FILED October 11, 2013 NO. 4-12-0943 Carla Bender th 4 District Appellate IN THE APPELLATE COURT Court, IL

OF ILLINOIS

FOURTH DISTRICT

LATESHA CLEMONS, ) Appeal from Plaintiff-Appellant, ) Circuit Court of v. ) Sangamon County NISSAN NORTH AMERICA, INC., ) No. 09L339 Defendant-Appellee. ) ) Honorable ) John Schmidt, ) Judge Presiding. ____________________________________________________________________________

JUSTICE KNECHT delivered the judgment of the court, with opinion. Presiding Justice Steigmann and Justice Turner concurred in the judgment and opinion.

OPINION

¶ 1 In June 2009, plaintiff, Latesha Clemons, filed a complaint against defendant,

Nissan North America, Inc. (Nissan), alleging breach of written warranty pursuant to the

Magnuson-Moss Warranty—Federal Trade Commission Improvement Act (Act) (

to 2312 (2006)) (count I) and breach of implied warranty (count II). Nissan is an

automobile manufacturer. In June 2012, Nissan filed a motion to dismiss pursuant to section 2-

619 of the Code of Civil Procedure (Code) (735 ILCS 5/2-619 (West 2010)), alleging the dealer

which sold the vehicle disclaimed the warranties through an "as is" clause. In July 2012, the trial

court granted Nissan's motion to dismiss.

¶ 2 Plaintiff appeals, arguing the trial court erred in granting Nissan's motion to

dismiss because the manufacturer's warranty had not been disclaimed. We reverse and remand. ¶ 3 I. BACKGROUND

¶ 4 On July 24, 2008, plaintiff purchased a used 2007 Nissan Pathfinder with 12,800

miles for $27,690 from New York Auto Sales, Inc. (New York Auto), an automobile dealership

in Aurora, Illinois. Plaintiff began experiencing mechanical problems with the Pathfinder's fuel

and exhaust systems and she took it to two Nissan dealerships in the St. Louis, Missouri,

metropolitan area for repairs.

¶ 5 In June 2009, plaintiff filed a complaint pursuant to the Act (see

(2006)) alleging breach of written warranty and breach of implied warranty, seeking damages for

the diminution of the Pathfinder's value and attorney fees. Plaintiff filed her complaint in the

Cook County circuit court. According to plaintiff, at the time of purchase defendant "issued and

supplied to [plaintiff] its written warranty, which included three (3) year or thirty-six thousand

(36,000) mile bumper to bumper coverage, as well as other warranties fully outlined in the

Warrantor's New Vehicle Warranty booklet." Plaintiff did not attach a copy of the warranty

booklet to her complaint.

¶ 6 In August 2009, Nissan filed a motion to transfer venue arguing it maintained an

office in Springfield, Illinois, and venue was proper in Sangamon County. In December 2009,

the Cook County circuit court transferred the case to the Sangamon County circuit court.

¶ 7 A. Discovery

¶ 8 In March 2010, the parties exchanged various discovery responses. Nissan

admitted it issued a "limited written warranty" for the Pathfinder. Plaintiff submitted several

sales documents in response to defendant's request to produce. She submitted two "Buyers

Guide" window forms from New York Auto. The first guide (see Appendix A) is the required

-2- window form (see

(2012)) and contains two large headings reading "AS IS-

No Warranty" and "Warranty." The box next to "Warranty" is checked. Below the "Warranty"

heading, the document is marked "Limited Warranty." It states the warranty covers 50% of the

costs to repair the vehicle's transmission and engine and is for one month or 1,000 miles from the

date of purchase, whichever comes first. The second attached "Buyers Guide" is in a different

format with New York Auto's name at the top and restates the vehicle is covered by a limited

warranty as described in the first guide. This guide is signed and dated. Plaintiff attached a

document appearing to be the sales contract. It is signed in plaintiff's name and contains

information about her trade-in vehicle, the Pathfinder, financing, and the unpaid balance. The

document contains six dark, boxed areas where we cannot read the text.

¶ 9 Plaintiff attached seven invoices for repairs: (1) The invoice dated August 12,

2008, shows the Pathfinder had 14,389 miles and a defective exhaust shield clamp was replaced.

(2) The invoice dated October 30, 2008, shows the Pathfinder had 18,117 miles and a fuel pump

was replaced. (3) The invoice dated December 16, 2008, shows the Pathfinder had 21,280

miles. It stated the mechanic took the vehicle for a test drive and it died and the fuel pressure

dropped to zero. The fuel pump was replaced. (4) The invoice dated December 29, 2008, shows

the Pathfinder had 21,780 miles and the voltage at the fuel pump was 9.45 volts rather than 12

volts. The battery was charged. (5) The invoice dated February 4, 2009, shows the Pathfinder

had 23,289 miles and the crash zone sensor was replaced. (6) The invoice dated February 12,

2009, shows the Pathfinder had 23,761 miles and a failed air fuel sensor was replaced. (7) The

invoice dated July 17, 2009, shows the Pathfinder had 30,284 miles and a defective secondary

timing chain and tensioner was replaced. The February 2009 invoices were from Suntrup

-3- Automotive Group in St. Louis, Missouri, and the other five invoices were from Auffenberg

Nissan in O'Fallon, Illinois.

¶ 10 In December 2010, Nissan filed an answer. Nissan admitted it supplies a "written,

limited warranty" at the time of distribution of a new Nissan motor vehicle. Nissan denied New

York Auto was an authorized Nissan dealer. Nissan asserted three affirmative defenses, namely

(1) damages should be reduced by the diminished value of plaintiff's use; (2) the alleged

nonconformity, defect, or condition was rectified and repaired; and (3) damages are limited by

the written, limited warranty issued by Nissan.

¶ 11 On February 22, 2011, plaintiff disclosed her expert witness's identity and

proposed testimony. See Ill. S. Ct. R. 213(f) (eff. Jan. 1, 2007). The expert was expected to

testify the Pathfinder had diminished in value by $4,085. The expert's 20-page vehicle diagnostic

report was attached. The report stated the Pathfinder was experiencing emissions and fuel

delivery issues "directly related" to the oxygen and fuel ratio sensors, and because the sensors are

not sending correct data the vehicle's computer system "becomes confused as to how much fuel

to deliver to the engine system, thus making the vehicle stall at times."

