Scheuler v. Aamco Transmissions, Inc.

• Decision Date: 05 August 1977
• Docket Number: No. 48522,48522
• Citation: 1 Kan.App.2d 525,571 P.2d 48
• Parties: , 23 UCC Rep.Serv. 30 Ruth Loreen SCHEULER et al., Conservator of Elizabeth C. Utter, and Ruth Loreen Scheuler, Administratrix of the Estate of George W. Utter, Deceased, Appellees, Cross-Appellants, v. AAMCO TRANSMISSIONS, INC., Appellant, Cross-Appellee.
• Court: Kansas Court of Appeals

Page 48

571 P.2d 48

1 Kan.App.2d 525, 23 UCC Rep.Serv. 30

Ruth Loreen SCHEULER et al., Conservator of Elizabeth C Utter, and Ruth Loreen Scheuler, Administratrix of the Estate of George W. Utter, Deceased Appellees, Cross-Appellants, v. AAMCO TRANSMISSIONS, INC., Appellant, Cross-Appellee.

No. 48522.

Court of Appeals of Kansas.

Aug. 5, 1977.

Syllabus by the Court

1. Advertising may be the basis of or form a part of an express warranty.

2. For a party to recover on an express warranty of performance, it is not necessary that a specific defect be proved but only that there was failure of performance as warranted.

John J. Alder, of Alder & Zemites, Overland Park, for appellant and cross-appellee.

Glenn E. McCann, of Knipmeyer, McCann, Fish & Smith, Kansas City, Mo., and Hylton Harman, Kansas City, for appellees and cross-appellants.

Before PARKS, P. J., and FOTH and REES, JJ.

REES, Judge:

This lawsuit involves two causes of action. Plaintiff, as conservator of her mother, asserted a wrongful death action by reason of the death of her father, George W. Utter. As administratrix of her father's estate, plaintiff also asserted a survival action for pain, suffering and medical and hospitalization expenses. K.S.A. 60-1801. Both causes of action arise out of fatal injuries sustained by George W. Utter when he was run over by his own car. The case was tried to a jury which returned verdicts against the defendant, $25,000 on the wrongful death claim and $11 on the survival claim. After allowing credit as discussed later in this opinion, judgment for $24,000 was entered in the wrongful death claim and no dollar judgment was entered on the survival claim. Defendant appeals contending it is not liable. Plaintiff cross-appeals from denial of a new trial on the amount of damages on the survival claim.

On May 9, 1966, Utter took his 1962 Mercury automobile to a local Aamco franchisee, Three B's, a Kansas corporation. By a written franchise agreement, Three B's was licensed by Aamco to do business as "Aamco Transmissions." The franchisee's name was not publicly displayed at its place of business. The only name on the sign outside was "Aamco Transmissions." Utter ordered installation of an "Aamco Custom Rebuilt Transmission with Lifetime Guarantee." The transmission was installed and the car was delivered to Utter on May 10, along with an "Aamco Transmissions Service Guide" which included, among other things, the written Aamco Transmissions Lifetime Guarantee.

Trouble with the new transmission developed immediately. One of Utter's daughters drove the car and reported that when it was started the car "would automatically jump into reverse all by itself . . ." Utter took the car back to Three B's on May 14 for repair and the car was redelivered to Utter the same day, ostensibly cured of its problem. After returning home with the car, Utter told his wife he was going to do some work on it. With the car in his driveway, Utter started the engine, walked around to the front of the car and lifted the hood. As he was adjusting the carburetor, the car backed away from him down the driveway. A neighbor saw Utter walk along beside the car as it backed toward the street and saw him reach into the car in an apparent attempt to turn off the ignition. In trying to stop the car, Utter was knocked down and run over by the left front wheel. Mrs. Utter, inside the house, witnessed the accident and ran to her husband's side. The driverless automobile continued to run in reverse, made a complete circle and ran over both Mr. and Mrs. Utter. Finally, the neighbor was able to get inside the car and stop it by turning off the engine.

