Rigoberto Ramos v. Mercedes-Benz USA, LLC

Plaintiff Rigoberto Ramos leased a new 2013 MercedesBenz E350 from Mercedes-Benz of Beverly Hills on March 24,

2013.

A year later, in April 2014, plaintiff took the car to the

dealer for the first time, because the car had been making

squeaking and grinding noises when the steering wheel was

turned to the right while backing up. The dealer was unable to

duplicate the noise. The car was in the shop for one day.

Six months after that, in October 2014, plaintiff brought

the car in because of a high-pitched noise from the front wheel

area. The dealer confirmed the complaint and performed several

repairs, including replacement of several parts. The service

department also independently discovered cracked bushings and

replaced them. The car was in the shop for 16 days.

About two weeks after the October repair, on November 15,

2014, plaintiff brought the car in again, reporting he continued to

hear the grinding noise when the steering wheel was turned to

the right while backing up. The dealer confirmed the noise

occurred and performed repeated diagnostic road tests, but could

not identify the cause. The dealer instructed plaintiff to continue

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driving the vehicle until further review by Mercedes-Benz. The

car was in the shop for 18 days.

In December 2014, plaintiff asked Mercedes-Benz USA,

LLC (the manufacturer) to repurchase the car, and on January 6,

2015, the company declined to do so.

Nine months later, in October 2015, plaintiff took the car to

the dealer, reporting the car was still making the same noise

when he backed up and turned the steering wheel to the left. The

dealer found the rack and pinion assembly was the source of the

noise, replaced it and performed other repairs. The car was in

the shop for nine days.

Plaintiff returned the vehicle at the end of the lease term in

May 2016.

Meanwhile, in February 2016 plaintiff filed this lawsuit

against Mercedes-Benz USA, LLC and Mercedes-Benz of Beverly

Hills under the Song-Beverly Act. (All statutory citations are to

the Civil Code unless otherwise specified.) He alleged several

causes of action, including failure to promptly replace the car or

make restitution, after failing to repair the car to conform to

express warranties after a reasonable number of attempts

(§ 1793.2, subd. (d)); failure to commence repairs within a

reasonable time and failure to repair the car so it conformed to

the applicable warranties within 30 days (§ 1793.2, subd. (b));

and breach of the implied warranty of merchantability (§ 1791.1).

A jury trial resulted in a special verdict finding the car did

not have a defect covered by the warranty that substantially

impaired the vehicle’s use, value or safety, and the car was fit for

ordinary purposes, but defendants failed to complete warranted

repairs within 30 days. Specifically, the jury answered these

questions.

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Question No. 3: “Did the vehicle have a defect covered by

the warranty that substantially impaired the vehicle’s use, value

or safety to a reasonable buyer in [plaintiff’s] situation?” The

jury answered “No.”

Question No. 10: “Did [the manufacturer] or its authorized

repair facility fail to complete repairs to a defect covered by the

written warranty within 30 days to conform the 2013 MercedesBenz E350 to the applicable warranties?” The jury answered

“Yes,” and found plaintiff’s incidental and consequential damages

were $1,800.

Question No. 17: “Was the motor vehicle fit for the

ordinary purposes for which vehicles are used?” The jury

answered “Yes.”

The court entered judgment for plaintiff and against

defendants for $1,800 on March 25, 2019. Plaintiff filed motions

for a new trial, for partial judgment notwithstanding the verdict,

and to vacate and enter a different judgment. Defendants filed

motions to enter a different judgment and for judgment

notwithstanding the verdict on the cause of action for failure to

complete repairs within 30 days.

All motions were denied, and plaintiff filed this appeal.

DISCUSSION

Defendants did not file a respondents’ brief. We decide the

appeal “on the record, the opening brief, and any oral argument

by the appellant.” (Cal. Rules of Court, rule 8.220(a)(2).)

Plaintiff contends the trial court erred when it refused to

instruct the jury that restitution of everything plaintiff paid

under his lease contract for the car could be awarded as the

remedy for defendants’ failure to complete warranty repairs in

30 days. As a consequence, on that cause of action the special

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verdict form asked the jury only: “What are [plaintiff’s]

incidental and consequential damages?”

The question whether the Song-Beverly Act permits

restitution of the price paid for the car, as a remedy for a

manufacturer’s failure to complete warranty repairs within

30 days, is a question of statutory construction that we review de

novo. We give statutory language “ ‘a plain and commonsense

meaning,’ ” and we consider a statutory provision “in its statutory

context,” not in isolation. (Kirzhner v. Mercedes-Benz USA, LLC

(2020) 9 Cal.5th 966, 972, 977 (Kirzhner).)

We begin with the pertinent statutes.

