Newmar Corp. v. McCrary
129 Nev. 638
| Nev. | 2013Background
- Allison McCrary bought a luxury motor home from Wheeler's Las Vegas RV; Newmar manufactured the vehicle and provided a two‑year express (bumper‑to‑bumper) warranty.
- After taking possession only when a Newmar factory representative reassured her that Newmar would handle defects, McCrary experienced persistent, serious electrical problems that rendered the vehicle unsafe and repeatedly unusable.
- McCrary attempted to revoke acceptance from Newmar; Newmar refused, and McCrary sued Newmar for revocation of acceptance, breach of contract, and breach of warranty.
- At bench trial the district court found Newmar had interjected itself into the sale and made assurances that induced McCrary to complete the purchase; it awarded revocation relief: refund of purchase price (conditioned on return), incidental and consequential damages, prejudgment interest, and attorney fees.
- Newmar appealed, arguing a buyer may revoke acceptance only against the immediate seller (Wheeler's), that its warranty disclaimed incidental/consequential damages, and that attorney fees were improper.
Issues
| Issue | Plaintiff's Argument (McCrary) | Defendant's Argument (Newmar) | Held |
|---|---|---|---|
| Whether a buyer may revoke acceptance against a manufacturer | Newmar interjected into the sale, made direct assurances and thus is effectively a co‑seller; revocation should be allowed against it | Revocation under UCC applies only against the seller in privity (the dealer); Newmar as manufacturer is not a "seller" for revocation | Allowed: where manufacturer directly participates in the sales process and creates privity with buyer, revocation against manufacturer is permitted |
| Whether privity exists between buyer and manufacturer | Direct dealings and assurances by Newmar created a direct relationship/privity | No privity because sale was through dealer; manufacturer neither received purchase price nor was immediate seller | Found privity based on Newmar’s direct representations and involvement in completing the sale |
| Availability of incidental and consequential damages despite Newmar’s warranty limitation | Newmar’s repair/replace remedy failed of its essential purpose after repeated unsuccessful repairs; UCC permits incidental/consequential damages | Warranty disclaimed such damages; revocation merely cancels sales contract leaving warranty limitations intact | Incidental and consequential damages allowed because exclusive remedial warranty failed of its essential purpose |
| Award of attorney fees to plaintiff | (Implicit) fees were sought and awarded after judgment | Award improper under NRCP 68(f) and NRS 17.115(4); defense was reasonable given split in authority | Reversed fee award: district court abused discretion; plaintiff did not beat her offer of judgment and fees were not authorized |
Key Cases Cited
- Seekings v. Jimmy GMC of Tucson, Inc., 638 P.2d 210 (Ariz. 1981) (majority view restricting revocation to immediate seller absent privity or agency)
- Griffith v. Latham Motors, Inc., 913 P.2d 572 (Idaho 1996) (manufacturer not subject to revocation claim without privity)
- Durfee v. Rod Baxter Imps., Inc., 262 N.W.2d 349 (Minn. 1977) (permitting revocation against remote entities where remedies fail and warranty merged)
- Volkswagen of Am., Inc. v. Novak, 418 So. 2d 801 (Miss. 1982) (allowing revocation against manufacturer where warranty and sale are functionally merged)
- Gochey v. Bombardier, Inc., 572 A.2d 921 (Vt. 1990) (express warranty to buyer can justify revocation remedy against manufacturer)