The court noted that a complaint generally should not be dismissed on a motion unless it fails to provide adequate notice of a claim or does not contain sufficient facts to state a "claim to relief that is plausible on its face." A complaint need not contain detailed factual allegations, but must contain more than mere labels and conclusions, or a simple recitation of the elements of a cause of action. Although Whitwell's complaint did not specify the terms of the alleged contract with particularity, the court found it reasonable to assume that when Wal-Mart sells goods it contracts with the buyer to refund all amounts paid in exchange inefor the buyer’s promise to comply with Wal-Mart's return and refund policies. The Court concluded that Whitwell’s alleged contract did not fail for indefiniteness, although it was ambiguous as to refund specifics, which would require factual proof. The complaint, however, failed for other reasons.
Whitwell did not provide notice of claim to Wal-Mart before filing his suit. The policy of the UCC is to favor the resolution of contract disputes without litigation. To advance this policy, the UCC requires a buyer of goods, within a reasonable time after he discovers or should have discovered any breach, to notify the seller of breach or be barred from any remedy. This policy and notice requirement has been consistently recognized by Illinois courts. Whitwell argued that the notice requirement did not apply because he never accepted goods from Wal-Mart; the notice requirement applies only to a claim for breach of warranty, which he did not assert; and that notice was not required because Wal-Mart had actual knowledge of Whitwell's claim when he filed suit. The court rejected each argument.
First, Whitwell accepted the DVD player because he had opportunity to inspect it, paid for it, took it home and used it. Second, the UCC notice requirement applies to any breach without differentiating between warranty and contract claims. Finally, although there may be a general exception under Illinois law to pre-suit notices where a seller has actual knowledge of a breach, "it is essential that the seller be notified that this particular transaction is troublesome and must be watched.." Whitwell did not allege that he gave pre-suit notice of the claimed breach, and alleged no facts to suggest that Wal-Mart had actual knowledge of the claimed breach of contract. Wal-Mart may have had "generalized information" that variations in local rates of sales tax could affect or were affecting its refunds to customers, but that did not establish actual notice of the breach in this case; what is required is that Wal-Mart have "actual knowledge of the alleged breach of the particular product[ ] purchased by [Whitwell] in this lawsuit," namely, the DVD player Whitwell purchased in Collinsville and returned in Glen Carbon. In view of Whitwell's failure to comply with the pre-suit notice requirement of the UCC, the case was dismissed.
This case illustrates the ramifications of failing to take all required steps in asserting a claim for recovery in any situation involving a sale of goods under the UCC. Please contact us if you require guidance in pursuing such a claim. *****