Regency Nissan, Inc. v. Jenkins, 92-CA-00052-SCT

• Decision Date: 12 October 1995
• Docket Number: No. 92-CA-00052-SCT,92-CA-00052-SCT
• Citation: 678 So.2d 95
• Parties: REGENCY NISSAN, INC. v. William H. JENKINS and Embers Wholesale Automobiles, Inc.
• Court: Mississippi Supreme Court

Page 95

678 So.2d 95

REGENCY NISSAN, INC. v. William H. JENKINS and Embers Wholesale Automobiles, Inc.

No. 92-CA-00052-SCT.

Supreme Court of Mississippi.

Oct. 12, 1995.

Opinion on Rehearing Aug. 22, 1996.

Elbert E. Haley, Jr., Jackson, for appellant.

C. Victor Welsh, III, Pittman Germany Roberts & Welsh, Jackson; William W. Abbott, Jr., Gulfport; Curtis G. Kirby, Jr., Jackson, for appellees.

En Banc.

BANKS, Justice, for the Court:

The matter before the court involves a judgment in the amount of $15,140.82, representing treble damages under the Odometer Disclosure Act, 15 U.S.C. § 1989 (1988), for alleged fraudulent representations by the defendant, appellant herein, Regency Nissan, Inc. (Regency), the retail used car dealer who sold a truck to Jenkins. We reject Regency's contention that it was entitled to a directed verdict and the other claimed trial errors in evidentiary and instruction rulings and affirm.

I.

On April 11, 1989, William Jenkins traveled from his home in Philadelphia, Mississippi to Jackson, Mississippi in his 1979 Chevrolet pick-up truck and visited Regency, a retail car dealership, where he became interested in a 1987 Dodge Dakota truck with an odometer reading of 51,236 miles. Jenkins noticed that the vehicle had a broken windshield, broken radio, a missing headlight and no inspection sticker. Regency promised to fix those problems if Jenkins bought the truck. With that assurance, Jenkins paid $8,546.94 for the Dakota, with the assurance that the odometer reading was accurate. Although Jenkins objected to taking the truck without the repairs completed and without an inspection sticker attached, he agreed to purchase the Dodge truck on the representation of the Regency salesperson that he already had a buyer for Jenkins's own Chevrolet truck.

After buying the truck, Jenkins observed that the oil change sticker in the frame of the passenger door which indicated an oil change on March 7, 1989 and mileage of 90,171 miles. Additional problems allegedly arose with the truck, which indicated to Jenkins that the odometer reading was inaccurate and that major defects existed with the vehicle, including such items as the oil pump, pistons, rod bearing, and the camshaft. The motor required an overhaul and the emergency brakes and speedometer cable, which was dragging on the ground, were repaired. There was evidence that the original passenger door had been cut off, a new door welded onto the frame, and the replacement door painted the same color as the truck. The truck had three different brands of tires, all requiring replacement; it also required a front-end realignment and two transmission repairs.

On June 12, 1989, Jenkins filed suit in the First Judicial District of Hinds County against Regency, alleging that he had purchased the Dodge pick-up truck with a fraudulent odometer reading. He requested relief under a federal act, the civil enforcement provision of the Odometer Disclosure Subchapter of the Motor Vehicle Information and Costs Saving Act, 15 U.S.C. § 1989 (1988). ¹

In response to this action, Regency filed an answer, counterclaim, and third-party claim. In its counterclaim, Regency alleged that Jenkins's action was frivolous and that the complaint violated the Mississippi Litigation Accountability Act of 1988, Miss.Code Ann. § 11-55-1 (Supp.1988). The third-party Complaint named as the third-party defendant Embers Wholesale Automobiles, Inc., (Embers), the wholesaler from whom Regency had purchased the truck. In turn, Embers filed another third-party complaint against others from whom they had purchased the truck. These additional third-party defendants were Paul Baugh d/b/a Star Motors (Star), and Frank G. Weaver and Harry Schermer d/b/a Hwy 49 Motors (Hwy 49). Regency, in turn, also filed a third-party complaint against Star and Hwy 49. The initial owner of the truck was Frank G. Weaver, another third-party defendant. Embers also sought indemnity from these additional defendants on the basis of their prior ownership of the truck.

After all claims and responsive pleadings were filed in trial court, the following parties appeared in the action. The parties are listed in descending order of their ownership of the 1987 Dodge Dakota pick up truck:

(1) Plaintiff/Appellee--William H. Jenkins;

(2) Defendant/Appellant--Regency Nissan, Inc., who answered, filed a third-party complaint, and appeared at trial;

(3) Third-party defendant/Appellee--Embers Wholesale Automobiles, Inc., who answered, filed a third-party complaint, and appeared at trial;

(4) Third-part defendant--Harry Schermer, d/b/a Highway 49 Motors, who answered, appeared at trial pro se, but did not present evidence, question witnesses or argue or appeal;

(5) Third-party defendant--Paul Baugh d/b/a Star Motors, who did not answer or appear at trial or appeal; and

(6) Third-party defendant--Frank G. Weaver, the truck's original owner, who did not answer or appear at trial or appeal.

