McDonald v. Mazda Motors of America, Inc., A04A1411.

• Decision Date: 10 August 2004
• Docket Number: No. A04A1411.,A04A1411.
• Citation: 603 S.E.2d 456,269 Ga. App. 62
• Parties: McDONALD v. MAZDA MOTORS OF AMERICA, INC.
• Court: Georgia Court of Appeals

603 S.E.2d 456

269 Ga. App. 62

McDONALD v. MAZDA MOTORS OF AMERICA, INC.

No. A04A1411.

Court of Appeals of Georgia.

August 10, 2004.

Certiorari Denied November 22, 2004.

Amy Myers-Burns, Eric Fortas, Amy Budow, Krohn & Moss, Ltd., Atlanta, for Appellant.

Charles Marsh, Swift, Currie, Mcghee & Hiers, Atlanta, for Appellee.

ELDRIDGE, Judge.

Mark McDonald appeals from the grant of summary judgment on his action for breach of warranties under the Magnuson-Moss Warranty Act, which are in fact state warranty claims, against Mazda Motors of America, Inc. for unrepaired defects to his new 2002 Mazda Protege over the first 17 months of ownership. On de novo review, we find disputed issues of material fact on the theories of liability appealed and reverse the grant of summary judgment by the trial court for trial by jury on the issues of breach of warranty, express and implied.

On August 31, 2001, McDonald purchased a new 2002 Mazda Protege from a Mazda Motors of America authorized dealership. Mazda provided a written warranty that promised to repair defects in materials or in workmanship in the vehicle for 36 months or 50,000 miles, whichever first occurred, and the alleged breach of warranties occurred within such conditions. Almost immediately after purchase, the vehicle developed a loud rattling noise under the engine and transmission. On November 3, 2001, McDonald took the vehicle for repair of such possible defects to an authorized Mazda dealer; the dealer kept the vehicle for three and one-half weeks in order to repair it, from November 3 to November 28. The authorized Mazda repair technician verified the existence of the conditions and wrote up the repair order: "Mazda is aware of concern, spoke with tech line, I have ref#, no repair available at this time." The vehicle was returned to McDonald unrepaired with the alleged defects still present.

In early January, McDonald again contacted the same manufacturer's authorized repair facility, and he advised them that the rattling noise continued and that the vehicle's engine was "running rough"; Vance, a technician there, told McDonald that no repair was available to fix the condition.

On January 24, 2002, McDonald took the vehicle to the repair center and advised them that the vehicle was "running rough" and making the rattling noise. The technician wrote up the repair order, stating, "the customer has kept up to date on info from Mazda as soon as two weeks ago by Vance, and was advised that there is still no repairs available; ... engineer still working on a fix at this time; ... we are advised not to make... any ... repair attempts. All controls are computer controlled. No adjustments can be made. No correction can be made at this time." No repair was made, and the vehicle was returned to McDonald again in the same unrepaired condition with the alleged defects.

On April 11, 2002, McDonald gave written notice to Mazda of the unrepaired defects and of the breach of warranty in the unreasonable delay in making or attempting to make repairs. On May 22, 2002, McDonald filed this law suit.

The alleged problems continued for months, even after suit. Finally, on March 23, 2003, the authorized repair facility attempted to fix the vehicle. The technician replaced the VTCS delay valve and recalibrated the PCM with updates per Mazda Technical Bulletin # 01-004/03.

Mazda moved for summary judgment, which motion raised issues as to the Lemon Law only; however, the trial court granted summary judgment both as to the Lemon Law claim and as to warranties under the Magnuson-Moss Warranty Act claims, i.e., state warranty claims. McDonald appeals only from the grant of summary judgment as to the Magnuson-Moss claims for breach of warranty under Georgia law and not as to the Georgia Lemon Law claims.

The Magnuson-Moss Warranty Act creates no claims except for attorney fees and relies upon state law to create and define implied warranties, breach, and some kinds of damages; the Act limits the content of written disclaimers and allows certain remedies and damages not available under state law. See generally Freeman v. Hubco Leasing, 253 Ga. 698, 703(2), 705-706(4), 324 S.E.2d 462 (1985) (damages for attorney fees and limited disclaimer of written and implied warranties arising under Georgia law); Dildine v. Town & Country Truck Sales, 259 Ga.App. 732, 734, 577 S.E.2d 882 (2003) (breach of implied warranty arises under state law — 15 USC § 2301(7)); Sharpe v. Gen. Motors Corp., 198 Ga.App. 313, 314(3), 401 S.E.2d 328 (1991) (provides damages for breach of warranty under state law); Ryals v. Billy Poppell, Inc., 192 Ga.App. 787, 788, 386 S.E.2d 513 (1989) (15 USC § 2311(b) action for personal injury arises under state law). Therefore, we will look to Georgia warranty law, except where the Magnuson-Moss Warranty Act requires a different result, which is not necessary under the facts of this case.

