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Original WP 5.1 Version
This case can also be found at 145 N.J. 372.
(This syllabus is not part of the opinion of the Court. It has been prepared by the Office of the Clerk for the convenience of the reader. It has been neither reviewed nor approved by the Supreme Court. Please note that, in the interests of brevity, portions of any opinion may not have been summarized).
Samuel P. Alloway, III, and New Hampshire Insurance Company v. General Marine Industries, L.P. and Mullica River Boat Basin (A-48-96)
Argued November 18, 1996 -- Decided June 30, 1997
POLLOCK, J., writing for the Court.
The primary issue in this appeal is whether New Hampshire Insurance Co. (New Hampshire) and its insured, Samuel P. Alloway III (Alloway), may recover from General Marine Industries, Inc. (GMI) in negligence and strict liability for economic loss caused by a defect in a power boat purchased by Alloway and insured by New Hampshire.
In l990, GMI purchased from Glasstream, a company in bankruptcy, substantially all of its assets free and clear of any interest in such property. At some point before then, Glasstream had made the boat at issue and sold it to Mullica. In July l990, Alloway purchased the thirty-three foot Century Grande XL from Mullica for $61,070. Century had expressly warranted for twelve months following the purchase that the boat was free from defects. Following his purchase, Alloway obtained from New Hampshire a comprehensive general insurance policy on the boat.
Three months later, while docked at the Bayview Marina in Manahawkin, the boat sank as a result of a defective seam in the swimming platform. No other property was damaged nor was anyone injured. Alloway filed a claim with New Hampshire, which spent over $40,000 to repair the boat. Alloway paid approximately $2,500 towards the repairs pursuant to his deductible under the policy. After completion of the repairs, he received a trade-in credit of over $38,000 for the Grande on the purchase of a new boat.
Thereafter, Alloway filed a three-count complaint against Mullica and GMI, seeking recovery for his economic loss. In the first count of the complaint, Alloway sought to recover for Mullica's breach of the manufacturer's warranty for repair or replacement of any defective part. The second count alleged a strict-liability claim asserting that Century had manufactured a defective boat for which GMI was liable as Century's successor. The third count alleged that Glasstream negligently manufactured and inspected the boat, that GMI was liable to Century's successor, and that Mullica had failed to discover the defect. Alloway then assigned his claims to New Hampshire, but retained a claim for the loss in value of the boat and for the deductible he had paid towards the repair of the boat.
The Law Division subsequently granted GMI's motion to dismiss the complaint for failure to state a cause of action, holding that a purchaser could not maintain an action in strict liability for economic loss. The Law Division also relied on an Appellate Division case that held that a consumer who had purchased a yacht that was not as represented could sue the manufacturer under the Uniform Commercial Code (U.C.C.) for breach of warranty, but not in strict liability. That case viewed the U.C.C. as providing the consumer with an exclusive remedy for economic loss resulting from breach of warranties.
The Appellate Division reversed, observing that one of the cases on which the Law Division relied precluded a commercial purchaser, but not a consumer, from recovering economic losses in strict liability. The Appellate Division further relied on a New Jersey Supreme Court case, Santor v. A&M Karagheusian, Inc., which recognized that a consumer could maintain a strict-liability claim against a manufacturer for loss in value of a defective carpet. Essentially, the Appellate Division held that GMI, as the successor to Glasstream, was liable to Alloway and New Hampshire in negligence and strict liability for economic loss caused by the sinking of the boat.
The Supreme Court granted GMI's petition for certification.
HELD: Under New Jersey law, GMI is not liable in tort for Alloway's and New Hampshire's economic loss resulting from a defect in a purchased product that destroyed or diminished the worth of only that product.
