Adams v. Nissan Motor Corp. in U.S.A.

• Decision Date: 03 November 1989
• Docket Number: Nos. 19041,19130,s. 19041
• Citation: 182 W.Va. 234,387 S.E.2d 288
• Parties: Richard W. ADAMS and Sandra Adams--Appellees, v. NISSAN MOTOR CORPORATION IN U.S.A.--Appellant. Richard W. ADAMS and Sandra Adams--Appellants, v. NISSAN MOTOR CORPORATION IN U.S.A.--Appellee.
• Court: West Virginia Supreme Court

Page 288

387 S.E.2d 288

182 W.Va. 234

Richard W. ADAMS and Sandra Adams--Appellees, v. NISSAN MOTOR CORPORATION IN U.S.A.--Appellant.

Richard W. ADAMS and Sandra Adams--Appellants, v. NISSAN MOTOR CORPORATION IN U.S.A.--Appellee.

Nos. 19041, 19130.

Supreme Court of Appeals of

West Virginia.

Nov. 3, 1989.

Syllabus by the Court

1. The purpose behind the West Virginia lemon law statute is to place upon the manufacturer of motor vehicles "the duty to meet their obligations and responsibilities under the terms of the express warranties extended to the consumers of this State." W.Va.Code § 46A-6A-1(1) (1986).

2. If the consumer can show a defect or condition "which substantially impairs the use or market value of the motor vehicle to the consumer ...," then the court's attention shifts to W.Va.Code § 46A-6A-5 to determine what is considered to be, as required by W.Va.Code § 46A-6A-3(b), a "reasonable number of attempts" by the manufacturer or dealer to conform the vehicle to the applicable express warranties. W.Va.Code § 46A-6A-3(b) and 5 (1986).

3. If a defect is one "likely to cause death or serious bodily injury ...," then one failed attempt by the manufacturer or dealer to repair the defect, within the earlier date of either the express warranty period or one year from the original delivery, is sufficient to satisfy W.Va.Code § 46A-6A-3(b) and require the manufacturer to replace the flawed vehicle with a comparable new motor vehicle which conforms to the express warranties.

4. If the defect is not likely to cause death or serious bodily injury, then it is presumed that "a reasonable number of attempts" to fix the vehicle has been undertaken if the same defect is subject to repair at least three times by the manufacturer or dealer within the express warranty term or one year from delivery, whichever is the earlier date, and the defect still exists. W.Va.Code § 46A-6A-5(a) (1986).

5. An alternate method of proving "a reasonable number of attempts" to fix the vehicle is available if, within the express warranty term or the one year period following delivery, whichever is the earlier date, the vehicle is out of service by reason of repair for a cumulative total of thirty or more days. W.Va.Code § 46A-6A-5(a) (1986).

6. A service contract which does not provide a warranty for fitness for use or the vehicle's condition is not considered a warranty for the purposes of W.Va.Code § 46A-6A-1 et seq. (1986).

Ralph C. Young, Hamilton, Mooney, Burgess, Young & Tissue, Oak Hill, for Richard and Sandra Adams.

Anita R. Casey, Meyer, Darragh, Buckler, Bebenek, Eck and Hall, Charleston, for Nissan Motor Corp. in U.S.A.

BROTHERTON, Chief Justice:

These joint appeals present novel issues regarding the interpretation of W.Va.Code § 46A-6A-1 et seq. (1986), the West Virginia lemon law statute. Specifically, Nissan Motor Corporation appeals the Fayette County jury's finding that their Security Plus Agreement constituted an express warranty for the purposes of the statute and thus extended the period under which a purchaser could prove a lemon law case. The Adams' also appeal, contending that they are entitled to both "post-verdict damages" and a cause of action as a private attorney general to act against Nissan. Although we find the Security Plus Agreement was not a warranty, we affirm the decision of the Fayette County Circuit Court for the reasons stated below and dismiss the Adams' appeal as meritless.

The Adams, plaintiffs below, purchased a 1986 Nissan 4 X 4 truck on October 31, 1986, from Derald Rollyson, Inc. of Beckley, West Virginia, for $15,854.90 plus tax, title, and registration. At the time of the purchase, the Adams also purchased a Nissan Security Plus Agreement at the cost of $519.75 over and above the purchase price of the vehicle. The Security Plus Agreement provided free repairs to the Nissan truck for five years or 60,000 miles, which was over and above the standard express warranty on the truck of twelve months/12,500 miles, or twenty-four months/25,000 miles for powertrain repairs. The Security Plus Agreement also included the cost of a rental car during any repairs incurred during the 60,000 mile period.

