Date: 09-14-2007

Case Style: Marisa Isip v. Mercedes-Benz USA, LLC

Case Number: B192382

Judge: KRIEGLER

Court: California Court of Appeal, Second Appellate District on appeal from the Superior Court of Los Angeles County

Plaintiff's Attorney:

Alexander Wick, Los Angeles, California, Previn Wick; Krohn & Moss, Los Angeles, California and Todd Friedman for Plaintiff and Respondent.

Defendant's Attorney:

Bannan, Green, Frank & Terzian, C. Forrest Bannan and Mark P. Estrella for Defendant and Appellant.

Description:

In this action for breach of written and implied warranties in the sale of a car, defendant and appellant Mercedes-Benz USA, LLC (MBUSA) appeals from a judgment following a jury trial in favor of plaintiff and respondent Marisa Isip (Isip) in the amount of $20,000. MBUSA contends the trial court erred by refusing its proposed jury instruction on the implied warranty of merchantability. We conclude there was no instructional error and affirm the judgment.

FACTS AND PROCEDURAL BACKGROUND

On June 21, 2004, Isip purchased a 2004 Mercedes-Benz C320 from a Mercedes- Benz dealership. She paid $46,797.84, with financing, and no down payment. She received a four-year/50,000-mile bumper-to-bumper warranty. The warranty provided that any authorized center "will make any repairs or replacements necessary to correct defects in material or workmanship arising during the warranty period."

Isip began to experience problems with the car after driving it for 3,900 miles. The problems she experienced during the first year of ownership1 included the following. The air-conditioning emitted an offensive smell every time it was turned on, giving Isip a headache and making her sister sneeze. The car made a loud tugging noise when she engaged the gear, and it made a clanking noise when Isip released the brake in reverse. When the car automatically shifted gears to pick up speed, the car pulled back, hesitated, and then took off like a slingshot. It also hesitated and pulled back before slowing down. The engine made a loud knocking sound and there were fluid leaks. White smoke came out of the exhaust system.

Isip brought the car in for repairs on six occasions during the first year. At the time of trial, the brakes still made a clanking noise, the transmission still hesitated, and white smoke was still coming out of the exhaust.

Isip cut her driving in half for fear the car was unsafe and would break down. She testified the car was only worth $10,600 to her in its defective condition. On February 9, 2005, Isip's attorney gave written notice to MBUSA, purporting to revoke acceptance of the car.

On March 14, 2005, Isip filed a complaint against MBUSA. In the first cause of action, Isip alleged MBUSA breached written warranties to repair defects in materials or workmanship in violation of the Magnuson-Moss Warranty Act (15 U.S.C. § 2301 et seq.). In the second cause of action, Isip alleged MBUSA breached the implied warranty of merchantability as defined in the Magnuson-Moss Warranty Act, including implied warranties that the vehicle was fit for the ordinary purpose for which it was intended and to pass without objection in the trade under the contract description, in that defects rendered the car unfit for the ordinary purpose for which the car was intended. In the third cause of action, Isip alleged MBUSA's tender of the car was substantially impaired to Isip, in violation of section 2310(d) of title 15 of the United States Code. In the fourth cause of action, Isip alleged that, pursuant to the Song-Beverly Consumer Warranty Act (Civ. Code, § 1790 et seq.), she presented the car to authorized service dealers four times for repairs and the service dealers were unable to repair the defects in a reasonable number of attempts. In the fifth cause of action, Isip alleged that MBUSA breached the implied warranty of merchantability, as defined by the Song-Beverly Consumer Warranty Act, including implied warranties to be fit for the ordinary purpose for which it was intended and to pass without objection in the trade under the contract description, in that the car's defects rendered the car unfit for the ordinary use for which the car was intended.

