Even though in theory I’m retired from teaching law, this spring I’m finishing up my 41st year of being a law professor at The Ohio State University (and my 47th year in this profession overall) by conducting a course in the law of Sales. One of the classes I now schedule as part of the course is a detailed exploration of an actual lawsuit that I filed right here in Columbus, Ohio, in the Municipal Court in 2014 involving my purchase of cork flooring materials for my condominium. I use what actually happened as a practical lesson in the lawyering of a dispute over the buying and selling of goods. It teaches, I believe, a valuable lesson about the difference between conducting a lawsuit and finding justice for the parties involved. My conclusion is that in the end the lawyers look bad and the lawsuit was a waste of time for everyone involved. As someone we all know tediously says, “Sad.” Read what follows and judge for yourselves.
In 2011 I decided to replace the carpeting on the first floor of my condominium with cork flooring. I chose cork because Norman Anderson, a contractor friend who was experienced in this field, said it was both durable and handsome. Norman and I went to a local Columbus retailer to look at samples, and, with him as my agent (and installer), I purchased the cork flooring that became the subject of the lawsuit I filed two years later. In the description that follows I have changed the names of the major parties and the lawyers that became involved.
Perhaps it can all best be summarized by the December 23, 2013 letter I wrote to the manufacturer of the product and the retailer who sold it to me in 2011, and which was eventually attached to the Complaint I filed in the Franklin County Municipal Court:
When I retired from The Ohio State University where I was a law professor for over 30 years, I bought a condominium in Dublin, Ohio, and in late 2011 I decided to replace the original carpeting in the downstairs with a cork floor, which I had done some research on and was pleased to learn how durable such floors were reputed to be. In October of that year I went to the premises of Superior Floor Coverings with the contractor who would install the floors, Norman Anderson, and we picked out some samples and then took them back to the condo. We eventually picked out WonderFloors New Dimensions, Slate Cork, and on October 17, 2011, Mr. Anderson, as my agent, ordered 40 cartons to be sent to my home (I immediately reimbursed him for the expense, which was $6,474.73).
The cork arrived in late December and was installed by Mr. Anderson, with the job being finished in mid-January of 2012. The flooring, which was almost black in color, is beautiful, and I loved it. As time went on, however, problems developed from the fact that the cork surface was eggshell sensitive to things like scratches and the pressure of furniture. I have two cats, both declawed (but possessing rear claws), and their routine running around the house produced major scratches and sometimes even scars in the portions of the floor open to much traffic, such as the halls. Since under the very thin black surface is a tan base, even tiny scratches left obvious marks in my beautiful floors. In the beginning I covered these with a black Sharpie pen, and that worked well enough at first. But as time went by the large number of such markings became a major chore, literally requiring hours of work (spread out since installation) on one’s hands and knees. If you look closely you can see where these cover-ups have occurred, and as their number mounted it’s become more and more obvious. I spent much time working with that Sharpie pen because in the spring of 2013 I put the condo on the market and wanted the floors to look as good as possible for potential buyers. But there were other problems as well. Everywhere on the floor where they were placed, objects of furniture caused major indents (visible by moving any piece of furniture) and damage to the cork floors happened from any significant contact other than mere walking across them. At one point I moved the living room sofa for a two week period and, when I moved it back to its original position, was astounded to realize that major deep indentations had been made in the cork during this very short period just from people sitting on the sofa. I found myself trying to figure out how to hide the damage to the cork from future buyers, and feeling like a fraud as I did so. That had to stop. I took the condo off the market last month. It’s clearly time to repair the floors, and this particular cork flooring is completely unsuitable in my home (or any home).
As I mentioned at the start of this letter, I’m a law professor and, as it happens, I am one of the leading experts in the United States on the law of warranties and consumer rights. If you doubt this, Google up my name or just go to Amazon and look at the many books I’ve written on Commercial Law, Contracts, Sales, Consumer Law, etc., seven of which are used as text books throughout the country. Huge numbers of lawyers in Ohio are my former students either in the classroom or bar review lectures. The Uniform Commercial Code [UCC], which is at the heart of this dispute, is my chief area of expertise.
