Maduro v. Ford Motor Co.

• Decision Date: 22 March 1974
• Docket Number: Civil No. 438-1970
• Citation: 10 V.I. 401
• Parties: GOODWIN MADURO, Plaintiff v. FORD MOTOR COMPANY and RAMSEY MOTORS, INC., Defendants
• Court: U.S. District Court — Virgin Islands

10 V.I. 401

GOODWIN MADURO, Plaintiff v. FORD MOTOR COMPANY and RAMSEY MOTORS, INC., Defendants

Civil No. 438-1970

District Court of the Virgin Islands Div. of St. Thomas and St. John

March 22, 1974

Action for damages for breach of implied warranty of merchantability. District Court, Christian, C.J., held implied warranty was not disclaimed where sales slip had "6 months or 6000 miles, whichever comes first" handwritten on it.CHRISTIAN, Chief Judge

OPINION

This is an appeal from a judgment of the municipal court, dismissing plaintiff's complaint.

On February 16, 1968, plaintiff purchased a new Mercury Montego from defendant Ramsey Motors, Inc., the authorized Ford dealer on St. Thomas. It was clearly understood by all concerned that plaintiff intended to use the vehicle as a taxi in St. Thomas. At the time of purchase, Mr. Ramsey, in the presence of the plaintiff, wrote by hand, on the sales slip, "6 months or 6000 miles, whichever comes first". The owner's manual, placed in the glove compartment, contained a standard new car warranty issued by Ford, limited to the repair or replacement of specified parts.

Commencing within days of this transaction and continuing over a period of several months, Mr. Maduro encountered numerous difficulties with the car's performance. The day after the car was purchased, plaintiff noticed that he kept running out of gas because the gas gauge wasn't functioning properly. About two weeks after this was repaired, a knock developed in the steering arm, which was also corrected upon request. Three months later, the alternator in the car burned up. Although that too was repaired, the car was in the garage the next day for the same problem. Within a matter of weeks, the car spent six days in the garage while the brakes were being repaired. Not long after, a faulty oil seal caused oil to leak onto the brake band. The next problem, occurring about five months after purchase, entailed engine and ignition trouble. Mr. Maduro described the car as sometimes running long after the ignition had been turned off, as well as suddenly stalling in the middle of operation, conditions which, according to the plaintiff, have not been corrected. Finally, the transmission started slipping. Although Maduro asserts that a Ramsey mechanic "tightened the bands", he maintains that the problem continued. Moreover, the car exuded an odor of fuel when theengine became heated and would often slip into neutral. It was when this latter problem was reported to Ramsey that things became so strained between the parties that plaintiff abandoned his car.

Although Maduro is unable to state with any certainty on what dates he reported these myriad malfunctions to the dealer, work sheets were admitted in evidence dated February 12, 19, March 22, April 5, June 13, and November 11, all in 1968. The work indicated on this last date is the basis of this appeal. The parties differ over whether or not it was included in any warranty, and if so, whether the warranty period had, in fact, expired. The trial court found, as a matter of law, that even if repair of the transmission were to be included in an implied warranty of merchantability, no such warranty ever arose because Mr. Ramsey's express notation "6 months or 6000 miles" disclaimed the implied warranty by virtue of inconsistency. U.C.C. 2—316(3) (a).

[1] Under our appropriate standard of review "findings of fact shall not be set aside unless clearly erroneous and due regard shall be given to the opportunity of the municipal court to judge the credibility of the witnesses". 4 V.I.C. § 33; Gordon v. Elskoe, 7 V.I. 144, 295 F.Supp. 909 (1969). However, testimony at trial was exceptionally brief and the greater part of the record consists of written documents such as depositions, stipulations and examination before trial. Legal authority apart, logic and sound principle would indicate that in such a case the trial court's determination of credibility is not likely to be any more incisive than that of the reviewing tribunal. The factual findings of the court below were (a) that the plaintiff had, in fact, purchased the automobile from the defendant, selecting the model himself; (b) that although defendant experienced problems and inconvenience due to the defective condition of the car, defendant Ramsey Motors substantially re-paired these conditions at no cost to the plaintiff;¹ (c) that the transmission trouble was not brought to the attention of defendant Ramsey until eight and one-half months after the car had been purchased, and after the car had been driven almost 11,000 miles; and (d) that the plaintiff had been advised, by oral, as well as by conspicuous written notice, of the limited warranty. It is with this last finding, as well as its resultant legal consequences, with which we are here primarily concerned.

