Managers and the Legal Environment 7th Edition by David Madsen, Constance Bagley

Exercise 4

Joseph Boud visited Wasatch Marine, a Salt Lake City retailer run by SDNCO, Inc., that sells yachts manufactured by Cruisers. During the visit, Wasatch gave Boud a copy of Cruisers' sales brochure, which included a photograph of Cruisers' 3375 Esprit model apparently moving at a high rate of speed. The photograph had the following caption:
Offering the best performance and cruising accommodations in its class, the 3375 Esprit offers a choice of either stern drive or inboard power, superb handling and sleeping accommodations for six.
Based in part on the photo and caption, Boud took a test-drive and signed a contract to purchase a 3375 Esprit model yacht for more than $150,000. During the test-drive and a subsequent test-drive a week later, the yacht manifested several electrical and mechanical problems. Pursuant to a limited warranty in its sales contract, Wasatch serviced the yacht and attempted to fix the problems. After the problems persisted during a third test-drive, Boud sought to cancel the sales contract. Cruisers responded by offering to repair or replace the defective parts in accordance with its limited warranty. Boud filed a lawsuit seeking rescission on the basis that the photograph and caption were themselves an express warranty and that Cruisers and Wasatch had breached this warranty. How will Wasatch respond? Will the court find in favor of Boud or the defendant? On what basis? [Boud v. SDNCO, Inc., 54 P.3d 1131 (Utah 2002).]