So I consulted the paperwork I was given to see what it said about the warranty on the cork flooring. Superior Floor Coverings invoice says nothing about the topic, but WonderFloors, Inc. had given me a “Lifetime Residential Limited Wear Warranty.” Let’s talk about the latter first.
The lawyers who drafted it up had one goal in mind: disclaim almost anything that can happen other than the product being damaged by the manufacturing process. Instead of being a warranty it’s mostly a disclaimer of liability for most of the problems that could occur with the product. One interesting clause disclaims “Damage due to . . . scratches, gouges, scuffs, punctures, cuts, indentations, . . . lack of proper furniture rests or any intentional misuse of the product.” Hmm. Another disclaims liability for “abuse caused by items such as roller skates, golf shoes or pets.” The “warranty” also requires that “the flooring must be maintained in accordance with WonderFloors maintenance instructions,” but none were given to me, nor is there a definition of “proper furniture rests.” I can understand WonderFloors, Inc. not wanting to warrant against misuse of the product by the owner’s pets (say a dog who tries to dig through the floor), or misuse by running around in golf shoes or roller skates, but this warranty in effect says that routine use of furniture or routine activity by pets that ruins the eggshell finish of the cork is not covered. Far from being durable, the surface on this flooring is very delicate. Phrased another way this very limited warranty means that WonderFloors’s product cannot be used in homes with either pets or furniture. No court is going to read the warranty disclaimer this broadly, and instead is likely to say that the warranty merely protects WonderFloors, Inc. from misuse by the owner. I certainly will contend in future litigation that I in no way misused the product.
No document from SuperiorFloor Coverings disclaims the implied warranty of merchantability created by UCC §2-314. That section creates a very interesting warranty that is automatically part of the transaction unless disclaimed, which was not done here by either WonderFloors, Inc. or SuperiorFloor Coverings. So let’s explore what the implied warranty of merchantability entails.
According to the UCC section cited above this warranty is that the goods sold shall be “fit for the ordinary purpose for which such goods are used.” I tell my law students this is the warranty that the goods will work. In the lawsuit that I will shortly file in the Franklin County Municipal Court unless this matter is settled to my satisfaction, I will contend that a cork flooring that is so delicate that routine use by the owner leads to major surface damage within a period of under two years is not fit for its ordinary purpose. I will then ask for damages in the amount of the purchase price of $6,474.73 and the wasted installation cost of $6,530, plus court costs. These damages are all clearly allowed by UCC §§2-714 and 2-715. I will be representing myself pro se, so I will have no attorney fees (though you certainly will).
I will file the lawsuit by January 14, 2014, so let me hear from you before then.
Douglas J. Whaley
In my mind the lawsuit asked one simple question: was a floor covering that was this sensitive fit for its ordinary purpose? I believed I could prove it was not. The major legal defense I knew I would have to battle (and which caused me some worry) comes from UCC §2-607(3)(a) which states that “the buyer must within a reasonable time after he discovers or should have discovered any breach notify the seller or be barred from any remedy.” Hmm. I’d waited almost two years before I gave the sellers notice. Was that within a “reasonable time”? My argument was that during this period I was battling to live with the problem so no notice was proper until I finally concluded that this was impossible, and from the very beginning there was no “fix” for this defect other that complete replacement of the product. Every single panel installed had the same unacceptable finish. But the judge (who would be the judge of both the law and the facts) might decide otherwise, so I was concerned about how the §2-607(3)(a) issue would play out.
|Scratches---some covered with Sharpie Pen|
Both the retailer and the manufacturer hired lawyers and they promptly filed Answers to my Complaint. They raised a lot of non-issues (I had “misused” the product, or I was “negligent” myself, etc.) but—to my astonishment neither Answer mentioned the §2-607(3)(a) lack of notice within a reasonable time defense! Amazing! In my opinion this was malpractice on the part of both the defense attorneys. They were not experts on the law of Sales, and so they just filled out Answers from form books and winged it.
