Correa v. Cruisers, a Division of KCS International, Inc.

298 F.3d 13, 59 Fed. R. Serv. 3d 888, 2002 U.S. App. LEXIS 14742, 2002 WL 1587039
CourtCourt of Appeals for the First Circuit
DecidedJuly 23, 2002
Docket01-1240, 01-1241
StatusPublished
Cited by96 cases

This text of 298 F.3d 13 (Correa v. Cruisers, a Division of KCS International, Inc.) is published on Counsel Stack Legal Research, covering Court of Appeals for the First Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Correa v. Cruisers, a Division of KCS International, Inc., 298 F.3d 13, 59 Fed. R. Serv. 3d 888, 2002 U.S. App. LEXIS 14742, 2002 WL 1587039 (1st Cir. 2002).

Opinion

■ TORRUELLA, Circuit Judge.

Defendants-appellants, Cruisers, a Division of KCS International, Inc., and Ther-mo Power Corporation, appeal from a jury verdict finding that they breached a warranty against hidden defects in the sale of a motorboat to plaintiffs. In accordance with the jury’s verdict, the United States District Court for the District of Puerto Rico ordered rescission of the sales contract and return of the purchase price of the boat, plus interest. In addition, the jury awarded to the plaintiffs their costs for dockage, repair and maintenance, insurance premiums, and license fees. The district court further awarded attorney’s *18 fees based on its determination that defendants acted obstinately in the course of the litigation. On appeal, defendants-appellants contend that the plaintiffs’ claim for breach of warranty against hidden defects is barred by the statute of limitations. Alternatively, even if the claim was properly before the district court, defendants-appellants contend that the district court erred in allowing the testimony of plaintiffs’ expert, in permitting the jury to award non-defect-related expenses, and in granting attorney’s fees. We affirm in part and reverse in part, remanding the case for action consistent with this opinion.

I. Background and Procedural History

Despite having weathered an eight-day jury trial, the facts in this case are far from settled. However, since this is an appeal from a denial of judgment as a matter of law, which we review de novo, we will present the relevant facts in the light most favorable to the plaintiffs. See Down E. Energy Corp. v. Niagara Fire Ins. Co., 176 F.3d 7, 13-14 (1st Cir.1999) (reviewing denial of judgment as a matter of law on limitations grounds de novo and in light most favorable to non-moving party).

On March 22, 1995, plaintiffs-appellees (“plaintiffs”), Arturo Correa (“Correa”) and his wife Melissa Correa, purchased a 1995 Cruisers 3570-Esprit motor yacht (“yacht” or “boat”) in San Juan, Puerto Rico from People’s Marine. The yacht, manufactured by Cruisers, a Division of KCS International, Inc. (“Cruisers”), was equipped with two Crusader, model 454X1Í, marine gasoline engines, manufactured by Thermo Power Corporation (“Crusader”). The plaintiffs paid .$132,350 for the boat, which was delivered to them at the San Juan Bay Marina on June 11,1995.

Pursuant to the sale of the yacht, both Cruisers and.Crusader'issued limited warranties, guaranteeing to repair or replace, free of charge, any defects in their respective products. Cruisers’ warranty provided five years of coverage for the hull of the boat and one year for all other items manufactured by Cruisers. Crusader’s warranty covered the engines for two years.

In the two months after the plaintiffs received their boat, they took several excursions to Fajardo, Puerto Rico and to the U.S. Virgin Islands. On these outings, plaintiffs experienced problems with the engines, including backfiring, stalling, and an inability to start. On July 26, 1995, Correa wrote a letter of complaint to Cruisers, with a copy to People’s Marine, describing the problems that plaintiffs had encountered with the boat, including engine troubles.

Correa, in August of 1995, made further complaints to People’s Marine about “hard starting” of the engines, meaning that the engines would not restart immediately after they had been running for awhile and were then shut off. Crusader was familiar with “hard starting” as a common symptom of “vapor lock,” which other manufacturers had been experiencing in the summer of 1995 due to a new fuel pump in Crusader engines. Crusader had found that the installation of additional fuel booster pumps had solved the hard starting problem. Accordingly, it ordered two booster pumps, which were installed on plaintiffs’ yacht by People’s Marine sometime during September of 1995.

After the booster pumps were installed, the Correas continued to experience engine problems. On September 25, 1995, Correa wrote another letter to Cruisers, explaining that the engines were, stalling and backfiring. In this letter, Correa informed Cruisers that he had already alerted People’s Marine of the continuing problem.

*19 On October 21,1995, Crusader sent Paul Doppke, a certified Crusader marine engine specialist, to Puerto -Rico to examine Correa’s engines. Doppke found that the booster pumps had been misinstalled by People’s Marine, which explained the continuing engine problems. Doppke removed the booster pumps and instead installed a new fuel delivery system that Crusader had found to eliminate the vapor lock problem. Doppke, with Correa aboard the yacht, then conducted a sea trial and performed diagnostic tests to determine how the engines were running. During the sea trial, which lasted over four hours, the engines ran without any difficulties.

During the trial, there was evidence that after the installation of the new fuel delivery system Correa took his boat out to watch an offshore race in San Juan Bay and experienced engine problems. 1 On November 10, 1995, Correa again contacted Cruisers to alert the company. That same day, following the telephone conversation, Correa sent a letter indicating that he expected Cruisers and Crusader to fix his engines and Cruisers to repair the other problems with the boat, including, inter aha, leaks, a rusting ice-maker door, defective wipers, and a broken gas alarm, that had plagued him since the time of delivery or shortly thereafter.

In response to Correa’s complaints, Cruisers and Crusader sent a team of their top management and technical personnel to Puerto Rico to inspect Correa’s yacht. This team included Gerald Scott, Vice President and General Manager of Crusader; Jim Viestenz, President of Cruisers; Jim Hayes, Customer Service and Quality Control Manager for Cruisers; Andrew Prietz, Customer Service Manager for Crusader; Guillermo Cidre, owner of People’s Marine; and Osmani del Pino, a' mechanic employed by People’s Marine. The Crusader and Cruisers representatives, along with Correa, took 'the boat out for a' sea trial. The group experienced no noticeable engine problems. In addition, computer monitoring of the engines indicated that the engines were functioning properly. Prior to leaving, Gerald Scott asked Correa to call him directly if Correa experienced further engine problems so that he could ensure that Crusader would fix or replace the engines.

Immediately after this inspection visit, on December .6, 1995, Cruisers wrote to Correa to,summarize the repairs and replacements that, pursuant to the inspection, would be made under warranty by People’s Marine. On December 11, 1995, Crusader wrote to Correa, reassuring him that the engines were running properly according to the inspection, but suggesting that the propellers be repitched. After People’s Marine had performed at least some of the prescribed replacements and repairs, Correa wrote another letter to Cruisers on December 26, 1995, detailing repairs that had not been completed by People’s Marine and further repairs or replacements that were required. In this letter, Correa also advised Cruisers that People’s Marine, in conducting the repairs, had noted that the engine water hoses were blistered and filled with water.

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298 F.3d 13, 59 Fed. R. Serv. 3d 888, 2002 U.S. App. LEXIS 14742, 2002 WL 1587039, Counsel Stack Legal Research, https://law.counselstack.com/opinion/correa-v-cruisers-a-division-of-kcs-international-inc-ca1-2002.