Hernandez v. Apple Auto Wholesalers of Waterbury LLC
| Decision Date | 18 May 2020 |
| Docket Number | No. 3:17-cv-1857 (VAB),3:17-cv-1857 (VAB) |
| Court | U.S. District Court — District of Connecticut |
| Parties | Isaac HERNANDEZ, Plaintiff, v. APPLE AUTO WHOLESALERS OF WATERBURY LLC & Westlake Services, LLC d/b/a Westlake Financial Services, Defendants. |
Daniel S. Blinn, Brendan Lorenz Mahoney, Consumer Law Group, Rocky Hill, CT, for Plaintiff.
Kenneth A. Votre, Votre & Associates, P.C., Ridgefield, CT, for Defendants.
RULING AND ORDER ON MOTIONS FOR SUMMARY JUDGMENT AND MOTION FOR DEFAULT JUDGMENT
Isaac Hernandez ("Plaintiff") bought a car from Apple Auto Wholesalers of Waterbury LLC ("Apple Auto") in July 2017 and financed it through an installment contract. Apple Auto assigned the installment contract to Westlake Services, LLC, doing business as Westlake Financial Services ("Westlake").
Mr. Hernandez has now sued both Apple Auto and Westlake under federal and state law and is seeking actual and punitive damages as well as attorney's fees and costs.
Mr. Hernandez has filed a motion for default judgment against Apple Auto, following a default entry entered against Apple Auto for failure to defend against Mr. Hernandez's claims.
Mr. Hernandez and Westlake have each moved for summary judgment against the other.
This Ruling and Order will only address Mr. Hernandez's claims and motion against Apple Auto. The Court will address issues relating to Westlake in a separate order certifying questions to the Connecticut Supreme Court.
For the following reasons, Mr. Hernandez's motion for default judgment against Apple Auto is GRANTED . Because the Court is certifying questions to the Connecticut Supreme Court in a separate order related to the claims against Westlake, Mr. Hernandez's motion for summary judgment and Westlake's motion for summary judgment are both DENIED without prejudice.
Because Mr. Hernandez validly revoked acceptance of the Vehicle, the Court orders that the installment contract be cancelled and awards actual damages in the amount of $1,500, incidental damages in the amount of $650, statutory damages under TILA in the amount of $2,000, attorney's fees and costs in the amount of $18,000, and punitive damages in the amount of $2,150. In sum, Mr. Hernandez is awarded $24,300 against Apple Auto.
In July of 2017, Mr. Hernandez agreed to purchase a 2011 Ford Taurus (the "Vehicle") for personal use from Apple Auto and made a down payment of $500. Local Rule 56(A)1 Statement ¶ 1–2, ECF No. 86-5 (Sept. 6, 2019) ("Pl.’s SOMF"); Hernandez Aff. ¶¶ 1, 3–4, ECF No. 86-3 at 1 (Aug. 26, 2019). As part of the payment arrangement, Mr. Hernandez traded in a 2003 Volkswagen Jetta, for which Apple Auto gave him a trade-in allowance of $1,000. Pl.’s SOMF ¶ 3; Hernandez Aff. ¶ 3.
On July 20, 2017, Apple Auto presented Mr. Hernandez with a Retail Purchase Order that listed a cash sale price of $12,650 for the Vehicle. Pl.’s SOMF ¶ 4; Hernandez Aff. ¶ 5; Hernandez Aff. Ex. B, ECF No. 86-3 at 12–13 (Retail Purchase Order (July 20, 2017)) ("Purchase Order"). The Purchase Order states that Mr. Hernandez made a cash payment of $1,000. Id.
On July 20, 2017, Apple Auto prepared a Retail Installment Contract (the "Contract") for the Ford Taurus that listed a cash price of $13,427.82, which included $777.82 in sales tax, a trade-in allowance of $1,000, and a cash payment of $1,000. Pl.’s SOMF ¶ 7; Hernandez Aff. ¶ 8; Hernandez Aff. Ex. C, ECF No. 86-3 at 14–18 (Retail Installment Contract (July 20, 2017)) ("Contract"). The Contract listed the financed amount as $12,206.82, which included a $4,231.31 finance charge, and payments of $400.93 a month for forty-one months, starting on September 3, 2017. Pl.’s SOMF ¶ 9; Contract. The Contract listed the total amount payable, including the down payment and installment payments, as $18,438.12. Pl.’s SOMF ¶ 10; Contract.
Apple Auto also provided Mr. Hernandez a vehicle inspection Form K-208, required by state law,2 which indicated that the Ford Taurus passed inspection for all items inspected. Hernandez Aff. Ex. D, ECF No. 86-3 at 20 (Conn. Dep't of Motor Vehicles, Vehicle Inspection Form (July 18, 2017)) ("Form K-208"). Apple Auto signed the form on July 18, 2017. Id. Mr. Hernandez signed the form as the buyer but did not indicate the date of his signing. Id.
Shortly after Mr. Hernandez purchased the Vehicle, Apple Auto assigned the Contract to Westlake. Pl.’s SOMF ¶ 12; Hernandez Aff. ¶ 13.
After he purchased the vehicle, Mr. Hernandez discovered an online advertisement by Apple Auto for the same Ford Taurus and learned that Apple Auto had at some point3 advertised the same Ford Taurus online for $11,495. Pl.’s SOMF ¶¶ 1, 4; Hernandez Aff. ¶¶ 2, 5; Hernandez Aff. Ex. A, ECF No. 86-3 at 5–10 () ("Apple Auto Ad").