Mr. and Mrs. Utter were taken to a hospital. Mr. Utter died of his injuries on May 23. There was testimony that Mr. Utter was in great pain prior to his death. Several witnesses heard him say the automobile had been in park when he started it but it had jumped into reverse.

Plaintiff sued Aamco and Three B's. Prior to trial, a settlement was made with Three B's. In consideration of payment of $1,000, plaintiff, as conservator for her mother, covenanted not to sue Three B's for wrongful death. In consideration of payment of $14,000, plaintiff, as administratrix, covenanted not to sue Three B's on any other claim. Plaintiff expressly reserved the right to sue Aamco in either of her capacities. The action as to Three B's was dismissed with prejudice.

Trial against Aamco was upon the theories of breach of implied and express warranties. The jury returned its verdict for plaintiff. After some initial uncertainty, the district court reduced the wrongful death recovery by $1,000 because of the Three B's settlement and disposed of the $11 verdict on the survival claim by crediting against it the $14,000 payment made by Three B's.

Now on appeal Aamco raises three arguments relating to warranty. It contends there was no substantial competent evidence that it expressly or impliedly warranted the quality or performance of the transmission installed in the Utter car. Aamco also argues that even if a warranty existed, there was no substantial competent evidence it was breached. Aamco's last contention is that there was no substantial competent evidence that a breach of warranty caused Utter's injury and death.

The Aamco Transmissions Lifetime Guarantee was supplied by Aamco to Three B's for issuance to purchasers. The text of the guarantee is as follows:

"All AAMCO Custom Rebuilt Transmissions and AAMCO Custom Exchange Torque Converters are guaranteed against any defects of material and workmanship for the lifetime of the car; providing: (1) that the ownership of the car remains the same, and (2) that it is delivered to any registered AAMCO Transmission Shop in the United States each year, including the current year, for service within 30 days of the Service Date indicated below. The charge for each service is $13.75, payable at the time of service, and it covers the replacement of transmission fluid and all preventive adjustments necessary to keep the transmission in good operating condition."

At the top of the guarantee the words "AAMCO TRANSMISSIONS" appear in bold type. Nowhere on the guarantee is Three B'S name.

The Aamco Transmission Service Guide given Utter with the guarantee extolls the virtues of Aamco transmissions and the care and skill with which each transmission is installed and serviced. The service guide assures the purchaser of "prompt service in any of the hundreds of Aamco Transmission Centers coast-to-coast." It includes a picture of the Aamco national headquarters in Philadelphia. The service guide was given to the Three B's by Aamco for issuance to transmission buyers. Three B's name does not appear on it.

The order form for the purchase of an Aamco Custom Rebuilt Transmission with Lifetime Guarantee signed by Utter has the words "AAMCO TRANSMISSIONS" prominently printed thereon and there is no mention of Three B's, although the address of Three B's does appear.

There was considerable evidence concerning Aamco advertising. The franchise agreement between Aamco and Three B's required Three B's to use Aamco advertising materials and sales promotions and to contribute to national advertising by Aamco. Aamco sent Three B's mats for newspaper advertisements and tapes for radio spots. Three B's used the materials to run advertisements in local newspapers and on local radio stations. The advertisements praised Aamco Transmissions with their "Coast-to-Coast Ironclad Guarantee" without naming Three B's.

Under these circumstances, we hold there was substantial competent evidence that individually and directly Aamco expressly warranted the installation and performance of the transmission sold to Utter.

Advertising may be the basis of or form a part of an express warranty. 67 Am.Jur.2d, Sales § 436 (p. 598); General Motors Corporation v. Dobson, 47 Tenn.App. 438, 338 S.W.2d 655 (1960). Lack of privity between a buyer and a manufacturer who advertises is no hurdle. In a widely-known treatise, it is said:

"Manufacturers constantly extol and represent the quality of their products on labels, on billboards, on radio and T.V., in newspapers and magazines, in...