¶ 12 B. Nissan's Motion To Dismiss

¶ 13 On June 19, 2012, Nissan filed a motion to dismiss pursuant to section 2-619 of

the Code. The motion stated "[a]lthough Plaintiff attached only the retail installment contract to

the Complaint, and has not produced the sales contract relative to the subject vehicle, [Nissan]

has recently obtained a copy of the sales contract, which is attached hereto as Exhibit 2, and

learned that the vehicle was actually sold to Plaintiff 'as is,' with no warranty." Nissan argued

plaintiff "was informed, in bold language that New York Auto Sales was selling the vehicle with

-4- no express warranty and no implied warranty of merchantability. *** Given that the vehicle was

sold 'as is,' with no warranty at all as to mechanical condition, Plaintiff cannot meet her burden to

prove the existence of, and her compliance with, the terms and conditions of a warranty given to

her by the Defendant at the time of sale."

¶ 14 Nissan did not attach an affidavit in support of its motion. It did attach a

document from New York Auto dated July 24, 2008. The document does not contain a title but

lists plaintiff's personal information, trade-in vehicle, purchase vehicle, and lists the price and

balanced owed. (It appears to be the same sales document plaintiff provided in March 2010 but

without the darkened areas.) The document states, in bold print, "[T]his vehicle is SOLD AS IS

with no warranty as to mechanical condition." The document is unsigned.

¶ 15 C. The Hearing and the Trial Court's Order

¶ 16 On June 29, 2012, the trial court held a hearing on Nissan's motion to dismiss.

Nissan asserted it had been provided the document from New York Auto on June 13, 2012, and

accused plaintiff of failing to disclose this document during discovery although dealer documents

were requested. Plaintiff responded she had disclosed the document and presented a signed

version of the document to the court. The trial court asked if plaintiff could offer proof she had

disclosed the document. She could not. The court asked if plaintiff signed the sales contract, and

she admitted she had.

¶ 17 Nissan argued the Pathfinder was sold "as is" by New York Auto, and the

manufacturer's warranty could not be part of the basis of the bargain. Nissan contended New

York Auto had the right to extinguish any preexisting warranty rights and it did so. By selling

the vehicle "as is" New York Auto "effectively eviscerated any subsequent legal obligation or

-5- responsibility" Nissan had.

¶ 18 Plaintiff responded Nissan's motion was "dilatory" and tantamount to filing a

motion to continue as it had been filed mere days before trial. On the merits, plaintiff

distinguished Nissan's provided authority on the basis New York Auto was not affiliated with

Nissan, was not its agent, and had no authority to disclaim the warranty. Plaintiff informed the

trial court Nissan's expert testified at his deposition repairs were carried out on the Pathfinder

under Nissan's warranty.

¶ 19 On July 2, 2012, the trial court issued a written order. The court cited Mitsch v.

General Motors Corp.,

,

(2005), for the proposition

the Uniform Commercial Code requires a "conspicuous" disclaimer for such to be effective. The

order, in relevant part, stated:

"In the instant case, the defendant properly disclaimed both

the express and implied warranties. The Plaintiff signed a sales

contract disclaiming the vehicle was sold, 'as is with no warranty as

to mechanical condition.' [Footnote: There is no dispute Plaintiff

signed the sales contract.] The disclaimer language is in a larger

type than the previous and subsequent type. The term 'sold as is' is

in all capital letters. The Court finds that this disclaimer is in

compliance with the law."

The court dismissed plaintiff's complaint.

¶ 20 D. Plaintiff's Motion To Reconsider and the Warranty

¶ 21 In July 2012, plaintiff filed a motion to reconsider arguing the trial court's reliance

-6- on Mitsch was error because the Pathfinder was still covered by Nissan's warranty and it is the

manufacturer, not the dealership, which is attempting to avoid its warranties. Plaintiff argued

Nissan's motion did not meet the requirements of section 2-619(a)(9) of the Code (735 ILCS 5/2-

619(a)(9) (West 2012)) because it was not filed within the time for pleading and not supported by

an affidavit.

¶ 22 Plaintiff attached a signed copy of the sales contract. (See Appendix B) This

copy contains several dark-shaded boxes, but it is possible to read the text. The "as is" language

is contained in one of these shaded boxes.

¶ 23 Plaintiff attached the warranty documentation booklet. (See Appendix C) The

warranty states as follows: (1) "The basic coverage period is 36 months to 36,000 miles,

whichever comes first"; (2) "This warranty is provided to the original and subsequent owner(s) of

a Nissan vehicle originally distributed by Nissan which is originally sold by a Nissan authorized

Nissan dealership in the United States and which is registered in the U.S. and normally operated

in the United States"; and (3) "This warranty is generally transferable from the original 'owner

other than a Nissan dealer' (OWNER) to subsequent owners of the vehicle at any time ownership

of the vehicle is transferred, without any action on your part" except when the vehicle is

registered outside of the United States within six months of purchase. The warranty states it is

void if the vehicle is issued a salvage title, including flood title, or is a total loss, such as the cost

of repairs exceeded the actual cash value of the vehicle. The warranty does not include language

about how the vehicle warranty can be disclaimed.

¶ 24 In September 2012, after a hearing, the trial court denied the motion to reconsider.

¶ 25 This appeal followed.

-7- ¶ 26 II. ANALYSIS

¶ 27 Plaintiff appeals, arguing the trial court erred in granting defendant's motion to

dismiss. Plaintiff contends defendant did not disclaim its manufacturer's warranty, New York

Auto could not disclaim the warranty, and the disclaimer in the sales contract relates only to New

York Auto's obligations.

¶ 28 A. Standard of Review

¶ 29 Section 2-619 of the Code provides a defendant may file a motion for dismissal on

nine different enumerated grounds, including "[t]hat the claim asserted against defendant is

barred by other affirmative matter avoiding the legal effect of or defeating the claim." 735 ILCS

5/2-619(a)(9) (West 2012). "Section 2-619(a)'s purpose is to provide litigants with a method of

disposing of issues of law and easily proved issues of fact—relating to the affirmative

matter—early in the litigation." (Emphasis in original.) Reynolds v. Jimmy John's Enterprises,

LLC,

,

. The section 2-619 movant, for purposes

of the motion, "admits all well-pleaded facts and reasonable inferences therefrom." Snyder v.

