Levondosky v. Marina Associates

Majority - Cohen, Senior District Judge

Yes, serving a complimentary beverage to a casino patron can give rise to claims for breach of implied warranty and strict liability. The transaction constitutes a 'sale' for value because the patron provides their gambling business in exchange for the drink, and public policy dictates that the party in the best position to prevent harm—the casino—should bear the responsibility for defective products. The court reasoned that for an implied warranty to exist under the UCC, a 'sale for value' must occur. While Levondosky did not directly pay for the drink, the 'value' was his gambling patronage, which the complimentary drink was intended to induce and prolong. Citing Newmark v. Gimbels Inc., the court found that the UCC's definition of a sale should not be applied so technically as to defeat its purpose. The purchase of gambling services included the incidentals that came with it, thus a sale occurred. Furthermore, the court held that the implied warranty extends not only to the drink itself but also to its container, as the product must be 'adequately contained' to be merchantable. Regarding strict liability, the court noted that New Jersey law does not require a technical 'sale' to impose liability. The core policy is to place the cost of injury on the party best able to prevent it. Unlike a case where a bowler selects their own ball (Dixon), here the casino selected the glass, served the drink, and was in a superior position to inspect for defects and ensure its quality and safety. Levondosky relied on the casino for the safety of the product, making the imposition of strict liability appropriate.