Nebraska Uniform Commercial Code 2-714

UCC 2-714

2-714.

Buyer's damages for breach in regard to accepted goods.

(1) Where the buyer has accepted goods and given notification (subsection (3) of section 2-607) he may recover as damages for any nonconformity of tender the loss resulting in the ordinary course of events from the seller's breach as determined in any manner which is reasonable.

(2) The measure of damages for breach of warranty is the difference at the time and place of acceptance between the value of the goods accepted and the value they would have had if they had been as warranted, unless special circumstances show proximate damages of a different amount.

(3) In a proper case any incidental and consequential damages under the next section may also be recovered.

Source

  • Laws 1963, c. 544, Art. II, § 2-714, p. 1762.

Annotations

  • If the buyer accepts defective goods, damages are measured under this section. McCoolidge v. Oyvetsky, 292 Neb. 955, 874 N.W.2d 892 (2016).

  • The existence of "special circumstances" under this section is not a precondition to a buyer's recovery of incidental and consequential damages under section 2-715. McCoolidge v. Oyvetsky, 292 Neb. 955, 874 N.W.2d 892 (2016).

  • In a warranty action against the manufacturer of an automatic collator, failure of plaintiff to present even a scintilla of evidence as to the value of the collator in the condition accepted or the reasonable expenditures necessary to make the collator conform to the warranty entitled defendant to a directed verdict. Settell's Inc. v. Pitney Bowes, Inc., 209 Neb. 26, 305 N.W.2d 896 (1981).

  • Damages for breach of warranty are determined on the date of acceptance of nonconforming goods. Alliance Tractor & Implement Co. v. Lukens Tool & Die Co., 199 Neb. 489, 260 N.W.2d 193 (1977).

  • Breach of warranty issue supported by evidence of representation that milk production would be increased by feeding seller's feed supplement in amounts as instructed, and proof of loss in production thereby, but directed verdict for defendant affirmed because purchaser failed to prove extent of damages therefrom. Shotkoski v. Standard Chemical Manuf. Co., 195 Neb. 22, 237 N.W.2d 92 (1975).

  • Statute is equivalent of the diminished value rule, which under some circumstances requires consideration of the cost of replacement or repair. T.O. Haas Tire Co. v. Futura Coatings, Inc., 2 Neb. App. 1, 507 N.W.2d 297 (1993).

  • Typical measure of damages for goods is the difference in the market price between goods as warranted and goods received, measured at the time and place of acceptance. Lackawanna Leather Co. v. Martin & Stewart, Ltd., 730 F.2d 1197 (8th Cir. 1984).

  • Rejection of breach of warranty instruction as regards manufacturer was not error where alleged failure to warn of danger was not proximate cause of injury. While a manufacturer who follows specifications of another, if such specifications are not obviously dangerous, may not be liable to the user of the product in negligence or strict tort liability, that does not preclude liability based on breach of implied warranty. Brassette v. Burlington Northern Inc., 687 F.2d 153 (8th Cir. 1982).

  • Once city notified contractor seller of sewage treatment plant of contractor seller's breach of contract, although city had accepted plant, city was entitled to recover damages for seller's breach and for incidental and consequential damages. Omaha Pollution Control Corp. v. Carver-Greenfield Corp., 413 F.Supp. 1069 (D. Neb. 1976).

  • COMMENT

  • Prior Uniform Statutory Provision: Section 69(6) and (7), Uniform Sales Act.

  • Changes: Rewritten.

  • Purposes of Changes:

  • 1. This section deals with the remedies available to the buyer after the goods have been accepted and the time for revocation of acceptance has gone by. In general this section adopts the rule of the prior uniform statutory provision for measuring damages where there has been a breach of warranty as to goods accepted, but goes further to lay down an explicit provision as to the time and place for determining the loss.

  • The section on deduction of damages from price provides an additional remedy for a buyer who still owes part of the purchase price, and frequently the two remedies will be available concurrently. The buyer's failure to notify of his or her claim under the section on effects of acceptance, however, operates to bar his or her remedies under either that section or the present section.

  • 2. The "nonconformity" referred to in subsection (1) includes not only breaches of warranties but also any failure of the seller to perform according to his or her obligations under the contract. In the case of such nonconformity, the buyer is permitted to recover for his or her loss "in any manner which is reasonable".

  • 3. Subsection (2) describes the usual, standard, and reasonable method of ascertaining damages in the case of breach of warranty but it is not intended as an exclusive measure. It departs from the measure of damages for nondelivery in utilizing the place of acceptance rather than the place of tender. In some cases the two may coincide, as where the buyer signifies his or her acceptance upon the tender. If, however, the nonconformity is such as would justify revocation of acceptance, the time and place of acceptance under this section is determined as of the buyer's decision not to revoke.

  • 4. The incidental and consequential damages referred to in subsection (3), which will usually accompany an action brought under this section, are discussed in detail in the comment on the next section.

  • Cross References:

  • Point 1: Compare section 2-711; sections 2-607 and 2-717.

  • Point 2: Section 2-106.

  • Point 3: Sections 2-608 and 2-713.

  • Point 4: Section 2-715.

  • Definitional Cross References:

  • "Buyer". Section 2-103.

  • "Conform". Section 2-106.

  • "Goods". Section 2-105.

  • "Notification". Section 1-201.

  • "Seller". Section 2-103.