## Facts

- James R. Winchester bought a new 1978 Jeep “Honcho” truck from McCulloch Brothers Garage, trading in a Chevrolet four-wheel-drive vehicle and paying additional cash.
- About one month after purchase, while Winchester was driving, the Jeep’s driveshaft came out, the vehicle left the roadway, and Winchester observed damage involving the rear leaf spring on the driver’s side.
- The Jeep was towed to the dealer; the dealer refused to repair the vehicle under the manufacturer’s written warranty.
- The written warranty limited the buyer’s remedy to repair or replacement of defective parts and disclaimed liability for incidental and consequential damages.
- Winchester borrowed a vehicle for two days, then purchased another vehicle for transportation.
- Evidence at trial included estimated repair cost, a substantial potential rental cost over the period between the incident and trial, and an expert witness fee to support defect proof.
- A jury returned a $20,000 verdict for Winchester.

## Issues

1. Whether the warranty’s exclusive remedy (repair or replacement) failed of its essential purpose under U.C.C. § 2-719(2) when the seller refused to honor it.
2. If the limited remedy failed, what damages were available under Alabama’s U.C.C., including the measure under § 2-714 and incidental/consequential damages under § 2-715.
3. Whether the trial court properly ordered a new trial unless Winchester accepted a remittitur reducing the verdict to $4,900.

## Decision

- The court held the evidence supported a finding that the exclusive repair-or-replace remedy failed of its essential purpose under § 7-2-719(2) because the seller refused to perform the promised repairs.
- Upon failure of the limited remedy, Winchester could pursue the general remedies provided by the U.C.C., including damages under § 7-2-714 and, in a proper case, incidental and consequential damages under § 7-2-715.
- The court upheld the trial court’s conditional new-trial order requiring remittitur to $4,900 and treated that ruling as within the trial court’s discretion to address an excessive verdict.

## Legal Principles

- A seller may limit remedies for breach of warranty (including to repair or replacement) and may disclaim incidental and consequential damages, as permitted by U.C.C. §§ 2-316 and 2-719(1).
- An exclusive or limited remedy fails of its essential purpose under U.C.C. § 2-719(2) when the remedy is not provided as agreed; a seller’s refusal to honor the repair-or-replace promise can support such a finding.
- When a limited remedy fails, the buyer may resort to the U.C.C.’s general remedies, including the § 2-714(2) measure (difference between value as warranted and value as accepted) and, where supported, incidental and consequential damages under § 2-715.
- The purchase price may be used as evidence of the value of goods as warranted in calculating § 2-714 damages.
- Trial courts have discretion to order remittitur or a new trial when a jury’s damage award is excessive in light of the evidence.

## Conclusion

The court recognized that a repair-or-replace warranty can fail of its essential purpose when the seller refuses to provide repairs, permitting the buyer to seek full U.C.C. damages, while also affirming the trial court’s authority to reduce an excessive verdict through remittitur or a new trial.


Winchester v. McCulloch Bros. Garage, Inc., 388 So. 2d 927 (Ala. 1980)