Smyser v. Western Star Trucks Corp.

• Decision Date: 18 July 2001
• Docket Number: No. 00-2482.,00-2482.
• Citation: Smyser v. Western Star Trucks Corp., 247 Wis.2d 281, 2001 WI App 180, 634 N.W.2d 134 (Wis. App. 2001)
• Parties: Charles H. SMYSER and Smyser and Associates, Inc., Plaintiffs-Appellants, v. WESTERN STAR TRUCKS CORP., Western Star Trucks Sales, Inc. and Racine Truck & Equipment Corp., Defendants-Respondents.
• Court: Wisconsin Court of Appeals

247 Wis.2d 281

2001 WI App 180

634 N.W.2d 134

Charles H. SMYSER and Smyser and Associates, Inc., Plaintiffs-Appellants,¹ v. WESTERN STAR TRUCKS CORP., Western Star Trucks Sales, Inc. and Racine Truck & Equipment Corp., Defendants-Respondents.

No. 00-2482.

Court of Appeals of Wisconsin.

Submitted on briefs June 6, 2001.

Decided July 18, 2001.

On behalf of the plaintiffs-appellants, the cause was submitted on the briefs of Gary W. Thompson of Thompson Law Offices, S.C. of Milwaukee.

On behalf of the defendants-respondents, the cause was submitted on the brief of Winthrop B. Reed, III of Lewis, Rice & Fingersh, L.C. of St. Louis, Missouri, and Michael J. Jassak of Habush, Habush, Davis & Rottier, S.C. of Racine.

Before Nettesheim, Anderson and Snyder, JJ.

¶ 1. NETTESHEIM, J.

The issues on appeal are whether a consumer may invoke the Lemon Law or revoke acceptance of a motor vehicle under the Uniform Commercial Code (UCC) after the consumer has surrendered possession and title of the vehicle to the dealer and the vehicle has been sold to a third party. Like the trial court, we hold that the remedies of the Lemon Law and the UCC are not available in such a situation. Consequently, we affirm the summary judgment dismissing the claims of Charles H. Smyser and Smyser and Associates, Inc. (Smyser) against Western Star Trucks Corp., Western Star Trucks Sales, Inc. (Western Star) and Racine Truck & Equipment, Corp. (Racine Truck).

FACTS

¶ 2. The relevant facts are not in dispute. On January 31, 1997, Smyser purchased a new 1997 Western Star truck from Racine Truck, a Western Star dealer. The purchase price was $86,496.39. Smyser financed $82,962.42 of the purchase price through Orix Credit Alliance, Inc. (Orix). As the lienholder, Orix retained possession of the title to the vehicle. The vehicle was covered by a warranty provided by Western Star.

¶ 3. Almost immediately, Smyser experienced vibration problems with the vehicle. He brought it in for attempted repairs at various Western Star dealers, including Racine Truck, but the problem persisted. Despite these attempts to repair the vehicle, Western Star does not dispute that the nonconformity continued and the vehicle is a "lemon" under the Lemon Law. See WIS. STAT. § 218.0171(1)(h), (2)(a) (1999-2000).²

¶ 4. On June 19, 1998, Smyser informed Glenn Long, Western Star's manufacturing representative, that he was not going to make future loan payments on the vehicle. Smyser similarly advised Orix, his lender. Orix responded by advising Smyser to surrender the vehicle to Racine Truck. Smyser then spoke with Tim Miles, Racine Truck's manager, who agreed that Racine Truck would take back the vehicle. Accordingly, on June 22, 1998, Smyser drove the truck to Racine Truck, parked it, gave the keys to a Racine Truck salesman, and signed a power of attorney authorizing Racine Truck to transfer his interest in the vehicle.³ Racine Truck then obtained clear title by paying Orix $65,000, the amount of Smyser's loan balance. A few days later, Racine Truck sold the vehicle to a third party.

¶ 5. Some ten months later, Smyser wrote to Western Star seeking monetary relief under the Lemon Law in the amount of $41,019.26.⁴ Western Star rejected Smyser's claim. Smyser responded with this lawsuit against Western Star and Racine Truck alleging various causes of action. Relevant to this appeal, Smyser's complaint alleged a Lemon Law claim against Western Star and revocation of his acceptance of the vehicle under the UCC against Western Star and Racine Truck.

¶ 6. Western Star and Racine Truck moved for summary judgment. Following a hearing and after reviewing the parties' written briefs, the trial court issued a written decision granting the motion for summary judgment. The trial court determined that Western Star had made a reasonable attempt to repair the vehicle but the nonconformity had not been repaired pursuant to WIS. STAT. § 218.0171(2)(a) and (b). However, because Smyser had previously surrendered the vehicle and the title to Racine Truck and the vehicle had been sold to a third party, the court concluded that Smyser could not obtain relief under the Lemon Law or the UCC. Smyser appeals.

