Avena v. Ford Motor Co.

107 Misc. 2d 444, 434 N.Y.S.2d 860, 1980 N.Y. Misc. LEXIS 2875
CourtNew York Supreme Court
DecidedJuly 9, 1980
StatusPublished
Cited by2 cases

This text of 107 Misc. 2d 444 (Avena v. Ford Motor Co.) is published on Counsel Stack Legal Research, covering New York Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Avena v. Ford Motor Co., 107 Misc. 2d 444, 434 N.Y.S.2d 860, 1980 N.Y. Misc. LEXIS 2875 (N.Y. Super. Ct. 1980).

Opinion

OPINION OF THE COURT

Hilda G. Schwartz, J.

This is a motion by the defendant Ford Motor Company (Ford) for an order pursuant to CPLR 908 approving the compromise of the individual claims of the named plaintiffs and the discontinuance of this action without notice to the putative class.

The plaintiffs have defaulted in appearing on this motion and have submitted no papers in opposition.

This action has not been certified as a class action and movant Ford asserts that this action does not satisfy the prerequisites to certification as a class action. Nevertheless, Ford moves for court approval of a proposed compromise as a class action under CPLR 908 which applies only to class actions. In order to permit Ford precertifica[445]*445tian discovery, two orders extending plaintiffs’ time to move for class certification to May 2, 1980 and June 6, 1980, respectively, were issued.

Plaintiffs’ complaint alleges purported requisites of a class action on behalf of all New York residents owning 1974 through 1977 model vehicles manufactured by Ford and equipped with a 351M or 400 C.I.D. engine. It alleges the susceptibility of these vehicles to develop a cracked engine block and seeks damages and injunctive relief for alleged violations of the Magnuson-Moss Warranty Act (US Code, tit 15, §§ 2301-2312) and New York State warranty law.

On February 8, 1980 Ford served its answer, asserting a number of affirmative defenses and appended to its answer a copy of Ford’s extended policy program which it had voluntarily instituted in response to complaints it had received about cracked engine blocks in 351M and 400 C.I.D. vehicles manufactured from 1974 through 1977. Plaintiffs served Ford with their first set of interrogatories on March 19, 1980. On April 16, 1980 Ford produced certain information and documents in lieu of answers to interrogatories pursuant to agreement which included a stipulation of confidentiality.

After the conclusion of precertification discovery, counsel for the respective parties negotiated a proposed settlement, the terms of which are as follows:

(a) plaintiff Avena will receive from Ford either repair of the engine block of his 1977 vehicle or reimbursement of his out-of-pocket expenses for repair of his vehicle’s cracked engine block. Inspection has revealed that a new engine including battery is required. Credit for $181 will be given to Mr. Avena;
(b) plaintiff Silverman will receive from Ford an inspection of his 1977 Ford LTD vehicle at a mutually convenient time and place, such inspection to determine whether his vehicle has exhibited any of the known symptoms of the cracked engine block problem. If a crack is detected, it will be corrected;
(c) both plaintiffs Avena and Silverman will execute and deliver several releases to Ford acknowledging re[446]*446ceipt of consideration in connection with the compromise and releasing Ford from all liability relating to the cracked engine block problem of their vehicles;
(d) Ford will pay to the attorneys for the plaintiffs reasonable attorneys’ fees and expenses in the amount of $6,000;
(e) as a condition of the compromise of their claims, plaintiffs will seek and obtain an order of discontinuance which shall dismiss with prejudice all individual claims asserted by the named plaintiffs and discontinue without prejudice any claims purportedly asserted on behalf of the putative members of the alleged but uncertified class;
(f) as a condition of the compromise, Ford requires that the proposed order of discontinuance contain no notice to putative members of the alleged but uncertified class and that if the court determines that such notice is necessary, then Ford shall withdraw from this settlement agreement.

An affidavit of plaintiffs’ attorney is submitted in which he states that he has advised his clients that the settlement is fair, equitable and in the best interests of the parties. He states that they advised him that they agree to the terms.

There are submitted brief affidavits of plaintiffs Avena and Silverman, each stating that they have discussed the terms of the proposed settlement with their counsel. Neither specifically states that they accept it or agree to the terms.

The affidavits of plaintiffs and plaintiffs’ counsel each state that to their knowledge this action brought by them has attracted no publicity, and that they have not contacted or received inquiries from putative class members.

The extended policy program voluntarily instituted by Ford in response to the complaints it had received about cracked engine blocks was the subject of an FTC proceeding which did not alter the terms of the program (Ford Motor Co., FTC Docket No. 9105, consent order to cease and desist, Feb. 21, 1980). Notice of such policy program [447]*447was given by mail to each owner of a subject vehicle. In it Ford stated that it will pay 100% of the costs of repair of any subject vehicle developing a cracked engine block within 36 months of ownership or 36,000 miles due to the causes identified.

This motion asking that this court, pursuant to CPLR 908, approve the alleged compromise and discontinuance of an alleged but uncertified class action is apparently an application of first impression.

The moving party, Ford, concedes that it does not appear that a New York court has applied CPLR 908 to circumstances similar to those of the instant case.

CPLR 908 states as follows: “Rule 908. Dismissal, discontinuance or compromise. A class action shall not be dismissed, discontinued, or compromised without the approval of the court. Notice of the proposed dismissal, discontinuance, or compromise shall be given to all members of the class in such manner as the court directs.”

Defendant Ford does not dispute that CPLR 908 provides that a class action shall not be discontinued or compromised without approval of the court and that the instant action is not a class action. No certification motion was ever brought and no court determination of a class action rendered.

Defendant contends that it has moved for court approval pursuant to CPLR 908 only because of the general rule which it asserts is followed by the Federal courts, that an action based on a complaint containing class action allegations should be treated as a class action even before a class certification motion has been made. Despite this contention, defendant argues that the likelihood of class certification in the action at bar must be considered remote. In addition, while urging application of CPLR 908, defendant urges application of only a portion of it, that of approval of the compromise and discontinuance. It urges that the court not comply with the second portion of CPLR 908, to wit: “Notice of the proposed dismissal, discontinuance, or compromise shall be given to all members of the class in such manner as the [448]*448court directs.” The giving of notice is mandated by the rule.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Naposki v. First National Bank
18 A.D.3d 834 (Appellate Division of the Supreme Court of New York, 2005)
Avena v. Ford Motor Co.
85 A.D.2d 149 (Appellate Division of the Supreme Court of New York, 1982)

Cite This Page — Counsel Stack

Bluebook (online)
107 Misc. 2d 444, 434 N.Y.S.2d 860, 1980 N.Y. Misc. LEXIS 2875, Counsel Stack Legal Research, https://law.counselstack.com/opinion/avena-v-ford-motor-co-nysupct-1980.