Superior Floor Coverings, the retailer, was represented by a lawyer from a small firm, and for purposes of this blog I’ll call him “John Smith.” As things progressed I would meet him on three or four occasions at the courthouse when he continually moved for more time to “conduct discovery” and “prepare for trial,” but as far as I can tell he never did anything to help his client. Certainly he did not request any discovery from me (such as a deposition). At one point I offered him a settlement: I would knock $4000 off of my damages as compensation for the use I did get out of the flooring. He said he would get back to me about that, but he never did. Superior Floor Coverings’s owner (whom I’ll call Alex Jones) was astounded to learn of this offer when I told him of it at the end of the case (see below), since Smith never mentioned it to him at all. Waiting in the seats outside the courtroom at each of the scheduled hearings I’d gotten friendly with Mr. Jones as we sat there for long periods until Smith belatedly showed up. While we obviously couldn’t talk about the case, Jones told me about his ongoing divorce trial where he was fighting with his wife over custody of their daughter. He confessed he was weary of lawsuits and lawyers. I sympathized. His lawyer, John Smith, nicely dressed and quite flashy, talked a good game, but appeared to me to be all appearance and no substance; I did not, however, say that to his client until much later (also see below).
WonderFloors was represented by one of the largest and most prestigious law firms in Columbus, here called Big Firm. Its Answer missed the “no notice” defense but did raise the defense of “lack of privity” between the manufacturer and me. “Privity” means sufficient legal connection to sue. Here the manufacturer sold to the retailer and I bought from the retailer, so there is allegedly no “privity” between the manufacturer and me. This is a ridiculous concept in a world in which the manufacturer provided a warranty along with the product and that warranty was clearly directed to the ultimate buyer—and, after all, the manufacturer is the entity that should bear the liability for the defective product that it produced (as opposed to the poor retailer, who did nothing more than pass on the product to me). But the Ohio Supreme Court had issued a ludicrous opinion some years before adopting this “privity” defense protecting out-of-state manufacturers (at the expense of Ohio retailers like Superior Floor Coverings), and when I had first read the decision, I decided it was clearly wrong, an example of how the Ohio Supreme Court sometimes just didn’t understand commercial law, and forgot about it. Now I was annoyed that it had come to life and that Big Firm had decided to use it. I debated challenging that decision in our case and, on appeal, trying to talk the Court (which had some of my former students on it) into changing the result, but that would take years. Hmm. I phoned the lawyer at Big Firm who had created their Answer (also a former student of mine, but to whom I had not taught Sales) and we talked.
I told him about another section of the Uniform Commercial Code, §2-607(5), which creates a process called “vouching in.” It says that if a retailer is sued for a defect created by the manufacturer then the retailer can give the manufacturer a notice to join the lawsuit. If the manufacturer does not do so the manufacturer is then bound by the factual conclusions reached at trial. Big Firm’s lawyer had never heard of this “vouching in” notice, but I assured him I would tell John Smith about it and thus such a notice would likely be coming to WonderFloors shortly. “Does Big Firm really want Mr. Smith to try this case and have the result bind WonderFloors?” The Big Firm lawyer said he would get back to me. In the event, I never heard another word from him, and I did dismiss the Complaint against WonderFloors, but told Smith about the vouching-in notice and sent him the statutory language to use when sending this notice to WonderFloors (thus binding it to the outcome of our lawsuit).
The judge kept setting a date for trial and Attorney Smith kept getting extensions for “discovery” that he never conducted. Finally the court announced a date for the trial and it looked like we were ready to go, but suddenly in the mail I received a pleading filed with the court by John Smith in which he withdrew from the case because the insurance company of the retailer that had been paying his fee had decided that the policy did not cover this sort of legal problem. The court approved his withdrawal the week before the trial was to start!
