Dodd v. Nelda Stephenson Chevrolet, Inc.

• Decision Date: 06 August 1993
• Citation: 626 So.2d 1288
• Parties: Jimmy H. DODD v. NELDA STEPHENSON CHEVROLET, INC., et al. 1911399.
• Court: Alabama Supreme Court

Page 1288

626 So.2d 1288

Jimmy H. DODD v. NELDA STEPHENSON CHEVROLET, INC., et al.

1911399.

Supreme Court of Alabama.

Aug. 6, 1993.

Rehearing Denied Sept. 24, 1993.

Robert H. McKenzie of Holt, McKenzie, Holt & Mussleman, Florence, for appellant.

J.A. Keller of Keller & Pitts, Florence, for Nelda Stephenson Chevrolet, Inc.

Nicholas B. Roth of Eyster, Key, Tubb, Weaver & Roth, Decatur, for General Motors Corp.

A. Stewart O'Bannon, Jr. of O'Bannon & O'Bannon, Florence, for Bob Hembree Motor Co., Inc.

ALMON, Justice.

The plaintiff, Jimmy H. Dodd, appeals from a summary judgment entered in favor of the defendants, Nelda Stephenson Chevrolet, Inc., Bob Hembree Motor Company, Inc., and General Motors Corporation. Dodd's action alleged fraud, suppression, fraudulent concealment, breach of express warranty, and breach of implied warranties of merchantability or fitness for a particular purpose, all in connection with his purchase of a 1990 Chevrolet Camaro R.S. automobile from Nelda Stephenson Chevrolet.

On May 5, 1990, Dodd went to Nelda Stephenson Chevrolet ("Stephenson Chevrolet") in Florence, Alabama, to purchase a car. Because Stephenson Chevrolet did not have the type of car Dodd requested, Stephenson Chevrolet arranged to obtain the car Dodd wanted from Bob Hembree Motor Company, Inc. ("Hembree Motors"), a Chevrolet dealership in Guntersville, Alabama. Almon Truitt, an employee of Stephenson Chevrolet, drove to Hembree Motors and exchanged a new car from Stephenson Chevrolet for a 1990 Camaro.

Truitt returned with the Camaro late in the afternoon on May 5, 1990. Approximately two hours later, Dodd picked it up. Because Stephenson Chevrolet had not had an opportunity to clean the car, it instructed Dodd to return the Camaro six days later to be cleaned.

A day or so after Dodd took possession of the Camaro, he noticed what looked like streaks or sand marks on the right rear quarter panel. When Dodd brought the Camaro to Stephenson Chevrolet the next Friday, Dodd informed a sales representative of Stephenson Chevrolet of the problem. Billy Ray, the sales representative at Stephenson Chevrolet with whom he had been dealing, informed Dodd that the 36-month warranty covered the problem and offered to repaint the car. Dodd, however, declined the offer to paint the Camaro at that time.

In February 1991, while washing the Camaro, Dodd noticed that a groove that was supposed to be on the right rear quarter panel had been filled in. Suspecting that the Camaro had been damaged and repaired before he had purchased it, Dodd complained to Stephenson Chevrolet. In response, Mrs. Nelda Stephenson, president of Stephenson Chevrolet, conducted a paint test of the area of the Camaro that Dodd claimed had been damaged, repaired, and repainted.

A paint test measures the thickness of the paint on a car to determine whether the car has been repainted. According to Nelda Stephenson's affidavit, an automobile factory can apply paint to a vehicle more thinly than an automobile body repair shop can. The test thus helps determine whether a car has been damaged and repaired after it was manufactured.

Dodd and Stephenson Chevrolet dispute the meaning of the paint test conducted on the Camaro. Both Dodd's affidavit and Ray's affidavit state that the paint on the right rear quarter panel of the Camaro measured 6-8 "milliliters" in depth, while the thickness of the paint on other new cars at the dealership and on other portions of Dodd's Camaro, they said, measured only 2-4 "milliliters." According to the affidavits of Dodd and Ray, Nelda Stephenson said, after concluding the paint test, that the right rear quarter panel had been repainted. However, in her own affidavit, Nelda Stephenson says that she told Dodd only that the paint on the right rear quarter panel of the Camaro measured 6 "milliliters," while paint applied by body shops usually measures around 10-14 "milliliters" in depth.

Dodd also had the Camaro inspected by Dan Sharp, an employee of A-One Body, an automobile repair shop, and Kenneth Davis, owner of Davis Body Shop. Sharp and Davis testified that the irregularity in the groove moldings and the paint finish on the right rear quarter panel indicated that the car had been damaged, repaired, and repainted.

A delivery receipt reflecting the delivery of the Camaro from the factory to Hembree Motors in October 1989 states: "Car has serious paint problems all over. Factory." In his affidavit, Robert L. Hembree, Jr., president of Hembree Motors, testified that the Camaro had suffered no damage while in the possession of Hembree Motors and that Hembree Motors had performed no body work, painting, or repairs on it during the six months it was in the possession of Hembree Motors. Robert Hembree's affidavit also states that the inspection of the car by Hembree Motors upon its delivery revealed no damage to the vehicle. In his affidavit, Almon Truitt states that he did not notice any defects in the Camaro when he picked it up at Hembree Motors and drove it to Stephenson Chevrolet.

