Tuesday, August 2, 2011

Case Brief: Soaper v. Hope Industries, Inc., 309 S.C. 438, 424 S.E.2d 493 (1992)

Today's Case Brief is for Soaper v. Hope Indus., Inc., 309 S.C. 438, 424 S.E.2d 493 (1992).  Soaper involved a color film processor and printer, and it is significant because it illustrates a merger of “fitness for particular purpose” with the warranty of merchantability under its facts.

FACTUAL BACKGROUND: Plaintiff purchased a color film processing machine from Defendant for use in his fast photo business.  309 S.C. at 439, 424 S.E. 2d at 494.  The machine malfunctioned over a period of three years, and Plaintiff ultimately had to close his business.  Id.

PROCEDURE: Plaintiff sued Defendant alleging (1) breach of express warranty, (2) breach of the implied warranty of merchantability, and (3) breach of the implied warranty of fitness for particular purpose.  309 S.C. at 439, 424 S.E. 2d at 494.  At trial, Plaintiff proceeded solely on the cause of action for breach of implied warranty of fitness for a particular purpose.  The jury returned a verdict for Plaintiff for $84,783.40 (i.e., the full value of the machine and its component parts).  Id.  The South Carolina Court of Appeals affirmed, finding ample evidence that "the goods were defective so as to be unfit for their intended use in Soapers fast photo business."  306 S.C. 531, ----, 413 S.E.2d 38, 40 (Ct. App. 1992).  Defendant sought rehearing, which the Court of Appeals denied.  309 S.C. at 439, 424 S.E. 2d at 494.  The South Carolina Supreme Court granted certiorari on the issue sought for re-hearing by Defendant.  Id.

ISSUE(S): "Does a purchaser establish a warranty of fitness for a particular purpose when goods, purchased solely for their ordinary purpose, are found to be unfit for any and all purposes?"  309 S.C. at 439, 424 S.E. 2d at 494.

DISPOSITION:  "[W]here a product is not fit for any purpose, it is not fit for its particular purpose.  Accordingly, the Court of Appeals opinion is affirmed as modified."  309 S.C. at 441, 424 S.E.2d at 495.

RULES AND OPINION: The implied warranty of fitness for a particular purpose arises under the Uniform Commercial Code, S.C. Code section 36-2-315 (1976).  309 S.C. at 439, 424 S.E. 2d at 494.  Defendant maintained that this warranty applies only when the buyer has a particular purpose for a product other than its ordinary/contemplated use.  Id. at 440, 424 S.E.2d at 494.  The court recognized that there was authority for this position but declined to follow it.  Id., 424 S.E.2d at 495.  The court referred to comment 2 to section 2-315, which states that "a contract may of course include both a warranty of merchantability and one of fitness for a particular purpose."  Id.  Section 2-317 also requires that warranties arising under the UCC "be construed as consistent with each other and as cumulative."  Id. 

When Plaintiff purchased the product, he made known to Defendant that his particular purpose for the machine was fast film developing.  Id. at 441, 424 S.E.2d at 395.  When it failed in that purpose, it was both unmerchantable and unfit for its particular purpose.  Id.

We hold that, where the particular purpose for which a product is purchased is also the ordinary or intended purpose of the product, the warranties of merchantability and of fitness for a particular purpose merge and are cumulative, such that a plaintiff may proceed upon either theory. 

Id. at 440, 424 S.E.2d at 495.  This holding accords with other jurisdictions.  Id. at 441, 424 S.E.2d at 495.

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