Section 1793.2 governs the duties of a manufacturer

making an express warranty. One of those duties appears in

section 1793.2, subdivision (b). It provides that where repair of

consumer goods is necessary “because they do not conform with

the applicable express warranties,” the goods must be repaired

“so as to conform to the applicable warranties within 30 days.”

(We will refer to this as the 30-day repair requirement, or

section 1793.2(b).)1

Another duty appears in section 1793.2, subdivision (d). “If

the manufacturer . . . is unable to service or repair a new motor

vehicle . . . to conform to the applicable express warranties after a

reasonable number of attempts, the manufacturer shall either

1 Section 1793.2(b) states, in pertinent part: “Where . . .

service or repair of the goods is necessary because they do not

conform with the applicable express warranties, service and

repair shall be commenced within a reasonable time by the

manufacturer or its representative in this state. Unless the

buyer agrees in writing to the contrary, the goods shall be

serviced or repaired so as to conform to the applicable warranties

within 30 days.”

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promptly replace the new motor vehicle in accordance with

subparagraph (A) or promptly make restitution to the buyer in

accordance with subparagraph (B).” (§ 1793.2, subd. (d)(2).) (We

refer to this as the replacement-restitution remedy, or

section 1793.2(d).)

Section 1794 governs a buyer’s damages. It allows any

buyer “who is damaged by a failure to comply with any obligation

under this chapter or under an implied or express warranty or

service contract” to bring an action for recovery of those damages

and other legal and equitable relief. (§ 1794, subd. (a).)

Section 1794, subdivision (b) sets the measure of a buyer’s

damages: “The measure of the buyer’s damages in an action

under this section shall include the rights of replacement or

reimbursement as set forth in subdivision (d) of Section 1793.2,

and the following: [¶] (1) Where the buyer has rightfully

rejected or justifiably revoked acceptance of the goods or has

exercised any right to cancel the sale, Sections 2711, 2712, and

2713 of the Commercial Code shall apply. [¶] (2) Where the

buyer has accepted the goods, Sections 2714 and 2715 of the

Commercial Code shall apply, and the measure of damages shall

include the cost of repairs necessary to make the goods conform.”

(Italics added.)

Because the jury found a violation of the 30-day repair

requirement (§ 1793.2(b)), plaintiff argues the plain language of

the just-quoted statutes entitles him to everything he paid under

his lease contract plus incidental and consequential damages

(rather than only incidental and consequential damages). He

also contends that he justifiably revoked acceptance of the car

(§ 1794, subd. (b)(1)), so that Commercial Code section 2711

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applies, permitting him to recover the price he paid for the car.

Neither of plaintiff’s contentions is correct.

First, as the language italicized above shows, section 1794,

subdivision (b) limits the replacement-restitution remedy to the

circumstances “set forth in subdivision (d) of Section 1793.2.”

Under section 1793.2(d), it is only when the manufacturer is

unable to repair the car “to conform to the applicable express

warranties after a reasonable number of attempts” that the duty

to replace or make restitution arises. (§ 1793.2(d)(2).) Further,

“[f]or the purposes of [section 1793.2(d)],” nonconformity is

defined to mean “a nonconformity which substantially impairs

the use, value, or safety of the new motor vehicle to the buyer or

lessee.” (§ 1793.22, subd. (e)(1).) The statute says nothing about

a replacement-restitution remedy for the section 1793.2(b)

violation of failing to complete repairs within 30 days.2

This conclusion is supported by Gavaldon v.

DaimlerChrysler Corp. (2004) 32 Cal.4th 1246 (Gavaldon), where

the Supreme Court held a service contract is not an express

warranty, and section 1794 does not authorize the replacementrestitution remedy for breaches of service contracts. (Gavaldon,

at pp. 1250, 1262.) (Recall that, in addition to failure to comply

with obligations under the statute, section 1794 authorizes

damages for failure to comply with obligations “under an implied

or express warranty or service contract.” (§ 1794, subd. (a).)) In

2 Plaintiff’s car was in the shop for a total of 44 days during

the period between April 2014 and October 2015, but no single

repair visit extended for 30 days. We have not been asked to

decide whether the 30 days of failure to complete repairs must be

30 consecutive days. For purposes of this appeal, we assume

plaintiff proved the 30-day failure to repair requirement without

deciding the question.

