Court Opinion

ID: 9608660
Source: CourtListenerOpinion
Date Created: 2023-08-22 03:15:36.503476+00
Date Added: 2024-06-11T18:02:46.975315
License: Public Domain

Justice MEYER
concurring in part and dissenting in part.
I agree with the majority’s conclusion that, under the peculiar facts of this case, sufficient privity exists to extend warranty liability to the defendant manufacturer, Brigadier Homes, Inc. However, *740while I concur in the result, I write separately to distance myself from what I consider to be the majority’s excessively broad construction of the law in the area of manufacturer liability for verbal express warranties passed on to remote purchasers.
Only recently has this State deviated from the historic strict adherence to the privity requirement.1 In Kinlaw v. Long Manufacturing, 298 N.C. 494, 259 S.E.2d 552 (1979), this Court saw fit to dilute the privity requirement in written express warranty cases wherein the manufacturer is sued by a remote purchaser. Kinlaw was an action by the purchaser of a farm tractor against the manufacturer to recover for breach of a written express warranty contained in the owner’s manual. The Court held that the existence of the written warranty, intended to reach the ultimate purchaser, sufficed to allow the purchaser to sue the manufacturer, despite the lack of an actual direct contractual relationship.
In deciding to extend liability to the manufacturer, the Kinlaw majority acknowledged that North Carolina’s allegiance to the principle of privity has, “at best, wavered.” Id. at 497, 259 S.E.2d at 555. Indeed, prior to Kinlaw, privity was required in all warranty instances with the exception of those written warranties addressed to the ultimate consumer pertaining to “sales of goods, intended for human consumption, in sealed packages prepared by the manufacturer and having labels with representations to consumers inscribed thereon.” Service Co. v. Sales Co., 261 N.C. 660, 668, 136 S.E.2d 56, 62-63 (1964). Somewhat later, the exception to the privity requirement was extended to include insecticides contained in sealed containers with warnings on the label that reached the ultimate consumer. See Byrd v. Rubber Co., 11 N.C. App. 297, 300, 181 S.E.2d 227, 228 (1971). As it concerned a tractor (as opposed to goods in sealed packages), Kinlaw itself extended the “assault on the citadel” of privity beyond the above circumscribed categories in which there was a strong public interest in ensuring manufacturer accountability for defective goods.2
*741My purpose here is not to quarrel with the outcome of Kinlaw, indeed, in a mass consumer market, consumers should, be able to rely on written representations by remote manufacturers addressed to ultimate consumers that provide a basis for the ultimate bargain. See Kinlaw, 298 N.C. at 501, 259 S.E.2d at 557 (quoting with approval Rogers v. Toni Home Permanent Co., 147 N.E.2d 612, 615-16 (Ohio 1958) (“ ‘Surely under modern merchandising practices the manufacturer owes a very real obligation toward those who consume or use his products. The warranties made by the manufacturer in his advertisements and by the labels on his products are inducements to the ultimate consumers . . . .’ ”)). To this end, manufacturers should not be able to hide behind the privity requirement when they launch defective goods into the marketplace and consumers rely on express representations of quality made by the manufacturer to induce sales.
My concern is that today the majority once again makes an abrupt, sub silentio alteration in the evolving common law in this area. To date, all instances in which the privity requirement has been abrogated have involved written express warranties addressed to ultimate consumers. See, e.g., Kinlaw, 298 N.C. 494, 259 S.E.2d 552; Corprew v. Chemical Corp., 271 N.C. 485, 157 S.E.2d 98 (1967); Service Co. v. Sales Co., 261 N.C. 660, 136 S.E.2d 56; Simpson v. Oil Co., 217 N.C. 542, 8 S.E.2d 813 (1940). Today, as in Kinlaw, the Court, without elaboration, extends the lines of assault against the citadel of privity. Henceforth, privity will not be necessary when oral representations are made by a manufacturer directly to a retailer intended to be communicated to remote buyers to induce them to buy a product. In a sense, the existence of a written warranty mitigates the attenuation of the relationship between remote buyers and manufacturers. My concern is that the justified and well-known premise of vertical privity, namely, to ensure that a valid, ascertainable relationship exists between commercial litigants prior to imposing liability, is being unduly vitiated.
*742Under the peculiar facts of this case, however, this extension arguably is justified. Brigadier Homes knowingly made an explicit warranty to its retailer, specifically so that the retailer would pass it on to the ultimate purchaser to serve as a sales inducement. It would be inequitable to allow Brigadier Homes to avoid liability under such circumstances. The privity requirement between remote buyers and manufacturers based on oral representations given by manufacturers should be abrogated only when such representations are explicit and are clearly intended to be passed on to prospective purchasers to induce the ultimate sale.
Finally, I dissent from that portion of the decision that remands this case for a new trial only on the question of damages, with instructions that whatever amount the jury returns be automatically trebled. The question of liability, in my view, is here inextricably intertwined with the question of damages, causing prejudice to defendant if only the damages issue is to be relitigated. Housing, Inc. v. Weaver, 305 N.C. 428, 290 S.E.2d 642 (1982). The issues presented to the jury at trial, and indeed defendant’s entire litigation strategy, were the result of intensive negotiations occurring at the precharge conference. As the majority has noted, the correct statutory measure of damages was not followed by the trial court. It is obvious, however, from the record before this Court that the parties and the trial judge agreed, with regard to the breach of warranty issue, that the amount of the damages would be the cost of the repairs (generously rounded from $358.00 to $500.00), trebled. That explains why only one issue, that is, whether the misrepresentation was made by the manufacturer, was submitted to the jury. The majority’s remand for reconsideration of the damages issue alone, with instructions that the amount returned by the jury be trebled, is inequitable under the peculiar facts of this case.
The case should be remanded to be retried upon the issues customarily submitted in chapter 75 actions of this type as well as the damages issue. I vote to remand for a new trial on all issues.
Justice MITCHELL joins in this concurring and dissenting opinion.

. This deviation is not without precedent. See Terry v. Bottling Co., 263 N.C. 1, 3, 138 S.E.2d 753, 754 (1964) (Sharp, J., later C.J., concurring); Marc A. Franklin, When Worlds Collide: Liability Theories and Disclaimers in Defective-Product Cases, 18 Stan. L. Rev. 974 (1966); William L. Prosser, The Fall of the Citadel (Strict Liability to the Consumer), 50 Minn. L. Rev. 791 (1966).

. Citing Simpson v. Oil Co., 217 N.C. 542, 8 S.E.2d 813 (1940), a case involving a manufacturer’s express warranty on the label of a spray insecticide that the product was nonpoisonous to humans, the Kinlaw majority offhandedly observed *741that the Kinlaw decision “simply reaffirmed] the vitality” of the Court’s prior case law regarding privity. Kinlaw, 298 N.C. at 500, 259 S.E.2d at 557. In retrospect, however, it is apparent that the decision amounted to something more than a reaffirmation; Kinlaw extended the privity exception to allow recovery against manufacturers for breach of written warranties pertaining to all sorts of goods directed to the ultimate consumer. See Beth H. Daniel, Note, Products Liability: No Privity Requirement If Express Warranty Addressed to the Ultimate Consumer, 16 Wake Forest L. Rev. 857, 868-70 (1980).