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Razor v. Hyundai Motor America

June 16, 2004


[6] Appeal from the Circuit Court of Cook County. Honorable Raymond J. Funderburk, Judge Presiding.

[7] The opinion of the court was delivered by: Justice Karnezis

[8]  Plaintiff Shante Razor brought an action pursuant to the Magnuson-Moss Warranty - Federal Trade Commission Improvement Act (15 U.S.C. §2301 et seq. (1994)) (Magnuson-Moss Act) and the Illinois New Vehicle Buyer Protection Act (815 ILCS 380/1 et seq. (West 2002)) seeking damages from defendant Hyundai Motor America for defendant's breach of its written warranty and implied warranty of merchantability on the new car it sold to plaintiff. The trial court entered judgment on a jury verdict in favor of plaintiff, awarding her actual and consequential damages.

[9]  Defendant argues on appeal that the court erred in failing to grant defendant's motion for judgment notwithstanding the verdict (judgment NOV), failing to reverse the jury's award of consequential damages, and awarding plaintiff attorney fees and costs. Defendant asserts that (1) plaintiff failed to prove damages, an essential element of her prima facie case; (2) plaintiff did not have a claim for breach of implied warranty under the Magnuson-Moss Act because there was no privity between plaintiff and defendant; (3) plaintiff had no claim for breach of limited warranty or implied warranty of merchantability because she failed to prove that an alarm/remote starter system not covered under defendant's limited warranty was not the cause of the car's problems; and (4) consequential damages should not have been awarded because defendant's limited warranty disclaimed liability for incidental and consequential damages. Defendant also asserts that, in the event this court reverses the trial court's judgment, the judgment awarding fees and costs must be reversed. We affirm.

[10]   Background

[11]   On August 4, 2001, plaintiff purchased and took delivery of a new 2001 Hyundai Sonata GLS. She purchased the car from Gartner Buick, Inc. (Gartner), in Aurora, Illinois. It was manufactured and distributed by defendant. Defendant's new vehicle limited warranty covered the car for 60 months or 60,000 miles, whichever came sooner. The warranty provided the following coverage for the duration of the warranty:

[12]   "Repair or replacement of any component originally manufactured or installed by Hyundai Motor Company or Hyundai Motor America (HMA) that is found to be defective in material or workmanship under normal use and maintenance, except any item specifically referred to in the section 'What is Not Covered.' "

[13]   The warranty stated that, "[i]n certain unique circumstances, Hyundai may decide, as a matter of goodwill, to pay for service or an item not normally covered by warranty."

[14]   The owner's manual for the car warned that the car "should not be modified in any way" because "[s]uch modifications may * * * violate conditions of the limited warranties covering the vehicle."

[15]   The "What is Not Covered" section of the warranty excluded coverage for damage or failure resulting from, among other things:

[16]   "- Negligence of proper maintenance as required in the Owner's Manual.

[17]   - Misuse, abuse, accident, theft, water/flooding or fire.

[18]   - Use of improper or insufficient fuel, fluids or lubricants.

[19]   - Use of parts other than Hyundai genuine parts, or parts of non-equivalent quality and design.

[20]   - Any device or accessories not supplied by Hyundai.

[21]   - Modifications, alterations, tampering or improper repair.

[22]   - Parts or accessories used in applications for which they were not designed or not approved by HMA."

[23]   The "What is not Covered" section also stated "incidental or consequential damages, including without limitation, loss of time, inconvenience, loss of use of the vehicle or commercial loss."

[24]   Approximately one month after purchasing the car, plaintiff experienced problems starting it. She took it to Gartner for repair five times for the same problem. On January 7, 2002, plaintiff filed a four-count complaint against defendant alleging that, "as a result of ineffective repair attempts by [defendant], through its authorized dealership network, the Sonata cannot be utilized for personal, family and household use as intended by Plaintiff at the time of acquisition." She stated that the car had been taken for repair of the same defect at least five times but that the defect remained uncorrected. Plaintiff asserted claims for (I) breach of written warranty under the Magnuson-Moss Act; (II) breach of implied warranty under the Magnuson-Moss Act; (III) revocation of acceptance under the Magnuson-Moss Act; and (IV) violation of the Illinois New Vehicle Buyer Protection Act. Following an arbitration finding and award in favor of plaintiff, defendant rejected the award and the case proceeded to trial.

[25]   Plaintiff testified at trial that the Sonata was her first new car and that she bought it because she had heard good things about the car, she needed dependable transportation to get to and from work and "every place else" and the price was reasonable. When plaintiff bought the car, the salesman showed her a binder of options and features that could be installed in the car. Plaintiff elected to have a Professional Sound Installers, Inc. (ProSound), alarm/remote starter system installed in the car. The price of the system was included in the purchase price of the car.

[26]   Plaintiff took her new car home on August 4, 2001, but returned it to Gartner on August 30, 2001, to have the remote starter system installed. The odometer on the car read 1,944 miles. Gartner subcontracted the installation to ProSound and plaintiff got the car back the same day. Plaintiff did not know until she saw the work order for the installation that the system was made and installed by ProSound rather than Hyundai.

[27]   On September 26, 2001, when plaintiff attempted to start the car with her key, the car did not crank. She checked multiple things to make sure that she was not the cause of the failure to start, such as whether the gear shift was engaged, but could find no reason for the problem. She called roadside assistance and had the car towed to Gartner. The odometer on the car read 3,518 miles. Gartner's work order shows that when Gartner service technicians checked the car it started every time and they found no problems with the battery, cables and connections. Plaintiff received the car back that afternoon but missed a day of work as a result of having to take the car for repair.

[28]   On October 6, 2001, plaintiff brought the car into Gartner again, complaining that the car would not start when cold. The odometer on the car read 3,931 miles. Gartner checked the car and it started. Technicians found the starter was intermittently open and replaced it. They also performed an oil change free of charge. Gartner provided plaintiff with a loaner car during the two days her car was being serviced.

[29]   On October 16, 2001, plaintiff had the car towed to Gartner again, complaining that the car would "not crank sometimes." The repair order shows that technicians replaced a shorted "ECU power relay" but does not state that it was the cause of the problem. Gartner had the car for three days.

[30]   On October 25, 2001, plaintiff again brought the car in complaining that it would not start. The repair order states that technicians let the car "sit overnight several times" and that it started in the morning. Gartner had ProSound remove the alarm/remote started system and then again let the car sit overnight several times. The car started each time. ProSound then installed an updated remote system. The car continued to start when ...

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