Heidelberger,

,

. In reviewing the motion, "[t]he court must

accept as true all well-pleaded facts in plaintiff's complaint and all inferences that may

reasonably be drawn in plaintiff's favor" (Sandholm v. Kuecker,

,

) and should only grant the motion "if the plaintiff can prove no set of facts that

would support a cause of action" (Snyder,

,

). "In a section 2-

619(a) motion, the movant is essentially saying ' "Yes, the complaint was legally sufficient, but

an affirmative matter exists that defeats the claim." ' " Reynolds,

,

(quoting Winters v. Wangler,

,

, 779

-8- (2008)). A section 2-619 dismissal is reviewed de novo.

¶ 30 B. Nissan's Section 2-619 Motion

¶ 31 As a threshold matter, we note Nissan's section 2-619 motion presents two

important procedural problems, namely, its untimeliness and defendant's failure to comply with

Illinois Supreme Court Rule 191 (eff. July 1, 2002). Plaintiff made these arguments before the

trial court at the motion hearing and in her motion to reconsider, but here proceeds directly to the

merits. In its brief, Nissan suggests, by way of a footnote, plaintiff did not disclose the sales

contract because of the "as is" clause and it was plaintiff's "own inexcusable failure to produce

the sales contract in the face of an explicit request that caused resolution of this issue to be

delayed until shortly before trial." In order to assist the bench and the bar and encourage better

motion practice, we briefly address these procedural problems.

¶ 32 1. The Motion's Timeliness

¶ 33 Because a section 2-619 motion admits the legal sufficiency of the complaint,

filing such a motion after filing an answer, without requesting leave to withdraw the answer, is

procedurally improper. Gulley v. Noy,

, 866,

(2000);

see also Ill. S. Ct. R. 191(a) (eff. July 1, 2002) (section 2-619 motions "must be filed before the

last date, if any, set by the trial court for the filing of dispositive motions"). A section 2-619

motion "is intended to be heard and decided before the expense and inconvenience of litigation

has been borne by either party or the trial court." Gulley,

,

. However, filing an answer does not preclude a section 2-619 motion, even if it is

procedurally improper, and a trial court has discretion to consider a section 2-619 motion filed

outside the pleadings phase. Id.; Thompson v. Heydemann,

, 596

-9- N.E.2d 664, 667 (1992).

¶ 34 Here, Nissan admitted it issued a limited, written warranty for the Pathfinder and

filed an answer in December 2010. The parties engaged in discovery for approximately a year

and a half, including procuring an expert witness. Then, in June 2012, approximately 20 days

before trial, Nissan filed its section 2-619 motion without moving to withdraw its answer. The

motion was untimely and procedurally improper. The trial court never considered whether the

motion conflicted with Nissan's admissions and answer, nor whether it should have been treated

as a summary judgment motion pursuant to section 2-1005 of the Code (735 ILCS 5/2-1005

(West 2010)). See Reynolds,

,

(improper section

2-619 motions may be treated as a summary judgment motion). Plaintiff argued the motion was

"dilatory" and tantamount to a motion to continue trial, but she did not argue she was prejudiced

by the motion. See Thompson,

, 596 N.E.2d at 667 (plaintiff must show

he or she was prejudiced by defendant's section 2-619 motion filed after answer).

¶ 35 2. Nissan's Failure To Submit an Affidavit

¶ 36 The movant of a motion for involuntary dismissal pursuant to section 2-619 " 'has

the burden of proof on the motion, and the concomitant burden of going forward.' " Reynolds,

,

(quoting 4 Richard A. Michael, Illinois Practice

§ 41:8, at 481 (2d ed. 2011)). "It is well settled that the 'affirmative matter' asserted by the

defendant must be apparent on the face of the complaint; otherwise, the motion must be

supported by affidavits or certain other evidentiary materials." Van Meter v. Darien Park

District,

, 377,

(2003). See Reynolds,

,

(an affirmative matter is something, other than the defendant's

- 10 - version of the facts, which negates the cause of action completely). Illinois Supreme Court Rule

191 (eff. July 1, 2002) requires affidavits in support of section 2-619 motions to set forth with

"particularity" the facts upon which the defense is based and attach "sworn or certified copies" of

the documents relied upon. See Robidoux v. Oliphant,

,

(2002) (attached-papers requirement must be strictly followed and failure to comply is fatal).

Strict compliance with Rule 191(a) is required to insure the trial court is presented with valid

evidentiary facts on which to base a decision.

,

. Basic rules of

evidence require a party to lay the proper foundation for the introduction of documentary

evidence, including its authenticity. Gardner v. Navistar International Transportation Corp.,

,

(1991); Ill. R. Evid. 901 (eff. Jan. 1, 2011).

¶ 37 Here, Nissan, as the movant, has the burden of proving the existence of an

affirmative matter. Nissan asserts the "as is" clause affixed by New York Auto, an unaffiliated

car lot, affirmatively bars plaintiff's warranty claim because the disclaimer "eviscerated" its

obligations to plaintiff. As the "as is" clause was not apparent from the complaint, Nissan was

required to support its motion by affidavit. Nissan submitted the purported sales contract—an

unsigned version nonetheless—without an affidavit authenticating the document or providing a

foundation. (In her reply brief, plaintiff argues Nissan has not provided any foundation to rely on

the sales contract.) Rather than complying with Rule 191(a), Nissan relied on its bare

representations the document was what Nissan purported it to be. Then, at the motion hearing,

Nissan accused plaintiff of not producing the document during discovery. The trial court

inquired whether this was correct and plaintiff stated it had been disclosed but she did not

provide any documentary proof. Plaintiff then retrieved a signed copy of the sales contract and

- 11 - presented it to the court. The court then inquired whether this had been produced; again plaintiff

did not provide proof. The court asked whether plaintiff had indeed signed the sales contract and

she admitted she had. The court's questioning shifted the burden of proof from Nissan to

plaintiff. Before the questioning, Nissan had not authenticated the document or shown plaintiff

even signed it. Absent plaintiff's admission she signed the sales contract, defendant would not be

able to carry its burden on the motion and it should have been denied.

