Ward v. W. Cnty. Motor Co.
| Decision Date | 28 May 2013 |
| Docket Number | No. SC 92675.,SC 92675. |
| Citation | 403 S.W.3d 82 |
| Parties | Tara L. WARD, et al., Appellants, v. WEST COUNTY MOTOR COMPANY, INC., d/b/a West County BMW, Respondent. |
| Court | Missouri Supreme Court |
OPINION TEXT STARTS HERE
Mitchell B. Stoddard of Consumer Law Advocates in St. Louis, Douglas M. Ommen, Missouri Attorney General Chris Koster and Brian T. Bear of the attorney general's office in Jefferson City, for Appellants.
Bryan M. Kaemmerer and Brian E. McGovern of McCarthy, Leonard, Kaemmerer LC in St. Louis, for Respondent.
Tara L. Ward, Kamal Yassin, Mona Yassin, Matthew F. Toole, Curt S. Zargan, and Larry L. LaBarge (plaintiffs) appeal the judgment of the trial court granting West County Motor Company, Inc. d/b/a West County BMW's (West County) motion to dismiss their claim for violation of the Missouri Merchandising Practices Act. The judgment is affirmed in part and reversed in part.
Each plaintiff paid a deposit to West County to secure the purchase of a vehicle. Each plaintiff signed a vehicle buyer's order providing that “ALL DEPOSITS ARE NON REFUNDABLE.” All plaintiffs, except LaBarge, allege that West County told them that their deposits were refundable if the purchase was not completed. When plaintiffs decided not to purchase their vehicles, they were told their deposits would not be refunded. Plaintiffs filed suit against West County for violation of the Missouri Merchandising Practices Act (“MMPA”), section 407.010 et seq.,1 and for conversion.
Plaintiffs alleged that West County engaged in unfair practices in violation of the MMPA by failing to give them a rescission period as required by section 365.070. They also alleged that West County violated the MMPA by:
1. Converting funds or property paid by plaintiffs when it failed to apply them to the purchase or lease of a motor vehicle;
2. Failing to act in good faith when it refused to make like-kind refunds of deposits after the sale or lease had been terminated, and before plaintiffs had taken delivery of a motor vehicle; and
3. Using a liquidated-damages clause in its contracts that was really a disguised penalty provision.
The trial court sustained West County's motion to dismiss the MMPA claims for failure to state a claim upon which relief could be granted. The plaintiffs voluntarily dismissed their common law conversion claim in Count II so they could appeal the judgment.
The standard of review for a trial court's grant of a motion to dismiss is de novo. Lynch v. Lynch, 260 S.W.3d 834, 836 (Mo. banc 2008). When this Court reviews the dismissal of a petition for failure to state a claim, the facts contained in the petition are assumed true and construed in favor of the plaintiffs. Id. If the petition sets forth any set of facts that, if proven, would entitle the plaintiffs to relief, then the petition states a claim. Id.
The MMPA supplements the common law definition of fraud. State ex rel. Koster v. Professional Debt Management, LLC, 351 S.W.3d 668, 671 (Mo.App.2011). The MMPA creates an individual cause of action under the MMPA for any person “who purchases or leases merchandise primarily for personal, family or household purposes and thereby suffers an ascertainable loss of money or property, real or personal, as a result of the use or employment by another person of a method, act or practice declared unlawful by section 407.020.” Section 407.025.1. Section 407.020 provides that it is unlawful to use any deceptive or unfair practices “in connection with the sale or advertisement of any merchandise in trade or commerce.” The transaction at issue in this case falls within the ambit of the MMPA.
The MMPA is drafted broadly and there is no specific definition of deceptive practices contained in the statute. State ex rel. Koster, 351 S.W.3d at 672. However, 15 CSR § 60–8.020, promulgated in conjunction with the MMPA, defines “unfair practice” as a practice that either: Therefore, to state a claim for violation of the MMPA, plaintiffs must allege that they (1) purchased or leased a vehicle from West County; (2) for personal, family, or household purposes; and (3) suffered an ascertainable loss of money or property as a result of an act declared unlawful by section 407.020.
In Count I, plaintiffs alleged that they purchased an automobile for personal, family or household purposes, and suffered an ascertainable loss of money as a result of an act declared unlawful by the MMPA. One of plaintiffs' allegations was that West County violated the MMPA by not allowing a rescission period as required by section 365.070.4 of the Missouri Motor Vehicle Time Sales Law, section 365.010 et seq.
Section 365.070.4 provide in pertinent part:
The seller shall deliver to the buyer, or mail to him at his address shown on the contract, a copy of the contract signed by the seller. Until the seller does so, a buyer who has not received delivery of the motor vehicle may rescind his agreement and receive a refund of all payments made and return of all goods traded in to the seller on account of or in contemplation of the contract, or if the goods cannot be returned, the value thereof. (Emphasis added).
Plaintiffs argue that section 365.070.4 provides a right of rescission in this case because the vehicle buyer's order and attendant deposit was an “agreement” subject to rescission. Plaintiffs assert that West County's failure to permit rescission of the agreement and to return the deposits violated section 365.070.4 and, therefore, constituted an unlawful act under the MMPA.
The plain language of section 365.070.4 requires a seller to deliver a copy of “the contract” to the buyer. Until such delivery, Section 365.070.4 provides the buyer may “rescind his agreement and receive a refund of all payments made and return of all goods traded in to the seller on account of or in contemplation of the contract....” Section 365.020(10) RSMo (Cum.Supp.2011) defines a “contract” as: “an agreement evidencing a retail installment transaction entered into in this state pursuant to which the title to or a lien upon the motor vehicle, which is the subject matter of the retail installment transaction is retained or taken by the seller from the buyer as security for the buyer's obligation.”
Plaintiffs concede they did not enter into a retail installment transaction with West County. Plaintiffs assert that use of the term “agreement” instead of “contract” or “retail installment contract” means that the statutory right to rescission applies to transactions other than just retail installment contracts and that section 365.070.4 allows them the right to rescind this “agreement” and obtain a refund of any money paid in contemplation of entering into a retail installment transaction. West County asserts that rescission under section 365.070.4 is unavailable because plaintiffs did not sign a retail installment contract. West County is correct.
Section 365.020(10), provides that “retail installment contract” and “contract” are defined, interchangeable terms that mean an “agreement evidencing a retail installment transaction....” The term “agreement” is not defined in the statute. Although section 365.070.4 refers to the rescission of an “agreement” and not to the rescission of a “contract” or “retail installment contract,” it must be noted that the person rescinding the agreement is the “buyer.” A “buyer” is “a person who buys a motor vehicle from a retail seller under a retail installment contract.” Section 365.020(9). Likewise, a “seller” is also defined as a person who sells a vehicle “under a retail installment contract.” Consequently, both the context and language of the statute demonstrate that the legislature drafted section 365.070.4 to apply only to retail installment contracts. West County did not violate section 365.070.4 by declining to return the deposits.The trial court did not err in dismissing that portion of plaintiffs' Count I alleging violations of the MMPA...
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