Parrot v. Daimlerchrysler Corporation

• Decision Date: 14 March 2006
• Docket Number: No. CV-05-0104-PR.,CV-05-0104-PR.
• Citation: 130 P.3d 530,212 Ariz. 255
• Parties: Bill PARROT, Plaintiff-Appellant, v. DaimlerCHRYSLER CORPORATION, Defendant-Appellee.
• Court: Arizona Supreme Court

Page 530

130 P.3d 530

212 Ariz. 255

Bill PARROT, Plaintiff-Appellant, v. DaimlerCHRYSLER CORPORATION, Defendant-Appellee.

No. CV-05-0104-PR.

Supreme Court of Arizona, En Banc.

March 14, 2006.

Krohn & Moss, Ltd. by Marshall Meyers, Ian Pryor, Phoenix, Attorneys for Bill Parrot.

Bowman and Brooke LLP by Negatu Molla, Jennifer L. Haman, Phoenix, Attorneys for DaimlerChrysler Corporation.

OPINION

RYAN, Justice.

¶ 1 In this case, we must determine whether an automobile lessee can maintain an action under the Magnuson-Moss Warranty Act ("Warranty Act" or "Act"), 15 U.S.C. §§ 2301-2312 (2000), and whether the lessee has a right to pursue remedies under the Arizona Motor Vehicle Warranties Act ("Lemon Law"), Ariz.Rev.Stat. ("A.R.S.") §§ 44-1261 to -1267 (2003 & Supp.2005). We hold that, under the circumstances of this case, a lessee neither can sue under the Warranty Act nor have remedies under the Lemon Law.

I

¶ 2 Bill Parrot leased a 2000 Jeep Cherokee from Pitre Chrysler Plymouth Jeep Eagle ("Pitre") in Scottsdale, Arizona. The Jeep came with "Chrysler's standard limited warranty." Simultaneously with executing its lease with Parrot, Pitre assigned the lease to the lender, Chrysler Financial Company, L.L.C. Pitre apparently retained title to the vehicle.¹

¶ 3 Parrot alleges that while he possessed the vehicle, he had to bring it to various dealerships at least thirteen times for repairs including: at least eleven times for suspension/axle defects; four times for alignment defects; three times for a windshield leak; three times for brake defects; and once for an exhaust system defect.

¶ 4 Dissatisfied with the repair work done on the Jeep, Parrot filed suit in superior court alleging that DaimlerChrysler had breached its written warranty and seeking remedies under the Warranty Act and the Lemon Law. The parties filed cross motions for summary judgment. The trial court granted DaimlerChrysler's motion for summary judgment.

¶ 5 Parrot appealed. The court of appeals reversed, concluding that Parrot was a consumer subject to protection under both the Warranty Act and the Lemon Law. Parrot v. DaimlerChrysler Corp., 210 Ariz. 143, 150-51, ¶¶ 30, 33, 39, 108 P.3d 922, 929-30 (App. 2005).

¶ 6 We granted DaimlerChrysler's petition for review because the applicability of the Warranty Act and the Lemon Law to lessees is an issue of first impression for this Court. We have jurisdiction under Article 6, Section 5(3), of the Arizona Constitution and A.R.S. § 12-120.24 (2003).

II

¶ 7 This matter concerns the interpretation of the Warranty Act and the Lemon Law. Statutory interpretation is an issue of law and is decided de novo. Canon Sch. Dist. No. 50 v. W.E.S. Constr. Co., 177 Ariz. 526, 529, 869 P.2d 500, 503 (1994). "We interpret statutes to give effect to the legislature's intent. When a statute is clear and unambiguous, we apply its plain language" to find the legislature's intent and do "not engage in other means of statutory interpretation." Kent K. v. Bobby M., 210 Ariz. 279, 283, ¶ 14, 110 P.3d 1013, 1017 (2005) (citing Aros v. Beneficial Ariz., Inc., 194 Ariz. 62, 66, 977 P.2d 784, 788 (1999)). A statute is clear and unambiguous when it admits of only one meaning. Millett v. Frohmiller, 66 Ariz. 339, 345, 188 P.2d 457, 461 (1948).

¶ 8 We first examine the Warranty Act and then turn to Arizona's Lemon Law. Under neither is Parrot entitled to relief.