¶ 38 We note if Nissan sought to accuse plaintiff of failing to comply with discovery it

should have done so pursuant to Illinois Supreme Court Rule 219(c) (eff. July 1, 2002). This

would have given the parties and the trial court an opportunity to properly determine whether the

document was disclosed, rather than conducting an impromptu hearing within the motion to

dismiss hearing. Our review of the record indicates plaintiff supplied a copy of the sales contract

in March 2010 as part of her response to Nissan's production request. This copy in the record

(photocopied an unknown number of times) contains dark areas which we cannot read, whereas

the copy plaintiff attached to her motion to reconsider contains the dark areas, but it is possible to

read the text (the "as is" language being in such a darker area). If Nissan was not able to read the

March 2010 copy, it should have requested a clearer copy.

¶ 39 C. The Warranty Claim

¶ 40 While plaintiff's underlying warranty claim is pursuant to the Act (

to 2312 (2006)), we must keep in mind the Uniform Commercial Code (UCC) (810 ILCS

5/1-101 to 13-103 (West 2010)) governs sales of goods, including warranties. Written warranties

provided with consumer goods must be examined under the requirements of both the Act and the

UCC. Sorce v. Naperville Jeep Eagle, Inc.,

,

, 234

- 12 - (1999). We turn to the legal framework governing warranties.

¶ 41 1. The Magnuson-Moss Warranty Act

¶ 42 The Act provides a private right of action by a consumer against a supplier or

warrantor failing to comply with the Act or the terms of a written warranty.

(d)

(2006). An automobile is a "consumer product" covered by the Act.

(a)

(2012). A "warrantor" is "any supplier or other person who gives or offers to give a written

warranty or who is or may be obligated under an implied warranty."

(5) (2006).

Under the Act, a "written warranty" is:

"(A) any written affirmation of fact or written promise

made in connection with the sale of a consumer product by a

supplier to a buyer which relates to the nature of the material or

workmanship and affirms or promises that such material or

workmanship is defect free or will meet a specified level of

performance over a specified period of time, or

(B) any undertaking in writing in connection with the sale

by a supplier of a consumer product to refund, repair, replace, or

take other remedial action with respect to such product in the event

that such product fails to meet the specifications set forth in the

undertaking."

(6)(A), (B) (2006).

See

(2012) (interpreting definition). Under the Act, a written warranty must

include a conspicuous designation as a full warranty or a limited warranty.

(a)

(2006);

(2012) ("Warrantors may include a statement of duration in a limited

- 13 - warranty designation."). Where the warrantor makes a written warranty to the consumer, an

implied warranty may not be disclaimed or modified but may be limited in duration to the

duration of the written warranty.

(a), (b) (2006). A disclaimer of an implied

warranty in violation of the Act is ineffective for state law purposes.

(c) (2006).

See generally

(c)(2) (West 2006) (defining "deceptive warranty").

¶ 43 2. The Uniform Commercial Code

¶ 44 Under section 2-313(1)(a) of the UCC "[a]ny affirmation of fact or promise made

by the seller to the buyer which relates to the goods and becomes part of the basis of the bargain

creates an express warranty that the goods shall conform to the affirmation or promise." 810

ILCS 5/2-313(1)(a) (West 2010); see also Mydlach v. DaimlerChrysler Corp.,

,

(2007) (treating a repair warranty as a promise to repair rather

than an "express warranty" for purposes of the tender-of-delivery rule). An express warranty may

be written or oral, and may be created by description, sample, or model. 810 ILCS 5/2-313

(West 2010). Comment 4 to section 2-313 provides:

"In view of the principle that the whole purpose of the law of

warranty is to determine what it is that the seller has in essence

agreed to sell, the policy is adopted of those cases which refuse

except in unusual circumstances to recognize a material deletion of

the seller's obligation. Thus, a contract is normally a contract for a

sale of something describable and described. A clause generally

disclaiming 'all warranties, express or implied' cannot reduce the

seller's obligation with respect to such description and therefore

- 14 - cannot be given literal effect under Section 2-316.

This is not intended to mean that the parties, if they

consciously desire, cannot make their own bargain as they wish.

But in determining what they have agreed upon good faith is a

factor and consideration should be given to the fact that the

probability is small that a real price is intended to be exchanged for

a pseudo-obligation." 810 ILCS Ann. 5/2-313, Uniform

Commercial Code Comment 4 (Smith-Hurd 2009).

¶ 45 Section 2-316 of the UCC restricts the exclusion or modification of warranties.

810 ILCS 5/2-316 (West 2010). Under section 2-316(1) of the UCC, a warranty disclaimer

inconsistent with an express warranty is inoperative. 810 ILCS 5/2-316(1) (West 2010). Section

2-316(3) permits disclaimers of implied warranties by expressions like "as is" or other language

which "makes plain that there is no implied warranty." (Emphasis added.) 810 ILCS

5/2-316(3)(a) (West 2010). Written disclaimers to "exclude or modify the implied warranty of

merchantability" must mention merchantability and "be conspicuous." 810 ILCS 5/2-316(2)

(West 2010); see 810 ILCS 5/1-201(b)(10) (West 2010) (defining "conspicuous"). Comment 1 to

section 2-316 explains:

"This section is designed principally to deal with those frequent

clauses in sales contracts which seek to exclude 'all warranties,

express or implied.' It seeks to protect a buyer from unexpected

and unbargained language of disclaimer by denying effect to such

language when inconsistent with language of express warranty and

- 15 - permitting the exclusion of implied warranties only by conspicuous

language or other circumstances which protect the buyer from

surprise." 810 ILCS Ann. 5/2-316, Uniform Commercial Code

Comment 1 (Smith-Hurd 2009).

¶ 46 3. The Parties' Arguments

¶ 47 Nissan asserts it is "well-settled Illinois law that when a vehicle is sold 'as is,' all

applicable warranties are effectively disclaimed and the purchaser is precluded from maintaining

a subsequent claim for breach of warranty" and plaintiff's "argument that this ['as is'] language

was somehow limited to warranties offered only by New York Auto Sales is not well-founded."

