Comer v. Person Auto Sales, Inc.

• Citation: 368 F.Supp.2d 478
• Decision Date: 02 February 2005
• Docket Number: No. 1:03CV00510.,1:03CV00510.
• Court: U.S. District Court — Middle District of North Carolina
• Parties: Keith COMER, Plaintiff, v. PERSON AUTO SALES, INC., and Wachovia Bank, N.A., Defendants.

368 F.Supp.2d 478

Keith COMER, Plaintiff, v. PERSON AUTO SALES, INC., and Wachovia Bank, N.A., Defendants.

No. 1:03CV00510.

United States District Court, M.D. North Carolina.

February 2, 2005.

COPYRIGHT MATERIAL OMITTED

COPYRIGHT MATERIAL OMITTED

Harding Kent Crowe, Conover, NC, Elmer Woodard, Danville, VA, for Plaintiff.

Joseph P. Gram, Polly D. Sizemore, Greensboro, NC, for Defendants.

ORDER

DIXON, United States Magistrate Judge.

This matter is before the court on Plaintiff's motion for partial summary judgment, docket no. 26, Defendants' (Person and Wachovia) motion for summary judgment, docket no. 28, and Plaintiff's motion to strike portions of Defendant Person's evidence, docket no. 35. A response has been filed in each of these motions, and a reply has been filed in both summary judgment motions. The parties have consented to the jurisdiction of a magistrate judge under 28 U.S.C. § 636(c). In this posture, this case is ripe for disposition.

I. Background

This action centers on Plaintiff's purchase of a used 2001 Ford Explorer Sport Trac ("the truck") from Defendant Person Auto Sales, Inc. ("Person") in Roxboro within this judicial district. Plaintiff financed most of the truck's purchase price through a credit contract with Person, and Person then assigned the credit contract to Defendant Wachovia Bank, N.A. (Wachovia). Plaintiff claims that the vehicle was damaged at the time he bought it, a fact not disclosed to him at the time, and in this action he asserts claims for violation of the Truth in Lending Act (Count I), Actual Fraud (Count II), violations of what Plaintiff has titled as the "North Carolina Consumer Protection Act" (Count III) (here Plaintiff is bringing a claim under the Unfair and Deceptive Trade Practices Act (UDTPA), N.C. GEN. STAT. § 75-1.1), and violations of N.C. GEN. STAT. § 20-303(b) (Count IV). All counts are filed against Person; all counts except Count I are also filed against Wachovia. Jurisdiction is based, in part, on diversity of citizenship as Plaintiff is a citizen and resident of Virginia.

Person bought the truck in question from AAA Sales and Leasing (AAA), through the Greensboro Auto Auction (GAA), on June 26, 2002. According to the invoice provided by GAA and signed by a representative of Person, the truck was sold with the "announced condition" of "frame damage." Bill of Sale and Title Warranty, Ex. H (attached to docket no. 27). Person essentially argues that although it was aware that there was "frame damage," it was unaware of the extent of damage about which Plaintiff is now complaining, and that it was unaware that the truck had actually been wrecked. See, e.g., Defs.' Br. in Opp'n to Pl.'s Mot. for Summ. J., p. 5 (docket no. 32) ("Person Auto Sales knew that the vehicle had frame damage of some type. However, the extent and significance of that damage is a factual issue."). Facts about the extent of Person's knowledge and the representations it made to Plaintiff are in dispute.

One important factor in the question about Person's knowledge is the information provided by the GAA. Person claims that it bought the truck at the auction under a "green light." Br. in Supp. of Defs.' Mot. for Summ. J., p. 4 (docket no. 29). This "green light" is a code used by the GAA representing that a vehicle is "ride and drive," which means that it is "mechanically fine." Dep. of Gary Thomas Osborne, Greensboro Auto Auction Inc., Ex. F, p. 39 (attached to docket no. 27). Osborne indicates that "you can still sell it on a green light with frame damage," id. at 39, but that if — as is indicated on the invoice for this particular truck — there is frame damage, a "yellow light" would have been on it too, id. at 46. A "yellow light" means that "something has been announced on that vehicle," "that there is a specified defect on the car." Id. at 41. Person does not admit that there was a yellow light signal for this truck.

Whether or not there was a yellow light signal for this truck, Person did not investigate whether the truck had any frame damage. "We did nothing.... We had no reason to." Dep. of Marcus Jordan, Person Auto Sales, Attach. J, p. 96 (attached to docket no. 31). Person claims that the truck was driven by an employee and given a safety inspection as required by North Carolina law, however, and that there was no indication that anything was amiss. Br. in Supp. of Defs.' Mot. for Summ. J., p. 5 (docket no. 29) (citing Dep. of Marcus D. Jordan, Person Auto Sales, Attach. 2, p. 82 (attached to docket no. 29)).

