Anthony Pools v. Sheehan
455 A.2d 434, 295 Md. 285, 35 U.C.C. Rep. Serv. (West) 408 (1983)
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Rule of Law:
In a hybrid transaction for consumer goods and services, the Uniform Commercial Code's implied warranties apply to the consumer goods component if the goods retain their character after the service is completed and the claim arises from a defect in those goods, even if the transaction is predominantly for services.
Facts:
- John and Pilar Sheehan entered into a contract with Anthony Pools for the construction of an in-ground gunite swimming pool at their home.
- The contract also included the sale and installation of related equipment, including a six-foot diving board manufactured by Anthony Pools.
- The diving board featured a skid-resistant surface on top, but this material did not extend to the edges, stopping approximately one inch short on each side.
- On August 21, 1976, about two months after the pool's completion, John Sheehan used the diving board for the first time.
- While walking on the diving board, Sheehan slipped off the side, fell, and struck the pool's coping, sustaining bodily injuries.
Procedural Posture:
- John and Pilar Sheehan sued Anthony Pools in the Circuit Court for Montgomery County (a trial court) for breach of warranty and strict liability.
- The trial court granted a directed verdict for Anthony Pools on the warranty claim, ruling that the contractual disclaimer was valid.
- The strict liability claim proceeded to a jury, which found in favor of the defendant, Anthony Pools.
- The Sheehans, as appellants, appealed to the Court of Special Appeals of Maryland (an intermediate appellate court).
- The Court of Special Appeals reversed the trial court's judgment and remanded for a new trial on both claims.
- Anthony Pools, as petitioner, was granted a writ of certiorari by the Court of Appeals of Maryland (the state's highest court) to review the decision of the Court of Special Appeals.
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Issue:
Does the UCC's implied warranty of merchantability apply to a consumer good (a diving board) sold as part of a hybrid contract for the construction of a swimming pool, and can a seller's disclaimer of this warranty be rendered unenforceable by Maryland statute CL § 2-316.1?
Opinions:
Majority - Rodowsky, J.
Yes. The UCC's implied warranty of merchantability applies to the consumer goods portion of a hybrid transaction, and Maryland law makes any attempt to disclaim this warranty for consumer goods unenforceable. The court declined to mechanically apply the 'predominant purpose' test, which would have classified the entire transaction as a service and defeated the warranty claim. Instead, the court adopted a 'gravamen of the action' test, which focuses on whether the complaint arises from the goods or the services component of the transaction. Here, the Sheehans' injury was allegedly caused by a defect in the diving board—a consumer good that was movable at the time of identification to the contract and retained its character as a good after installation. Therefore, the UCC's implied warranty of merchantability applies to the diving board, and under Maryland's CL § 2-316.1, Anthony Pools' contractual disclaimer of that warranty is unenforceable.
Analysis:
This decision establishes an important limitation on the 'predominant purpose' test for hybrid contracts in the consumer context within Maryland. By adopting a 'gravamen' test, the court prevents sellers from using a predominantly service-oriented contract to shield themselves from UCC implied warranty liability for defective consumer goods included in the transaction. This ruling strengthens consumer protection by ensuring that warranty law applies directly to the source of the harm. Future cases involving hybrid transactions will look to whether the injury arose from the goods or the service component to determine if UCC warranties are applicable, rather than classifying the contract as an all-or-nothing proposition.