1. McDonald contends that the trial court erred in granting summary judgment as to the written warranty. We agree.

The trial court ruled that McDonald failed to produce evidence that Mazda failed or refused to repair the vehicle in that there was no repair remedy available. Obviously, if there is no repair remedy for a defect, then there will be a breach of warranty, because the product is not merchantable with an unrepairable defect. The trial court misconstrued the evidence and the law. On November 3, 2001, McDonald took the vehicle for repair; the vehicle was kept to make repairs for three and one-half weeks without repair or attempt to repair; and the vehicle was returned with the notation "Mazda is aware of concern ... no repair available at this time." After what a jury may find to be an unreasonable time to make repairs, the vehicle was returned unrepaired; this raises a jury question whether there was a failure to make repairs or a refusal to make repairs by Mazda, which could be found to constitute a breach of the express warranty on the first delivery of the vehicle for repairs. In January 2002, McDonald was told on two occasions that Mazda could not repair the vehicle and that the technicians were expressly ordered by Mazda not to attempt any repairs. Such failure or refusal to attempt repair raises a jury issue as whether such conduct constituted a breach of express warranty after two deliveries for repair with no repair or attempt to repair.

Finally, on March 23, 2003, long after suit was instituted and nearly 17 months after purchase, Mazda authorized an attempt to fix the vehicle for the first time. Such facts create a jury question as to whether Mazda failed to repair the vehicle or refused to repair the vehicle previously and whether the lack of a repair remedy for 17 months constituted a breach of the express warranty.

On March 23, 2003, the replacement of the VTCS delay valve and recalibration of the PCM raise reasonable inferences that the rattling noise and "running rough" engine, which persisted for months, constituted the defect or defects that existed from the purchase date unrepaired or with no attempt to repair. The inability for months to devise a repair strategy or repair solution by the manufacturer's engineering department raises a reasonable inference by which a jury may find defects that were either a manufacturing defect or a design defect, which existed from the time of manufacture.

(a) When a defect in the product exists, the manufacturer and seller are liable strictly in warranty, without evidence of fault or knowledge, where the breach of warranty conditions are satisfied. OCGA § 11-2-314; John Deere Co. v. Lindsey Landclearing Co., 122 Ga.App. 827, 831(2), 178 S.E.2d 917 (1970); accord Pierce v. Liberty Furniture Co., 141 Ga.App. 175, 176(3), 233 S.E.2d 33 (1977) (superceded by statute). The purpose of warranty statutes is "that the enterprise which causes losses should lift them from the individual victims and distribute them widely among those who benefit from the activities of the enterprise.... This would include strict liability on the part of the manufacturer upon an implied warranty [as to defects] lurking in any kind of product." (Citations and punctuation omitted.) Wood v. Hub Motor Co., 110 Ga.App. 101, 105, 137 S.E.2d 674 (1964); see also Firestone Tire etc. Co. v. Jackson Transp. Co., 126 Ga.App. 471, 474-475(1), 191 S.E.2d 110 (1972).

When there is a written warranty that includes repair or replacement of parts, two conditions of the warranty are notice of the defect and a reasonable opportunity to repair the defect before a breach of warranty can exist. OCGA §§ 11-2-508; 11-2-605; 11-2-607 (3)(a). "These being express provisions and conditions of the warranty, a breach of that warranty would occur only upon [Mazda's] refusal to remedy.... [I]t cannot be liable for breach of the warranty attaching to the vehicle [until it has a reasonable opportunity to repair.]" DeLoach v. Gen. Motors, 187 Ga.App. 159, 160(3), 369 S.E.2d 484 (1988); see also Ford Motor Co. v. Gunn, 123 Ga.App. 550, 551(1), 181 S.E.2d 694 (1971).

[A] warranty contemplates that the warrantor shall have an opportunity to remedy defects. Thus the warranty is not instantly breached if the car is found on delivery or at some time thereafter within the warranty period to have a defective part or operational deficiency. The language of the warranty provides that in such event the manufacturer, through its selling dealer or other appointed agency, will replace or repair ... and do what is necessary to bring the vehicle to normal at no cost to the purchaser. Assuming the purchaser has maintained his vehicle in the manner specified, it is the refusal to remedy within a reasonable time, or a lack of success in the attempts to remedy which would constitute a breach of warranty.

(Emphasis omitted.) Id. at 551, 181 S.E.2d 694; accord Olson v. Ford Motor Co., 258 Ga.App. 848, 851(2), 575 S.E.2d 743 (2002). If the defect can be cured, then...