Plaintiff claims that, at the time of the purchase of the truck, he specifically asked whether the truck had ever been wrecked and whether there were any engine or transmission problems to worry about, and that Person's salesman, Tim Pleasant, told him "no." Pl.'s Mem., p. 4 (docket no. 31). Plaintiff also claims that manager Chad Sanford told him that the truck was in good shape and said that the truck had never been wrecked. Id. at 5. Sanford pointed out a damage disclosure on the title that guarantees that a vehicle has not been damaged by more than 25% of its value. Dep. of Keith Comer, Ex. K, p. 72 (attached to docket no. 31).

Nevertheless, while he was experiencing problems with the engine, Plaintiff discovered that the truck had been wrecked. Pl.'s Mem., p. 6 (docket no. 31). In fact, the GAA had been forced, after an arbitration, to buy the truck back from a previous buyer because of the frame damage. See, e.g., Br. in Supp. of Defs.' Mot. for Summ. J., p. 4 (docket no. 29). Plaintiff claims that since he bought the truck, he has had to have the "chattering pulley" repaired, the mass airflow sensor repaired, has had three sets of tires, and has had to replace the brake shoes twice. Pl.'s Mem., p. 7 (docket no. 31).

Person maintains that Plaintiff was advised that the truck had not "been involved in an occurrence in which it was damaged in excess of 25% of its fair market retail value," that even now Plaintiff does not contend that the vehicle has sustained such damage, and that evidence regarding the accident and the damage complained of "was discovered by plaintiff's counsel after filing this action." Br. in Opp'n to Pl.'s Mot. for Summ. J., pp. 3-4 (docket no. 32). Plaintiff claims that he has been injured in that "had [ ]he known that the truck had been mangled to this extent, he would not have even considered buying the truck, let alone paying over $23,000 for it." First Am. Compl., p. 8 (docket no. 10).

The circumstances surrounding Plaintiff's financing of this vehicle are also the subject of this litigation. Plaintiff claims that he told Sanford that he had only $350.00 for a down payment, and that he had no other cash available to put toward the purchase of a vehicle. Pl.'s Mem., p. 5 (docket no. 27). Plaintiff claims that, in response, Sanford told him that all taxes and title fees would be financed and that Plaintiff would not be required to pay additional cash to gain title to and register the car. Id.

Person used a Virginia title application for this transaction. Dep. of Marcus Jordan, Person Auto Sales, Ex. J, p. 40 (attached to docket no. 27) ("I know that — I'm almost positive that it is on a Virginia title application."). Nevertheless, Person calculated the sales tax for the truck according to the North Carolina highway use tax formula. Therefore, when Plaintiff tried to register his car in Virginia, he was required to pay an additional $324.75. Pl.'s Mem., p. 15 (docket no. 27). Person claims that this is standard procedure.

[W]hen we go through the documents and we go through the amount of — if it's a Virginia customer — we go through the amount of tax and tags charged. We do tell the customer that that is calculated on a North Carolina basis — that's the way our computer program is set up — and that there will be differences in the — in the North Carolina to whatever state's tax rates and tag fees and title fees and stuff like that. So — I mean, we are very clear that there will be differences when you go to your local DMV. But the amount of money that we are collecting per the way our system is programmed will be forwarded to you in a check form made out to your state's Department of Motor Vehicles.

Dep. of Marcus Jordan, Person Auto Sales, Attach. 2, p. 70 (attached to docket no. 29). Person acknowledges that none of the documents associated with the sale explained this discrepancy in writing. Id. In his complaint, Plaintiff claims that he was injured by having to pay this difference between the North Carolina tax and the Virginia tax in cash rather than having it financed, and that he would not have agreed to buy the truck on these terms. First Am. Compl., p. 9 (docket no. 10).

II. Standard of Review

Summary Judgment Standard

Summary judgment is appropriate when there exists no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. FED. R. CIV. P. 56(c); Zahodnick v. International Bus. Machs. Corp., 135 F.3d 911, 913 (4th Cir.1997). The party seeking summary judgment bears the burden of initially coming forward and demonstrating the absence of a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). Once the moving party has met its burden, the non-moving party must then affirmatively demonstrate that there is a genuine issue of material fact which requires a trial. Matsushita Elec. Indus. Co. Ltd. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986). There is no issue for trial unless there is sufficient evidence favoring the non-moving party for a fact-finder to return a verdict for that party. Anderson v. Liberty Lobby Inc., 477 U.S. 242, 250, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986); Sylvia Dev. Corp. v. Calvert County, Md., 48 F.3d 810, 817 (4th Cir.1995). Thus, the moving party can bear his burden either by presenting affirmative evidence or by demonstrating that the non-moving party...