"Immediately after taking delivery" of the Vehicle, Mr. Hernandez also "noticed that the Vehicle would shake when being driven and would make noises during braking." Pl.’s SOMF ¶ 14; Hernandez Aff. ¶ 15. He contacted Apple Auto to have the Vehicle serviced and sent text messages to one of Apple Auto's managers, but his calls and text messages were not returned. Pl.’s SOMF ¶¶ 15–16; Hernandez Aff. ¶¶ 16–17.
On or about August 15, 2017, Mr. Hernandez had the Vehicle inspected by Robert Collins, an independent auto body expert and owner of Wreck Check Assessments of Boston, LLC. Pl.’s SOMF ¶¶ 18–19; Hernandez Aff. ¶¶ 19–20; Collins Aff., ECF No. 86-4 at 1–2 (Aug. 29, 2019); Collins Aff. Ex. A, ECF No. 86-4 at 3–27 (Robert Collins, Vehicle Inspection and Value , Wreck Check Assessments of Boston, LLC (Aug. 25, 2017)) ("Collins Report"). As part of the inspection, Mr. Collins reviewed the CarFax Vehicle History Report for the Vehicle, which showed that the Vehicle had been in reported accidents on September 12, 2014, and on May 12, 2016, and that it had been sold at auction on April 19, 2017, with a disclosure by the seller of structural damage. Pl.’s SOMF ¶¶ 22–23; Collins Aff. ¶ 9; Collins Aff. Ex. B, ECF No. 86-4 at 28–34 (CARFAX Vehicle History Report (last updated Aug. 9, 2017)) ("CarFax Report").
After inspecting the Vehicle and reviewing its CarFax Report, Mr. Collins determined that the vehicle had structural damage and was "not safe to operate on public roads." Collins Report at 1. Specifically, Mr. Collins found that the vehicle had been involved in "an event that caused structural damage to the front and rear of the vehicle," that it was "not in merchantable condition," that it was "unsafe due to structural damage," and that it had "not been restored in a quality and workmanlike manner." Pl.’s SOMF ¶¶ 28–31; Collins Report at 3. He stated that "[a]ny automotive profession[al] performing a simple visual inspection can clearly see that this vehicle has been wrecked and poorly repaired," and that it had been repaired to a "Repair Level 4, which entails the use of only some of the available procedures, parts, and materials to provide the minimum level of repair that would be acceptable to the average consumer's untrained eye." Pl.’s SOMF ¶¶ 32–33; Collins Report at 3.
Based on the asking prices for similar Ford Taurus vehicles with similar damage history, Mr. Collins determined that the fair market value for the Vehicle Mr. Hernandez purchased on July 20, 2017 would have been $11,000. Pl.’s SOMF ¶ 27; Collins Report at 3.
On August 28, 2017, Mr. Hernandez returned the Vehicle to Apple Auto by leaving it in Apple Auto's parking lot. Pl.’s SOMF ¶ 36; Hernandez Aff. ¶ 23; Hernandez Aff. Ex. E, ECF No. 86-3 at 21–24 () ("Demand Letter").
On August 29, 2017, Mr. Hernandez sent a letter through his counsel to Apple Auto and Westlake. Pl.’s SOMF ¶ 37; Hernandez Aff. ¶ 24; Demand Letter. The letter stated that Mr. Hernandez had revoked his acceptance of the Vehicle, that Apple Auto had sold him an unmerchantable and unsafe vehicle and fraudulently misrepresented the state of the vehicle on the Inspection Form in breach of the implied warranty of merchantability under Article 2 of the Uniform Commercial Code. Demand Letter.
The letter also stated that Apple Auto had violated the Truth in Lending Act (TILA) and the Connecticut Unfair Trade Practices Act (CUTPA) by stating a false down payment of $2,000 "when Mr. Hernandez only provided $500 cash" and a $1,000 trade-in allowance. Id. The letter demanded that Apple Auto return his $500 cash down payment and either the 2003 Volkswagen Jetta that Mr. Hernandez traded in or the $1,000 allowance that was agreed upon for the Jetta. The letter also stated that Westlake was "advised that Mr. Hernandez disputes any further indebtedness under the retail installment contract." Id. The letter asserted that "Mr. Hernandez also has claims for his attorney's fees under CUTPA, TILA[, and] the federal Magnuson Moss Warranty Act." Id. It asserted further that any attempts by Westlake "to contact Mr. Hernandez directly in an attempt to collect th[e] disputed debt would be a violation of the Connecticut Creditor Collection Practices Act." Id.
On October 13, 2017, Westlake assigned the Contract back to Apple Auto. Pl.’s SOMF ¶ 39; Pl.’s SOMF Ex. 1, ECF No. 86-5 at 9 (Westlake Financial Services, Reassignment of Contract (Oct. 13, 2017)) ("Contract Reassignment").
Apple Auto never refunded any part of Mr. Hernandez's deposit or the value of his trade in, and Mr. Hernandez never made any installment payments under the Contract. Pl.’s SOMF ¶¶ 38, 40; Hernandez Aff. ¶¶ 25–26.
On November 3, 2017, Mr. Hernandez filed the Complaint alleging that Defendants violated the Truth in Lending Act, 15 U.S.C. §§ 1601 et seq. ; the Magnuson-Moss Warranty Act, 15 U.S.C. §§ 2301 et seq. ; Article 2 of the Uniform Commercial Code ("UCC"); ...
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