1. Generally, tort principles are better suited to respond to claims for personal injuries or damage to other property, while contract principles more readily respond to claims for economic loss caused by damage to the product itself. (pp. 6-8)
2. The relative bargaining power of the parties and the allocation of the loss to the better risk-bearer are relevant to the distinction between tort principles and contract principles of recovery. (pp. 9-10)
3. The Legislature adopted a comprehensive system for compensating consumers for economic loss arising from the purchase of defective products by enacting the U.C.C., which attempts to strike the proper balance between manufacturers and purchasers for economic loss arising from injury to a defective product. (pp. 10-11)
4. The vast majority of courts across the country have concluded that purchasers of personal property, whether commercial entities or consumers, should be limited to recovery under contract principles. (pp. 11-17)
5. The extension of strict liability to include claims for purely economic loss has been criticized by scholars and has been rejected by the American Law Institute's proposed Restatement of Torts. (pp. 17-19)
6. Several state courts have confined consumers to contract principles in actions for economic loss. (pp. 20-22)
7. Because Alloway and New Hampshire have not raised the issue, the Court does not resolve the issue whether tort or contract law applies to a product that poses a risk of causing personal injuries or property damage but has caused only economic loss to the product itself. (pp. 22-23)
8. The Legislature did not intend to codify in the New Jersey Products Liability Law all common-law remedies and, consequently, that law is not dispositive of claims involving fraud. (pp. 23-25)
9. Because judicial decisions and statutory enactments, including the U.C.C., protect consumers from overreaching, a tort cause of action for economic loss duplicating the one provided by the U.C.C. is superfluous and counterproductive. (p. 26)
10. To impose liability on GMI would impose the cost of an uncertain liability on one that did not agree to assume that cost. (pp. 26-27)
11. In view of the Court's holding, it does not reach the additional issues concerning GMI's liability as Glasstream's successor or the effect on GMI of the purchase in bankruptcy of Glasstream's assets free and clear of all claims. (pp. 28-29)
Judgment of the Appellate Division is REVERSED, and the judgment of the Law Division dismissing the complaint is REINSTATED.
JUSTICE HANDLER filed a separate concurring opinion in which JUSTICE STEIN joins, expressing confidence that the Court's decision does not preclude tort remedies for economic loss where there is a gross inequality of bargaining power on the part of the purchaser, whether it be a commercial or a non-commercial purchaser.
CHIEF JUSTICE PORITZ and JUSTICES O'HERN, GARIBALDI
and COLEMAN join in JUSTICE POLLOCK's opinion. JUSTICE HANDLER filed a
separate concurring opinion in which JUSTICE STEIN joins.
SUPREME COURT OF NEW JERSEY
A- 48 September Term 1996
SAMUEL P. ALLOWAY, III, and NEW HAMPSHIRE INSURANCE CO.,
GENERAL MARINE INDUSTRIES, L.P.,
MULLICA RIVER BOAT BASIN,
Argued November 18, 1996 -- Decided June 30, 1997
On certification to the Superior Court, Appellate Division, whose opinion is reported at 288 N.J. Super. 479 (1996).
John C. Penberthy, III, argued the cause for appellant (Mesirov Gelman Jaffe Cramer & Jamieson, attorneys; Mr. Penberthy and Matthew O. Dickstein, on the brief).
Sanford F. Schmidt and Edward A. Penberthy argued the cause for respondents (Brandt Haughey Penberthy Lewis & Hyland, attorneys for Samuel P. Alloway, III, and Mr. Schmidt, attorney for New Hampshire Insurance Co.; Suzanne E. Bragg, on the brief).
The opinion of the Court was delivered by
liability for economic loss caused by a defect in a power boat purchased
by Alloway and insured by New Hampshire. Alloway purchased the boat from
Mullica River Boat Basin ("Mullica"), a retail boat dealer, and insured
it with New Hampshire under a comprehensive general insurance policy. Mullica
had purchased the boat from Century Boats ("Century"), an unincorporated
division of Glasstream Boats, Inc. ("Glasstream"), the manufacturer. Subsequently,
Glasstream went bankrupt, and GMI, formerly known as GAC Partners, P.L.
("GAC"), purchased Glasstream's assets.
372 (1996). We reverse the judgment of the Appellate Division and reinstate that of the Law Division.
From the limited record, the following facts emerge.
In October 1989, Glasstream filed a voluntary petition in bankruptcy. Five
months later, the Bankruptcy Court directed Glasstream to sell substantially
all of its assets to GMI "free and clear of any interest in such property."
At some unspecified time, Glasstream made the boat and sold it to Mullica.
Thereafter, Alloway filed a three-count complaint
against Mullica and GMI, seeking recovery for his economic loss. In count
one, Alloway sought to recover for Mullica's breach of "the manufacturer's
warranty" for "repair or replacement of any part found to be defective."
Count two alleged a strict-liability claim asserting that Century had manufactured
a defective boat for which GMI was liable as Century's successor. Count
three alleged that Glasstream, "negligently manufactured and inspected
the boat," that GMI was liable to Century's successor, and that Mullica
had failed to discover the defect.
