Snap-On Tools Corp., 339 F.Supp. 676, 680 (D.N.H.1972) (“In order to find an express warranty, it must be shown that the representations of fact describing the hammer were made ‘part of the basis of the bargain.’ In other words, plaintiff has the burden of showing that he acted on the basis of the representation.”). See generally Note, Basis of the Bargain— What Role Reliance?, 34 U.Pitt.L.Rev. 145 (1972).