Hall v. Riverside Lincoln Mercury-Sales, MERCURY-SALES

• Citation: 101 Ill.Dec. 789,148 Ill.App.3d 715,499 N.E.2d 156
• Decision Date: 15 October 1986
• Docket Number: No. 2-85-0290,MERCURY-SALES,2-85-0290
• Parties: , 101 Ill.Dec. 789 Donald C. HALL, and Reba M. Hall, Plaintiffs-Appellees, v. RIVERSIDE LINCOLN, a Delaware corporation, Defendant-Appellant.
• Court: United States Appellate Court of Illinois

Page 156

499 N.E.2d 156

148 Ill.App.3d 715, 101 Ill.Dec. 789

Donald C. HALL, and Reba M. Hall, Plaintiffs-Appellees, v. RIVERSIDE LINCOLN MERCURY-SALES, a Delaware corporation,

Defendant-Appellant.

No. 2-85-0290.

Appellate Court of Illinois,

Second District.

Oct. 15, 1986.

Nicholas M. Spina, Chicago, for defendant-appellant.

Goldsmith Thelin Schiller & Dickson, Bruce Goldsmith, Aurora, for plaintiffs-appellees.

Presiding Justice NASH delivered the opinion of the court:

Defendant, Riverside Lincoln Mercury Sales, Inc., appeals from a partial summary judgment granted to plaintiffs, Donald and Reba Hall, in their suit against defendant alleging a violation of Federal odometer requirements (15 U.S.C. § 1981 et seq. (1984)), fraud and breach of contract and awarding plaintiffs $4,365 in damages and $1,990.57 in attorney fees. Defendant contends the circuit court (1) lacked jurisdiction, (2) erred in granting partial summary judgment as there remained a genuine issue of material fact, (3) erred in refusing to dismiss plaintiffs' fraud and breach of contract counts, and (4) abused its discretion in the award of attorney fees to plaintiffs.

On May 7, 1984, plaintiffs purchased a used 1981 Oldsmobile Cutlass from defendant for $6,500. At that time, defendant certified the vehicle's odometer reading of 38,907 was accurate. Plaintiffs later found documentation in the car's glove compartment detailing the complete repair history of the vehicle and showing the car had last been serviced at 50,609 miles. Subsequently, plaintiffs had to have repaired several mechanical problems, including a malfunctioning on-board computer, which cost $190, the catalytic converter, which cost $225, and a wiper motor, which cost $80. As the vehicle's actual mileage exceeded 50,000 miles, a General Motors warranty covering catalytic converters and on-board computers for five years or 50,000 miles had expired.

On August 1, 1984, plaintiffs brought this action against defendant alleging a violation of section 1989(a) of the Motor Vehicle Information and Cost Savings Act ("Act") (15 U.S.C. § 1989(a) (1984)) for defendant's failure to disclose the true mileage to plaintiffs, fraud and breach of contract. Defendants answered the complaint and plaintiffs attached to their subsequent motion for summary judgment on the issues of liability and damages an affidavit from Donald Hall attesting to the above facts, the receipts for service discovered in the glove compartment, and an affidavit from Walter Schultz, the prior user of the vehicle, stating the car had actual miles of 59,873 when he returned the vehicle to a California leasing firm on December 29, 1983. In response, defendant submitted an affidavit from its salesman, Kenneth Morgan, stating that Auto Dealers Exchange of Indianapolis, Indiana had sold the vehicle to defendant and certified the odometer read 38,877, that defendant had no reason to doubt the certification at that time, and that defendant did not know and had no way of knowing the actual mileage was in excess of 38,907 at the time it sold the car to plaintiffs. The trial court granted summary judgment for plaintiffs solely on the issue of liability and denied a motion to dismiss by defendant.

At an evidentiary hearing on damages and the issue of attorney fees, plaintiffs presented receipts for the $495 they had expended in repair costs and an affidavit from Jeffrey Loveland, a bank collections officer, stating the difference between the certified mileage and the true mileage of the vehicle reduced the worth of the car by $1,000. Based on this evidence and the treble damages provision of 15 U.S.C. § 1989(a)(1) (1984), the court awarded plaintiffs $4,365 in damages. The only evidence offered by the parties regarding plaintiffs' attorney fees was an affidavit from plaintiffs' attorney stating he had expended 20 3/4 hours on the case, his usual hourly rate was $80 for routine matters and $100 for complex matters and major litigation, and the usual charge for attorneys in the community ranged from $75 to $125 per hour. Based upon this evidence, the court awarded $1,900 in attorney fees in accordance with section 1989(a)(2) of the Act. This appeal followed.

Defendant first contends the circuit court lacked jurisdiction to hear count I of plaintiffs' complaint because the claim was based upon a Federal statute. Section 1989(b) of the Motor Vehicle Information and Cost Savings Act provides,

"An action to enforce any liability created under subsection (a) of this section, may be brought in a United States district court without regard for the amount in controversy, or in any other court of competent jurisdiction within two years from the date on which the liability arises." 15 U.S.C. § 1989(b) (1984).

Defendant argues the Illinois courts have not considered an action based on the Motor Vehicle Information and Cost Savings Act and the present action should have been brought in Federal district court. We do not agree.

