Champion Ford Sales, Inc. v. Levine

433 A.2d 1218, 49 Md. App. 547, 32 U.C.C. Rep. Serv. (West) 108, 1981 Md. App. LEXIS 335
CourtCourt of Special Appeals of Maryland
DecidedSeptember 3, 1981
Docket1407, September Term, 1980
StatusPublished
Cited by28 cases

This text of 433 A.2d 1218 (Champion Ford Sales, Inc. v. Levine) is published on Counsel Stack Legal Research, covering Court of Special Appeals of Maryland primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Champion Ford Sales, Inc. v. Levine, 433 A.2d 1218, 49 Md. App. 547, 32 U.C.C. Rep. Serv. (West) 108, 1981 Md. App. LEXIS 335 (Md. Ct. App. 1981).

Opinion

Thompson, J.,

delivered the opinion of the Court.

This case involves an appeal and a cross-appeal from a judgment entered in favor of Mr. and Mrs. Robert J. Levine, appellees and cross-appellants, (buyers) against Champion Ford Sales, Inc. and Ford Motor Company, appellants and cross-appellees (sellers) in the Circuit Court for Baltimore County. The principal issues presented in the sellers’ appeal are: (1) whether under the circumstances described below, the buyers justifiably revoked their acceptance, under Md. Com. Law Code Ann. § 2-608, of an automobile which had been purchased from Champion and manufactured by Ford; and (2) if revocation was justified, whether the damages *549 awarded the buyers were proper. The only significant question presented in the buyers’ cross-appeal is whether the trial judge erred in ruling that the Magnuson-Moss Warranty Act, 15 U.S.C. § 2301 et seq., was not applicable in the instant case and that the buyers were therefore not entitled to recover attorneys’ fees under its provisions. For the reasons set forth below, we shall hold that the buyers’ revocation of acceptance was justified, that the judgment entered included damages which were improperly awarded, and that the trial judge erred in holding that the federal statute had no applicability.

On December 20, 1977, the buyers took delivery from Champion of a new 1978 Ford Granada. They had selected the Granada, which they intended to use for normal family transportation purposes, after considerable comparison shopping. With the car came a limited warranty 1 under which the manufacturer promised that "the Selling Dealer will repair, replace, or adjust free any parts, except tires, found to be defective in factory materials or workmanship within the earlier of twelve months or 12,000 miles.” The buyers paid the purchase price of $5,446.35 in cash. Six days after delivery, when the car had been driven 109 miles, the engine became inoperable. After the car was towed to the dealer’s service facility, an inspection revealed that a defective engine valve had broken and had fallen into a cylinder, destroying or damaging the engine block, the cylinder head, two pistons, a connecting rod, rings, and a number of gaskets. The defect had existed when the car was sold but could not have been discovered by any reasonable inspection. After the cause and extent of the damage was ascertained, the dealer informed the buyers that it would repair the engine and provided them with a "loaner” car. The buyers accepted the loaner vehicle, but after viewing their car while it was dismantled in the dealer’s shop indicated that they did not want the engine repaired but rather desired replacement of either the engine or the car. It was *550 their view that a vehicle with a shop-rebuilt engine was not comparable to one with a factory assembled engine. Both the buyers and the dealer’s mechanic testified that certain equipment which Ford used in assembling engines in the factory and which it advertised as contributing to the quality of its engines was not available in the dealer’s shop. A series of meetings with representatives of the dealer and the manufacturer followed, at which the buyers’ requests for a new engine or car were refused. Following these refusals, on January 13, 1978 the buyers advised the dealer that they were revoking their acceptance of the car and demanded the return of the money they had paid. The dealer refused to refund the purchase price and proceeded to repair the car’s engine. The repairs were performed by qualified mechanics at the dealer’s service facility, at a cost of $889.69. The repairs were completed on February 10,1978, at which time the car was test-driven by Champion personnel and found to operate satisfactorily. The buyers were then informed that their car was ready to be picked up. The buyers again advised the dealer that they had revoked their acceptance and declined to either inspect or accept the repaired car. On February 13, the buyers returned the loaner vehicle provided by the dealer. On April 10, 1978, when their money had not been refunded, they filed suit. In August 1978, the buyers purchased a replacement for the Granada, a used 1974 Ford Pinto, for which they paid $1,200.00.

On July 10, 1980, the buyers’ action came to trial. Their amended declaration was in four counts: Count I sought return of the purchase price paid for the Granada, on the grounds that the buyers had revoked their acceptance; Count II set forth a claim for breach of the implied warranty or merchantability; Count III claimed violation of the Magnuson-Moss Act and breach of express warranties; and Count IV alleged wrongful breach of a guaranty in violation of Md. Com. Law Code Ann. § 14-401(k). 2 In each count, the *551 buyers sought interest, costs, and attorneys’ fees. At the close of the buyers’ case, the trial judge directed a verdict for the sellers as to Counts III and IV. Counts I and II were submitted to the jury, which returned a verdict in favor of the buyers on each. The jury awarded damages in the amount of the purchase price of the Granada plus interest from the date acceptance was revoked; it also awarded an additional $1200, representing the purchase price of the used Pinto bought to replace the Granada. The judge held that the Magnuson-Moss Act was not applicable and refused to award the buyers attorneys’ fees. Appeals to this Court followed.

Md. Com. Law Code Ann. § 2-608 sets forth the circumstances under which a buyer may revoke his acceptance: 3

"(1) The buyer may revoke his acceptance of a lot or commercial unit whose nonconformity substantially impairs its value to him if he has accepted it
(a) On the reasonable assumption that its nonconformity would be cured and it has not been seasonably cured; or
(b) Without discovery of such nonconformity if his acceptance was reasonably induced either by the difficulty of discovery before acceptance or by the seller’s assurances.
(2) Revocation of acceptance must occur within a reasonable time after the buyer discovers or should have discovered the ground for it and before any substantial change in condition of the goods which *552 is not caused by their own defects. It is not effective until the buyer notifies the seller of it.
(3) A buyer who so revokes has the same rights and duties with regard to the goods involved as if he had rejected them.”

See Lynx, Inc. v. Ordnance Products, 273 Md. 1, 14-17, 327 A.2d 502 (1974).

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433 A.2d 1218, 49 Md. App. 547, 32 U.C.C. Rep. Serv. (West) 108, 1981 Md. App. LEXIS 335, Counsel Stack Legal Research, https://law.counselstack.com/opinion/champion-ford-sales-inc-v-levine-mdctspecapp-1981.