In other words, Nissan's position is a third party can disclaim a manufacturer's written warranty

through an "as is" clause in a sales contract.

¶ 48 Nissan cites six cases in support but has not provided a single case where a third

party disclaimed a manufacturer's written warranty.

¶ 49 In Basselen v. General Motors Corp.,

,

(2003), the plaintiffs purchased a new Chevrolet van with a 3-year or 36,000-mile warranty

provided by General Motors.

,

. After experiencing difficulty with

the van, the plaintiffs sued the manufacturer, General Motors, and the dealer. A " 'new buyer's

order' form" stated " 'New Car Factory Limited Warranty—As Is.' "

,

.

Before trial, the trial court granted summary judgment against the dealer on an express warranty

claim and the case proceeded to trial where a jury returned a verdict against General Motors on

the breach of express and implied warranty claims.

,

. The trial court

granted a directed verdict in favor of the dealer on the implied-warranty-of-merchantability

- 16 - count.

The First District upheld the directed verdict because the "as is" disclaimer language

in the order form complied with section 1-201 of the UCC (810 ILCS 5/1-201(10) (West 1996)).

Basselen,

,

. The appeal in Basselen concerned a

dealer's implied warranty, not an express warranty, and not the manufacturer's warranty. Further

Basselen was overruled on other grounds in Kinkel v. Cingular Wireless, LLC,

,

(2006), and is of limited precedential value.

¶ 50 In Tague v. Autobarn Motors, Ltd.,

,

(2009), the plaintiff purchased a used 2001 Ford Mustang where the sales contract contained

a disclaimer of warranties and indicated the vehicle was sold "as is." At the time of purchase, the

Mustang was still covered by Ford's limited warranty, which provided "bumper-to-bumper

coverage" for 3 years or 36,000 miles, whichever occurred earlier.

,

-

13. Ford moved to dismiss on the basis its limited warranty had expired by the time the Mustang

started experiencing problems.

,

. The appellate court upheld the

dismissal as Ford's limited warranty expired approximately four months before the Mustang

began having problems.

,

. The appellate court also held the

dealer, Autobarn, properly disclaimed all implied warranties because the disclaimer contained

conspicuous language.

,

. Again, Tague concerned the dealer's

disclaimer of its implied warranty and not a manufacturer's warranty, which had expired by its

own terms.

¶ 51 This is the same situation in Mitsch, where the plaintiffs purchased a used 2002

GMC Yukon from an authorized GMC dealership. Mitsch,

,

. The purchase contract contained a disclaimer stating the vehicle was sold "as is" and the

- 17 - plaintiffs purchased an extended warranty.

The vehicle had more than 36,000 miles when

sold and General Motors asserted the original warranty had already expired.

,

. The trial court granted the dealer's motion for summary judgment and the

plaintiffs appealed whether the purchase agreement disclaimed the dealer's implied warranty of

merchantability.

,

. The appellate court concluded the "as is"

language in the sales contract "was sufficient to disclaim the implied warranty of

merchantability."

,

.

¶ 52 Disclaimer of a manufacturer's warranty was not at issue in any of the other cases

cited by defendant. See Lytle v. Roto Lincoln Mercury & Subaru, Inc.,

,

(1988) (rejecting the argument the dealer adopted the manufacturer's

written warranty and could not disclaim its implied warranty of merchantability); Priebe v.

Autobarn, Ltd.,

(7th Cir. 2001) (rejecting the argument the Act prevented

the dealer from making a disclaimer of its implied warranty of merchantability because the

plaintiff purchased a third-party service contract, to which the dealer was not a party); Pelc v.

Simmons,

,

(1993) (holding the seller's statement

he had rebuilt the engine of a 1978 Pontiac Sunbird did not create an express warranty and there

was no implied warranty based on a sign in the vehicle's window stating it was " 'sold as is' ").

¶ 53 Like Nissan, plaintiff provided no case where a manufacturer successfully argued

it, or a third party, disclaimed its written warranty. See Rothe v. Maloney Cadillac, Inc.,

,

(1988) (addressing manufacturer's implied warranties

and noting section 2308(a) of the Act "prohibits a 'supplier' (defined *** as including parties with

whom a consumer does not necessarily deal directly) who makes an express warranty from

- 18 - disclaiming any implied warranty to a consumer"); Larry J. Soldinger Associates, Ltd. v. Aston

Martin Lagonda of North America, Inc., No. 97 C 7792,

, *3-6 (N.D. Ill. Sept.

13, 1999) (denying the manufacturer's motion for summary judgment with respect to its written

warranty because an issue of material fact existed whether the manufacturer had remedied the

defects within a reasonable period of time and number of attempts). Plaintiff points out the

manufacturer in Basselen was held liable on its written warranty despite the dealer disclaiming

its implied warranties. Basselen is of limited value as it did not address the verdict against the

manufacturer.

¶ 54 4. The Warranties Here

¶ 55 Nissan admitted it provided a written warranty for 3 years or 36,000 miles,

whichever came first. The warranty states it covers "any repairs needed to correct defects in

materials or workmanship." Nissan has not asserted the written warranty has expired by its own

terms, as in Tague or Mitsch, the warranty was voided pursuant to its terms, such as a salvaged or

flood title, or does not cover the repairs made. The evidence in the light most favorable to

plaintiff reflects Nissan is the warrantor, it supplied the written warranty for the Pathfinder, and

the warranty was effective under its own terms.

¶ 56 There are several problems with Nissan's position a third party can disclaim the

written warranty through an "as is" clause contained in a sales contract. We must be careful to

distinguish between the two potential warrantors—New York Auto and Nissan—and the two

types of potential warranties—express and implied. We need not resolve whether an agency

relationship existed between Nissan and New York Auto, and if New York Auto had authority to

disclaim Nissan's warranty. These are normally factual questions. Ioerger v. Halverson

- 19 - Construction Co.,

,

(2008) (existence of agency

relationship); Amigo's Inn, Inc. v. License Appeal Comm'n,

,

(2004) (scope of agent's authority). It is undisputed New York Auto is the alleged

disclaiming party and Nissan's manufacturer's warranty is the allegedly disclaimed warranty.