A summary judgment, under Rule 56, Ala.R.Civ.P., is proper only when the trial court determines that there is no genuine issue of material fact and that the movant is entitled to a judgment as a matter of law. On a motion for summary judgment, when the movant makes a prima facie showing that no genuine issue of material fact exists, the burden shifts to the nonmovant to present substantial evidence creating a genuine issue of material fact. ¹ Cobb v. Southeast Toyota Distributors, Inc., 569 So.2d 395 (Ala.1990); Bean v. Craig, 557 So.2d 1249, 1252 (Ala.1990); Rule 56(e), Ala.R.Civ.P.; § 12-21-12, Alabama Code 1975. The evidence is viewed most favorably to the nonmovant, and all reasonable doubts concerning the existence of a genuine issue of material fact are resolved against the movant. Specialty Container Mfg., Inc. v. Rusken Packaging, Inc., 572 So.2d 403, 404 (Ala.1990); Stark v. Troy State Univ., 514 So.2d 46 (Ala.1987); Lolley v. Howell, 504 So.2d 253 (Ala.1987).

Because this case involves multiple claims against multiple defendants, we examine each defendant and the claims against it separately.

Claims Against Stephenson Chevrolet

Dodd asserts first that Stephenson Chevrolet fraudulently misrepresented that the 1990 Camaro was a "new" car, or, alternatively, that Stephenson Chevrolet fraudulently concealed that it was not "new." Dodd argues, therefore, that the trial court erred in entering the summary judgment in favor of Stephenson Chevrolet because, Dodd says, he presented substantial evidence that, although it had not been previously sold, the Camaro was not "new."

Section 6-5-101, Alabama Code 1975, provides a cause of action for misrepresentations of material fact:

"Misrepresentations of a material fact made willfully to deceive, or recklessly without knowledge, and acted on by the opposite party, or if made by mistake and innocently and acted on by the opposite party, constitute legal fraud."

(Emphasis added.) We note that under § 6-5-101 "legal fraud" includes misrepresentations of material fact made "by mistake and innocently," as well as those made either "willfully to deceive, or recklessly without knowledge." Young v. Serra Volkswagen, Inc., 579 So.2d 1337, 1339 & n. 3 (Ala.1991).

Because we find no evidence that Stephenson Chevrolet made any misrepresentation willfully or with reckless disregard of the truth, we address Dodd's argument that Stephenson Chevrolet innocently or mistakenly misrepresented that the Camaro was "new." To recover under a claim of innocent misrepresentation, a plaintiff must prove (1) that there was a false representation; (2) that it concerned a material fact; (3) that the plaintiff reasonably or justifiably relied on the material misrepresentation; and (4) that the plaintiff was damaged as a proximate result of the reliance. Mahoney v. Forsman, 437 So.2d 1030 (Ala.1983).

Stephenson Chevrolet argues that in the circumstances of this case it cannot be liable because it made no misrepresentation of fact. Moreover, Stephenson Chevrolet contends, no evidence indicates that it knew of the alleged defects in the Camaro or that it even had an opportunity to discover them. In reply, Dodd argues that even if the dealership did not know of the defects or was unable to discover them while the Camaro was in its possession, Stephenson Chevrolet may nonetheless be liable for innocently misrepresenting that the Camaro was "new."

In support of this argument, Dodd refers to the "reasonable expectation" standard first enunciated in Mathis v. Jim Skinner Ford, Inc., 361 So.2d 113 (Ala.1978):

"Purchasers have a right to assume that new automobiles will perform in accordance with reasonable expectations and in accordance with implied representations inherent in marketing such products. Absent express representation, implied representations are not uncommon in the sale of new products, and reliance thereon may be shown by the totality of the circumstances and the underlying nature of the transaction itself. These concepts have long been recognized in actions based upon breach of an implied warranty and, under proper circumstances, may support a tort action for misrepresentation."

361 So.2d at 115; see also Ford Motor Co. v. Burkett, 494 So.2d 416 (Ala.1986); Larry Savage Chevrolet, Inc. v. Richards, 470 So.2d 1168 (Ala.1985); Boulevard Chrysler-Plymouth, Inc. v. Richardson, 374 So.2d 857, 859-60 (Ala.1979). Thus, under Mathis, implied representations may arise out of the mere sale of a new product, and such representations, if false, may support a claim of fraud. Burkett, 494 So.2d at 417.

The trial court erred in entering the summary judgment as to the claim of innocent misrepresentation on the part of Stephenson Chevrolet. Drawing all relevant inferences in favor of Dodd, as the applicable standard of review requires, we conclude that, given the circumstances of this case, Dodd presented substantial...