The trial court instructed the jury substantially in the language of Judicial Council of California Civil Jury Instructions (2006-2007), CACI No. 3210 on the implied warranty of merchantability under both the Magnuson-Moss Warranty Act and the Song- Beverly Consumer Warranty Act. "In order for Maria [sic] Isip to prove that MBUSA breached the implied warranty of merchantability, you must find that her vehicle is not fit for the ordinary purpose for which such vehicle is intended. . . . [] To establish this claim, Maria [sic] Isip must prove all of the following: [] 1. That Maria [sic] Isip bought a vehicle manufactured and sold by MBUSA. [] 2. That at the time of purchase, MBUSA was in the process of selling and manufacturing vehicles; and [] 3. That the vehicle was not of the same quality as those generally acceptable in the trade, or was not fit for the ordinary purpose for which such vehicles are used. To this instruction, the trial court added: "Fitness for the ordinary purpose of a vehicle means that the vehicle should be in safe condition and substantially free of defects."2

The trial court denied MBUSA's request to add the following language to CACI No. 3210: "The implied warranty of merchantability does not impose a general requirement that goods precisely fulfill the expectations of the buyer; rather, it provides for a minimum level of quality which the law describes as being fit for the ordinary purposes for which such goods are used. In the case of automobiles, the implied warranty of merchantability can be breached only if the vehicle manifests a defect that is so basic that it renders the vehicle unfit for its ordinary purpose of providing transportation."

The jury was also instructed to determine "under all of [Isip's] claims . . . whether she allowed MBUSA or its authorized repair facilities to have a reasonable number of attempts to repair the problems she alleges to have occurred with the vehicle, or whether MBUSA or its authorized repair facilities exceeded a reasonable number of attempts to repair the problems."

Regarding damages for breach of the implied warranty of merchantability, the trial court instructed the jury: "If you find that MBUSA or its representatives violated its express warranty or the implied warranty, or both, under the Magnuson-Moss Warranty Act or the implied warranty of merchantability under Song-Beverly, then [Isip] is entitled to recover the following as damages: [] The difference at the time of purchase between the value of the vehicle and the value it would have if it had been as warranted, unless special circumstances show damages in a different amount. Such special circumstances may include any wear and tear or damage to the vehicle to the date of trial."

The jury returned the following verdict. MBUSA breached the implied warranty of merchantability, which caused $20,000 in damages to Isip. Under the Magnuson- Moss Warranty Act, MBUSA breached the written warranty by failing to repair the car after a reasonable number of repair attempts, but this breach of written warranty caused no monetary damage to Isip. Under the Song-Beverly Consumer Warranty Act, the car did not have defects covered by the warranty that substantially impaired its use, value, or safety. On April 19, 2006, judgment was entered in the amount of $20,000 for breach of the implied warranty of merchantability under the Magnuson-Moss Warranty Act and the Song-Beverly Consumer Warranty Act and in the amount of $0 for breach of express warranty under the Magnuson-Moss Warranty Act.

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The Magnuson-Moss Warranty Act provides a right of action for a consumer who is damaged by a warrantor's failure to comply with an implied warranty that arises under state law. (15 U.S.C. §§ 2301(7), 2310(d)(1).) In California, an implied warranty of merchantability arises under the Song-Beverly Consumer Warranty Act: "Unless disclaimed in the manner prescribed by this chapter, every sale of consumer goods that are sold at retail in this state shall be accompanied by the manufacturer's and the retail seller's implied warranty that the goods are merchantable." (Civ. Code, § 1792.) "The ‘[i]mplied warranty of merchantability' or ‘implied warranty that goods are merchantable' means that the consumer goods meet each of the following: [] (1) Pass without objection in the trade under the contract description. [] (2) Are fit for the ordinary purposes for which such goods are used. . . ." (Civ. Code, § 1791.1, subd. (a).)

The Song-Beverly Consumer Warranty Act provides a right of action for a buyer to recover damages and other relief when there has been a breach of the implied warranty of merchantability. (Civ. Code, § 1794, subd. (a).) Civil Code section 1794, subdivision (b)(2) provides that, where the buyer accepts the goods, damages include damages available under Commercial Code sections 2714 and 2715 [incidental and consequential damages]. Commercial Code section 2714 provides in pertinent part: "(2) The measure of damages for breach of warranty is the difference at the time and place of acceptance between the value of the goods accepted and the value they would have had if they had been as warranted, unless special circumstances show proximate damages of a different amount."

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Outcome: The judgment is affirmed. Costs on appeal are awarded to Isip.

Plaintiff's Experts: Unknown

Defendant's Experts: Unknown

Comments: None