Problem.Dispute.Leak in an SUV

     Part A

     In September, Calvin purchased a new Galileo Sports Utility Vehicle (SUV) from Universal Auto Sales.  Calvin purchased the SUV because he was prepared to start a business teaching survival skills in the wilderness and needed the SUV to transport clients to and in the wilderness. 

     During the first rainy season after buying the SUV (November - March), the carpeting inside would get soaking wet (and sometimes puddle), beginning at the rear and working forward toward the front of the SUV, because of a leak through the rubber seals in the rear door.  On one occasion this damaged clothes and equipment of clients (whom he felt compelled to reimburse), on other occasions caused him to cancel scheduled outings with clients, and on all occasions left a musty smell in the SUV until aired out for several days.  Calvin also had to refrain from scheduling outings with clients during times that the SUV was in the Universal Auto Sales service facility for free but unsuccessful attempts to prevent the leaks.  Eventually an independent service facility was able to repair the vehicle to prevent the leaks and Calvin decided to keep the vehicle.  

     Assuming breach of warranty and no contractual limitation of remedy, is Calvin entitled to damages from Universal Auto Sales compensating him for loss of revenues and for reimbursement to clients whose property was damaged?  First consider Hadley v. Baxendale and then see UCC 2-714(3), 2-715(2).   Would a contractual exclusion of consequential damages protect the seller against such liability?  See UCC 2-719(3). 

     Part B

     Calvin returned the SUV to the dealer for repair of the leak three times within the first six months after his purchase.  Each repair, made without charge, was ineffectual.  Disgusted with the inability of the dealer to repair the leak, Calvin has demanded of the dealer that it take the SUV back and return the purchase price.  The dealer has refused and told Calvin to bring the SUV back for repair, pointing to the following provision in the written warranty given to Calvin at the time of his purchase: 

"Manufacturer warrants this vehicle to be free of defects in material and workmanship for a period of 24 months or 24,000 miles after the date of purchase, whichever first occurs.  For any defect covered by this written warranty and for any defect covered by the implied warranty of merchantability, purchaser shall return the vehicle to an authorized dealer for repair of the defect or replacement of the defective part.  Neither the manufacturer nor any dealer shall be liable for consequential damages arising from any defect in material or workmanship."   

     Has Calvin any remedy other than returning the vehicle for repair or replacement of the defective part?  See UCC 2-719.  Then consider excerpts from the California Civil Code:  Cal. Civ. Code 1790.3, Cal. Civ. Code 1793.2 and 1793.22.   The referenced portions of the California Civil Code that refer to new motor vehicles and motor homes are colloquially referred to as California's "lemon law" because of the historical use of the word "lemon" to describe a motor vehicle with many defects.  Some referenced portions of the California Civil Code apply to new consumer goods other than motor vehicles; accordingly, lawyers, consumer advocates, and others may use the phrase "lemon law" to encompass these special statutory consumer remedies for defects in any kind of new consumer good.  For the text of lemon law statutes in other states, information about lawyers who specialize in lemon law cases, and examples of lemon law cases, see the web site of Lemon Law America. 

     May Calvin recover for any of the consequential loss described in Part A of this problem that occurred prior to the third repair attempt?   That occurred after the third repair attempt?