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Seller liabilty for implied warranty

The Sixth Circuit recently had occasion to interpret another facet of Michigan's tort "reform" legislation in Croskey v. BMW of North America.   The Court concluded that the legislature eliminated a non-manufacturing seller's liability for implied warranty of fitness in the personal injury context, making a seller liable only for its own negligence.

In most states, an injured consumer can pursue a claim against a seller either on the basis of active negligence by the seller, or on the theory that the product sold was not "reasonably fit" for the purpose intended.  This vicarious responsibility on the part of a seller (for a manufacturer's creation of a defective product) assures that the customer will have a responsible party within the Court's venue.

Under Michigan tort "reform", however, this liability has been eliminated, and as a result, Michigan sellers are not required to "stand behind" the products they sell.  This means that they can select and sell products without any concern for the integrity or reliability of manufacturers and that they do not need to require that manufacturers purchase insurance to protect consumers (and sellers--by way of indemnity).

With more and more products coming from overseas and with the documented inability of U.S. sellers, trade representatives, associations and governmental entities to investigate and monitor overseas imports, the net result is a total denial of  recourse for Michigan citizens injured by defective products.  If Wal Mart sells someone a defective product made in China, the injured consumer won't be able to sue Wal Mart.  And Chinese manufacturers are government subsidiaries protected from service of process by a government that does not believe in the tort system of reparations:  no one can seek redress from them.  The net effect:  the wronged victim is uncompensated; taxpayers are forced to pick up expenses for medical and life care of the victim; and local manufacturers bear a burden of preparing for and defending defective products that many foreign manufacturers do not face. 

This is shabby public policy by any standard.  And it doesn't make products any cheaper for Michigan consumers because prices are determined by the other 49 states where manufacturers still carry liability exposure.  You won't save five cents on a lawn mower at Wal Mart by buying it on this side of the state line--where neither the seller nor the Chinese manufacturer can be sued.

Thompson O’Neil, P.C.
309 East Front Street
Traverse City, Michigan 49684
Toll Free: 1-800-678-1307
Fax: 231-929-7262