Plaintiff contends that there is an implied warranty of merchantability which exists cotemporaneously with, and extends beyond the express warranty of 6 months or 6000 miles, whichever comes first, given by Ramsey on behalf of itself and Ford. It follows, if this argument is valid, that any such warranty is breached if the automobile is not "at least fit for the ordinary purposes" for which it is used, section 2—314(2)(c), no matter when the culminating disaster occurs. The municipal court deemed it unnecessary to address this issue, and based its decision on section 2—316 (3) (a), holding that by virtue of this section no implied warranty of merchantability ever arose. That section relates to the exclusion or modification of warranties, and provides in subsection (1) that "words or conduct relevant to the creation of an express warranty and words or conduct tending to negate or limit warranty shall be construed wherever reasonable as consistent with each other". Moreover, section 2—317 states that "Warranties whether express or implied shall be construed as consistent with each other and as cumulative, but if such construction is unreasonable . . . (c) express warranties displace inconsistent implied warranties other than an implied warranty of fitness for a particular purpose".

[2] Ramsey's express warranty, although plainly conspicuous, is too lacking in particularity to effectively disclaim or supersede the statutory warranty of merchantability. Two reasons prompt this conclusion: first, because it does not conform to section 2—316 by specifically disclaiming that warranty, and second, because it can reasonably be read as consistent, and therefore concomitant with the express warranty.

[3, 4] The first reason raises a major factual issue, not touched on by the trial court, which is indispensable to the determination of this case. Section 2—316(3) requires the explicit use of the word merchantability in any effective disclaimer of that warranty. Although no mention of the term was made on the sales slip which contained the handwritten limitation, it does appear on the standard warranty ordinarily given to new car purchasers. The question of whether or not appellant received such an official warranty, and therefore must be held to have knowledge of its contents, is in sharp dispute, and no finding as to it was made below. If answered in the affirmative, that would effectively determine the controversy since the warranty would have been clearly disclaimed and the 6 months term would stand as plaintiff's sole protection. In a deposition taken before trial, plaintiff strenuously denies ever having received such a document. Defendant Ramsey, while asserting that it is common practice at his place of business to have the accountant give one to the purchaser when concluding a sale, conceded that he had no personal knowledge whether that practice was followed in the instant case. The disposition of this question is crucial to determination of the case in that if such standard warranty were received in hand, plaintiff is confined to the handwritten note, in which case, as the trial court stated, "if anything major were to go wrong with the car the buyer could only hope that it would occur during this limited period, otherwise he would not be cov-ered." Although there are several documentary exhibits in evidence, including the original sales slip, work orders, and a copy of what Ramsey asserts his accountant should have given Maduro, totally absent is a standard warranty form made out in Maduro's name. Moreover, while the plaintiff definitely states that he never received one, the best defendant Ramsey could say of his own knowledge was that it was common practice to give such a form to all purchasers. In the absence of any definite evidence that plaintiff Maduro received a standard warranty form, I conclude that he did not. Not having received the paper, he clearly cannot be held to have knowingly accepted the disclaimer of the warranty of merchantability. This conclusion is in nowise affected by the fact that the same disclaimer is included in the owner's manual.

The commercial code is designed to protect the buyer from bearing the burden of loss where merchandise does not conform to normal commercial standards of meeting the buyer's "ordinary purpose for which such goods are used." The entire purpose behind the implied warranty sections of the Code is to hold the seller responsible when inferior goods are passed along to the unsuspecting buyer. Koellmer v. Chrysler Motors Corp., 6 Conn. Cir. 478, 276 A.2d 807, 811 (1970), cert. den. 274 A.2d 884, (1971), citing Vlases v. Montgomery Ward, 377 F.2d 846, 850 (3rd Cir. 1967).

The Koellmer case is particularly apposite to the case at bar. On the face of the purchase slip there involved, was written, "such vehicle is covered for 5 years or 50,000 miles per manufacturer's new car warranty". On the back of the same form, buried among a host of conditions, was a disclaimer clause, which also incorporated, by reference, similar conditions set forth in the owner's manual. After holding that the disclaimer on the back of the...