The Law Division granted GMI's motion to dismiss
for failure to state a cause of action. It relied on Spring Motors Distribs.
v. Ford Motor Co., 98
N.J. 555 (1985), which held that a purchaser could not maintain an
action in strict liability for economic loss. It also relied on D'Angelo
v. Miller Yacht Sales, 261
N.J. Super. 683 (1993), in which the Appellate Division held that a
consumer who had purchased a yacht that was not as represented could sue
the manufacturer under the U.C.C. for breach of warranty, but not in strict
liability. According to the D'Angelo court, the U.C.C. provides
a consumer with the exclusive remedy for economic loss resulting from the
breach of express or implied warranties. Id. at 688. The Law Division
reasoned that because plaintiffs sought to recover for economic loss to
the boat itself, GMI was not liable as Glasstream's successor.
The Appellate Division reversed, relying on Santor
v. A & M Karagheusian, Inc., 44
N.J. 52 (1965), which recognized that a consumer could maintain a strict-liability
claim against a manufacturer for loss of value of a defective carpet. According
to the Appellate Division, Spring Motors precluded a commercial
purchaser, but not a consumer, from recovering in strict liability. 288
N.J. Super. at 486-87. Observing that Spring Motors declined
to reconsider Santor, the Appellate Division concluded that "[s]ince
Santor has not been overruled, we must follow it." Id. at
488. In so holding, the court rejected the Appellate Division's holding
in D'Angelo, supra, 261
N.J. Super. 683.
the court held that a suit against GMI as the purchaser of Century's assets in the bankruptcy sale did not constitute a claim against Century. Consequently, plaintiffs' suit against GMI did not offend the Bankruptcy Code's scheme for the priority of claimants. Ibid. Essentially, the Appellate Division held that GMI, as the successor to Glasstream, was liable to plaintiffs in negligence and strict liability for economic loss caused by the sinking of the boat.
The threshold issue is whether plaintiffs may rely
on theories of strict liability and negligence to recover damages for economic
loss resulting from a defect that caused injury only to the boat itself.
Plaintiffs seek damages for the cost of repair and for the boat's lost
value on trade-in. They do not allege that other property was damaged or
that anyone sustained personal injuries. The question reduces to whether
plaintiffs may use tort theories to recover the lost benefit of their bargain
from the purchaser of the manufacturer's assets, GMI.
further includes "the diminution in value of the product because it
is inferior in quality and does not work for the general purposes for which
it was manufactured and sold." Comment,
Manufacturers' Liability to
Remote Purchasers For `Economic Loss' Damages--Tort or Contract?, 114
U. Pa. L. Rev. 539, 541 (1966).
Various considerations support the distinction. Tort
principles more adequately address the creation of an unreasonable risk
of harm when a person or other property sustains accidental or unexpected
injury. See Spring Motors,
supra, 98 N.J. at
570-71, 579-80. When, however, a product fails to fulfill a purchaser's
economic expectations, contract principles, particularly as implemented
by the U.C.C., provide a more appropriate analytical framework. See
East River, supra, 476 U.S. at 871-75, 106 S. Ct.
at 2302-04, 90
L. Ed.2d 865; Casa Clara v. Charley Toppino & Sons, 620
So.2d 1244, 1247 (Fla. 1993); Oceanside, supra, 659 A.
2d at 270; Bocre Leasing, supra, 645 N.E. 2d at
1198-99; Waggoner v. Town & Country Mobile Homes, 808
P.2d 649, 652-53 (Okla. 1990). Implicit in the distinction is the doctrine
that a tort duty of care protects against the risk of accidental harm and
a contractual duty preserves the satisfaction of consensual obligations.
Casa Clara, supra, 620
So. 2d at 1246-47; Spring
Motors, supra, 98 N.J. at 579.
or property damage, a purchaser may be better situated to absorb the
"risk of economic loss caused by the purchase of a defective product."
Ibid.; see East River, supra, 476 U.S.
at 871, 106 S. Ct. at 2302, 90
L. Ed.2d 865 (noting purchaser can insure against risk of economic
loss); Lucker Mfg. v. Milwaukee Steel Foundry, 777
F. Supp. 413, 416-17 (E.D. Pa. 1991) (same); Bocre Leasing,
645 N.E. 2d at 1196 (same).
government requires courts to consider the legislation in determining
the limits of judicial action. See Spring Motors,
98 N.J. at 577; see also Danforth v. Acorn Structures,
A.2d 1194, 1200-01 (Del. 1992) (declining to displace provisions of
U.C.C. with tort actions). By enacting the U.C.C., the Legislature adopted
a comprehensive system for compensating consumers for economic loss arising
from the purchase of defective products. See Spring Motors,
supra, 98 N.J. at 577;
Danforth, supra, 608
A. 2d at 1194, 1200-01; Waggoner, supra, 808
2d at 653. The U.C.C. represents the Legislature's attempt to strike
the proper balance in the allocation of the risk of loss between manufacturers
and purchasers for economic loss arising from injury to a defective product.
