39 F. Supp. 3d 95
D. Me.2014Background
- American Aerial purchased a Terex Model T-780 crane from Empire, a Terex dealer, in December 2011 for $615,000.
- Read, American Aerial’s president, relied on a Data Sheet with load chart and warnings when deciding to buy.
- Terex and Empire allegedly misrepresented the crane’s readiness and condition; delivery occurred December 30, 2011 with prior storage on a lot.
- Read revoked acceptance on January 6, 2012 due to engine issues and a shredded serpentine belt; subsequent complaints followed through 2012.
- American Aerial hired third-party and Terex personnel to inspect and repair; disputes centered on warranty coverage, notice, and disclosure.
- The case was removed from state court to federal court; dispositive motions for summary judgment were filed by Terex and Empire.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Existence of apparent agency | Empire acted as Terex's agent by dealer status and branding. | No agency; no training or direct control by Terex; branding alone insufficient. | No reasonable basis for apparent authority; no agency found. |
| Breach of contract—newness of the crane | Crane was not new due to storage and prior use; contract breach. | Crane was new at sale; no prior use evident. | Crane was new; contract claim granted to defendants (no breach). |
| Implied warranty of merchantability | Terex impliedly excluded merchantability via Data Sheet language. | Disclaimer is conspicuous and effective under 2-316. | Disclaimers not conspicuous; merchantability claim survives (denied for exclusion). |
| Economic loss doctrine and fraud claims | Fraud in inducement and misrepresentation independent of contract. | Economic loss doctrine bars tort claims where contract remedies suffice. | Fraud claims barred by economic loss doctrine; counts Three and Four granted to defendants. |
| Punitive damages | Punitive damages available for proven malice in fraud or misrepresentation. | No tortious conduct remaining after fraud dismissal; punitive damages not warranted. | Punitive damages denied; Count Five barred. |
Key Cases Cited
- J & E Air, Inc. v. State Tax Assessor, 773 A.2d 452 (Me. 2001) (defines fiduciary apparent authority framework)
- Williams v. Inverness Corp., 664 A.2d 1244 (Me. 1995) (apparent authority based on principal's conduct)
- Oceanside at Pine Point Condominium Owners Ass’n v. Peachtree Doors, Inc., 659 A.2d 267 (Me. 1995) (economic loss doctrine in Maine; exclusion of contract remedies)
- Engine Mfrs. Ass’n v. E.P.A., 88 F.3d 1075 (D.C. Cir. 1996) (definition of a ‘new’ vehicle in federal environmental regulation context)
- Toomer v. City Cab, 443 F.3d 1191 (10th Cir. 2006) (definition related to new-vehicle concept under federal standards)
- Giles v. General Motors Acceptance Corp., 494 F.3d 865 (9th Cir. 2007) (fraud and economic loss doctrine considerations in misrepresentation context)
- Werwinski v. Ford Motor Co., 286 F.3d 661 (3d Cir. 2002) (limitations of economic loss doctrine in fraud cases)
- Williams v. Ubaldo, 670 A.2d 913 (Me. 1996) (measure of damages for contract and tort misrepresentation)