The circuit courts of Illinois "have original jurisdiction over all justiciable matters" (Ill. Const.1970, art. VI, § 9; Skilling v. Skilling (1982), 104 Ill.App.3d 213, 219, 59 Ill.Dec. 937, 432 N.E.2d 881, aff'd on remand sub nom. Levy v. Skilling (1985), 136 Ill.App.3d 727, 91 Ill.Dec. 431, 483 N.E.2d 917; In Interest of Vaught (1981), 103 Ill.App.3d 802, 803, 59 Ill.Dec. 474, 431 N.E.2d 1231), and Illinois courts recognize the general principle that state courts have concurrent jurisdiction with Federal courts where Congress has not demonstrated an intent to reserve exclusive jurisdiction to the Federal courts. (Reidelberger v. Bi-State Development Agency (1956), 8 Ill.2d 121, 124, 133 N.E.2d 272; Ninth Liberty Loan Corp. v. Hardy (1977), 53 Ill.App.3d 601, 605, 11 Ill.Dec. 363, 368 N.E.2d 971). Accordingly, actions premised upon Federal statutory schemes have been entertained in the Illinois courts in the absence of a statutory provision limiting jurisdiction to the Federal courts. See Reidelberger v. Bi-State Development Agency (1956), 8 Ill.2d 121, 124, 133 N.E.2d 272; Regan v. Kroger Grocery & Baking Co. (1944), 386 Ill. 284, 293, 54 N.E.2d 210; Ninth Liberty Loan Corp. v. Hardy (1977), 53 Ill.App.3d 601, 605-06, 11 Ill.Dec. 363, 368 N.E.2d 971; Alberty v. Daniel (1974), 25 Ill.App.3d 291, 295, 323 N.E.2d 110.

The Illinois courts have not previously considered this jurisdictional policy in relation to the Federal claim raised under section 1989(a) of the Act. (See People ex rel. Scott v. Larance (1982), 105 Ill.App.3d 171, 61 Ill.Dec. 68, 434 N.E.2d 5.) However, other jurisdictions have addressed this issue and held that section 1989(b) evinces a congressional intent to allow the filing of suits based upon the Act in state courts. (Osage Homestead, Inc. v. Sutphin (Mo.App.1983), 657 S.W.2d 346, 353; Vogt v. Nelson (1975), 69 Wis.2d 125, 126, 230 N.W.2d 123, 124.) We also note that the courts of numerous other states have heard claims based upon the Act without questioning the propriety of their exercise of jurisdiction. Wheeler v. Friendly Motors, Inc. (1976), 138 Ga.App. 260, 226 S.E.2d 95; Don Medow Motors, Inc. v. Grauman (Ind.App.1983), 446 N.E.2d 651; Rasmussen Buick-GMC, Inc. v. Roach (Ia.1982), 314 N.W.2d 374; Levine v. Parks Chevrolet, Inc. (1985), 76 N.C.App. 44, 331 S.E.2d 747; Shepherd v. Eagle Lincoln Mercury, Inc. (Tex.Civ.App.1976), 536 S.W.2d 92; Harden v. Gregory Motors (Wyo.1985), 697 P.2d 283.

Absent any indication of a congressional intent to limit jurisdiction of claims under the Motor Vehicle Information and Cost Savings Act to Federal courts and our policy of recognizing concurrent jurisdiction in such instances, we conclude that the circuit court did not lack jurisdiction to hear plaintiffs' count based upon section 1989(a) of the Act. 15 U.S.C. § 1989(a) (1984).

Next, defendant contends the circuit court erred in granting partial summary judgment in favor of plaintiffs on their cause of action based upon the Act because there remained a genuine issue of material fact as to defendant's intent to defraud plaintiffs. The Act provides,

"Any person who, with intent to defraud, violates any requirement imposed under this subchapter shall be liable in an amount equal to the sum of * * * three times the amount of actual damages sustained or $1,500, whichever is the greater * * *." 15 U.S.C. § 1989(a)(1) (1984).

Summary judgment should be granted only if the pleadings, affidavits and depositions on file reveal that there is no genuine issue of material fact and that the movant is entitled to judgment as a matter of law. (In re Estate of Whittington (1985), 107 Ill.2d 169, 176-77, 90 Ill.Dec. 892, 483 N.E.2d 210, cert. denied (1986), 475 U.S. 1016, 106 S.Ct. 1199, 89 L.Ed.2d 313; Murphy v. Urso (1981), 88 Ill.2d 444, 463-64, 58 Ill.Dec. 828, 430 N.E.2d 1079; Kroll v. Sugar Supply Corp. (1983), 116 Ill.App.3d 969, 975, 72 Ill.Dec. 396, 452 N.E.2d 649, appeal denied.) All well-pleaded uncontradicted facts contained in a movant's affidavit will be taken as true for purposes of ruling on a motion for summary judgment. Heller v. Goss (1980), 80 Ill.App.3d 716, 719, 35 Ill.Dec. 933, 400 N.E.2d 70; Ohio Oil Co. v. Yacktman (1976), 36 Ill.App.3d 255, 261, 343 N.E.2d 544.

Defendant argues that section 1989(a) requires a finding of an actual intent to defraud and therefore a genuine issue of fact remains. However, only one Federal court considering the question has agreed with defendant that an individual is civilly liable under section 1989(a) only if he had actual knowledge the odometer reading was incorrect. (Mataya v. Behm Motors, Inc. (E.D.Wis.1976), 409 F.Supp. 65, 69.) Other Federal courts have held that an intent to defraud on the part of the transferor may be inferred from a finding of gross negligence or reckless disregard of facts that would have informed him the reading was incorrect (Tusa v. Omaha Auto Auction, Inc. (8th Cir.1983), 712 F.2d 1248, 1253-54 (dealer ignored...