See generally James J. White & Robert S. Summers, 1 Uniform
Commercial Code 582 (4th ed. 1995); East River, supra,
476 U.S. at 872-73, 106 S.Ct. at 2302-04, 90
L.Ed.2d 865; Seely, supra, 403 P. 2d at 148; Spring
supra, 98 N.J. at 577; Bocre Leasing,
supra, 645 N.E. 2d at 1196.
binding on a consumer unless the consumer has signed the form. N.J.S.A.
12A:2-209(2). A consumer, moreover, may recover incidental and consequential
12A:2-714. In addition, the Legislature has directed courts to construe
the U.C.C. liberally and to promote the U.C.C.'s underlying purposes and
require privity between the purchaser and the manufacturer. Seeid.
and a decrease in the market value of the trucks. Id. at 564.
Thereafter, Spring Motors sued Ford under theories of negligence, strict
liability and breach of warranty. Ibid. The basic issue was whether
the applicable statute of limitations was the four-year statute in the
12A:2-725, or the six-year statute of limitations pertaining to tort
actions for property damage, N.J.S.A.
2A:14-1. We held that Spring Motors had a cause of action against both
Ford and Clark for breach of warranty and that the U.C.C.'s four-year period
of limitations determined the time for the commencement of the action.
decide whether a cause of action in tort is stated when a defective
product purchased in a commercial transaction malfunctions, injuring only
the product itself and causing purely economic loss." Id. at 859,
106 S. Ct. at 2296, 90
L. Ed.2d 865. The Court continued, "charting a course between products
liability and contract law, we must determine whether injury to a product
itself is the kind of harm that should be protected by products liability
or left entirely to the law of contracts." Ibid.
in the chain of distribution. Id. at 874, 106 S. Ct. at
L. Ed.2d 865.
The vast majority of courts across the country likewise have concluded that purchasers of personal property, whether commercial entities or consumers, should be limited to recovery under contract principles. See, e.g., Arkwright-Boston Mfgs. Mutual Ins. Co. v. Westinghouse Elec. Corp., 844 F.2d 1174, 1178 (5th Cir. 1988) (holding that Texas law did not permit recovery of economic loss resulting from damage to product itself); Aloe Coal Co. v. Clark Equip. Co., 816 F.2d 110, 118 (3d Cir. 1987) (holding that, under Pennsylvania law, fire damage to product itself was not recoverable from manufacturer on theory of negligence, but buyer's remedies limited to law of warranty); Purvis v. Consolidated Energy Prods. Co., 674 F.2d 217, 222-23 (4th Cir. 1982) (finding that losses resulting from ineffective equipment were recoverable under law of contracts and not strict liability); East Mississippi Power Assoc. v. Porcelain Prods. Co., 729 F. Supp. 512, 517-19 (S.D. Miss. 1990) (holding that Mississippi law does not allow electric company to recover economic loss from manufacturer of defective insulation); Public Serv. Co. v. Westinghouse Elec. Corp., 685 F. Supp. 1281, 1285 (D.N.H. 1988) (holding that, under New Hampshire law, manufacturer of steam turbine electric generator could not be held strictly liable when allegedly defective product injured only itself); Lucker Mfg., supra, 777 F. Supp. at 415-17 (holding that, under Pennsylvania law, purchaser of defective steel components could not use tort theories to recover damages for
purchase price, higher costs of completing project, and loss of goodwill, because these were in the nature of economic loss); Wellcraft Marine v. Zarzour, 577 So.2d 414, 418 (Ala. 1991) (finding that purchaser of defective motor boat could not recover under state products liability statute because damage was only to boat); Florida Power & Light Co., supra, 510 So. 2d at 902 (holding that buyer's claims for economic loss resulting from negligent design and manufacture of steam turbines were cognizable in contract but not tort); Bay State-Spray & Provincetown S.S. v. Caterpillar Tractor Co., 533 N.E.2d 1350, 1351-53 (Mass. 1989) (finding that action for lost profits and costs of repair concerning defective steamship engines was governed by U.C.C. statute of limitations rather than products liability limitations period); Bocre Leasing, supra, 645 N.E. 2d at 1199-1200 (holding that commercial purchaser of used helicopter, which crashed and caused injury only to itself, could not recover in negligence or strict tort liability for economic loss); Cooperative Power Ass'n v. Westinghouse Elec. Corp., 493 N.W.2d 661, 665-66 (N.D. 1992) (holding that manufacturer of machine sold in commercial transaction not liable in negligence or strict tort liability for economic loss when machine injures only itself); Mid-Continent Aircraft Corp. v. Curry County Spraying Serv., Inc., 572 S.W.2d 308, 312-13 (Tex. 1978) (holding that parties were relegated to contractual remedies because damage to airplane was in nature of economic loss); see also