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Gavaldon, the Supreme Court rejected the plaintiff’s contention

“that [section 1794,] subdivision (b) signifies that anyone injured

under subdivision (a) may obtain the replacement/restitution

remedy.” (Gavaldon, at p. 1262.) The court explained:

“But the statute on its face does not so read. The right to

replacement or restitution is qualified by the phrase ‘as set forth

in subdivision (d) of section 1793.2.’ It is most reasonable to

assume that this qualification means that the remedy is subject

to the provisions set forth in section 1793.2, subdivision (d)

(section 1793.2(d)), otherwise the reference to section 1793.2(d)

would be superfluous. [The plaintiff] argues in effect that only

some of the provisions of section 1793.2(d) apply, but not the

provision stating that the replacement/restitution remedy is

available only for breach of an express warranty.” (Gavaldon,

supra, 32 Cal.4th at p. 1262; id. at p. 1263 [“the legislative

history confirms that the only reasonable reading of section 1794,

subdivision (b) is that the replacement/restitution remedy applies

only if the conditions of section 1793.2(d) are met”]; see also

Kirzhner, supra, 9 Cal.5th at p. 986 [“The duty to promptly

provide restitution arises only after the manufacturer is unable

to repair the vehicle after being afforded the opportunity to make

a reasonable number of repair attempts.”].)

Here, “the conditions of section 1793.2(d)” (Gavaldon,

supra, 32 Cal.4th at p. 1263) were not met. As we have just

observed, a nonconformity for purposes of section 1793.2(d) is a

nonconformity that substantially impairs the use, value, or safety

of the new car. (§ 1793.22, subd. (e)(1).) Plaintiff would have us

construe the statute to require a replacement-restitution remedy

for failure to repair, within 30 days, a defect the jury expressly

found did not substantially impair the vehicle’s use, value or

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safety to a reasonable buyer in plaintiff’s circumstances. We see

no basis in the statute, or in sound reason, to do so.

Second, plaintiff’s theory that section 1794,

subdivision (b)(1) entitles him to restitution fares no better.

Section 1794, subdivision (b)(1) provides “[w]here the buyer has

rightfully rejected or justifiably revoked acceptance of the goods

or has exercised any right to cancel the sale,” section 2711 of the

Commercial Code “shall apply.” Section 2711 allows a buyer who

“justifiably revokes acceptance” to recover “so much of the price

as has been paid,” as well as “any expenses reasonably incurred

in their inspection, receipt, transportation, care and custody.”

(Cal. U. Com. Code, § 2711, subds. (1) & (3).) Plaintiff contends

he revoked acceptance when he asked the manufacturer to buy

back the car, and again when he filed his complaint. But the

statute requires the buyer’s revocation of acceptance be

justifiable, and here, the jury’s verdict foreclosed a finding that

revocation of acceptance would have been justifiable. (§ 1794,

subd. (b)(1).)

The jury’s verdict, finding no substantial nonconformity in

the car, makes clear it would not have been justifiable for

plaintiff to revoke acceptance, and that he had no “right to cancel

the sale.” (§ 1794, subd. (b)(1); see Cal. U. Com. Code, § 2608,

subd. (1) [“The buyer may revoke his acceptance of a lot or

commercial unit whose nonconformity substantially impairs its

value to him . . . .”].)3

3 Plaintiff argues he did not have to show he revoked

acceptance of the car “within a reasonable time” and “before any

substantial change in condition” as required under section 2608

of the California Uniform Commercial Code. This argument

misses the point. The point in this case is that plaintiff’s asserted

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In short, plaintiff was only entitled to recover damages

caused by the delay in repairing a nonconformity that did not

substantially impair the car’s use, value or safety. The trial court

correctly concluded such damages do not include the

replacement-restitution remedy under section 1793.2(d). Nor do

they include damages that are available when a buyer justifiably

revokes acceptance of goods under section 1794,

subdivision (b)(1). There was no instructional error.

revocation of acceptance was unjustified at any time, because

there was no substantial impairment of the value of the car. The

argument is wrong on the law as well. A buyer seeking the

replacement-restitution remedy of section 1793.2(d) need not

revoke acceptance of the vehicle at any time to obtain that

remedy. (Krotin v. Porsche Cars North America, Inc. (1995)

38 Cal.App.4th 294, 303.) Justifiable revocation of acceptance

under section 1794, subdivision (b)(1) is an alternate theory of

recovery, as explained in Gavaldon, and the Commercial Code’s

requirements apply to it. (Gavaldon, supra, 32 Cal.4th at

pp. 1263-1264; id. at p. 1264 [“As can readily be observed,

revocation of acceptance requires more and different actions of

the buyer than is required under section 1793.2(d).”].) Plaintiff’s

reliance on such cases as Mocek v. Alfa Leisure, Inc. (2003)

114 Cal.App.4th 402 and Music Acceptance Corp. v. Lofing (1995)

32 Cal.App.4th 610 is misplaced. Those cases involve the

remedies for breach of implied warranty, which include the right

to cancel the contract and recover amounts paid. (Mocek, at

pp. 406-407; Music Acceptance, at p. 621; see also § 1791.1,

subd. (d), § 1794; Cal. U. Com. Code, § 2711.) The jury here

found there was no breach of implied warranty.

The judgment is affirmed.