Volkswagen of America, Inc. v. Harrell

• Decision Date: 01 April 1983
• Citation: 431 So.2d 156
• Parties: 36 UCC Rep.Serv. 553 VOLKSWAGEN OF AMERICA, INC. v. Curtis G. HARRELL and Diane C. Harrell. 81-913.
• Court: Alabama Supreme Court

Page 156

431 So.2d 156

36 UCC Rep.Serv. 553

VOLKSWAGEN OF AMERICA, INC. v. Curtis G. HARRELL and Diane C. Harrell.

81-913.

Supreme Court of Alabama.

April 1, 1983.

James W. Garrett, Jr. of Rushton, Stakely, Johnston & Garrett, Montgomery, for appellant.

George H.B. Mathews, Montgomery, for appellees.

JONES, Justice.

Plaintiffs/Appellees Curtis G. Harrell and Diane C. Harrell initiated this cause on November 19, 1981, seeking compensatory damages from Defendant/Appellant Volkswagen of America, Incorporated. The crux of Plaintiffs' complaint was premised upon allegations of breach of a new vehicle limited written warranty by Defendant in its sale to Plaintiffs of a 1981 Volkswagen "Vanagon" camper.

Plaintiffs further demanded that attorneys' fees of "a sum equal to the aggregate amount of costs and expenses, including reasonable attorney's fees," be awarded pursuant to 15 U.S.C. § 2310(d)(2) (1976) (Magnusson-Moss Federal Warranty Act). ¹

Volkswagen denied Plaintiffs' allegations and submitted in defense, inter alia, that the warranty issued Plaintiffs limited their recovery, if any, to "repair" or "replacement" of defective parts, if the vehicle were presented for repairs to an authorized Volkswagen dealership during its effective warranty tenure.

Prior to trial on the merits, Plaintiffs' counsel sought an order from the court that Defendant, its counsel, and any witnesses be prohibited from informing the jury that Plaintiffs, in their demand for judgment, sought an award by the court of attorney's fees, costs and expenses, in addition to their claim for damages. This motion was granted over Defendant's objection.

During the course of the trial, Plaintiff Curtis G. Harrell testified concerning his alleged conversation with an unknown employee of a Volkswagen dealership in Seattle, Washington. The purpose of this testimony was to negate Defendant's contention that Plaintiffs intentionally ignored a warning by Volkswagen personnel to "retorque" the repaired engine after 1000 miles ². This testimony was submitted over Defendant's "hearsay" objection.

Immediately prior to the trial court's charge to the jury, Defendant sought an instruction (# 4) to the effect that the jury not consider, in its deliberations of an award, monies owed by Plaintiffs as attorneys' fees, costs and expenses. ³

The jury returned a verdict for Plaintiffs in the amount of $10,000. ⁴ After an evidentiary hearing concerning attorneys' fees, costs and expenses, the trial court awarded Plaintiffs' counsel fees of $8,650.85, plus costs of $487.87, for a total award of $9,138.72. Judgment was thereafter entered against Defendant for $19,138.72.

We affirm.

FACTS

The Harrells purchased a 1981 Volkswagen (VW) "Vanagon" camper on April 1, 1981, from Ted Avrett Volkswagen, Inc. in Enterprise, Alabama, for $14,714.20. Included in their documentation of purchase was a written warranty from Volkswagen of America, Inc., which read, in pertinent part, as follows:

"1. VWoA warrants to the original retail customer and any subsequent purchaser that every 1981 Volkswagen vehicle imported or distributed by VWoA and sold as a new vehicle to a retail customer will be free from defects in material and workmanship for 12 months after the date of first use or delivery of the vehicle to the original retail customer or until the vehicle has been driven 20,000 miles, whichever comes first....

"2. In order to keep this warranty in effect, the owner must have the vehicle maintained and serviced as prescribed in the Volkswagen Maintenance Schedule.

"...

"3. VWoA is not responsible for damage or malfunctions resulting from:

"(I) misuse, negligence, alteration, accident or fire;

"(II) improper repair of the vehicle;

"(III) use of the vehicle in competitive events; or

"(IV) failure to follow recommended maintenance requirements.

"...

"6. This warranty and the limited emission control system warranties for Volkswagen vehicles are in lieu of all other express warranties of VWoA, the manufacturer, the distributor and the selling dealer. Any implied warranty is limited in duration to the duration of these written warranties.

"Neither VWoA nor the manufacturer assumes, or authorizes any person to assume, on its behalf, any other obligation or liability.

"Some states do not allow limitations on how long an implied warranty lasts, so the above limitation may not apply to you.

"7. VWoA is not responsible for loss of time, inconvenience, loss of use of the vehicle or other consequential damage.