National Union Fire Ins. Co. v. Pratt & Whitney Canada, Inc.,
P.2d 601, 603-05 (Nev. 1991) (holding that economic loss not recoverable
from engine manufacturer under tort theories of negligence and strict liability
even though defective engine damaged entire aircraft and product caused
school board could bring strict-liability action for costs of asbestos
removal because board was not a commercial purchaser and asbestos created
grave personal safety risk).
114 U. Pa. L. Rev. at 548-49 (finding that U.C.C. remedies seem
more appropriate than products liability law when damage is loss of benefit
said that the Doctrine did not apply when the damage was to the product
itself. Id. at 418. Declining to distinguish between purchasers
who were consumers or commercial buyers, the Court held that the "rule
remains the same, regardless of the nature of the consumer." Ibid.;
see also Dairyland Ins. Co. v. General Motors Corp., 549
So.2d 44, 46 (Ala. 1989) (holding that consumer purchaser of defective
van could not recover economic loss).
exception to the economic loss rule. Accordingly, the Court upheld the
dismissal of the homeowners' negligence claim. Id. at 1201. Writing
for a unanimous court, Chief Justice Veasey reasoned that to allow an exception
for individual consumers would defeat the legislative intent in enacting
the U.C.C. "as the complete framework of the rights and remedies available
to parties to a sale of goods contract." Id. at 1200-01.
plaintiff's negligence claim, since . . . the contractor's negligence
would constitute a breach of the contractor's implied promise to construct
the patio in a workmanlike manner").
traditionally the core concern of contract law.
[Id. at 871, 106 S.
Ct. at 2301-02, 90
L. Ed.2d 865 (citations omitted).]
provides that "[u]nless displaced by the particular provisions of this
Act, the principles of law and equity, including the law merchant and the
law relative to capacity to contract, principal and agent, estoppel, fraud,
misrepresentation, duress, coercion, mistake, bankruptcy or other validating
or invalidating cause shall supplement its provisions." See N.J.S.A.
12A:1-103. The New Jersey Products Liability Law (the "Law") is to
the same effect. N.J.S.A.
2A:58C-1 to -11. Although the Law excludes physical damage to the product
itself from the definition of "harm," N.J.S.A.
2A:58C-1b(2), the Legislature did not intend to codify in the Law all
common-law remedies, see Senate Judiciary Committee Statement,
Senate, No. 2805, L. 1987, c. 197. Consequently, the exclusion
of physical damage from harm that falls within the Law is not dispositive.
party for a violation of the Act. L. 1971, c. 247 §
7, codified at N.J.S.A.
56:8-19. Included in the conduct prohibited by the Consumer Fraud Act
Another statute, the Truth-In-Consumer Contract, Warranty and Notice Act (the "Act"), N.J.S.A. 56:12-1 to -18, protects consumers by requiring that consumer contracts be clearly written and understandable. For example, if a seller violates the Act and "the violation caused the consumer to be substantially confused about the rights, obligations for remedies of the contract," the seller is liable to the consumer for actual damages, punitive damages up to $50, and reasonable attorney fees not to exceed $2500. N.J.S.A. 56:12-3. A court, moreover, may reform a consumer contract if a notice provision of the contract violates the Act and the violation substantially confused and caused financial detriment to the consumer. N.J.S.A. 56:12-4.1. The Act further prohibits limitations on warranties that "violate any clearly established legal right of the consumer or responsibility of a seller." N.J.S.A. 56:12-15. An aggrieved consumer may seek a civil penalty of not less than $100, actual
damages, or both, together with attorneys fees and court costs. N.J.S.A.
