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Ramirez v. Autosport | 440 A.2d 1345 (1982)

Imagine you enter into a contract with a seller to buy goods. On the day of delivery, the seller tenders to you goods that have some minor defects. Can you refuse to accept the goods and cancel the contract? Does the seller at least have a reasonable opportunity to cure the defects? The New Jersey Supreme Court addressed this issue in Ramirez versus Autosport.

Adele and Ernest Ramirez negotiated with a salesperson at Autosport to buy a recreational vehicle. They entered into a contract whereby the Ramirezes would purchase a new RV. The contract provided for Autosport to deliver the RV in two weeks. When the Ramirezes returned to Autosport two weeks later to pick up the RV, the Ramirezes inspected it and discovered several defects, including scratched paint and missing hubcaps. A salesperson advised the Ramirezes not to accept the camper because it wasn’t ready. They agreed and left the showroom, after being given assurances that the RV would be ready soon.

Nearly two weeks later, a salesperson informed the Ramirezes that the RV was ready. They went back to Autosport, but workers were still making repairs. The Ramirezes again refused to accept the RV and left. After two more weeks had passed, a salesperson telephoned the Ramirezes and said the RV was finally ready. When they returned to Autosport a fourth time, the salesperson asked them to wait and then left. After waiting ninety minutes without anyone from Autosport updating them, the Ramirezes left.

The Ramirezes sued Autosport in state court, requesting rescission of the contract and the fair-market value of their trade-in as damages. Autosport counterclaimed for breach of contract. Relying on New Jersey’s codification of the Uniform Commercial Code, the trial court ruled that the Ramirezes had validly canceled the contract after the RV proved defective. The trial court ruled in the Ramirezes’ favor on the rescission claim and against Autosport on its counterclaim. On Autosport’s appeal, the Appellate Division of the Superior Court affirmed.

Autosport further appealed to the New Jersey Supreme Court.

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