A Unanimous Arizona Court of Appeals Division One Panel Refuses to Expand Terms of "Limited Warranty" Offered by Car Dealer to Permit Revocation of Acceptance by Buyer.
After Chaurisia discovered numerous defects in his Corvette and after authorized dealers failed to repair the car to Chaurisia’s satisfaction, he sued General Motors for breach of express warranty and implied warranty of merchantability. The trial court granted GM’s motion for summary judgment and awarded it attorneys’ fees.
The Magnuson-Moss Warranty Act provides two categories of warranty: full warranties and limited warranties. See 15 USC 2304. Because GM’s warranty did not meet the requirements of a full warranty under the MMWA, GM was permitted to conspicuously label its warranties as “limited warranties. The only cause of action under MMWA for breach of a limited warranty is for failure to comply with the warranty’s express terms. GM’s limited express warranty provided that it would pay for repairs needed to correct defects in materials or workmanship: “Warranty repairs, including towing, parts and labor, will be made at No Charge.” To prove a breach of this warranty, Chaurisia was required to demonstrate that GM refused or otherwise failed to pay for the repair to a covered item. Because GM paid for all claimed warranty repairs made by its authorized facilities, Chaurisia could not prove that GM breached the terms of its express warranty.
Chaurisia also argued that he was entitled to protections offered under a full warranty, namely that the manufacturer is obligated to refund or replace a product if it contains a defect after a reasonable number of attempts by the warrantor to remedy the defect. 15 U.S.C. § 2304(a)(4). Citing decisions of other courts that refused to apply the reasonable number of attempts requirement when the plaintiff holds a limited express warranty, the appellate court rejected Chaurisia’s argument, and his attempt to “engraft” protections provided to consumers under the UCC and Arizona’s Lemon Law.
Chaurisia’s claims based on the alleged breach of an implied warranty failed because he could not demonstrate privity of contract required under Arizona law. Because he bought the Corvette from a dealer, not from GM, he could not sue GM for breach of the implied warranty. Though the Court acknowledged public policy reasons for eliminating the privity requirement, the Court noted that the Arizona Supreme Court had explained that without the privity requirement, the UCC’s scheme would be “unduly complicated.”
Finally, the Court affirmed the award of attorneys’ fees to GM.
Authored by Judge Thompson, Presiding Judge Kessler, and Judge Irvine concurring.