During a promotional sale, Alice bought a car from Bill for $10,000. Bill warranted that the car had no defects. The car would have been worth $11,000 had it complied with Bill’s warranty. In fact, the car’s transmission was defective; a breach of warranty. As a result, the actual value of the car was only $9,000. Alice paid $200 for a rental car when the transmission failed and she needed transportation. Alice has accepted the car, and intends to keep it. Under the theories of obligation and performance, and given that Allison wants to keep the car, what can she do? What standard must she prove? What are her responsibilities as the buyer? Is Alice required to give Bill notice of the breach? What can Bill do if Alice gives him notice? How much in damages can Alice recover? What other remedies might Allison have? Thoroughly explain your answer. Fully describe the applicable laws and then apply them to the material facts. Explain your analysis. If you make assumptions of fact, fully explain them. Please explain your answers with appropriate, relevant case law citations.
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