Davis v. Forest River, Inc.

• Decision Date: 21 February 2008
• Docket Number: No. 270478.,270478.
• Citation: 748 N.W.2d 887,278 Mich. App. 76
• Court: Court of Appeal of Michigan — District of US
• Parties: Keith Gayle DAVIS, Plaintiff-Appellee, v. FOREST RIVER, INC., Defendant-Appellant, and Kitsmiller RV, Inc., Defendant.

748 N.W.2d 887

278 Mich. App. 76

Keith Gayle DAVIS, Plaintiff-Appellee, v.FOREST RIVER, INC., Defendant-Appellant, and Kitsmiller RV, Inc., Defendant.

No. 270478.

Court of Appeals of Michigan.

Submitted November 14, 2007, at Lansing.

Decided February 21, 2008, at 9:00 a.m.

Green & Green, P.L.L.C., by Jonathan A. Green, Farmington Hills, for Keith G. Davis.

Winegarden, Haley, Lindholm & Robertson, P.L.C., by Donald H. Robertson, Grand Blanc, for Forest River, Inc.

Liblang & Associates, P.C., by Dani L. Liblang, Birmingham, for amici curiae the Consumer Law Section of the State Bar of Michigan and the Michigan Trial Lawyers Association.

McKelvie DeLuca, P.C., (by Frank M. DeLuca and Edmund S. Yee), Birmingham, for amici curiaeGeneral Motors Corporation.

Dolenga & Dolenga, P.L.L.C., (by Michael D. Dolenga and Keith A. Wuotinen) Farmington, for the Recreational Vehicle Industry Association.

Before: OWENS, P.J., and BANDSTRA and DAVIS, JJ.

DAVIS, J.

DefendantForest River, Inc., appeals as of right an order granting revocation of acceptance under the Magnuson-Moss Warranty — Federal Trade Commission Improvement Act (the MMWA), 15 U.S.C. 2301 et seq., to plaintiff of a recreational vehicle (RV) manufactured by Forest River and sold by Kitsmiller RV, Inc.¹We affirm, albeit with one clarification.

As we discuss later in this opinion, the remedy of "revocation of acceptance" is actually a Uniform Commercial Code(UCC), MCL 440.1101 et seq., remedy, available by statute under MCL 440.2608, but not available to plaintiff in this case because plaintiff and defendant were not in privity of contract.SeeHenderson v. Chrysler Corp.,191 Mich.App. 337, 477 N.W.2d 505(1991).However, it is clear from the pleadings, discussions, and arguments that plaintiff really pursued, and the trial court really granted, the equitable remedy, available at common law, of "rescission," which is available irrespective of privity.Our affirmance is based on the "well-settled" principle that "the gravamen of an action is determined by reading the complaint as a whole, and by looking beyond mere procedural labels to determine the exact nature of the claim."Adams v. Adams(On Reconsideration), 276 Mich. App. 704, 710-711, 742 N.W.2d 399(2007).Therefore, we affirm the substance of the trial court's order, but not the nomenclature used.

The facts of this case are not seriously disputed.Plaintiff and his wife are avid campers.In 2002, they decided to upgrade from a relatively small Winnebago RV to a 34-foot Windzone RV manufactured by Forest River and sold by Kitsmiller RV.They were motivated in part by an injury that precluded plaintiff from easily entering and leaving the Winnebago, and partly a desire for a larger and more-luxurious vehicle that could be used for more extensive traveling.Although they had owned RVs before, and plaintiff had learned how to operate vehicles of that size while serving in the military, they had never owned a new RV before.After taking possession of the RV, plaintiff experienced numerous problems with it, some of which he concluded were safety issues.He cut short a total of three intended trips, and the RV spent several months being repaired by Forest River on two occasions.Plaintiff ultimately concluded that Forest River should take the RV back and repay his purchase price.Plaintiff has properly maintained the RV in the meantime.The only real disputes concerned the number and the severity of the problems plaintiff experienced and some testimony that all new RVs are expected to have initial problems that can be worked out.