Astounded I phoned Smith and asked him what this was all about. He explained that once the insurance company withdrew he simply couldn’t continue. I asked him if he’d looked at the policy to see if the insurance company was right or just trying to wiggle off the hook, but he said no, he hadn’t. I asked him what he had done to get his client ready for the trial. He said he couldn’t go into that. I asked him if he’d sent the manufacturer the vouching-in notice I’d provided advising them of their duty to participate in the trial or be bound by the outcome. No, he’d never gotten around to that. [I also later learned he’d not told his own retailer client about my settlement offer either.] I was furious and my anger came through in my voice. “You’re just dumping your client on the eve of trial! You can’t do this! You owe your client a duty of zealous representation according the rule of professional conduct.” “Well," he replied, “technically my client is the insurance company.” “No, it’s not!” I thundered. “Your name is listed as the attorney of record for Superior Floor Coverings!” Smith was done with this conversation, so he tried to cut it off. “What should poor Superior Floor Coverings do?” I asked him in perhaps too loud a tone. “Get a good lawyer,” was his outrageous response, to which I replied, “That would be something new because they certainly didn’t have one in the first place.” He started to reply but I terminated the call, fuming.
I called Alex Jones, the owner of Superior Floor Coverings, who, as I said above, I’d gotten to know and like. He was depressed. I told him he should send the vouching-in notice to WonderFloors, and that I would send him the language to use in an email, so that the manufacturer would know that they would be bound by whatever happened at the trial. Alex Jones said he would send that notice and thanked me. I asked him what he was going to do and he confessed that he didn’t have the money for a new attorney. “Isn’t there any way to make this go away?” he asked me. “Well, replace the floor,” I replied. He paused and then said he’d get back to me.
Within a couple of days he phoned me and said he'd worked out a deal with WonderFloors by which they’d provide a new and better flooring to by chosen by me from their online site and he would use his workers to install that flooring, all at no cost to me. I was delighted with this offer. It was all I ever wanted. I drafted up the settlement agreement and we signed it, and I dismissed the lawsuit. Within a month the new flooring (bamboo and imperious to scratches, etc.) was installed and the whole thing was over. The flooring has now been in my home for almost a year and a half and it is still beautiful. All I was out financially was the filing fee of the lawsuit ($123). I did provide Alex Jones with the relevant forms and information for filing a complaint with the bar association against John Smith, though I have no idea if he ever did so.
|The New Bamboo Flooring|
When I teach this lawsuit to my Sales students I ask them what really happened here. Did the attorneys do their job? Did the rules of law help or hurt? Think about that.
My conclusion is that the law failed everybody involved (except me) horribly.
First of all the Ohio Supreme Court should never have handed down a decision that was clearly out of line with what Congress intended when it passed the Magnuson-Moss Warranty Act, a statute designed to make manufacturers live up to the warranties they make to consumers. Instead the Court read the statute to permit manufacturers to make warranties and only be liable to the retailer, thus leaving the consumer with no immediate remedy against anyone other than the retailer. Such a “warranty” by the manufacturer to the consumer is no warranty at all, but the Court never discussed (nor, apparently, considered) the practicality of what it was doing. Instead its mindless decision put all the onus of the manufacturer’s warranty breach on the poor retailer who sold the product to the consumer. Yes, in theory, the retailer could then pass the liability back to the manufacturer, but John Smith, the attorney for the retailer, at one point told me that the contract between the two required such a suit to be brought in Georgia where the manufacturer was located. Superior Floor Coverings couldn’t finance that suit. Thus the Court’s decision meant that entity creating the defective product escapes liability because a technical lack of “privity” (legal connection) with the consumer. Some other jurisdictions have also reached this ludicrous result, but most have not and the legal commentators all say it’s dreadfully wrong.
Then along came the retailer’s attorney, John Smith. He took the case without a basic understanding of the law of Sales. That’s malpractice, and he exhibited it by missing his best defense (lack of notice within a reasonable time by me, the buyer), and not knowing or using the vouching-notice to the manufacturer to come in and defend. Smith took the money that the reatiler’s insurance company paid him, but he never did a lick of work on the case other than filing an Answer. He didn’t send the notice I provided him that would keep the manufacturer on the hook, he didn’t conduct any discovery (and misled that trial court about this), and he bailed on his client in an inexcusable way when the trial finally was unavoidable.
