## Facts

- Western Recreational Vehicles, Inc. manufactured recreational vehicles and used a roll-coater lamination process to bond exterior sidewalls to interior components.
- Swift Adhesives, Inc. recommended a specific adhesive (Adhesive #47344) after testing it with Western’s aluminum sidewalls and equipment; Western used it for years with low delamination rates.
- In 1984 Western switched to reinforced fiberglass (Filon) siding and again asked Swift whether the same adhesive would work with Filon.
- After testing Filon samples, Swift advised that the adhesive could be used on Filon similarly to its use on aluminum.
- Western relied on that assurance and produced Filon-sided vehicles laminated with the adhesive.
- Within about 18 months, Western received substantial delamination complaints; inspections showed a discolored glue line with loss of tack, especially where panels were exposed to the elements.
- Western incurred significant repair and customer-service costs and claimed lost profits.
- Western sued Swift for breach of express and implied warranties under Washington’s UCC.
- After a bench trial, the district court found an express warranty, rejected Swift’s invoice/data-sheet disclaimers, applied the UCC “future performance” exception to delay limitations accrual, and awarded damages exceeding $3 million.
- Swift appealed on limitations, disclaimers, and damages; Western cross-appealed regarding damage allocation tied to limitations.

## Issues

1. Whether Swift’s assurance that the adhesive would work on Filon constituted an explicit warranty of future performance under UCC § 2-725(2), delaying accrual until discovery.
2. Whether printed warranty disclaimers/limitations on Swift’s invoices and product data sheets were enforceable to negate or limit liability for Swift’s express warranty about Filon performance.
3. If accrual began at tender of delivery, which party bore the burden to prove what portion of Western’s damages fell outside the limitations period.

## Decision

- The Ninth Circuit affirmed in part, reversed in part, and remanded.
- The court held Swift’s statements did not explicitly extend to future performance; the statute of limitations accrued at tender of delivery, not upon discovery of delamination.
- The court held Swift’s boilerplate disclaimers and limitations were ineffective to negate the express warranty regarding Filon performance.
- The court held the district court misallocated the burden on time-barred damages; Swift, as the party asserting the statute-of-limitations defense, bore the burden to show which damages (including lost profits) were outside the limitations period.
- The case was remanded for application of the correct accrual rule and proper allocation of damages consistent with Swift’s burden.

## Legal Principles

- Under Washington’s UCC § 2-725, breach-of-warranty claims generally accrue at tender of delivery and must be filed within four years.
- The § 2-725(2) discovery-rule exception applies only when a warranty explicitly extends to future performance; general assurances of suitability or present capability do not suffice absent a clear, explicit reference to future performance.
- Under Washington UCC principles, disclaimers and limitations are strictly construed; boilerplate terms on invoices or data sheets that contradict an express warranty, especially without evidence of negotiation, are ineffective to negate that express warranty.
- A statute of limitations is an affirmative defense; the defendant asserting it bears the burden to prove the extent to which claimed damages are time-barred.

## Conclusion

The Ninth Circuit rejected treating Swift’s “works on Filon” assurance as an explicit future-performance warranty for limitations purposes, but upheld liability despite Swift’s boilerplate disclaimers, and required Swift to prove which portions of Western’s damages were outside the limitations period on remand.


W. Recreational Vehicles, Inc. v. Swift Adhesives, Inc., 23 F.3d 1547 (9th Cir. 1994)