Smith and Roberson's Business Law 16th Edition by Richard Mann,Barry Roberts

Exercise 22

Through information provided by S-2 Yachts, Inc., the plaintiff, Barr located a yacht to his liking at the Crow's Nest marina and yacht sales company. When Barr asked the price, he was told that, although the yacht normally sold for $102,000, Crow's Nest was willing to sell this particular one for only $80,000 to make room for a new model from the manufacturer, S-2 Yachts, Inc. Barr was assured that the yacht in question came with full manufacturer's warranties. Barr asked if the yacht was new and if anything was wrong with it. Crow's Nest told him that nothing was wrong with the yacht and that there were only twenty hours of use on the engines.
Once the yacht had been delivered and Barr had taken it for a test run, he noticed several problems associated with saltwater damage, such as rusted screws, a rusted stove, and faulty electrical wiring. Barr was assured that Crow's Nest would pay for these repairs. However, as was later discovered, the yacht was in such a damaged condition that Barr experienced great personal hazard the two times that he used the boat. Examination by a marine expert revealed clearly that the boat had been sunk in saltwater prior to Barr's purchase. The engines were severely damaged, and there was significant structural and equipment damage as well. According to the expert, not only was the yacht not new, it was worth at most only one-half of the new value of $102,000. What should Barr be able to recover from S-2 Yachts and Crow's Nest?