## Facts

- Raymond and Lynn Sheehan purchased a new motor home from a Florida dealership; the motor home was manufactured by Monaco Coach Corp.
- The Sheehans were experienced RV owners and had previously owned six motor homes.
- At the time of sale, the Sheehans received Monaco’s written warranty, which was designated as a “limited” warranty and provided a repair-or-replace remedy.
- The warranty included a clause printed in bold, capital letters excluding consequential damages (including loss of use) and stating that the consequential-damages exclusion was independent of, and would survive, any failure of a limited remedy’s essential purpose.
- After purchase, the motor home developed significant problems, including persistent water leaks and mold.
- The motor home underwent multiple repair attempts, including work performed at a Monaco factory facility, but the Sheehans alleged the problems continued.
- The Sheehans sued Monaco for breach of express and implied warranties, seeking relief under the Magnuson-Moss Warranty Act (MMWA), including a refund, and also sought loss-of-use damages.
- Monaco moved for summary judgment, arguing that (1) the MMWA’s refund-type relief was unavailable because the warranty was “limited,” and (2) the written warranty barred consequential damages.

## Issues

1. May a consumer pursue MMWA relief, including a refund-type remedy, when the manufacturer provided only a limited written warranty and the consumer pleads breach of warranty?
2. Is a conspicuous exclusion of consequential damages enforceable even when the limited repair-or-replace remedy is alleged to have failed of its essential purpose?

## Decision

- The court granted Monaco’s motion for summary judgment in part and denied it in part.
- The court rejected Monaco’s categorical argument that the Sheehans could not seek refund-type relief under the MMWA merely because Monaco’s written warranty was “limited,” and it allowed the Sheehans’ MMWA breach-of-warranty claim to proceed.
- The court enforced the warranty’s consequential-damages exclusion and disposed of the Sheehans’ claims for consequential damages, including loss-of-use damages.

## Legal Principles

- The MMWA provides a federal cause of action for a warrantor’s failure to comply with obligations under a written or implied warranty; the existence and scope of the underlying warranty breach and many remedies are supplied by applicable state law.
- The MMWA’s provisions addressing remedies for “full” warranties do not, by themselves, eliminate breach-of-warranty claims where the written warranty is labeled “limited”; a plaintiff who alleges breach of warranty may pursue MMWA relief tied to that breach.
- Under U.C.C. § 2-719 and related warranty law, limitations on remedies (such as repair-or-replace) and exclusions of consequential damages are analyzed as separate contract terms.
- Even if a limited repair remedy fails of its essential purpose, a separately stated and conspicuous consequential-damages exclusion may remain enforceable, absent a sufficient showing (such as unconscionability) that would justify setting it aside.
- Clear warranty language stating that a consequential-damages exclusion is independent of, and survives, failure of essential purpose supports enforcement of the exclusion.

## Conclusion

The court permitted the Sheehans to continue pursuing a Magnuson-Moss breach-of-warranty claim and refund-type relief notwithstanding Monaco’s “limited” warranty label, but it enforced Monaco’s bold, stand-alone consequential-damages exclusion and barred recovery of loss-of-use and other consequential damages.


Sheehan v. Monaco Coach Corp., 2006 WL 208689 (2006)