State, ex rel. Tierney v. Ford Motor Co.

• Decision Date: 03 November 1981
• Parties: STATE of Maine, ex rel. James E. TIERNEY, Attorney General, et al. v. FORD MOTOR COMPANY.
• Court: Maine Supreme Court

Page 866

436 A.2d 866

STATE of Maine, ex rel. James E. TIERNEY, Attorney General, et al. v. FORD MOTOR COMPANY.

Supreme Judicial Court of Maine.

Argued Sept. 11, 1981.

Decided Nov. 3, 1981.

Cheryl Harrington (orally), John Dana, Asst. Atty. Gen., Augusta, for plaintiffs.

Verrill & Dana, Howard H. Dana, Jr. (orally), Robert J. Keach, David Hillman, Roger A. Putnam, Portland, for defendant.

Before McKUSICK, C. J., GODFREY, NICHOLS, ROBERTS and VIOLETTE, JJ., and DUFRESNE, A. R. J.

ROBERTS, Justice.

This action arises from the sale of automobiles manufactured by the defendant, Ford Motor Company (Ford), to Maine residents and consumers. Following the Superior Court's denial of its motion to dismiss, Ford, as an "aggrieved party," moved the Superior Court pursuant to M.R.Civ.P. 72(c) to report the case to the Law Court. ¹ The Superior Court granted Ford's motion to report the case over the Attorney General's opposition on the grounds that the issues presented were of sufficient doubt and importance to justify report to this Court. We reverse in part the ruling of the Superior Court.

I. Factual Background

The Attorney General commenced two actions against Ford in 1979. ² Both actions are predicated upon claims that between 1974 and 1977 Ford vehicles were sold to Maine buyers in defective condition; that Ford included misleading maintenance specifications with the vehicles; and that Ford later failed to repair the vehicles. The Attorney General alleges Ford vehicles were sold with latent defects including piston scuffing, piston slapping, excessive camshaft and rocker arm wear, cracked engine blocks and other "malfunctioning conditions." These alleged defects may lead to shortened engine life and the possibility of premature major engine repair.

The initial complaint brought by the Attorney General, CV 79-415 (415), contains five counts against Ford. Three of the five counts, Counts One, Two and Four, allege violations of the Maine Unfair Trade Practices Act (UTPA), 5 M.R.S.A. §§ 206-214. ³ Count Three alleges that Ford's improper lubricant specifications constituted a false material representation which injured buyers of its products. Count Five is a class action claim wherein the State, relying on the aforementioned grounds, seeks to bring a class action on behalf of the consumers injured by Ford's acts and omissions.

The second complaint before us, CV 79-737 (737) contains three counts against Ford. Counts One and Three allege Ford's breach of warranty, failure to honor the warranty and improper lubricant specifications constitute violations of Maine's UTPA. Count Two alleges the improper lubricant specifications constitute false material representations.

Ford, pursuant to M.R.Civ.P. 12(b), moved to dismiss 415 on fourteen grounds and moved to dismiss 737 on thirteen grounds. The Superior Court conducted an evidentiary hearing and heard oral argument regarding Ford's motion. At oral argument Ford relied primarily on its position that 5 M.R.S.A. § 208(2) bars the Attorney General from bringing an action sounding under the UTPA and deprives the Superior Court of jurisdiction over the action and that the Attorney General is not a proper party to prosecute the class action claim.

Section 208(2) of Title 5 contains what is commonly referred to as the "interstate commerce exemption" of the UTPA. This section of the UTPA provides:

Nothing in this chapter shall apply to:

....

2. Interstate commerce. Trade or commerce of any person of whose gross revenue at least 20% is derived from transactions in interstate commerce, excepting however transactions and actions which occur primarily and substantially within the State, and as to which the Federal Trade Commission or its designated representative has failed to assert in writing within 14 days of notice to it and to said person by the Attorney General its objection to action proposed by him and set forth in said notice; the burden of proving exemption, under this subsection, from this chapter shall be upon the person claiming the exemption.

5 M.R.S.A. § 208(2). ⁴ The parties stipulated that the defendant derived at least 20% of its gross revenue from interstate commerce. Ford argued that section 208(2) should apply as "the transactions and actions" complained of did not occur "primarily and substantially within the State" so as to bring the action within the intrastate exception to the section 208(2) interstate commerce exemption, but rather, occurred, if they occurred at all, on a nationwide scale. ⁵

The Attorney General, in opposition to the motion, argued that a 1973 amendment to the Maine Uniform Commercial Code (U.C.C.), 11 M.R.S.A. § 2-316(5) (a), "jumped over," or "superseded" the provisions of section 208(2). ⁶ In addition, the Attorney General argued that the implied warranties which arise under the provisions of the Maine U.C.C., 11 M.R.S.A. §§ 2-314, 2-315, 2-316, are created solely by state statute and that if a "violation" of the implied warranties created by §§ 2-314, 2-315, and 2-316 constitutes a violation of the Maine UTPA by virtue of 11 M.R.S.A. § 2-316(5)(a) then that violation must be construed to occur primarily and substantially within the state which created the warranties.

