Warranty Law Revived by the East River Treatment: The Basis of the Bargain Redefined

Wednesday, January 1st, 1986 at 12:00 am by Mary Louisa Riley
Mary Louisa Riley, Warranty Law Revived by the East River Treatment: The Basis of the Bargain Redefined, 1986 Colum. Bus. L. Rev. 201

Disagreement over what “basis of the bargain”‘ really means has led to inconsistent lines of reasoning in warranty law. Prior to the East River decision, this confusion was immaterial, because warranty claims were usually subsidiary to tort actions. The Supreme Court’s distinction between cases demanding tort treatment of a product malfunction, and cases more appropriately decided under contract law, raises anew the need to understand what must be established to successfully plead a warranty claim. Equitable application of warranty law can be achieved through use in practice, as well as in theory, of a term such as “basis of the bargain”‘ to designate a factual basis for a well pleaded warranty claim. The rationale of relying on a formal rather than a factual basis for reaching warranty decisions must not be used by a judge who wishes to apply the meaning of the U.C.C. warranty language as intended by its drafters.

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