Parrot v. DaimlerChrysler Corporation – 3/24/2006

March 24, 2006

Arizona Supreme Court Holds That a Lessee Cannot Maintain an Action Under the Magnuson-Moss Warranty Act or Arizona’s Lemon Law Statute.

Bill Parrot leased a 2000 Jeep Cherokee from Pitre, a DaimlerChrysler dealership. The Jeep came with DaimlerChrysler’s standard limited warranty, and in connection with the lease financing transaction, Pitre retained title to the vehicle. The Court explained that to have a cause of action under the Warranty Act, a person must be a “consumer” of a consumer product and have a written warranty, implied warranty, or service contract (as defined in the Act). Although the Act sets forth the three categories of “consumers,” each category requires a qualifying sale – sale in which a person buys a consumer product for purposes other than resale. In this case, it was undisputed that Pitre purchased the Jeep from DaimlerChrysler for the purpose of resale, and thus there was no qualifying sale. Consequently, Parrot had no cause of action under the Warranty Act. As for the Lemon Law claim, the available remedies assume that the consumer has the right to transfer title to the vehicle back to the manufacturer. In this case, Pitre owned and held title to the vehicle. Therefore, Parrot had no remedy under the Lemon Law.

Justice Ryan authored the unanimous opinion.