BRANDON CHRYSLER PLYMOUTH JEEP EAGLE v. Chrysler

• Decision Date: 08 September 1995
• Docket Number: No. 94-897-CIV-T-24(E).,94-897-CIV-T-24(E).
• Citation: 898 F. Supp. 858
• Parties: BRANDON CHRYSLER PLYMOUTH JEEP EAGLE, INC., Plaintiff, v. CHRYSLER CORPORATION, Defendant.
• Court: U.S. District Court — Middle District of Florida

898 F. Supp. 858

BRANDON CHRYSLER PLYMOUTH JEEP EAGLE, INC., Plaintiff, v. CHRYSLER CORPORATION, Defendant.

No. 94-897-CIV-T-24(E).

United States District Court, M.D. Florida, Tampa Division.

September 8, 1995.

James D. Adams, Marc E. Brandes, A. Edward Quinton, III, Adams & Quinton, P.A., Boca Raton, FL, for plaintiff.

Dean Bunch, Cabaniss, Burke & Wagner, P.A., Tallahassee, FL, for defendant.

ORDER

BUCKLEW, District Judge.

Before the Court are the parties' cross motions for summary judgment (D-11 & D-16). Plaintiff, Brandon Chrysler Plymouth Jeep Eagle, Inc. ("Brandon") moves for partial summary judgment (D-11) asserting that Defendant Chrysler Corporation's ("Chrysler") warranty reimbursement practices for automobile parts are contrary to Florida law. In opposition, Chrysler moves for summary judgment (D-16) on all claims of Brandon's complaint.

BACKGROUND

Plaintiff is a franchised motor vehicle dealer and holder of a franchise agreement with the Defendant, as defined in sections 320.60(1) and (11) of the Florida Statutes. Fla.Stat. §§ 320.60(1), (11) (1993). Defendant is an automobile manufacturer and a licensee under § 320.61 of the Florida Statutes. Fla.Stat. § 320.61 (1993). A franchise agreement between two such parties in the industry is commonly known as a Sales and Service Agreement ("SSA") and defines the manufacturer-dealer relationship.

On or about August 24, 1993, Chrysler and Brandon entered into a SSA in which Brandon became or continued as a dealer for Chrysler, Plymouth, Jeep and Eagle cars and trucks (D-17, Ex. 1-A). Under these agreements, Brandon contracted to perform all warranty service on Chrysler products, in return for Chrysler's commitment to reimburse Brandon in accordance with its policies as stated in its "Warranty Policy and Procedure Manual"¹ ("Manual") (D-17, Ex. 1-A, ¶ 11(b)). Section 3D of the Manual provides specific guidelines for warranty parts reimbursement.²

In addition to the contractual warranty obligations between the parties, the Florida Automobile Dealer Act, Fla.Stat. § 320.01 et seq. (1993) ("Dealer Act"), also governs certain aspects of the parties' relationship. In particular, § 320.696 of the Dealer Act addresses a manufacturer's warranty reimbursement obligation. That section provides:

The licensee shall reasonably and timely compensate any authorized motor vehicle dealer who performs work to rectify the licensee's product or warranty defects or fulfills delivery and preparation obligations. In the determination of what constitutes reasonable compensation under this section, the factors to be given consideration shall include, among others, the compensation being paid by other licensees to their dealers, the prevailing wage rate being paid by the dealers, and the prevailing labor rate being charged by the dealers, in the city or community in which the dealer is doing business.³ For the purpose of this section, reasonable compensation for work by a motor vehicle dealer for warranty repairs service on behalf of a licensee shall not be determined to be less than the amount charged by the dealer for like work to retail customers for nonwarranty repairs and service, unless the licensee can demonstrate and establish in a proceeding before the department that the dealer's retail charges for labor are improper in light of all economic circumstances. Compensation not paid within 30 days of receipt or notice of billing shall be presumed untimely.

Plaintiff contends that this statute requires a manufacturer/licensee to compensate dealers for warranty parts at a "retail rate."⁴ Conversely, Defendant denies that it has any duty to reimburse Plaintiff at a retail rate for parts used in warranty repairs or service under the terms of Florida Statute § 320.696.

The parties agree that the statute clearly provides that Brandon, as dealer, is responsible for issuing a "notice of billing," and in response Chrysler is to reimburse Brandon within 30 days (D-17, pgs. 2, 9; D-22, pg. 15). Additionally, the parties do not dispute that Chrysler reimbursed Brandon for warranty parts in the amounts provided for in the parties' dealer agreements (D-17, pg. 2; D-22, pgs. 15-16 and Ex. 2, pg. 2). In a letter dated November 4, 1993, Brandon first asserted that Chrysler's reimbursement policy for parts was in violation of Florida law, and demanded payment at the retail price for warranty parts reimbursement (D-17, Ex. 3-A; D-22, Ex. 2). Chrysler disagreed with Brandon's position, and thereafter this action ensued.