STANDARD OF REVIEW

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¶ 7. This court reviews decisions on summary judgment de novo. When reviewing a summary judgment, we follow the same methodology as the trial court. That methodology has been described many times, and we need not repeat it here in detail. Vultaggio v. Gen. Motors Corp., 145 Wis. 2d 874, 881, 429 N.W.2d 93 (Ct. App. 1988). Suffice it to say that we review decisions on summary judgment de novo. Id. In addition, Smyser's arguments require that we apply the relevant provisions of the Lemon Law and the UCC to the facts of this case. That exercise also presents a question of law that we review de novo. See Tomczak v. Bailey, 218 Wis. 2d 245, 252, 578 N.W.2d 166 (1998). Despite our de novo standard of review, we nonetheless value the trial court's decision on the issues. Scheunemann v. City of West Bend, 179 Wis. 2d 469, 475, 507 N.W.2d 163 (Ct. App. 1993).

DISCUSSION

1. Lemon Law

¶ 8. Smyser asserted claims under WIS. STAT. § 218.0171(2)(a) and (b) of the Lemon Law. Section 218.0171(2)(a) obligates a manufacturer to repair a nonconformity covered by a warranty under certain conditions.⁵ Section 218.0171(2)(b) provides that the consumer may obtain a replacement vehicle or a refund and related costs where, after the manufacturer's reasonable attempt to repair, the nonconformity is not repaired.⁶ To receive a replacement vehicle or a refund, the consumer must offer to transfer the title of the vehicle to the manufacturer and, upon the manufacturer providing the replacement vehicle or the refund, the consumer must deliver the vehicle and the title to the manufacturer. Section 218.0171(2)(c).⁷

¶ 9. In Vultaggio, we explained the differences between these two subsections:

G.M. argues that allowing consumers to bring a claim under subsec. (2)(a) of the statute would render subsec. (2)(b) superfluous. We disagree. Subsection (2)(b) contains a series of conditions which, if satisfied, entitle the consumer to the remedies of refund or replacement. These remedies are unavailable to violations of subsec. (2)(a). In this manner, subsecs. (2)(a) and (2)(b) are best viewed as addressed to different obligations of the manufacturer: a duty to repair a defective vehicle, in subsec. (a), and in subsec. (b), a duty to replace or refund the cost of a vehicle which is subject to an inordinate amount of repair. With their different requirements and remedies, subsec. (2)(a) does not render subsec. (2)(b) superfluous.

Subsection (2)(a) protects the consumer from those instances in which the consumer is unable to establish the "reasonable attempt to repair" necessary under sec. 218.015(2)(b), Stats., but can show that the dealer has not, cannot, or will not repair a nonconformity brought to its attention during the warranty period.

Vultaggio, 145 Wis. 2d at 891 (emphasis added). ¶ 10. We further addressed Vultaggio in Dussault v. Chrysler Corp., 229 Wis. 2d 296, 600 N.W.2d 6 (Ct. App. 1999). There, as here, the consumer alleged Lemon Law claims under both WIS. STAT. § 218.0171(2)(a) and (2)(b). We rejected the § 218.0171(2)(a) claim because the manufacturer had made a "reasonable attempt to repair" under § 218.0171(2)(b). Dussault, 229 Wis. 2d at 308. We said:

Here, Dussault alleged in her complaint that Chrysler had been offered a "reasonable attempt to repair" the vehicle because it had not been fixed after thirty days or four attempts. See § 218.015(1)(h), Stats. Chrysler conceded this fact. Therefore, there is no dispute that Dussault established a "reasonable attempt to repair." As a consequence, because a para. (2)(a) remedy is only intended for a "consumer [who] is unable to establish the `reasonable attempt to repair,'" Vultaggio, 145 Wis. 2d at 891, 429 N.W.2d at 99, Dussault has no claim under para. (2)(a).

Dussault, 229 Wis. 2d at 308.

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¶ 11. The undisputed summary judgment evidence in this case supports the trial court's determination that although Western Star could not remedy the nonconformity, it did make a reasonable attempt to repair the vehicle pursuant to WIS. STAT. § 218.0171(2)(b). In fact, Smyser does not contend otherwise. As such, Vultaggio and Dussault bar Smyser's claim under subsec. (2)(a).

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¶ 12. Next, we address Smyser's claim for a refund and related expenses under WIS. STAT. § 218.0171(2)(b). As our prior discussion reveals, in order to receive a refund or a replacement vehicle, the consumer must first offer to transfer title to the vehicle back to the manufacturer. Then, upon the manufacturer providing the replacement vehicle or the refund, the consumer must deliver the vehicle and the title to the manufacturer. Section 218.0171(2)(c). The undisputed evidence establishes that Smyser could not have satisfied either of these requirements at the time he made his Lemon Law claim since he had previously surrendered the vehicle and the title to Racine Truck. Smyser did not take these actions under the auspices of the Lemon Law. To the contrary, he did not invoke the Lemon Law until some ten months later, long after Racine Truck had sold the vehicle to a third party.

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¶ 13. Smyser argues that it makes no difference that he surrendered the vehicle and the title before made his refund demand. In support, he notes that the Lemon Law is a remedial statute that should be liberally construed to protect consumers from warranty abuses by motor vehicle manufacturers. See Hughes v. Chrysler Motors Corp., 197 Wis. 2d 973, 978-82, 542 N.W.2d 148 (1996). We recognize that the Lemon Law is the result of past warranty abuses against consumers by motor vehicle manufacturers. But, despite its remedial purpose in favor of consumers, the Lemon Law nonetheless places certain duties on consumers who seek its remedies. Among these duties is the obligation to...