Krack v. Action Motors Corp.
Krack v. Action Motors Corp.
Opinion of the Court
Opinion
The novel issue in this appeal is whether a dealer that sells used automobiles breaches the implied warranty of merchantability
When the plaintiff, Laura Ann Krack, realized that the defendant, Action Motors Corporation of Danbury, had sold her a salvaged vehicle without her knowledge, she sued, pro se, in the small claims session of the Superior Court. The defendant transferred the case to the regular civil docket pursuant to Practice Book § 24-21, and the plaintiff, who hired an attorney, prevailed. What began as a small claims matter limited to $3500 in damages ultimately was transferred to the complex litigation docket of the Superior Court, and resulted in awards of $9715.10 in damages
Following the transfer to the regular civil docket, the plaintiff filed an amended, three count complaint alleging a breach of the implied warranty of merchantability, and violations of the Magnuson-Moss Warranty-Federal Trade Commission Act
“The defendant’s policy is not to sell vehicles that it knows have branded, salvaged or otherwise infirm titles. In this case, the defendant had no actual knowledge that the car had been salvaged. As a general rule, the defendant would have its finance department review the title documents of any vehicle it obtains. The title conveyed to the defendant by the New York owner for the Suburban was clean. Two people working for or contracted by the defendant appraised the car. There were no problems with the body work or painting, or any other evidence during the appraisal process, that gave the appraisers any indication of the car’s salvage history. . . .
“In August, 2001, the plaintiff brought the car for servicing to a General Motors Coiporation dealer in
I
The defendant claims that its innocent
In Prishwalko v. Bob Thomas Ford, Inc., 33 Conn. App. 575, 636 A.2d 1383 (1994), this court stated: “In Connecticut, strict liability for innocent misrepresentation in the sale of goods is well established.” (Internal quotation marks omitted.) Id., 588. Although the defen
“[Uniform Commercial Code] § 2-314 imposes warranty liability for the protection of buyers. The purpose behind . . . § 2-314 is to hold a merchant seller responsible when inferior goods are passed along to an unsuspecting buyer. Thus, whether or not the defects could, or should, have been discovered by the merchant seller, the merchant seller is liable to the buyer whenever the goods are not, at the time of delivery, of a merchantable quality .... The Uniform Commercial Code is designed to protect the buyer from bearing the burden of loss where merchandise does not live up to normal commercial expectations . . . .” 3 L. Lawrence, Anderson on the Uniform Commercial Code (3d Ed. 2002) § 2-314:5. “The effort has been made by some to force warranty liability into the category of liability based on fault. This effort is misguided. In the case of the implied warranty of merchantability, there is liability without fault. Although the goods must be nonconforming [for a breach to occur], no distinction is made in terms of the ‘fault’ of the defendant. The implied warranty of merchantability is breached whether or not the seller could have prevented the nonconformity. . . . The only practical and logical conclusion is that the warrantor is made hable, although free from moral or personal fault, because society for one reason or another wants to place the burden of harm resulting from nonconform
The defendant argues that this decision places on automobile dealers the additional onerous burden of researching the history of facially clean titles, which is in contravention of General Statutes § 14-174 (d). In so arguing, the defendant injects the language of the law of negligence into a situation in which it has no place. In fact, we do not hold that the defendant was negligent in failing to research the title for a history of salvage. See footnote 7. Instead, we hold that the defendant seller rather than the plaintiff buyer bore the risk that the vehicle was salvaged. Section 14-174 (d) does not, as the defendant claims, conflict with our holding today. It provides in relevant part: “A certificate of title issued by the commissioner [of motor vehicles] is prima facie evidence of the facts appearing on it. . . .” The defendant essentially asks us to interpret that subsection to mean that it can rely on the nonexistence of all facts not appearing on the title. That is not a logical reading of the statute.
II
We next consider whether the court’s award of attorney’s fees was reasonable.
We review the award of attorney’s fees for a clear abuse of discretion. “Whether any award is to be made and the amount thereof lie within the discretion of the trial court, which is in the best position to evaluate the particular circumstances of a case. ... A court has few duties of a more delicate nature than that of fixing counsel fees. The issue grows even more delicate on appeal; we may not alter an award of attorney’s fees unless the trial court has clearly abused its discretion
Following trial, the court criticized the defendant for, inter alia, making the tactical decision to transfer the case to the regular docket, which would prolong and complicate the issues. The court was also particularly critical of the defendant for refusing to settle or to acknowledge the vehicle’s salvage history, for giving evasive answers to the plaintiffs requests for admissions and for utilizing its superior economic resources to gain an advantage over the plaintiff. The court stated: “The defendant’s move [transferring the case from the small claims session] has backfired. In a court of law, might does not make right. Now that the court has declared the defendant responsible for the plaintiffs damages, the defendant must pay for the consequences
The court mentioned its consideration of the enumerated reasonableness factors, but did not give a full explanation of its process in applying them. The defendant claims that this necessarily indicates that the court did not, in fact, even apply the factors. We, on the other hand, believe that the court, within its broad discretion, could have applied the relevant factors, enumerated and otherwise, and reached the result that it did. The court was in the best position to weigh the factors and
The applicability of § 52-251a distinguishes this case from others in which the particular award of attorney’s fees at issue might be questionable. The very purpose of § 52-251a is to deter similarly situated defendants from transferring a case from the small claims session and turning a relatively clear-cut case into a pitched legal battle. The defendant claims that the court’s award was punitive, and that is not entirely untrue. As stated by our Supreme Court: “Section 52-251a thus creates a substantial and effective disincentive for a defendant who might otherwise raise defenses bordering on the frivolous in an effort to gain a tactical advantage over a plaintiff by obtaining a transfer of a case from the Small Claims division.” Burns v. Bennett, 220 Conn. 162, 169, 595 A.2d 877 (1991).
