## Facts

- American Bumper manufactured front bumpers for Ford pickup trucks under Ford-controlled specifications, including use of Ford-approved fastener vendors.
- American Bumper purchased “U-nut” fasteners from Palnut (whose successors/related entities included TransTechnology and TRW).
- Ford required a change from a phosphate coating to a zinc-based coating; Palnut used a zinc organic coating (“Dorroflake”) and later proposed switching to a zinc-rich inorganic coating (“Dacromet”) to improve production efficiency.
- After testing, both American Bumper and Ford approved use of Dacromet in 1993.
- Later in 1993, Ford reported field failures: U-nuts failed and bumpers loosened or detached; American Bumper notified Palnut and terminated Palnut in December 1993.
- Ford incurred over $9 million recalling and replacing U-nuts; the failure mechanism was identified as stress corrosion cracking of coated high-strength steel U-nuts in salt exposure and under tightening stress.
- In early 1994, Ford issued an internal report attributing fault to both American Bumper and Palnut but placing end-item responsibility on American Bumper.
- American Bumper disputed responsibility, contending Ford’s specification control and coating approval caused the problem; American Bumper and Ford settled recall costs in 1995 without Palnut’s participation.
- In 1997, American Bumper sued TransTechnology/TRW on UCC-based warranty and contract theories seeking reimbursement for amounts paid to Ford.
- The trial court granted summary disposition to defendants, ruling American Bumper failed to provide timely notice of breach as required by UCC § 2-607(3)(a).

## Issues

1. Whether American Bumper provided notice of breach to TransTechnology/Palnut within a reasonable time under UCC § 2-607(3)(a), preserving its warranty and contract remedies.
2. Whether American Bumper’s communications about the failures and recall constituted sufficient “notice,” even without a formal legal demand for damages.
3. Whether the adequacy and timeliness of notice could be decided as a matter of law on summary disposition.

## Decision

- The Michigan Court of Appeals reversed the grant of summary disposition and remanded.
- The court held that the record contained evidence from which a fact-finder could conclude American Bumper gave timely and adequate notice of breach under UCC § 2-607(3)(a).
- The court ruled the notice questions were not suitable for disposition as a matter of law given the commercial context and disputed inferences from the communications.

## Legal Principles

- Under UCC § 2-607(3)(a), a buyer who accepts goods must notify the seller of breach within a reasonable time after discovery (or when it should have been discovered) or be barred from any remedy.
- Notice need not be formal or state a detailed legal theory; it is sufficient if it informs the seller that the transaction is claimed to involve a breach and that the buyer is asserting legal rights.
- “Reasonable time” is context-dependent and generally a fact question; it may be resolved as a matter of law only when facts are undisputed and permit a single reasonable conclusion.
- The notice requirement serves to encourage settlement, permit investigation and possible cure or mitigation, and protect sellers from stale claims; early seller awareness and participation in investigating failures may bear on whether the purposes of notice were met.

## Conclusion

The court reinstated American Bumper’s warranty and contract claims by holding that, in a technically complex supply chain dispute involving ongoing communications about product failures and a third-party recall, a jury could find that American Bumper’s commercial communications provided timely and sufficient UCC notice of breach, making summary disposition improper.


Am. Bumper & Mfg. Co. v. TransTechnology Corp., 252 Mich. App. 340, 652 N.W.2d 252 (Mich. Ct. App. 2002)