Taken in the light most favorable to plaintiff, there can be little dispute Nissan's warranty is a

written warranty under the Act. See

(6)(A), (B) ( 2006). Nissan asserts an

owner may terminate Nissan's warranty obligations if the owner so chooses. However, according

to the terms of the warranty, it is provided "to the original and subsequent owner(s)" and is

"generally transferable" to "subsequent owners of the vehicle at any time ownership of the

vehicle is transferred." Federal regulation requires a written warranty to "clearly and

conspicuously disclose in a single document in simple and readily understood language *** [t]he

identity of the party or parties to whom the written warranty is extended, if the enforceability of

the written warranty is limited to the original consumer purchaser or is otherwise limited to

persons other than every consumer owner during the term of the warranty."

(a)

(2012). Nissan's warranty contains no provision restricting enforcement of the warranty to less

than "every consumer owner during the term of the warranty" or stating an owner can disclaim

the warranty for subsequent owners. We decline to read such provisions into Nissan's warranty

and read the warranty according to its terms as being extended to and enforceable by all

subsequent owners. Regardless of whether Nissan's repair warranty is an "express warranty" as

defined by the UCC or a promise to repair (Mydlach,

,

), it is

obvious Nissan would be unable to unilaterally renege on its promise to repair without subjecting

itself to a breach of contract claim. See Hasek v. DaimlerChrysler Corp.,

,

- 20 - 788,

(2001) (express warranties are contractual in nature). The Act clearly

provides Nissan cannot disclaim an implied warranty where there is a written warranty.

(c) (2006); see also Sorce,

,

(summarizing the Act's requirements on disclaimers). Further, the UCC provides a disclaimer

inconsistent with an express warranty is ineffective and courts can deny the effect of an "as is"

clause where it is inconsistent with a contract's language. 810 ILCS 5/2-316 (West 2010);

Snelten v. Schmidt Implement Co.,

,

(1995)

("when a written contract contains a specific, written, affirmative representation, the inclusion of

general 'as is,' 'with all faults' or like language does not, in and of itself, relieve the party making

the statement of a duty arising from the statement"). Together, this means if Nissan was the

disclaiming party, the "as is" clause would be ineffective because it is inconsistent with its

written warranty and promise to repair.

¶ 57 Although Nissan asserts it is "well-settled Illinois law," it has not provided a

single case supporting its position a third party can disclaim a manufacturer's written warranty

through "as is" language contained in a sales contract. The provided cases address waiver of an

implied warranty, not an express warranty or promise, and do not address a third-party

disclaimer. Nissan is correct Illinois law supports waiver of an implied warranty through an "as

is" clause. We find no support for Nissan's position a third party's "as is" clause voids a

manufacturer's written warranty. Nissan's position would be in invitation for automobile

manufacturers to engage in misleading warranty claims and do an end run around the Act. See

Mydlach,

,

(noting a purpose of the Act is to restrict

misleading marketing). The manufacturer could simply escape any obligation to repair, despite

- 21 - its representations or promises, based on the automobile seller's disclaimer contained in the sales

contract. Moreover, to reach the conclusion a third party can disclaim a manufacturer's warranty,

we would have to interpret the Act and UCC inconsistent with their restrictions on warranty

practices and disclaimers. See McFatridge v. Madigan,

,

("A court should not depart from the plain language of a statute by reading into it exceptions,

limitations, or conditions that the legislature did not intend."). Considering the consumer

protections afforded by the Act and UCC in restricting deceptive warranty practices, a third-party

disclaimer cannot possibly void a manufacturer's written warranty when the manufacturer's

disclaimer would not be given effect. Nissan has not provided a single case where a

manufacturer even asserted an "as is" clause in a sales contract vitiated its written warranty and

our research has not revealed one. As plaintiff points out, one would suspect General Motors in

Basselen would have made this argument and not been liable on its express-written warranty if

Illinois law supported such a position. See also Villanueva v. Toyota Motor Sales, U.S.A., Inc.,

,

(2007) (appeal from dealer's section 2-619

motion to dismiss where the sales contract for a new Toyota minivan contained "as is" language

and Toyota did not assert this vitiated the manufacturer's warranty). As Nissan's motion to

dismiss is without a basis in law, it must fail.

¶ 58 As an aside, we note Nissan's argument a third party can disclaim a

manufacturer's warranty does not answer whether the third party did disclaim the warranty. At

the time of purchase, New York Auto provided plaintiff with a one-month written warranty on

the Pathfinder's engine and transmission. The sales contract's language "This vehicle SOLD AS

IS with no warranty as to mechanical condition" is inconsistent with New York Auto's warranty.

- 22 - The "as is" clause would be "inoperative" because it is inconsistent and negates the express

warranty. See 810 ILCS 5/2-316(1) (West 2010). In sum, Nissan's argument not only requires us

to twist the Act and UCC to permit a third party to do what a manufacturer could not, it also

requires a finding the disclaimer is ineffective against New York Auto but is nevertheless

effective for Nissan.

¶ 59 The trial court only analyzed whether the "as is" clause was conspicuous and did

not consider whether it was effective under the Act and UCC, it applied to express warranties or

promises to repair, or it conflicted with other representations made by New York Auto. The

plain language of section 2-316(2) states the conspicuousness requirement applies to disclaimers

of implied warranties and says nothing of express warranties or promises. 810 ILCS 5/2-316(2)

(West 2010). It is unclear if the court failed to draw this distinction or assumed defendant had

not made a repair warranty—which would require construing the pleadings in the light most

favorable to Nissan. Moreover, the trial court found Nissan effectively disclaimed its warranty,

whereas the undisputed facts reflect a third party attempted to disclaim the warranty. The trial

court dismissed both of plaintiff's counts. This was error and plaintiff's two counts must be

reinstated. See Sorce,

,

("A cause of action asserted for

breach of an express warranty does not extinguish a concurrent cause of action for breach of

implied warranties arising from the express warranty."); Mekertichian v. Mercedes-Benz U.S.A.,

L.L.C.,

,

(2004).

¶ 60 III. CONCLUSION

¶ 61 We reverse the trial court's judgment and remand the cause for further

proceedings.

