Way back when – before Restatement (Second) of Torts §402A (1965) crystallized the concept of strict liability – courts around the country were poking around, trying to come up with viable theories of what we would now call “product liability.” One method that gained some traction, prior to the advent of strict liability, was to strip contractual implied warranty of its historical requirement that the buyer and seller have been in “privity” (that is, that they dealt directly with each other). New York was one of the states that started down that road. In Goldberg v Kollsman Instrument Corp., 191 N.E.2d 81 (N.Y. 1963), the court held 4-3 that the manufacturer of a “thing of danger” (not otherwise defined, but in Goldberg, an airplane part that allegedly caused a crash) could be liable for breach of implied warranty without being in contractual privity with the plaintiff. Id. at 83 (“at least where an article is of such a character that when used for the purpose for which it is made it is likely to be a source of danger to several or many people if not properly designed and fashioned, the manufacturer as well as the vendor is liable, for breach of law-implied warranties, to the persons whose use is contemplated”). This was problematic, because until §2-318 was amended in 1975, New York’s UCC hadn’t done away with privity in all personal injury cases.
But along came strict liability, and New York’s tentative steps down the road of privity-less implied warranty were largely forgotten. Nobody paid much attention to warranty in the Empire State until the Court of Appeals held that strict liability and implied warranty were “not identical” in Denny v. Ford Motor Co., 662 N.E.2d 730, 739 (N.Y. 1995), in that strict liability utilized a risk/utility approach whereas implied warranty focused on consumer expectations. Id. at 736. While this distinction “may have little or no effect in most cases,” it can in some. Id. at 738.Continue Reading The Citadel Revisited – New York’s “Thing of Danger” Privity Exception Is Obsolete (and Another New York Note)