Caterpillar Fin. Servs. Corp. v. Harold Tatman & Son's Ents., Inc.
50 N.E.3d 955
Ohio Ct. App.2015Background
- Tatman and Son’s purchased a Vermeer HG8000 grinder in May 2009 for $762,823.80, financed through Vermeer Midwest and ultimately assigned to Caterpillar Financial Services.
- Vermeer provided a one-year/1,000-hour warranty expressly disclaiming implied warranties; Caterpillar and Heartland issued warranties on the engine.
- Plaintiff filed a breach of contract and replevin action against Tatman and Son’s and individual guarantors in November 2012.
- Tatman and Son’s filed a second amended third‑party complaint in November 2013 against Midwest, Caterpillar Corporate, Ohio Machinery/Ohio Cat, Vermeer, and Heartland, asserting the grinder was defective and unrepaired after multiple engine replacements.
- Vermeer moved to dismiss the claims under Civ.R. 12(B)(6); the trial court granted the motion; Tatman and Son’s appeals, asserting error in dismissal.
- The Fourth District ultimately held that the express warranty claim was barred by expiration, allowed certain tort-based implied warranty claims to proceed, and affirmed in part and reversed in part, remanding for further proceedings.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Express warranty expiration defeats claim | Tatman and Son’s contends written warranty remains actionable beyond one year. | Vermeer argues the express warranty expired before the grinder failed. | Express written warranty claim barred by expiration. |
| Implied warranty in contract requires privity | Tatman and Son’s alleges breach under contract; privity exists through Heartland sale. | No privity between Tatman and Son’s and Vermeer. | Contract-based implied warranty claim fails for lack of privity. |
| Implied warranty in tort and negligence viability | Claims for breach of implied warranty in tort and negligence survive economic loss issues. | Economic loss rule bars tort claims for purely economic losses against a manufacturer. | Economic-loss rule does not bar these tort claims; claims may proceed (tort-based implied warranty and negligence). |
| Jusitful enrichment viability | Tatman and Son’s conferred benefit by purchasing the grinder. | No direct benefit conferred to Vermeer; lack of direct transaction. | Unjust enrichment claim dismissed. |
Key Cases Cited
- O'Brien v. Univ. Community Tenants Union, Inc., 42 Ohio St.2d 242 (1975) (affirms standard for Civ.R. 12(B)(6) dismissal and factual review on motion to dismiss)
- Taylor v. London, 88 Ohio St.3d 137 (2000) (defines dismissal standards and review for pleadings in Ohio)
- Mitchell v. Lawson Milk Co., 40 Ohio St.3d 190 (1988) (limits on judicial inference in Civ.R. 12(B)(6) analysis)
- State ex rel. Scott v. Cleveland, 112 Ohio St.3d 324 (2006) (reiterates standard for determining whether complaint states a claim)
- Curl v. Volkswagen of Am., Inc., 114 Ohio St.3d 266 (2007) (privity requirements for implied warranties in contract)
- LaPuma v. Collinwood Concrete, 75 Ohio St.3d 64 (1996) (economic loss and implied warranty in tort; consumer not in privity may pursue tort claim)
- Corporex Dev. & Constr. Mgt., Inc. v. Shook, 106 Ohio St.3d 412 (2005) (economic-loss rule context in commercial setting; distinguishes contractual duties)
- Chemtrol Adhesives, Inc. v. Am. Mfrs. Mut. Ins. Co., 42 Ohio St.3d 40 (1989) (economic loss rule foundational case for product liability analysis)