The Superior Court denied Ford's motion holding that "section 208(2) does not apply to actions asserting private rights." The Court also noted that "(a) lthough the Attorney General and Ford have raised many other issues in support of their respective positions, it is the Court's view that resolution of the matters presented at oral argument encompasses these other issues." Following the denial of its motion to dismiss, Ford, over the State's opposition, moved the Court to report the case to the Law Court, pursuant to M.R.Civ.P. 72(c).

II. The Propriety of a Report Pursuant to M.R.Civ.P. 72(c)

A report brought before this Court pursuant to Rule 72(c) presents the Law Court with the entire case, not only the issue underlying the decision complained of below. ⁷ Although presented with the entire case, we emphasize that our review must concurrently conform with our function as an appellate tribunal. Matheson v. Bangor Publishing Co., Me., 414 A.2d 1203, 1205 (1980). As we have said many times in the past, "the Law Court retains power to make its own independent determination whether in all the circumstances of a given case its decision 'on report' would be consistent with the Court's basic function as an appellate tribunal." Bangor Publishing Co., 414 A.2d at 1205, quoting State v. Foley, Me., 366 A.2d 172, 173 (1976); see Gendron v. Pawtucket Mutual Ins. Co., Me., 409 A.2d 656, 660 n.10 (1979). Notwithstanding the provisions of Rule 72, we have consistently reiterated our strong policy against piecemeal appellate review. In re Spring Valley Development, Me., 300 A.2d 736, 754 (1973). See, e. g., Bar Harbor Banking & Trust Co. v. Alexander, Me., 411 A.2d 74, 76 (1980); Mechanic Falls Water Co. v. Public Utilities Commission, Me., 381 A.2d 1080, 1088 (1977). See generally 2 Field, McKusick & Wroth, Maine Civil Practice, § 73.1 (2d ed. 1970). As we stated in State v. Placzek, Me., 380 A.2d 1010, 1013 (1977), it "is not an efficient use of total court resources to report the case to the Law Court merely on the chance that its decision may turn out to be the one that finally disposes of the case." The case presently before us approaches dangerously close to evils we warned against in Placzek and cases prior thereto. See Laverdiere v. Marden, Me., 333 A.2d 701, 702 (1975).

We also recognize that sound appellate procedure requires appellate courts to refrain from ruling upon issues which the parties did not pursue below and which the parties have not raised before us. McNicholas v. York Beach Village Corp., Me., 394 A.2d 264, 268 (1978). See In re Estate of Thompson, Me., 414 A.2d 881, 890 (1980); National Advertising Company v. Inhabitants of the Town of York, Me., 345 A.2d 512, 514 (1975).

Although we have recognized in the past that reports pursuant to Rule 72(c) may serve the cause of justice when appropriate, Laverdiere v. Marden, 333 A.2d 701, 702 (1975), we also must require, before determination of issues underlying an appeal brought under Rule 72(c), "clear concreteness ... precisely framed ... from a clash of adversary argument exploring every aspect of a multifaceted situation embracing conflicting and demanding interests." United States v. Fruehauf, 365 U.S. 146, 157, 81 S.Ct. 547, 554, 5 L.Ed.2d 476 (1961).

In the case at bar, the defendant has raised fourteen separate grounds in support of its motion to dismiss. At oral argument to the Superior Court Ford pressed only two of its defenses, viz., that 5 M.R.S.A. § 208(2) exempted Ford from suit and that the Attorney General was not a proper party to prosecute a class action. The order of the Superior Court denying Ford's motion relates only to Ford's argument that section 208(2) should exempt it from suit under the UTPA. Ford's section 208 argument, however, can only be reasonably construed to relate to Counts One, Two and Four of 415 and Counts One and Three of 737. Thus, even if this Court reverses the order of the Superior Court, Counts Three and Five of 415 and Count Two of 737 will remain unaffected. If we were to decide only the section 208 issue now raised, briefed and argued before us without addressing any of the other defenses raised by the defendant our action would conflict with our policy against piecemeal litigation.

If, on the other hand, we were to now address all the issues raised by Ford in its motion to dismiss, we would be forced to decide the issues it has raised without the benefit of the Superior Court's consideration and decision, and the arguments raised in this Court as we lack the focus and depth provided by these procedures which constitute the touchstone of appellate review, we accordingly decline to address the issues not presently raised before us. ⁸

Although the...