III

A

¶ 9 In response to complaints "from irate owners of motor vehicles complaining that automobile manufacturers and dealers were not performing in accordance with the warranties on their automobiles," Motor Vehicle Mfrs. Ass'n of U.S. v. Abrams, 899 F.2d 1315, 1317 (2d Cir.1990) (quoting H.R.Rep. No. 93-1107 (1974), as reprinted in 1974 U.S.C.C.A.N. 7702, 7708), Congress enacted the Warranty Act in 1975. The purpose of the Warranty Act is "to prevent warranty deception." Milton R. Schroeder, Private Actions under the Magnuson-Moss Warranty Act, 66 Cal. L.Rev. 1, 9 (1978) ("Schroeder"). To further that purpose, the Act requires conspicuous disclosure of the "terms and conditions" of warranties "in simple and readily understood language." 15 U.S.C. § 2302(a). And, "[t]o enforce its requirements, the Act permits `a consumer who is damaged by the failure of a supplier, warrantor, or service contractor to comply with any obligation under this chapter, or under a written warranty, implied warranty, or service contract' to sue warrantors for damages and other relief in any court of competent jurisdiction." DiCintio v. DaimlerChrysler Corp., 97 N.Y.2d 463, 742 N.Y.S.2d 182, 768 N.E.2d 1121, 1123 (2002) (quoting 15 U.S.C. § 2310(d)(1)). To bring a cause of action under the Warranty Act, a person must be a consumer of a consumer product and have a written warranty, implied warranty, or service contract, as those terms are defined by the Warranty Act.²

¶ 10 The Warranty Act defines "consumer product" as "any tangible personal property which is distributed in commerce and which is normally used for personal, family or household purposes." 15 U.S.C. § 2301(1). The parties agree that the Jeep is a consumer product. Therefore, the dispositive issue is whether Parrot is a consumer as defined by the Act.

¶ 11 The Act creates three categories of consumers. Id. § 2301(3). The first category includes "a buyer . . . of any consumer product," other than for purposes of resale. Id. The second encompasses "any person to whom [a consumer product] is transferred during the duration of . . . [a] written warranty." Id. The third category includes "any other person who is entitled by the terms of such warranty . . . or under applicable State law to enforce against the warrantor . . . the obligations of the warranty." Id.

¶ 12 Each category requires a qualifying sale — a sale in which a person buys a consumer product for purposes other than resale. The first category necessarily involves a qualifying sale by its own terms, requiring that a consumer be a "buyer . . . of any consumer product." Id. (emphasis added). The necessity of a qualifying sale for categories two and three consumers arises from the Warranty Act's definition of "written warranty." DiCintio, 742 N.Y.S.2d 182, 768 N.E.2d at 1124.

¶ 13 The Warranty Act defines "written warranty" as:

(A) any written affirmation of fact or written promise made in connection with the sale of a consumer product by a supplier to a buyer which relates to the nature of the material or workmanship and affirms or promises that such material or workmanship is defect free or will meet a specified level of performance over a specified period of time, or

(B) any undertaking in writing in connection with the sale by a supplier of a consumer product to refund, repair, replace, or take other remedial action with respect to such product in the event that such product fails to meet the specifications set forth in the undertaking,

which written affirmation, promise, or undertaking becomes part of the basis of the bargain between a supplier and a buyer for purposes other than resale of such product.

15 U.S.C. § 2301(6) (emphasis added).

¶ 14 Subsections (A) and (B) each expressly require a sale of a consumer product by a supplier. Id. In addition, both subsections are modified by the qualifying phrase at the end of 15 U.S.C. § 2301(6). That qualifying phrase calls for the underlying sale to be to a buyer "for purposes other than resale" and for the written affirmation, promise, or undertaking to be part of the basis of the bargain. Id.

¶ 15 Consequently, the existence of a written warranty, as defined by the Warranty Act, is a requirement for both category two and category three "consumer" status. A person cannot be a category two consumer unless some person purchased the vehicle for purposes other than resale and the written warranty was "part of the basis of the bargain between a supplier and a buyer." Id.

¶ 16 Similarly, a person cannot be a category three consumer unless a qualifying sale has occurred. The category three definition of "consumer" has two parts. Both parts require that a qualifying sale occur — that a person purchased the vehicle for purposes other than resale and that the warranty was "part of the basis of the bargain between a supplier and a buyer." Id.

¶ 17 The first part states that, in addition to meeting the foregoing requirements, a consumer must be a person "entitled by the terms of such warranty . . . to enforce against the warrantor . . . the obligations of the warranty." 15 U.S.C. § 2301(3) (emphasis added). The use of the word "such" to modify "warranty" logically refers to the previous use of "warranty" in the statute. The previous use of "warranty" occurs in category two when it defines a consumer as a person to whom the product is "transferred during the duration of . . . [a] written warranty." Id. Thus, the first part of the definition of a category three consumer means any person entitled by the terms of a written warranty to enforce the obligations of the warranty against the warrantor. As discussed above, the term "written warranty," as defined in the Warranty Act, is a "written affirmation, promise, or undertaking [that] becomes part of the basis of the bargain between a supplier and a buyer for purposes other than resale of such product." Id. § 2301(6) (emphasis added). Accordingly, to be a category three consumer under the first part of the definition, a qualifying sale as defined by the Warranty Act must have occurred.

¶ 18 The second part of category three defines a consumer as "any other person who is entitled . . . under applicable State law to enforce against the warrantor . . . the obligations of the warranty." Id. § 2301(3) (emphasis added). In this second part, the phrase "the warranty" should not be interpreted in the generic sense as meaning any warranty. Such an interpretation would be inconsistent with the statutory scheme as a whole.

¶ 19 We presume that Congress uses terms...