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Keywords

contracttortdamages

contracttortplaintiffdamagesappeal

Related Cases

Grams v. Milk Products, Inc., 283 Wis.2d 511, 2005 WI 112, 699 N.W.2d 167, 60 UCC Rep.Serv.2d 965

Facts

The Grams, who specialized in raising calves, switched to a non-medicated milk replacer called 'Half-Time' after being advised by a Cargill representative that it was a less expensive option. Following the switch, they observed significant health issues in their calves, including poor weight gain and a tripled mortality rate. They filed suit against Cargill and Milk Products, alleging multiple tort claims, which the Circuit Court dismissed based on the economic loss doctrine.

Gerald and Joliene Grams have specialized in raising calves since 1992. The Grams acquire the calves when they are between three and five days old and raise them until they are approximately four months old, at which time they resell them.

Issue

Whether the Grams' tort claims against Milk Products and Cargill were barred by the economic loss doctrine.

The economic loss doctrine barred the Grams' tort claims against Milk Products and Cargill.

Rule

The economic loss doctrine prevents a party to a contract from using tort remedies to recover purely economic losses arising from that contract, with exceptions for personal injury or damage to property other than the product itself.

The economic loss doctrine is a judicial doctrine intended to preserve the fundamental distinction between contract and tort.

Analysis

The court determined that the Grams' claims were fundamentally based on disappointed performance expectations of the milk replacer. Since the damages claimed were a result of the product's failure to perform as expected, the court ruled that the economic loss doctrine applied, barring the tort claims.

We hold that if claimed damages are the result of disappointed expectations of a bargained-for product's performance, the economic loss doctrine applies to bar the plaintiff's tort claims and the plaintiff must rely upon contractual remedies alone.

Conclusion

The Supreme Court affirmed the lower court's ruling, concluding that the Grams' tort claims were barred by the economic loss doctrine.

Accordingly, we affirm the decision of the court of appeals.

Who won?

Milk Products, Inc. and Cargill, Inc. prevailed because the court found that the Grams' claims were based on disappointed performance expectations, which fell under the economic loss doctrine.

The court of appeals affirmed on both issues.

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