The defendant’s related argument, that § 52-251a punishes defendants for exercising their right to transfer a case to the regular docket, was raised in 1973 prior to the adoption of the precursor to § 52-251a. Conn. Joint Standing Committee Hearings, Judiciary, Pt. 1, 1973 Sess., pp. 230-31, remarks of John Ahem, counsel to the Insurance Association of Connecticut. Thus, the legislature considered and rejected the identical argument the defendant now repeats.
Another factor that supports the court’s high award of attorney’s fees, relative to the plaintiffs recovery, is the undesirability to Connecticut attorneys of relatively small dollar amount consumer cases such as the plaintiffs case. The plaintiffs counsel testified that he knew of only one other lawyer in the state who may have
Several other factors justify the strong message the court has sent, including the defendant’s overzealous defense of this case, its failure to cite any support for its legal argument and its evasive answers to discovery requests that ultimately led to the imposition of sanctions.
The judgment is affirmed.
In this opinion DRANGINIS, J., concurred.
General Statutes § 42a-2-314 (2), which is identical to § 2-314 (2) of the Uniform Commercial Code, provides in relevant part: “Goods to be merchantable must be at least such as (a) pass without objection in the trade under the contract description . . . .”
The parties’ contract described the salvaged vehicle at issue as “used.” The court found, and the defendant does not challenge on appeal, that a salvaged vehicle cannot pass without objection as a used vehicle.
The court awarded $9668 in expectation damages and $47.10 in consequential damages. See General Statutes § 42a-2-714 (2) and (8).
See 15 U.S.C. §§ 2301 through 2312 (2000). The court’s finding in the plaintiffs favor under that theory was duplicative of its finding under the implied warranty of merchantability and, as such, we do not discuss the substantive provisions of the Magnuson-Moss Warranty-Federal Trade Commission Act in this opinion.
See General Statutes § 42-110a et seq.
The plaintiff alleged in the CUTPA count of her complaint that the defendant had “actual knowledge” of the vehicle’s salvage history, but was unable to prove that fact.
The court stated in its memorandum of decision: “Although there was testimony that a car can become branded as a salvage vehicle for a variety of reasons, such as damage from an accident or because it was stolen, there was no evidence concerning the precise reason why the car in this case became a salvage vehicle.”
Because we conclude that the defendant’s fault is irrelevant to whether it breached the implied warranty of merchantability, we may assume without deciding that the defendant did everything reasonably appropriate in examining the vehicle’s title history.
We note that the second sentence of General Statutes § 14-174 (d), which provides that “[i]n any criminal proceeding, a certified copy of a certificate of title shall be prima facie evidence as to the ownership of a motor vehicle, ” betrays its purpose as part of the legislature’s effort to combat the traffic
The defendant’s claim that the plaintiffs failure to allege an “innocent misrepresentation” was a material variance from the counts pleaded is wholly without merit. The plaintiff alleged a breach of the implied warranty of merchantability, which, as a matter of law, includes innocent misrepresentations.
The court awarded attorney’s fees and costs pursuant to General Statutes § 52-251a, Practice Book § 13-25 and 15 U.S.C. § 2310 (d). Because the award would be duplicated under those provisions, we need only address § 52-251a, on which the court primarily relied as statutory authority for its award. Section 52-251a provides: “Whenever the plaintiff prevails in a small claims matter which was transferred to the regular docket in the Superior Court on the motion of the defendant, the court may allow to the plaintiff his costs, together with reasonable attorney’s fees to be taxed by the court.”
The plaintiffs counsel testified at a hearing and submitted an affidavit and billing statement in which he disclosed the number of hours billed and the bases for the rates charged. He requested fees in the amount of $39,763.50.
The plaintiffs counsel had, on his own, subtracted a substantial number of billed hours from his request for fees, including all time attributable solely to the unsuccessful CUTPA claim.
See footnote 10.
Although General Statutes § 52-251 authorizes attorney’s fees in cases transferred from the small claims session to the regular docket, it appears that the defendant’s overall manner of conducting the litigation played a significant role in the amount of the fee award. The defendant’s unreasonable behavior is evident in its answer, in which it stated that it lacked sufficient information on which to form a belief as to whether it was a merchant or whether the subject vehicle constituted “goods.”
The plaintiff paid counsel a retainer of $500, but the fee agreement stated that counsel would receive his hourly rate only on the successful completion of the plaintiffs case. Thus, counsel took a substantial risk by agreeing to represent the plaintiff.
Concurring Opinion
concurring. While I agree with the result reached by my colleagues, I write separately sim
Reference
- Full Case Name
- Laura Ann Krack v. Action Motors Corporation
- Cited By
- 13 cases
- Status
- Published