Bailey v. Monaco Coach Corp.

• Decision Date: 10 November 2004
• Docket Number: Civil Action File No. 1:04-CV-40-TWT.
• Citation: 350 F.Supp.2d 1036
• Parties: Richard BAILEY, Plaintiff, v. MONACO COACH CORPORATION, Defendant.
• Court: U.S. District Court — Northern District of Georgia

350 F.Supp.2d 1036

Richard BAILEY, Plaintiff, v. MONACO COACH CORPORATION, Defendant.

Civil Action File No. 1:04-CV-40-TWT.

United States District Court, N.D. Georgia, Atlanta Division.

November 10, 2004.

COPYRIGHT MATERIAL OMITTED

Eric Scott Fortas, Krohn & Moss, Atlanta, GA, Plaintiff.

Michael David Hostetter, Nall & Miller, Atlanta, GA, for Defendant.

ORDER

THRASH, District Judge.

This is an action for breach of warranty. It is before the Court on the Defendant's Motion for Summary Judgment [Doc. 30], and the Plaintiff's Motion to Supplement his Memorandum of Law in Opposition to Defendant's Motion for Summary Judgment [Doc. 40]. For the reasons set forth below, the Court GRANTS the Defendant's Motion for Summary Judgment and GRANTS the Plaintiff's Motion to Supplement his Memorandum of Law.

I. BACKGROUND

On December 11, 2002, Plaintiff Richard Bailey purchased a Safari Sahara motorhome, manufactured by Defendant Monaco Coach Corporation, from a Florida dealership. When Bailey purchased the motorhome, he received a copy of the "Safari Motorhome Limited Warranty." The Limited Warranty states that it covers defects in the manufacture of the motorhome, and defects in the materials used to manufacture the motorhome. (Def.'s Br. in Supp. of Mot. for Summ. J., Ex. 5.) However, the Limited Warranty also includes several exclusions and limitations. The duration of the warranty is limited to the first 12 months or first 24,000 miles, whichever occurs first. (Id.) The warranty limits a consumer's remedy during this period to the repair or replacement of defective parts. (Id.) Additionally, the warranty states that the warrantor will not be liable for any consequential or incidental damages resulting from any defect in the motorhome. (Id.) Finally, in a section labeled "What the Warranty Does Not Cover," the warranty limits the scope of the repair or replacement remedy by expressly excluding certain items or problems. This section states, in relevant part, that:

The Limited Warranty does not cover ... items that are working as designed but which you are unhappy with because of the design; ...appliances and components covered by their own manufacturer's warranty including, by way of example the microwave, refrigerator ... generator ... hydraulic jacks ... or flaking, peeling and chips or other defects or damage in or to the exterior or finish caused by rocks or other road hazards....

(Def.'s Br. in Supp. of Mot. for Summ. J., Ex. 5.)

Shortly after taking possession of the motorhome, Bailey began to experience a series of problems with the vehicle. He alleges that his motorhome has required service for the following defects: electrical system, brakes, exterior trim, interior trim, water pump, luggage doors, rear bumper, body, tail pipe, entry door, backup camera, driver seat, passenger seat, screen door, radiator, closet doors, compartment doors, sewer hose door, cabinets, drawers, dinette slide-out, rotting wood, stress cracks, generator, marker lights, awning, shore power system, furnace, leveling system, air conditioning system, transmission oil cooler, and reverse lights. (Compl.¶ 13.) In all, Bailey's motorhome has been serviced six times, for a total of 130 days out of service. (R. Bailey Aff. ¶ 3.)

Bailey alleges that he continues to suffer problems with his motorhome because Monaco Coach has failed to repair the numerous defects. Pursuant to the Magnuson-Moss Warranty Act, 15 U.S.C. § 2301 et seq., Bailey asserts claims for breach of express and implied warranty. Monaco Coach moves for summary judgment on these claims.

II. SUMMARY JUDGMENT STANDARD

Summary judgment is appropriate only when the pleadings, depositions, and affidavits submitted by the parties show that no genuine issue of material fact exists and that the movant is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(c). The court should view the evidence and any inferences that may be drawn in the light most favorable to the nonmovant. Adickes v. S.H. Kress & Co., 398 U.S. 144, 158-59, 90 S.Ct. 1598, 26 L.Ed.2d 142 (1970). The party seeking summary judgment must first identify grounds that show the absence of a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323-24, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). The burden then shifts to the nonmovant, who must go beyond the pleadings and present affirmative evidence to show that a genuine issue of material fact does exist. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 257, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986).