- 23 - ¶ 62 Reversed and remanded.

- 24 - Appendix A (Case No. 4-12-0943) Appendix B (Case No. 4-12-0943) Appendix C (Case No. 4-12-0943)

4 2007 NEW VEHICLE LIMITED WARRANTY WHO IS THE WARRANTOR warranty applies to a relocated vehicle which is returned to, THE WARRANTY BEGINS Nissan1 warrants all parts of your 2007 Nissan vehicle supplied and is registered and normally operated in the United States, The warranty period begins on the date the vehicle is delivered by Nissan, except for those listed elsewhere under the caption the U.S. territories or Canada, except for conditions due to the to the first retail buyer or put into use, whichever is earlier. “WHAT IS NOT COVERED.” vehicle’s foreign operation, e.g., use of inappropriate fuels or other fluids. FOR HOW LONG AND WHAT IS APPLICABILITY COVERED I This warranty is provided to the original and subsequent LIMITATION OF WARRANTIES AND OTHER WAR- I BASIC COVERAGE owner(s) of a Nissan vehicle originally distributed by Nissan which is originally sold by a Nissan authorized Nissan RANTY TERMS AND STATE LAW RIGHTS • The basic coverage period is 36 months or 36,000 dealership in the United States, and which is registered EXTRA EXPENSES - LIMITATIONS OF DAMAGES miles, whichever comes first. in the U.S. and normally operated in the United States This warranty does not cover incidental or consequential • This warranty covers any repairs needed to correct (including Alaska and Hawaii), the United States territories damages such as loss of the use of the vehicle, incon- defects in materials or workmanship of all parts and venience or commercial loss. components of each new Nissan vehicle supplied by (specifically Guam, Saipan, American Samoa, Puerto Rico and the U.S. Virgin Islands), and Canada. ANY IMPLIED WARRANTY OF MERCHANTABILITY AND FIT- Nissan except for the exclusions or items listed under NESS FOR A PARTICULAR PURPOSE SHALL BE LIMITED the caption “WHAT IS NOT COVERED” or, if the part I This warranty is generally transferable from the original is covered by one of the separate coverages described TO THE DURATION OF THIS WRITTEN WARRANTY. ‘owner other than a Nissan dealer’ (OWNER) to in the following sections of this warranty, that specific Some states do not allow the exclusion or limitation of incidental subsequent owners of the vehicle at any time ownership of or consequential damages or limitations on how long an implied coverage applies instead of the basic coverage. the vehicle is transferred, without any action on your part; warranty lasts, so the above limitations or exclusions may not • Bedliners will be repaired to commercially acceptable except that this warranty is not transferable but is instead apply to you. This warranty gives you specific legal rights, and standards subject to the conditions and limitations listed void if during the first six months after delivery to the original you may also have other rights which vary from state to state. in "WHAT IS NOT COVERED." OWNER: (1) ownership of the vehicle is transferred from the original OWNER, and (2) the vehicle is registered Nissan does not authorize any person to create for it any other I POWERTRAIN COVERAGE outside of the United States. warranty, obligation or liability in connection with this vehicle. • The Powertrain coverage period is 60 months or 60,000 miles, whichever comes first. I Your Nissan vehicle is manufactured to meet U.S. • This warranty covers any repairs needed to correct regulations and environmental requirements. With the Nissan makes available to you, and you are specifically required defects in materials or workmanship. exception of privately owned vehicles belonging to by Federal Law to use BBB AUTO LINE [(800) 955-5100] before • Powertrain coverage applies to components listed below, members of the U.S. military or employees and officers exercising rights or seeking remedies under the Federal Magnuson- supplied by Nissan except for those items listed under of the United States Government stationed abroad, this Moss Warranty Act,

, et. seq. You are not required the caption “WHAT IS NOT COVERED”. warranty does not apply if an otherwise covered vehicle to first use BBB AUTO LINE if you seek remedies not created is operated in, or relocated to, a country other than those by Title I of that Federal law, but are required to first use BBB ENGINE listed above under this caption, except that it continues AUTO LINE if you seek remedies created by state law, including Cylinder heads and block and all internal parts, rocker to apply if the vehicle is operated in full compliance with your state's lemon law, if applicable state law provides for using covers and oil pan, valve train and front cover, timing chain its proper use as described in the applicable OWNER’S a 703 compliant or similar process before filing suit. Please refer and tensioner, oil pump, water pump and fuel pump, fuel MANUAL2 while touring outside of the United States, the to pp. 2-3 of this booklet and the "Supplement to 2007 Nissan injectors, intake and exhaust manifolds and supercharger, U.S. territories or Canada for a period not exceeding sixty (60) Warranty Information Booklet & 2007 Nissan Owner's Manual" flywheel, seals, and gaskets. consecutive days or sixty (60) days in any one 12 month period. for additional information. Subject to the transferability restriction described above, this TRANSMISSION AND TRANSAXLE Case and all internal parts, torque converter and converter 1 Nissan indicates Nissan North America, Inc., P.O. Box 685003, Franklin, TN 37068-5003 which distributes Nissan vehicles in the United States. housing, automatic transmission control module, transfer 2 See the Owner’s Manual for information relevant to proper operation of the vehicle, including the recommended fuels and fluids.