Here, plaintiffs seek the lost value on trade-in and the costs of repairing the boat under theories of negligence and strict liability. Thus, this action raises the question whether
a consumer and his insurer can maintain an action in tort for economic
insure against the risk of the purchase of defective goods either directly
through the purchase of an insurance policy, such as Alloway's purchase
of the New Hampshire policy, or through insurance provided indirectly through
many credit card purchases. Under the U.C.C. as construed by this Court,
moreover, the absence of privity no longer bars a buyer from reaching through
the chain of distribution to the manufacturer. See Spring Motors,
supra, 98 N.J. at 582, 586-87; Santor, supra,
44 N.J. at 63. In addition, the United States Supreme Court, the
overwhelming majority of state courts, and legal scholars have recognized
the unfairness of imposing on a seller tort liability for economic loss.
Accordingly, we hold that plaintiffs' tort claims are barred.
Maisonet v. Department of Human Services, Div. of Family Dev.,
N.J. 214, 222-23 (1995) (holding that courts not required by Supremacy
Clause to exercise original jurisdiction over civil-rights claim when asserted
for first time on appeal); R. 2:10-5 (indicating that exercise of
original jurisdiction is discretionary). Similarly, we need not reach the
additional issues concerning GMI's liability as Glasstream's successor
or the effect on GMI of the purchase in bankruptcy of Glasstream's assets
free and clear of all claims.
CHIEF JUSTICE PORITZ and JUSTICES O'HERN, GARIBALDI and COLEMAN join in JUSTICE POLLOCK's opinion. JUSTICE HANDLER filed a separate concurring opinion in which JUSTICE STEIN joins.
SUPREME COURT OF NEW JERSEY
SAMUEL P. ALLOWAY, III, and NEW HAMPSHIRE INSURANCE CO.,
GENERAL MARINE INDUSTRIES, L.P.,
MULLICA RIVER BOAT BASIN,
HANDLER, J., concurring.
In this case, the Court holds that a consumer, who has purchased a product, cannot rely on a common-law cause of action sounding in strict-products liability and negligence to recover damages solely for the economic loss resulting from a defect that destroys the worth of the product. Instead, the majority determines that the consumer's exclusive remedy consists of the express warranties contained in the Uniform Commercial Code ("U.C.C."). I am not troubled with that disposition because I am convinced that in a case such as this, the consumer is not at a genuine commercial disadvantage and is the kind of consumer who falls within the ambit of the U.C.C. The consumer here is a
purchaser of an expensive luxury boat whose bargaining power is substantially
equivalent to that of the seller. Furthermore, because the majority has
not foreclosed tort recovery for purely economic loss in instances where
the parties may be economic captives with unequal bargaining power, I am
able to join in the result. See Ante at __ (slip op. at 23-24)
("[W]e do not reach the issue of the preclusion of a strict-liability claim
when the parties of unequal bargaining power, the product is a necessity,
no alternative source for the product is readily available, and the purchaser
cannot reasonably insure against consequential damages.").
result is acceptable only where the parties to the contract have equivalent
bargaining power and meaningful alternatives. SeeWilliams v. Walker-Thomas
Furniture Co., 350
F.2d 445, 449 (D.C. Cir. 1965) ("[W]hen a party of little bargaining
power, and hence little real choice, signs a commercially unreasonable
contract with little or no knowledge of its terms, it is hardly likely
that his consent . . . was ever given to all the terms.")
determined only by consideration of all the circumstances surrounding
the transaction. In many cases, a gross inequality of bargaining power
will supplant the exclusivity of the U.C.C. remedy.
SEPTEMBER TERM 1996
ON CERTIFICATION TO
Appellate Division, Superior Court
SAMUEL P. ALLOWAY, III, and
GENERAL MARINE INDUSTRIES, L.P.,
MULLICA RIVER BOAT BASIN,
June 30, 1997
Footnote: 1 The majority is satisfied with the limited U.C.C. remedy because "[a]lthough a manufacturer may be in a better position to absorb the risk of loss from physical injury
or property damage, a purchaser may be better situated to absorb the `risk of economic loss caused by the purchase of a defective product.' Ante at __ (slip op. at 9)(citations omitted). That is not always the case. One can imagine myriad instances where the purchaser of an expensive necessity, such as a refrigerator or an oven, could be devastated by the product's defectiveness.
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