"Some states do not allow the exclusion or limitation of incidental or consequential damages, so this limitation or exclusion may not apply to you."

From the date of purchase in April of 1981 until mid-August of that year, the vehicle was relatively trouble-free, save for a minor oil consumption problem. This trouble was apparently rectified; and, shortly thereafter, the Harrells embarked on a camping sojourn to Washington State. While in Washington, the van lost power and subsequently quit running. Unable to locate an authorized Volkswagen representative in the immediate area, Mr. Harrell purchased and installed certain ignition parts, hoping that with these parts they might reach Yakima, Washington, and the nearest authorized VW dealer. Once in Yakima, the Harrells were informed that it would be at least one and one-half weeks before the VW dealer could service his vehicle. As a result, they visited Kinetic Engineering, an "independent" garage, for a diagnostic check of their engine. This process included a timing check, as well as removal of spark plugs to measure compression. Kinetic also installed a set of points on the engine. The total charge for this service was $21.40.

After reaching Seattle, Mr. Harrell visited Freeway Volkswagen, an authorized dealership, in an effort to eradicate the trouble. Freeway kept the camper seven days, doing extensive repairs to the engine, during which time the Harrells incurred additional expenses for a replacement vehicle, food, and lodging. The service order prepared by Freeway Volkswagen bore the stamped notation "Important--Return car at 1000 miles for cylinder head retorque."

Leaving Seattle, the Harrells incurred their next major problem in Oregon, where the muffler fell off. ⁵ After leaving Oregon, and while the Harrells were in Arizona, the engine again commenced to lose power. This was followed by a renewed tapping noise. These were the same two problems initially experienced in Washington.

When the Harrells reached El Paso, Texas, the vehicle was again turned in to an authorized VW dealership for a period of five days. While in El Paso, Mr. Harrell was informed by the VW mechanic that improper "pushrods" had been installed in Seattle, and that this was the primary cause of his subsequent troubles.

Before trial, it was Volkswagen's contention that improper repairs (i.e., installation of pushrods) by a "non-authorized shop" in Washington State had caused the subsequent problems during the trip to El Paso. This position was expressed in certain of Volkswagen's interrogatory answers to Question Three that were read to the jury:

"Bob Hoy Volkswagen [the WV dealer in El Paso] removed and replaced the hydraulic lifters, disassembled and cleaned them since they were contaminated from damaged pushrods which were installed by an independent non-authorized repair shop not authorized by VWoA to perform any repairs. This non-authorized shop to which the Plaintiff had taken the vehicle had installed solid lifter pushrods instead of hydraulic lifter pushrods which were the appropriate components. These parts were inappropriate being of different lengths than the authorized parts which should have been installed. As a result they were not suited for the purpose intended, and, therefore, they deteriorated and particles of the pushrods contaminated other parts of the engine."

The only "non-authorized shop" that serviced Plaintiffs' vehicle was Kinetic Engineering in Yakima, Washington. Kinetic's services included no internal work on the engine, but only compression checks, tuning, and installation of ignition parts. The only garage to have performed "extensive" repairs on the camper before it reached El Paso was Freeway Volkswagen. After leaving El Paso, the Harrells headed back to Alabama. In Troy, Alabama, the muffler fell off again. Additionally, while in this vicinity, the tapping noise reappeared and the van began to lose power. Each misfortune experienced at this point had occurred at least three times since the Harrells' original departure from Alabama.

Upon their arrival back in Ft. Rucker, Alabama (their original point of departure), Mr. Harrell returned the camper to Ted Avrett Volkswagen, Inc., in September 1981. While the vehicle was with Ted Avrett's dealership, Mr. Harrell called VW's regional manager in Jacksonville, Florida, and described his plight. Additionally, Mr. Harrell called VW's Englewood, New Jersey, home office and spoke with a customer service representative. Pursuant to VW's request, Mr. Harrell next forwarded to VW's home office correspondence detailing his recent misfortunes. In this letter, Mr Harrell enclosed service orders from each garage that had worked on the vehicle, including Kinetic Engineering, the "independent" mechanic. Mr. Harrell also indicated that his purchase of the van evolved from a desire to use it in Europe, following his proposed transfer to Germany for service in the armed forces. In response, Mr. Harrell received a letter from Volkswagen informing him of an individual "to call" upon his arrival in Germany.

The van remained with Ted Avrett Volkswagen for a week. Thereafter, in November 1981, the engine once again repeated the same "old" malfunction. Mr. Harrell next turned the vehicle in to Imperial Volkswagen, Inc., of Dothan, Alabama, on December 10, 1981, where it remained for thirteen days. From December 23, 1981, until March of 1982, the van had few problems. In March,...