Pursuant to its complaint, Brandon seeks two claims for relief: 1) damages for the difference between the actual reimbursements Chrysler has paid for warranty parts and Brandon's retail prices for an unspecified period in the past;⁵ and 2) an injunction requiring Chrysler to pay its retail prices for warranty parts in the future⁶ (D-2, ¶¶ 6-7, 9 and 12). Defendant now seeks summary judgment as a matter of law on both of Brandon's claims. Plaintiff, however, seeks partial summary judgment specifically as to whether § 320.696 of the Florida Statutes requires the manufacturer to compensate a dealer for parts used in warranty service at a rate not less than the amount charged by the dealer for like work to retail customers for nonwarranty work. The Defendant contends that § 320.696 does not require the manufacturer to reimburse the dealer for "parts" at a "retail rate."

The parties agree that this case presents one determinative issue regarding the interpretation of Florida Statute § 320.696 for warranty parts reimbursement (D-11, pg. 4-5; D-13, pg. 1; D-17, pg. 1). Specifically, that issue is whether Chrysler as a manufacturer/licensee is required to reimburse Brandon, a dealer, for parts used in warranty service at the retail rate charged by Brandon to nonwarranty customers. The parties further agree that the resolution of this issue is strictly a question of law involving statutory construction, and does not involve any genuine issues of material fact. Id. See DeSisto College, Inc. v. Town Of Howey-In-The-Hills, 706 F.Supp. 1479, 1495 (M.D.Fla.1989), aff'd, 888 F.2d 766 (11th Cir.1989), (citing Devin v. Hollywood, 351 So.2d 1022, 1026 (Fla. 4th DCA 1976) (statutory construction is a question of law to be decided by the court)).⁷

STATUTORY CONSTRUCTION

When interpreting a statute, a court must start with the language of the statute itself. Carpenters Dist. Council of New Orleans & Vicinity v. Dillard Dep't Stores, Inc., 15 F.3d 1275, 1282 (11th Cir. 1994), cert. denied, ___ U.S. ___, 115 S.Ct. 933, 130 L.Ed.2d 879 (1995); St. Petersburg Bank & Trust, Co. v. Hamm, 414 So.2d 1071, 1073 (Fla.1982). If statutory language is clear and unambiguous, the court may end its inquiry. Carpenters, 15 F.3d at 1282-83; Forsythe v. Longboat Key Beach Erosion Control Dist., 604 So.2d 452, 454 (Fla.1992). Only when the statute has more than one reasonable interpretation should the court look beyond the language itself. Carpenters 15 F.3d at 1283. Thus, a court may depart from the statute to seek extrinsic aid when the language is unclear, or if the apparent clarity leads to an absurd result. Blue Cross & Blue Shield of Ala. v. Weitz, 913 F.2d 1544, 1548 (11th Cir.1990); Weber v. Dobbins, 616 So.2d 956, 958 (Fla.1993); Holly v. Auld, 450 So.2d 217, 219 (Fla.1984).

In the instant case, the Plaintiff claims that the language of Florida Statute § 320.696 is clear and that the statute on its face requires retail compensation to dealers for warranty parts. Plaintiff asserts that the key phrase in the statute is the obligation of the manufacturer to compensate the dealer "for work by a motor vehicle dealer for warranty repairs or service on behalf of a licensee." See (D-11, pg. 7). Plaintiff argues that the disjunctive phrase "repairs or service" requires compensation for both forms of work. In particular, "repair" consists of both labor and parts.⁸ Relying on the definition of "repair," Plaintiff claims that in order to restore an automobile to its original state, one must employ both parts and labor. Furthermore, Plaintiff contends that the legislative intent to compensate for parts at a "retail rate" is clearly set forth in the statute's definition of "reasonable compensation." This definition provides that compensation "shall not be determined to be less than the amount charged by a dealer for like work to retail customers for nonwarranty repairs and service...." Fla.Stat. § 320.696 (1993).

In contrast to Plaintiff's focus on the word "repairs," Defendant argues that the statute speaks entirely in terms of "work" performed by the dealer, the prevailing "wage" rate paid by the dealer, and its retail charges for "labor." Furthermore, Defendant contends that the statute on its face does not make any reference to any obligation to reimburse a dealer for "parts," much less parts at a "retail rate." Defendant asserts that "work," as defined in Black's Law Dictionary,⁹ case law, and other statutory contexts, is explained in terms of physical acts, not materials, and equates "work" with "labor." Thus, Defendant contends that "work" can only mean "labor" in the context of Florida Statute § 320.696.¹⁰ Moreover, Defendant asserts that if the Florida legislature intended for a dealer to be reimbursed for warranty "parts" at a retail rate, it would have specifically used the word "parts" as it did in § 320.63(5) of the Florida Statutes. Fla. Stat. § 320.63(5) (1993).

Upon the Court's analysis of § 320.696 and the parties' different interpretations of the statute, the Court finds that the statutory language is ambiguous. It is unclear whether the statute provides for reimbursement for warranty parts, in particular whether the terms "work," or "repairs" include "parts." In an attempt to ascertain the legislature's intent in drafting the statute, the Court begins with basic tenets of statutory construction. The Court must assume that the legislature intended the ordinary meaning of the words it...