57052 Booklet text pages.indd 4 8/30/06 3:34:10 PM

2007 NEW VEHICLE LIMITED WARRANTY 5 case and all internal parts, seals and gaskets, clutch cover I ADJUSTMENT COVERAGE fuel and fluids), or the vehicle’s lack of compliance with local d and housing, and electronic transmission controls. Service adjustments not usually associated with the regulations or environmental requirements of any country replacement of parts, such as wheel alignment, are (other than the U.S., the listed U.S. territories or Canada) DRIVETRAIN covered only during the first 12 months or 12,000 are not covered by this warranty. Drive shafts, final drive housing and all internal parts, miles, whichever comes first. propeller shafts, universal joints, bearings, seals and gaskets. I REFRIGERANT RECHARGE ONLY COVERAGE Refrigerant recharge not associated with the repair or MAINTENANCE AND RECORDS RESTRAINT SYSTEM replacement of a warranted part is covered only during As a condition of this warranty, you are responsible for properly Air bags and related electronic control systems. the first 12 months, regardless of the mileage. using, maintaining and caring for your vehicle as outlined I CORROSION COVERAGE (PERFORATION FROM in your OWNER’S MANUAL and your NISSAN SERVICE CORROSION) NO CHARGE & MAINTENANCE GUIDE, and maintaining copies of all Warranty repairs will be made at no charge for parts and/or maintenance records & receipts for review by Nissan. Failure Any body sheet metal panel supplied by Nissan found to labor (except for batteries and tires, in which case you may pay to do so is likely to result in the denial of warranty coverage. have developed perforation (rust-through) due to corro- certain charges as noted above or as described in the applicable sion in normal use is covered for 60 months, regardless Evidence of the performance of the required maintenance tire warranty found later in this booklet). Any needed parts should be kept and presented as proof of such maintenance of mileage, except for those items listed under “WHAT IS replacement will be made using genuine Nissan or in connection with related warranty repairs. To assist you in NOT COVERED”. No additional rust proofing applications Nissan approved new or remanufactured parts. maintaining appropriate records, the maintenance log located are required. Perforation is a condition in which any body in your NISSAN SERVICE & MAINTENANCE GUIDE can be sheet metal panel has corroded from one surface through used along with supporting repair invoices, receipts and other to another. OBTAINING WARRANTY SERVICE such records. I You must take the vehicle to an authorized Nissan dealer I ORIGINAL EQUIPMENT BATTERY COVERAGE in the United States or Canada during regular business The coverage period is 36 months or 36,000 miles, (Continued on page 6) hours at your expense in order to obtain warranty service. whichever comes first. A defective original equipment battery The names and addresses of authorized Nissan dealers which is unserviceable within the first 12 months and 36,000 are listed in telephone directories. (See following page for miles will be replaced free of charge. After 12 months but within 24 months and 36,000 miles, you will pay 50% of I If you require warranty service outside of the United States "WHAT IS NOT COVERED." ) the replacement battery’s suggested retail price plus any (see terms under caption “APPLICABILITY”), contact applicable taxes. After 24 months but within 36 months an authorized Nissan dealer in that country. Note that and 36,000 miles, you will pay 75% of the replacement complaints related to failure to comply with proper use battery’s suggested retail price plus any applicable taxes. of the vehicle as described in the applicable OWNER’S MANUAL (including the lack of availability or use of proper Nissan will pay the rest, including all labor to remove and replace the defective battery. I TOWING COVERAGE If your vehicle is inoperative due to the failure of a warranted part, towing service to the nearest authorized Nissan dealer is covered for 36 months or 36,000 miles, whichever comes first.

57052 Booklet text pages.indd 5 8/30/06 3:34:11 PM 6 2007 NEW VEHICLE LIMITED WARRANTY WHAT IS NOT COVERED I The items listed below are not covered under corrosion (See following pages for separate warranties which may apply coverage (perforation from corrosion). to your Nissan, such as those covering vehicle emissions, E DAMAGE, FAILURES OR CORROSION DUE TO • Exhaust system components. seat belts, and tires.) ACCIDENTS, MISUSE OR ALTERATIONS This warranty does not cover damage, failures or corrosion • Corrosion of outer trim parts, such as moldings. resulting from: However, corrosion of outer trim parts is warranted for a 12 months or 12,500 miles, whichever comes first. I Accident, theft, fire, driving through water (including engine • Corrosion other than perforation, such as cosmetic T water ingestion) or misuse, which includes racing of any or surface corrosion due to defects in materials d sort whatsoever (Proper use is outlined in your OWNER’S or workmanship. This is covered under the Basic c MANUAL). Coverage of the New Vehicle Limited Warranty. I Alteration, tampering or improper repair. • Special bodies or equipment not manufactured or I Installation of non-Nissan approved accessories or supplied by Nissan. components. DAMAGE, FAILURES OR CORROSION DUE TO LACK I Improper installation of any Nissan approved or aftermarket C OF OR IMPROPER MAINTENANCE accessory or component. This warranty does not cover damage, failures or corrosion I Glass breakage, unless resulting from defects in material resulting from: or workmanship. I Normal wear and tear, including dings, dents, chips or I Lack of performance of proper maintenance services as W scratches. outlined in your NISSAN SERVICE & MAINTENANCE GUIDE. H ALTERED OR UNCERTAIN ODOMETER MILEAGE I Use of improper or dirty fuel, fluids or lubricants. This warranty does not cover repair of any vehicle or any part T I Use of parts not equivalent in quality or design to parts o of a vehicle of which the odometer mileage has been altered, supplied by Nissan. or the odometer repaired or replaced and the actual vehicle d mileage cannot be correctly and readily determined. MAINTENANCE SERVICE EXPENSE This warranty does not cover normal maintenance services d SALVAGE TITLE as specified in your NISSAN SERVICE & MAINTENANCE This limited warranty does not apply to any vehicle, and is a GUIDE such as engine tune-up; cleaning and polishing; wheel rendered void if the vehicle is (or ever has been) issued a alignment; headlight aiming; replacement of filters, replacement “salvage” or similar title under any state’s law; or has ever been of windshield wiper inserts, replacement of key fob batteries, w determined to be a “total loss” or equivalent by any insurance lubricants, coolant; worn brake shoes, pads, drums and rotors company, such as by payment of a cash payment of claim in lieu and worn clutch discs. E of repairs because of a determination that the cost of repairs SEAT BELTS, TIRES, DROP-IN BEDLINERS AND exceeded the actual cash value of the vehicle. EMISSION CONTROL SYSTEM T Seat belts, tires, drop-in bedliners and the emission control DAMAGE, FAILURES OR CORROSION FROM system are not covered by this warranty, but are covered by ENVIRONMENTAL CONDITIONS separate warranties. This warranty does not cover damage, failures or corrosion resulting from: NISSAN SPRAY-IN BEDLINERS I Stone chipping, chemical fallout (acid rain), tree sap, salt, Nissan Spray-in Bedliners will be repaired to commercially hail, wind-storm, lightning, flood or other environmental acceptable standards which may include minor appearance conditions. differences from the original bedliner.

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