III. DISCUSSION

The Magnuson-Moss Warranty Act, 15 U.S.C. § 2301 et seq., creates minimum disclosure and content requirements for certain consumer product warranties. Under the Act, consumers have a federal right of action against warrantors who fail "to comply with any obligation under ... a written warranty, implied warranty, or service contract." 15 U.S.C. § 2310(d). The Act was intended to supplement, not supplant, state law. Therefore, unless the Act expressly prescribes a regulating rule, courts should apply state law to written and implied warranty claims made under the Act. Walsh v. Ford Motor Co., 807 F.2d 1000, 1012 (D.C.Cir.1986).

A. Breach of Express Warranty

Congress enacted the Magnuson-Moss Warranty Act in order to "improve the adequacy of information available to consumers, prevent deception, and improve competition in the marketing of consumer products." 15 U.S.C. § 2302(a). The Act does not require manufacturers to provide warranties. But, if a manufacturer chooses to provide a written warranty, certain duties and liabilities are imposed on the warrantor. 16 C.F.R. § 700.3. One such duty relates to the content of written warranties. The Act requires that a written warranty must "fully and conspicuously disclose in simple and readily understood language the terms and conditions of such warranty." 15 U.S.C. § 2302(a). The Act delegates the promulgation of specific disclosure requirements to the Federal Trade Commission. 15 U.S.C. § 2302(b)(1)(A).

The Federal Trade Commission regulations promulgated under the Act require warrantors to "clearly and conspicuously disclose [warranty terms] in a single document in simple and readily understood language." 16 C.F.R. § 701.3(a). In order to prevent consumer misunderstanding, the single document rule codified by the Federal Trade Commission specifies nine mandatory disclosures. Bailey argues that Monaco Coach's Limited Warranty does not satisfy these mandatory requirements. Specifically, Bailey contends that the Limited Warranty fails to make the following disclosures adequately:

(2) A clear description and identification of products, or parts, or characteristics, or components or properties covered by and where necessary for clarification, excluded from the warranty; and ... (5) A step-by-step explanation of the procedure which the consumer should follow in order to obtain performance of any warranty obligation, including the persons or class of persons authorized to perform warranty obligations. This includes the name(s) of the warrantor(s), together with: the mailing address(es) of the warrantor(s), and/or the name or title and the address of any employee or department of the warrantor responsible for the performance of warranty obligations, and/or a telephone number which consumers may use without charge to obtain information on warranty performance.

16 C.F.R. § 701.3(a).

Bailey asserts that the failure to comply with these requirements should void any exclusions and disclaimers included in the Limited Warranty. Thus, Bailey argues that the Limited Warranty should be deemed to cover every component within the motorhome. This argument fails for a number of reasons. Bailey has not cited any case to support the proposition that a failure to satisfy the disclosure requirements negates exclusions and disclaimers of the warranty. Moreover, violations of the Federal Trade Commission disclosure regulations would more properly form the basis of a claim for unfair or deceptive acts or practices under the Magnuson-Moss Act and the Federal Trade Commission Act. 15 U.S.C. §§ 45(a)(1), 2310(b); Cunningham v. Fleetwood Homes of Georgia, Inc., 253 F.3d 611, 620-21 (11th Cir.2001). Bailey, however, has failed to plead or prove any claim for deceptive trade practices.

Even if noncompliance would require a court to void a warranty's exclusions and disclaimers, Monaco Coach's Limited Warranty does not violate the Federal Trade Commission requirements. The Limited Warranty states that it "covers defects in the manufacture of your motorhome and defects in materials used to manufacture your motorhome." (Def.'s Br. in Supp. of Mot. for Summ. J., Ex. 5.) Based on this language, Bailey argues that the warranty does not give a clear description of the products covered by or excluded from the warranty. See 16 C.F.R. § 701.3(a)(2). He contends that this statement leads a consumer to believe that the entire motorhome is covered under the warranty. However, the rule of contract construction requires courts to read provisions of a contract harmoniously in order to give effect to all portions. City of Homestead v. Johnson, 760 So.2d 80, 84 (Fla.2000). In doing so, "one part of an agreement may be resorted to for the explanation of the meaning of the language of another part." Arriaga v. Florida Pacific Farms, L.L.C., 305 F.3d 1228, 1247 (11th Cir.2002). Thus, even construing any potential ambiguities in the warranty against Monaco Coach, Bailey's interpretation of the scope of the warranty lacks merit.

First, the warranty is clearly labeled as a "Safari Motorhome Limited Warranty." This label should alert a reasonable consumer to the fact that portions of the motorhome will not be covered by the warranty. See Plagens v. National RV Holdings, 328 F.Supp.2d 1068, 1075 (D.Ariz.2004). Furthermore, the second sentence of the section describing coverage explicitly directs the consumer to look to the section titled ...