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(Jiagbogu v. Mercedes-Benz )

 

Consumer Law -Song-Beverly Act-Civ. Code, §§ 1790-1795.7-Contracts-Rescission
Jiagbogu v. Mercedes-Benz

 Defendant Mercedes-Benz USA, Inc. (MBUSA) appeals from a judgment in favor of plaintiff Azubueze Jiagbogu in an action for breach of express and implied warranties under the Song-Beverly Consumer Warranty Act (Act) (Civ. Code, §§ 1790-1795.7).  (All further statutory references are to the Civil Code unless otherwise specified.)  MBUSA argues the trial court erred by not instructing on waiver of right to rescind, on statutory offsets for post-rescission use of a product, on the presumption under section 1793.22, subdivision (b), and on other matters.  MBUSA also argues the trial court should have awarded it an equitable offset for Jiagbogu’s use of his Mercedes-Benz car after he requested a replacement or refund from MBUSA.

            We hold that the right of a vehicle buyer under the Song-Beverly Consumer Warranty Act to compel a manufacturer to reimburse the purchase price or replace the vehicle is distinct from a rescission; that the manufacturer is not entitled to an offset for use of the vehicle except where that remedy is authorized by the statute; and that the trial court should not instruct on the presumption that the manufacturer has had an adequate opportunity to correct defects in the vehicle where the conditions for claiming the presumption are not shown by the evidence, and the buyer does not assert it.  Finding no error, we affirm.

DISCUSSION

I

            MBUSA argues the trial court should have instructed the jury that Jiagbogu’s continued use of the car after he requested replacement or restitution could have waived his right to rescind.  In a related argument, MBUSA claims the court should have instructed that Jiagbogu’s use of the car after his buyback request entitled MBUSA to an offset against Jiagbogu’s damages under section 1692.

            Under the Act, a buyer who discovers a nonconformity in a manufacturer’s goods “shall deliver” the nonconforming goods to a repair facility maintained by the manufacturer within the state.  (§ 1793.2, subd. (c).)  If the nonconforming product is a new motor vehicle and the manufacturer is unable to service or repair the vehicle to conform to applicable express warranties after a reasonable number of attempts, “the manufacturer shall either promptly replace the new motor vehicle . . . or promptly make restitution to the buyer.”  (§ 1793.2, subd. (d)(2).)  The buyer may elect restitution in lieu of replacement.  (§ 1793.2, subd. (d)(2).)

            MBUSA contends that Jiagbogu’s request for restitution amounted to a rescission.  But section 1793.2 does not refer to rescission or any portion of the Commercial Code that discusses rescission.  The Act does not parallel the Commercial Code; it provides different and more extensive consumer protections.  (Krotin v. Porsche Cars North America, Inc. (1995) 38 Cal.App.4th 294, 301 (Krotin).)  Jiagbogu did not invoke rescission, or any of the common law doctrines or Commercial Code provisions relating to that remedy.  It would not matter if he had referred to rescission in his buyback request, as long as he sought a remedy only under the Act, which contains no provision requiring formal rescission to obtain relief.  (See id., at pp. 300, 302.)  MBUSA acknowledges in its brief that Jiagbogu requested refund or replacement.  That comports with a claim under the Act, not with a traditional cause of action for rescission.

            MBUSA cites Ibrahim v. Ford Motor Co. (1989) 214 Cal.App.3d 878 (Ibrahim), for its argument that continued use after a request for buyback can constitute waiver of the right to rescind.  In Ibrahim, the plaintiff filed a verified complaint for rescission, restitution and damages, breach of express and implied warranties, fraud, and negligent misrepresentation under the Act, the California Uniform Commercial Code (UCC), and a federal consumer protection statute.  (Id. at pp. 883-884.)  In considering whether continued use waived the right to revoke acceptance under the UCC, the Ibrahim court discussed the nationwide consensus that “reasonable continued use of motorized vehicles does not, as a matter of law, prevent the buyer from asserting rescission (or its U.Com.Code equivalent, revocation of acceptance).”  (Id. at p. 897.)  As part of this consensus, the court explained that a seller is entitled to a setoff for the buyer’s use after revocation of acceptance.  The court held that “[n]othing in the language of either the [UCC] or [the Act] suggests that abrogation of the common law principles relating to continued use and waiver of a buyer’s right to rescind was intended. . . .  The legal principles governing continued use . . . are thus still applicable.”  (Id. at p. 898.)

            Ibrahim did not hold that waiver of the right to rescind applies to actions brought solely under the Act.  Nor did it rule that any analogous common law principle applies to or limits the Act.  Rather, the court held that the Act did not abrogate common law principles applying to causes of action brought under the UCC.  By including a cause of action for rescission and invoking the UCC in her complaint, Ms. Ibrahim invoked the common law doctrines of waiver of right to rescind and seller’s offset for buyer’s use after revocation of acceptance.  (Ibrahim, supra, 214 Cal.App.3d at pp. 883-884.)  Jiagbogu, who filed claims only under the Act, did not.

            MBUSA contends that regardless of the language in the Act, section 1793.2 describes a rescission that should be subject to common law and UCC rules for rescission.  In practice, a consumer usually will have to request replacement or restitution under the Act, since most manufacturers do not offer these options voluntarily.  (Krotin, supra, 38 Cal.App.4th at p. 303.)  MBUSA argues that a buyback request is “the very definition of rescission.”  But as we have seen, the Act is designed to give broader protection to consumers than the common law or UCC provide.  (Krotin, at p. 301.)  Had the Legislature intended this more protective statute to be limited by traditional doctrines, or the remedies provided in section 1793.2, subdivision (d) to be treated as a rescission under common law, it surely would have used language to that effect.  We may not rewrite the section to conform to that unexpressed, supposed intent.  (See Murillo v. Fleetwood Enterprises, Inc. (1998) 17 Cal.4th 985, 993; People v. Garcia (1999) 21 Cal.4th 1, 7.)

            The same reasoning applies to MBUSA’s related argument that the trial court should have instructed the jury that Jiagbogu’s use of the car after his request for a buyback could be considered as a post-rescission offset against his damages.  This argument also hinges upon MBUSA’s claim that the buyback amounts to a rescission.  MBUSA points to section 1692 regarding contract rescission and offsets.  But as we have seen, the Act does not characterize replacement or buyback under section 1793.2, subdivision (d) as a rescission, nor does it refer to section 1692 in any way.  Instead, it protects consumers more extensively than the common law or UCC.  MBUSA’s lengthy overview of rescission and offsets under the common law of California and other states is thus irrelevant, and its arguments about waiver of rescission and statutory offsets under Ibrahim are inapplicable.  (See Ibrahim, supra, 214 Cal.App.3d at pp. 883-884, 897-898.)

            Since we reject MBUSA’s basic argument that a request for replacement or refund under the Act constitutes rescission, we find no error in the trial court’s refusal to instruct on waiver of right to rescind or on statutory offsets for post-rescission use.

Jiagbogu v. Mercedes-Benz 5/24/04-B163974

May 24 2004

B163974 [PDF] [DOC]

Jiagbogu v. Mercedes-Benz 5/24/04 CA2/4

Gavaldon v. Daimler-Chrysler S104477-5-27-2004-Song-Beverly Consumer Warranty Act-Opinion
Consumer Law-Beverly-Song- Act-Contract-Civil Code Sec.1791--Service Contract Not Express Warranty(Gavaldon v. DaimlerChrysler)
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