Plaintiff's complaint alleged eight counts: breach of express warranty; breach of implied warranty of merchantability; revocation of acceptance under MCL 440.2608; breach of written warranty under the MMWA; breach of implied warranty under the MMWA; violation of the Michigan Consumer Protection Act, MCL 445.901 et seq.; breach of contract and rescission of contract.The parties stipulated the dismissal of the claim for revocation of acceptance under state law; however, a significant part of plaintiff's claim was the assertion that he was nevertheless able to seek revocation of acceptance or rescission as a common-law remedy through the MMWA.The trial court granted summary disposition to defendant on the breach-of-contract claim, and a jury found in defendant's favor on the Michigan Consumer Protection Act claim; plaintiff has not cross-appealed with regard to those matters.The jury found that plaintiff had "proven that he is entitled to revoke his acceptance of the motor home," on the basis of which the trial court entered judgment against defendant, from which defendant now appeals.²

The first question posed is what remedies or causes of action are provided for under the MMWA."The applicability of a legal doctrine is a question of law.This Court reviews questions of law de novo."James v. Alberts,464 Mich. 12, 14, 626 N.W.2d 158(2001).Because there is no decision on point regarding the MMWA from the United States Supreme Court, this Court is required to make its own independent assessment of the MMWA; although federal court decisions may be persuasive, they are not controlling, even if there is no conflict between them.Abela v. Gen. Motors Corp.,469 Mich. 603, 606-607, 677 N.W.2d 325(2004).Under the circumstances of this case and considering the answers reached by other courts, we are not persuaded of a present necessity to answer this question.As we will discuss later in this opinion, the law in Michigan obviates any need to do so to resolve the issues at bar.

Under the MMWA, subject to provisions not relevant here, "a consumer who is damaged by the failure of a supplier, warrantor, or service contractor to comply with any obligation under this chapter, or under a written warranty, implied warranty, or service contract, may bring suit for damages and other legal and equitable relief" in a state or federal court.15 U.S.C. 2310(d)(1).The MMWA provides for an award of costs and expenses to prevailing parties, but it does not otherwise indicate what that legal and equitable relief might be.Nothing in the MMWA itself appears to mandate any sort of privity between any parties.In fact, its definition of a "supplier" suggests the opposite: The term "supplier" means "any person engaged in the business of making a consumer product directly or indirectly available to consumers."15 U.S.C. 2301(4)(emphasis added).Significantly, it states that "implied warranties" arise under state law.15 U.S.C. 2301(7).Nowhere in the MMWA is there any hint regarding the nature of the "damages and other legal and equitable relief."

The parties cite cases reaching opposite results with regard to whether the available relief under the MMWA is limited to whatever is available under state law in the jurisdiction where a suit is brought.We have not been offered any authority suggesting that a plaintiff under the MMWA is entitled to any less than would be available under state law, and it appears that the parties do not dispute that much.The lower federal courts are substantially divided on the issue whether the MMWA provides remedies in addition to those available under state law.In our view, whether the MMWA mandates the availability of remedies beyond what the state provides can only be satisfactorily determined by the United States Supreme Court.However, it seems settled that the MMWA does make available, at a minimum, remedies that are available under state law.Because we find plaintiff here is entitled to a remedy under Michigan law, we need not address this question any further in this case.

We note initially two legal theories that do not afford plaintiff a remedy here.First, as Henderson discussed, "revocation of acceptance" is a purely statutory remedy under MCL 440.2608 that was "inextricably connected to the contractual relationship between a buyer and a seller," and "[t]he fact that a manufacturer may be liable under its warranty provisions does not change the fundamental nature of the revocation remedy as being contractually based."Henderson, supra at 341-343, 477 N.W.2d 505.The Henderson Court therefore found that revocation of acceptance, as a contractual remedy, required privity of contract.Id.Second, Michigan's "lemon law,"MCL 257.1401 et seq., explicitly excludes RVs and motor homes.MCL 257.1401(f).This is significant, in part, because such an exclusion is not necessarily intuitively obvious.But most importantly, the "lemon law" would give purchasers of automobiles an adequate remedy at law, Henderson, supra at 342, 477 N.W.2d 505, precluding an equitable remedy such as rescission from being available against automobile manufacturers.Detroit Trust Co. v. Old Nat'l Bank of Grand Rapids,155 Mich. 61, 65, 118 N.W. 729(1908).We hold that neither the "lemon law" nor the UCC is relevant to this matter.

The critical issue in this case is whether a purchaser who, like plaintiff in this case, is not in contractual privity with a manufacturer may obtain the common-law remedy of rescission.We find that privity has long been categorically eliminated in Michigan as a prerequisite to purchasers' bringing suit against manufacturers, and the Legislature's adoption of the UCC did not abolish rescission except where the parties actually do have a contract with each other.

The abolition of the privity requirement was accomplished half a century ago in Spence v. Three Rivers Builders & Masonry Supply, Inc.,353 Mich. 120, 126-127, 90 N.W.2d 873(1958).The case involved concrete building blocks that turned out to be defective after they had been used to construct buildings; the problem was that the plaintiff purchased the blocks from an intermediary who was not reachable at the time of the action, not from the manufacturer itself.Id. at 122-125, 90 N.W.2d 873.Justice Voelker, writing for the Court, observed that the "general rule" in Michigan had,...