Big Firm does somewhat better, but it also missed the best defense (my lack of prompt notice), and that’s malpractice. My students had no problem coming up with it, but that’s because they do understand the law of Sales. Why would Big Firm take this case if it didn’t have similar expertise? The answer, alas, is that most lawyers think of Sales Law as just an extension of the law of Contracts, which they did study in law school, and believe (wrongly) that they can just wing it by copying defenses out of a form book. Big Firm did find the privity defense, but that had a bad result: it left their client’s ultimate fate in the hands of the retailer’s attorney, which (see above) was a major mistake.
I ask my law students what should Big Firm have done. Hands go up to mention the lack of notice defense, but I tell them that isn’t what I would have done if I were the manufacturer’s lawyer. I make the students sit and think about it. Then I give them a clue. “What should the lawyer have asked the manufacturer at the beginning?”
Long pause. Finally a student raises his/her hand and gets to the real issue. I always emphasize in my classroom this question: “What’s really going on here?” Forget the law. Look at reality. What’s in dispute? Who is right and who is wrong? Do we need a lawsuit at all? The student who’s hand went up was right in phrasing the issue as follows for my case, “Was there really a warranty breach? I mean, was the product defective or was the buyer misusing the product?” Yep. That’s the right question.
The Japanese have a saying that is often repeated: “If all you have is a hammer everything looks like a nail.” Lawyers aren’t advisors with only one weapon: a lawsuit. Lawyers, I tell my students, are problem solvers, and a lawsuit should almost always be the last resort, not the first. Was it wise to spend whatever large legal fees Big Firm charges battling Douglas Whaley, an expert on the law of Sales, if the manufacturer was in fact at fault here? Were I Big Firm I would have wanted to know about the product that was sold. Did it have an “eggshell” finish as Whaley contended. You can bet in the trial Whaley was going to come into court with a sample of the flooring and demonstrate how very easily it was marred. If the client’s response showed that this lawsuit was a loser, then for heaven’s sake settle the damn thing! What you don’t do is throw up a legal barrage of non-defenses, miss the big one, and hope “privity” will somehow get rid of that pesky Whaley.
Law (including the Ohio Supreme Court of course) failed all of the clients here that hired lawyers, vainly counting on their help. As soon as the lawyers disappeared from the suit the clients themselves settled it easily and quickly.
I worry that’s all too often the case. For someone who has devoted his life to the law, it’s a depressing thought.
"The Payment-In-Full Check: A Powerful Legal Maneuver," April 11, 2011; http://douglaswhaley.blogspot.com/2011/04/payment-in-full-check-powerful-legal.html
"What Non-Lawyers Should Know About Warranties," October 11, 2011; http://douglaswhaley.blogspot.com/2011/10/what-non-lawyers-should-know-about.html
"How To Write an Effective Legal Threat Letter," October 19, 2011; http://douglaswhaley.blogspot.com/2011/10/how-to-write-effective-legal-threat.html
“How To Win Arguments and Change Someone’s Mind,” August 5, 2012; http://douglaswhaley.blogspot.com/2012/08/howto-win-argument-and-change-someones.html
"Mortgage Foreclosures, Missing Promissory Notes, and the Uniform Commercial Code: A New Article," February 11, 2013; http://douglaswhaley.blogspot.com/2013/02/mortgage-foreclosures-missing.html
"Legal Terms You Should Know,” September 13, 2013; http://douglaswhaley.blogspot.com/2013/09/legal-terms-you-should-know.html
“How To Respond to a Legal Threat.” March 29, 2014; http://douglaswhaley.blogspot.com/2014/03/how-to-respond-to-legal-threat.html
“Clicking on 'I Agree': Sticking Your Head in the Lion's Mouth?” September 27, 2014; http://douglaswhaley.blogspot.com/2014/09/clicking-on-i-agree-sticking-your-head.html
“A Guide to the Best of My Blog,” April 29, 2013; http://douglaswhaley.blogspot.com/2013/04/a-guide-to-best-of-my-blog.html