An Illinois appeals panel has refused to reinstate a breach of warranty jury verdict against American Isuzu Motors Inc., ruling that the purchaser of a 1996 Rodeo failed to prove that her vehicle was 'unfit for the purpose for which it was intended.'
Although Marian Alvarez suffered inconvenience because of 'minor deficiencies,' all problems were repaired without charge, and the Rodeo never stalled or died, the court said.
Alvarez bought the new Rodeo with a 36-month warranty from Schaumburg Isuzu in Schaumburg, Ill. What the court called a 'myriad of problems' started six weeks later. Over the next 10 months, the dealership fixed or replaced the transmission, oxygen sensor, radiator hose, brake caliper and door switch.
After filing suit, Alvarez drove the Rodeo for 14 months until she traded it to the same dealer toward a 1998 Trooper, the court said. The dealership was not sued.
A Cook County Circuit Court jury awarded $2,200 for breach of implied warranty, but Judge Robert Gordon granted Isuzu's motion to set aside the verdict.
The Illinois Appellate Court agreed that Alvarez had failed to prove her claim. 'Her defects were minor and did not affect the fitness of the product,' Judge Michael Gallagher said.
Alvarez's lawyer, Adam Krohn of Chicago, called the decision 'an injustice' because the trial judge and appellate court rejected the jury's verdict. But there will be no further appeal, he said.
Isuzu lawyer Denean Sturino of Chicago said, 'The court said Isuzu fixed the problems.' The minor problems, he added, 'didn't affect use, value or safety and thus there couldn't be a breach of implied warranty.'
Finance firms may be liable for undisclosed damage
Finance companies that sell vehicles through auction to dealerships without fully disclosing damage may be liable to the people who ultimately buy the vehicles, two Virginia judges have ruled.
The lack of a direct contract with the eventual customer doesn't insulate the finance company from a lawsuit, they held in separate cases involving Ford Motor Credit Co.
Their reasoning also applies to wholesalers that use auctions to sell vehicles to dealers, according to John Cole Gayle Jr. of Richmond, Va., the plaintiffs' lawyer in one of the cases. 'Sellers should be more explicit about the damage they know about,' even if vehicles are sold as-is or at dealer-only auctions, he said.
But Ford Credit spokesman Dan Jarvis said finance companies never see the vehicles and rely on inspections and damage reports from the leasing dealers or from repossession agents.
At the end of a lease period, as in the two Virginia cases, the dealership takes the vehicle to auction on Ford Credit's behalf, and the auction firm does a second inspection and damage report, he said. Dealerships that buy the vehicles get that final report.
In one case, the plaintiffs bought a used 1995 Ford Contour from Universal Ford Inc. in Glen Allen, Va., which acquired it at auction. The suit alleged that they weren't told about frame damage and that the dealership told them the car had never been damaged or repaired.
They sued in U.S. District Court in Richmond, where Magistrate Dennis Donhal said Ford Credit could be held liable on a legal theory called 'constructive fraud.' He rejected Ford Credit's defense that it had no relationship with the plaintiffs.
Ford Credit and Universal have settled for $30,000, Gayle said. Jarvis said Ford Credit did not admit any guilt but that settlement was less costly than further litigation.
In the other case, plaintiffs bought a used 1995 Explorer from Ford dealership Amherst Motors Inc. in Amherst, Va., and later discovered frame damage. Amherst had bought it from Ford Credit at auction. The suit alleged Ford Credit did not tell the dealership about the damage.
Amherst County Circuit Judge J. Michael Gamble ruled that Virginia allows fraud claims even if the parties had no direct relationship.
The dealership was dismissed from the case because the claim against it was filed too late, Jarvis said. The claims against Ford Credit are scheduled for trial in October.
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