Summary
In Ministic Air Ltd. v. Raytheon Aircraft Co., No. 99-1493-JTM (D. Kan.), which involved a warranty provision identical to Paragraph 19(b)(5), defendant argued that the cause of action accrued on the date of the airplane accident.
Summary of this case from SMD Investments Limited v. Raytheon Aircraft CompanyOpinion
No. 99-1493-JTM.
March 20, 2001.
MEMORANDUM ORDER
The present action arises from damages to a commercial jet owned by the plaintiff Ministic Air Ltd. The jet, which had been manufactured by defendant Raytheon, was purchased by Ministic in 1996. The jet was allegedly damaged during an attempted takeoff in Manitoba, Canada on November 29, 1997. Ministic has brought claims for relief against Raytheon on a number of grounds. In the present motion, Raytheon seeks dismissal of claims relating to breach of contract, negligence, negligent misrepresentation, and strict liability (counts 1, 2, 3, and 7). Granting the motion will leave claims for misrepresentation, fraudulent misrepresentation, and fraud by silence (counts 4, 5, and 6).
Raytheon's argument against the breach of contract claim is two-fold, noting that the complaint alternately suggests Raytheon violated both the Kansas Consumer Protection Act (KCPA), and the Kansas UCC. Raytheon contends that the KCPA is inapplicable, since Ministic was a commercial buyer, and therefore cannot qualify as a "consumer" within the meaning of the act. Raytheon contends that the UCC was not violated since the contract expressly limited warranties to the express warranty, which restricted any claims for violation to those brought within one year of the date of the contract. Ministic's response is silent as to the KCPA claim. Ministic argues that dismissal is inappropriate as to the UCC claims, suggesting that the waiver of warranties was the product of coercion.
The court finds that the plaintiff's contract claim must be dismissed. Ministic does nothing more than suggest hypothetically that it might show that the warranty exclusion was unconscionable, and suggest that dismissal is inappropriate since Raytheon's motion is based on evidentiary materials (parts of the sales contracts including the exclusionary language) which go outside its complaint. This, however, does not bar dismissal. A motion to dismiss pursuant to Rule 12(b)(6) may be converted into a summary judgment motion so long as there has been notice and an opportunity for the parties to present relevant evidence. See David v. City County of Denver, 101 F.3d 1344, 1352 (10th Cir. 1996). The required notice may be actual or constructive, and may in fact arise from the movant's submission of evidentiary materials. Here, Ministic does not either supply facts from which the court might determine that the exclusionary clause was unconscionable, or articulate with any reasonable certainty what facts in support of such a conclusion it might obtain by further discovery.
Raytheon, on the other hand, has presented evidence that the contract explicitly and conspicuously limited the buyer's remedies for alleged breach of express or implied warranties. There is no basis in the facts for concluding that the limitation — part of a sales contract between two experienced commercial entities — was unconscionable, or was the product of coercion or some other invalidating cause. Cf. Willie v. Southwestern Bell Tel. Co. 219 Kan. 755, 758-59, 549 P.2d 903 (1976) (listing factors suggestive of unconscionable bargaining).
Similarly, the court will dismiss the plaintiff's claims grounded in either negligence or strict liability. Raytheon's argument is that such claims cannot be advanced under the economic loss doctrine, where (as here) the only damage has been to purchased goods. See East River Steamship Corp. v. Transamerica Delaval Inc., 476 U.S. 858 (1986); Koss Construction v. Caterpillar, Inc., 25 Kan. App.2d (1998). Ministic argues that the doctrine is inapplicable because it advances claims for both negligent misrepresentation, and that the other negligence claims are very detailed in advancing a number of different theories as to how Raytheon allegedly departed from its duty of due care.
The attempted distinction is not convincing. There is no basis in the economic loss doctrine (as articulated in East River, and then recognized in Kansas in Koss) for permitting the doctrine to be circumvented by simply pleading a lengthy list of allegedly negligent acts in detail. The holding of the doctrine is that, whether pled in detail or as combined with some other doctrine (here, negligent misrepresentation) a purchaser of damaged goods cannot rely on claims arising from negligence or strict liability.
IT IS ACCORDINGLY ORDERED this day of March, 2001, that the defendant's motion to dismiss (Dkt. No. 25) is hereby granted.