Before trial, Regency filed a motion in limine to suppress admission of an oil change sticker that indicated that the Dakota's mileage was substantially higher than shown on the odometer. Regency's position was that this document was neither admissible authentic nor as a hearsay exception. Jenkins argued that he offered this sticker to show notice that the mileage was inaccurate rather than to prove the truth of the matter asserted, i.e., that the car had more than 90,000 miles on it. Overruling Regency's hearsay objection, the trial court found the sticker was admissible and reserved its ruling on the authentication objection until trial.

At trial, Jenkins offered the sticker into evidence. Jenkins admitted that the oil sticker could have been on the replacement passenger door that was put on the Dakota to replace the original door. The parties entered into a stipulation concerning the oil change sticker. Jenkins's interpretation of the stipulation is that the odometer was tampered with before Regency's ownership; Regency's interpretation of the stipulation is that Regency did not tamper with the odometer. Over objection, Jenkins told the jury he would have been willing to pay only $3,500 for the vehicle with its mileage and problems, had he known the "truth." The trial court admitted the sticker into evidence despite hearsay and authentication objections.

As to a $1,000 repair bill on the car paid by Jenkins, offered to show damages and produced by Jenkins the day before trial, the trial court allowed it into evidence for use in refreshing Jenkins's memory because Jenkins had only received the bill the day before trial. The trial court excluded entirely the other bills offered by Jenkins for lateness of production.

Shortly before Jenkins rested, Regency introduced a title history of the truck showing that the Dakota had 51,236 miles when Jenkins purchased it; 51,186 miles when Regency purchased it; 51,176 miles when Embers purchased it; 51,160 when Harry Schermer of Hwy 49 motors purchased it; and 51,144 when Star Motors purchased the vehicle from the original owner. Regency moved for a directed verdict. That motion was denied and the matter was presented to the jury resulting in the aforementioned verdict in favor of Jenkins. Regency appeals raising the following issues:

A) WAS THE VERDICT AGAINST THE OVERWHELMING WEIGHT OF THE EVIDENCE AND DID THE COURT ERR IN FAILING TO GRANT A DIRECTED VERDICT?

B) DID THE COURT ERR IN FAILING TO GRANT THE MOTION IN LIMINE AND IN ALLOWING INTO EVIDENCE PLAINTIFF'S EXHIBIT 4 (THE OIL STICKER)?

C) DID THE COURT ERR IN FAILING TO SUSTAIN REGENCY'S OBJECTION TO APPELLANT'S EVIDENCE AND TESTIMONY REGARDING THE ESTABLISHMENT OF FAIR MARKET VALUE?

D) DID THE COURT ERR IN GRANTING INSTRUCTION P-4 (PLAINTIFF'S DAMAGE INSTRUCTION) AND BY GRANTING A MODIFICATION TO SAME?

E) DID THE COURT ERR IN FAILING TO DIRECT A VERDICT OR IN FAILING TO REFORM THE VERDICT IN FAVOR OF REGENCY AGAINST EMBERS AND SCHERMER ET AL., AS WELL AS FAILING TO DIRECT A VERDICT AGAINST

SCHERMER, IN LIGHT OF PEREMPTORY INSTRUCTIONS D-21 AND D-24?

F) DID THE COURT ERR IN GRANTING ATTORNEY'S FEES TO THE ATTORNEY FOR THE PLAINTIFF/APPELLEE AND IN GRANTING THE AMOUNT AWARDED?

II.

a.

To be found liable for a violation of the Motor Vehicle Information and Cost Savings Act under 15 U.S.C. §§ 1981 to 1991 (1988), the plaintiff must show that the seller had an intent to defraud. 15 U.S.C. § 1989 (1988). The plaintiff may satisfy the requirements of the Act by showing that the dealer did one of two things. The plaintiff may show that the defendant car dealer represented a car as having a certain mileage when the dealer had actual or constructive knowledge that the odometer reading was less than the actual miles traveled. Nieto v. Pence, 578 F.2d 640, 641 (5th Cir.1978); Moore v. H. Gene Simmons, Inc., 543 So.2d 186, 187 (Miss.1989); 15 U.S.C. § 1989(b). Alternatively, the plaintiff may show that the dealer failed to disclose that the mileage was unknown if, by using reasonable care, the dealer would have had reason to know that the actual mileage exceeded the odometer reading. Nieto, 578 F.2d at 641. A reckless disregard in failing to determine if the odometer reading is incorrect is also sufficient to prove intent to defraud. Haynes v. Manning, 917 F.2d 450, 452-53 (10th Cir.1990).

Constructive knowledge may be proved by a contradictory odometer statement from another source (See Landrum v. Goddard, 921 F.2d 61, 62 (5th Cir.1991)) or by the vehicle's overall condition as compared to the mileage shown on the odometer. See Nieto, 578 F.2d at 642. Contrary to other types of fraud claims, the plaintiff's burden of proof is a preponderance of the evidence. Landrum, 921 F.2d at 62-63.

b.

This Court's standard of review is limited when determining the sufficiency of the evidence on a motion for a directed verdict. When contradictory testimony exists, this Court will "defer to the jury, which determines the weight and worth of testimony...