Applying Economic Loss Doctrine to Article 2 Transactions: A Doctrine at a Loss
27 Pages Posted: 12 Oct 2012
Date Written: October 11, 2012
The purpose of this Essay is to analyze the treatment and the types of tort and strict liability claims that courts are likely to redirect toward the Code’s Article 2 remedies. This Essay examines the typical application of the economic loss doctrine, including the bargain policy underlying the Code that supports imposition of the economic loss doctrine in a variety of claims touching Article 2 matters. The Essay conducts an exercise using the Chinese Drywall Litigation to demonstrate how characterizing claims made by aggrieved buyers is a more disciplined approach toward application of the economic loss doctrine. The Essay further evaluates the application of the doctrine to other property claims, including the extent to which the parties may either actually or impliedly take into account certain claims when entering into the sale of goods. This Essay concludes that modern application of the economic loss doctrine preserves the boundary between tort and contract, but should be subject to a less obscure approach that lends greater surety to parties and does not require judicial intervention in most cases.
Keywords: UCC, tort, economic, loss doctrine, chinese, drywall, strict liability, remedies, commercial, claims
JEL Classification: K1, K10, K12, K19, K20
Suggested Citation: Suggested Citation