In January, 1987, when the vehicle odometer read approximately 7,495 miles, it was returned to Rollyson Motors for correction of problems with the left front hub. The hub on this model truck allows a shift into four-wheel drive while the truck is moving. After service, no further repairs were attempted on the alleged hub problem during the express warranty period. However, the Adams contend that the hub was never completely repaired and currently they cannot shift into four-wheel drive unless the truck stops completely.

The second complaint was made in September, 1987, when a sway bar bushing and bracket went bad. Repairs were effected on September 18, 1987, when the vehicle had 20,899 miles. Following the repair, no further problems were reported with the sway bar bushing and bracket.

The next problem complained of by the Adams occurred in January, 1988, when the vehicle had mileage of 29,000 miles on it, over and above both express warranties. There does not seem to be any dispute that the repairs were made without cost to the plaintiffs below under the Security Plus Agreement.

The plaintiffs filed suit in May, 1988. The Adams contended that, pursuant to W.Va.Code § 46A-6A-1 et seq., their Nissan 4 X 4 truck failed to conform with the warranties provided by Nissan, and that after a reasonable number of attempts to repair the vehicle, the petitioner was unable to conform the subject vehicle to the warranties. Therefore, the Adams sought:

1. Revocation of acceptance and a refund of the purchase price of the vehicle, including sales tax, license, registration, and other reasonable expenses incurred in the purchase of a new vehicle and interest thereon;

2. Damages for the cost of repairs allegedly required to conform the vehicle to the express warranty;

3. Damages for loss of use, annoyance, and inconvenience resulting from the alleged nonconformity, including expenses for replacement transportation; and

4. Reasonable attorney fees.

Prior to trial, Nissan presented a motion in limine to exclude during trial any evidence of the alleged damages, defects, problems, and/or repairs to the Nissan truck which occurred outside the manufacturer's express warranty periods of 12 months/12,500 miles or 24 months/25,000 miles for powertrain repairs as provided by W.Va.Code §§ 46A-6A-3 and 5. By contrast, counsel for the Adams argued that the Nissan Security Plus Agreement extended the manufacturer's express warranty to a period of 5 years/60,000 miles, thus permitting the introduction of evidence of repairs beyond the standard warranty periods. The circuit court reserved ruling on the motion until hearing the evidence in the case.

During the trial, Mr. Adams testified about alleged defects which occurred when the vehicle had in excess of 25,000 miles. After objection by Nissan's counsel, the court ruled that it would leave to the jury the issue of whether the Nissan Security Plus Agreement was a warranty which extended the applicability of the lemon law statute to the respondent's truck. Nissan objected to the judge's ruling.

Following the close of the evidence, the jury returned a verdict finding that there was a nonconformity with the written warranty that substantially impaired the use and market value of the vehicle. Therefore, the jury awarded $21,500 for revocation of the purchase price, and vehicle and incidental expenses, including $2,500 for annoyance and inconvenience and $2,500 for loss of use. ¹

On November 16, 1988, Nissan moved to have the jury verdict set aside. On November 29, 1988, the motion for a new trial was denied. Nissan appeals from that order, primarily alleging that the trial court erred in permitting the jury to make the determination of whether the Security Plus Agreement was a warranty and that the Security Plus Agreement was not a warranty, but rather a service contract. Simultaneously, the Adams appealed, contending they had the right to obtain "post-verdict damages" while this appeal was pending and to act as a private attorney general to levy civil fines against Nissan for failure to disclose the availability of lemon law options to the consumer.

I.

Lemon law statutes developed as a logical extension of the federal Magnuson-Moss Warranty-Federal Trade Commission Improvement Act, which was created by Congress to deal with problems inherent in consumer warranties. ² Contrary to popular belief, the Magnuson-Moss Act does not require a seller to give a warranty. Rather, it is applicable in situations not otherwise controlled by statute only when a "warrantor" offers a written warranty on a "consumer product" to a "consumer." ³ Section 2302 of the Act generally requires that the terms and conditions of the warranty, if offered, must be expressed in "simple and readily understood language"; ⁴ that when offered, full warranties must meet certain requirements, including full refund or free replacement if the product continues to malfunction after failure of a reasonable attempt to fix the defect; ⁵ and that when offering a full warranty, the manufacturer may not attempt to limit that warranty. ⁶ Thus, if a "full" warranty is limited in any manner, it must be labeled a limited warranty. ⁷

While similar in intent, lemon law statutes are specially designed to remedy the problem of new motor vehicle warranties. ⁸ Much more specific and remedy-oriented than the Magnuson-Moss Act, a majority of the states have enacted some version of the original Connecticut New Motor Vehicle Warranty statute to date. ⁹

The West Virginia lemon law statute, W.Va.Code § 46A-6A-1 et seq. (1986), entitled "Consumer Protection--New Motor Vehicle Warranties," explains that the public policy behind the lemon law statute is to place upon the manufacturer of motor vehicles "the duty to meet...