Oddo v. General Motors Corp.
22 UCC Rep. Serv. 1147 (N.Y.Sup. 1977)

  • Oddo bought a new car, drove it off the lot, and almost immediately it burst into flames! He had the smoldering car towed back to the dealer and demanded a refund.
  • The dealer argued that the car could be fixed and therefore their sole obligation was to repair the car in accordance with the warranty. They repaired the car, but Oddo refused to accept it.
  • Instead, Oddo sued for a refund (aka rescission).
  • The Court found for Oddo and said that he has a right to rescission.
    • The Court found that Oddo had a reasonable expectation to have a safe car. The fire was a breach of contract based on merchantability, and therefore rescission is justified.
    • Basically, when a seller sells something, there is an implicit guarantee that the thing is useable (aka a guarantee of merchantability). If it isn’t, then the contract is considered void.
      • See UCC §2-601.
  • If General Motors had offered to give Oddo a completely new car instead, that would probably have been acceptable as a conforming delivery under UCC §2-508(1).