1.1                          A bill for an act 
  1.2             relating to civil actions; clarifying the economic 
  1.3             loss doctrine; providing for a comprehensive statute 
  1.4             governing economic loss; proposing coding for new law 
  1.5             in Minnesota Statutes, chapter 604.  
  1.6   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.7      Section 1.  [604.101] [ECONOMIC LOSS ARISING FROM THE SALE 
  1.8   OF GOODS.] 
  1.9      Subdivision 1.  [DEFINITIONS.] (a) The definitions in this 
  1.10  subdivision apply to this section. 
  1.11     (b) "Economic loss" means financial harm, limited to damage 
  1.12  to or loss of the goods sold; damage to tangible property other 
  1.13  than the goods sold; damage to intangible property; damage to 
  1.14  property into which the goods are incorporated and become a 
  1.15  component part; damage to a component part caused by the 
  1.16  property into which the component part is incorporated; or 
  1.17  damage to real property.  Economic loss includes any damage or 
  1.18  loss resulting from any such financial harm.  Economic loss does 
  1.19  not include damages arising out of personal injury. 
  1.20     (c) "Fraud in the inducement" means an intentional or 
  1.21  reckless misrepresentation that induces the buyer to enter into 
  1.22  the contract, but does not include negligent representations. 
  1.23     (d) "Merchant in goods of the kind" means a person who 
  1.24  deals in goods of the kind that are the subject of the 
  1.25  transaction in issue. 
  2.1      (e) "Tort" means common law torts, but does not include 
  2.2   independent statutory causes of action. 
  2.3      Subd. 2.  [ECONOMIC LOSS.] (a) In transactions governed by 
  2.4   article 2 of the Uniform Commercial Code, or in transactions 
  2.5   outside the scope of article 2 where damage is caused by the 
  2.6   goods sold, where the buyer is a merchant in goods of the kind, 
  2.7   economic loss may be recovered in tort only if the claim is one 
  2.8   for fraud in the inducement. 
  2.9      (b) In transactions governed by article 2 of the Uniform 
  2.10  Commercial Code where the buyer is not a merchant in goods of 
  2.11  the kind, economic loss may be recovered in tort, except that 
  2.12  damage to or loss of the goods sold, or damage to intangible 
  2.13  property may be recovered in tort only if the claim is one for 
  2.14  fraud in the inducement. 
  2.15     Subd. 3.  [EFFECT.] This section supersedes the common law 
  2.16  economic loss doctrine in transactions which are governed by 
  2.17  article 2 of the Uniform Commercial Code or in cases outside the 
  2.18  scope of article 2 where damage is caused by the goods sold. 
  2.19     Sec. 2.  [EFFECTIVE DATE.] 
  2.20     This act is effective the day following final enactment and 
  2.21  applies to contracts or agreements entered into by the buyer on 
  2.22  or after that date.