Judge: Anne Richardson, Case: 22STCCV10441, Date: 2023-11-02 Tentative Ruling

DEPARTMENT 40 - JUDGE ANNE RICHARDSON - LAW AND MOTION RULINGS
The Court issues tentative rulings on certain motions.The tentative ruling will not become the final ruling until the hearing [see CRC 3.1308(a)(2)]. If the parties wish to submit on the tentative ruling and avoid a court appearance, all counsel must agree and choose which counsel will give notice. That counsel must 1) email Dept 40 by 8:30 a.m. on the day of the hearing (smcdept40@lacourt.org) with a copy to the other party(ies) and state that all parties will submit on the tentative ruling, and 2) serve notice of the ruling on all parties. If any party declines to submit on the tentative ruling, then no email is necessary and all parties should appear at the hearing in person or by Court Call. 

Case Number: 22STCCV10441    Hearing Date: November 2, 2023    Dept: 40

Superior Court of California

County of Los Angeles

Department 40

Background

Plaintiff John Villanueva Jr. sues Defendants Volkswagen Group of America, Inc. and Does 1 through 10 pursuant to a March 25, 2022 Complaint alleging three Song-Beverly Consumer Warranty Act (lemon law) claims: breach of express warranty; breach of implied warranty; and failure to commence repairs within a reasonable time.

The claims arise from allegations that on July 10, 2021, Plaintiff leased a new 2021 Volkswagen ID4 (Vehicle), that Volkswagen warranted the Vehicle and agreed to preserve or maintain the utility or performance of Plaintiff’s vehicle or to provide compensation if there was a failure in such utility or performance, and that the Vehicle was delivered to Plaintiff with serious defects and nonconformities to warranty and developed other serious defects and nonconformities to warranty including, but not limited to, electrical and suspension system defects, which Volkswagen’s authorized repair facilities were not able to conform within a reasonable number of attempts.

On August 18, 2023, Volkswagen filed a motion for summary judgment or adjudication of the Complaint’s causes of action.

On October 19, 2023, Plaintiff opposed the opposition.

On October 27, 2023, Volkswagen replied to the opposition.

Volkswagen’s motion is now before the Court.

Request for Judicial Notice

The Court takes judicial notice of the California Department of Consumer Affairs, Arbitration Certification Program certificates relating to the Better Business Bureau’s “BBB AUTO LINE” program. (Mot., RJN; Evid. Code, §§ 452, subd. (h), 453; see Julian Volunteer Fire Co. Assn. v. Julian-Cuyamaca Fire Protection Dist. (2021) 62 Cal.App.5th 583, 600 [judicial notice may be taken as to existence of document and legal effects deriving therefrom].)

Evidentiary Objections

In granting or denying a motion for summary judgment or summary adjudication, the court need rule only on those objections to evidence that it deems material to its disposition of the motion. Objections to evidence that are not ruled on for purposes of the motion shall be preserved for appellate review. (Code Civ. Proc., § 437c, subd. (q).) Evidentiary objections not made either in writing or orally shall be deemed waived. (Code Civ. Proc., § 437c, subd. (b).)

Reply Objections

Not ruled on as not dispositive of this motion. (Objections do not relate to Opp’n, Villanueva Decl., ¶¶ 7-11, Exs. 3-7.)

Motion for Summary Judgment or Adjudication

Preliminary Notes

The Court first notes that the opposition argument that this motion was filed within 75 days of the hearing date is incorrect. (See Opp’n, p. 1.) 75 days before the hearing was Saturday, August 19, 2023, which, by operation of law, was pushed back to August 18, 2023, when this motion was filed. (Mot., POS; see Code Civ. Proc., §§ 10, 12, 12a, 12c.) Moreover, though additional days for service by mail must be added to the 75-day requirement (Code Civ. Proc., § 437c, subd. (a)(2)), that requirement is not applicable here because personal service was made on Plaintiff’s counsel. (Mot., POS.)

The Court also notes that it is satisfied there is a sufficient agreement between the notice and separate statement as to the causes of action and damages challenged in Volkswagen’s motion, thus satisfying California Rules of Court, rule 3.1350, subdivision (b). (See Opp’n, p. 1.) The Court notes that Schmidlin v. City of Palo Alto (2007) 157 Cal.App.4th 728, 744 simply explained that the trial court may properly deny a motion for summary adjudication that does not specify the causes of action, affirmative defenses, damages, or issues of duty against which relief is sought because there is no notice to the opposing party as to the subject matter at issue for summary adjudication. Here, the notice and separate statement both explicitly list out the two issues for summary adjudication, if not verbatim. To the extent that the issues were not copied verbatim from the notice to the separate statement, the Court determines that failure to meet this requirement does not amount to grounds for denial. Plaintiff has been put on notice by both the notice and the separate statement as to the two grounds for summary adjudication. The notice requirements in Schmidlin are thus satisfied. (Cf. Schmidlin v. City of Palo Alto, supra, at p. 744 [“… [D]efendants’ separate statement reflects no attempt to comply with th[e] requirement” in Cal. Rules of Court, rule 3.1350, subd. (b)].)

Legal Standard

A motion for summary judgment shall be granted if all the papers submitted show that there is no triable issue as to any material fact for trial or that the moving party is entitled to a judgment as a matter of law. (Code of Civ. Proc., § 437c, subd. (c).) A party may also seek summary adjudication of select causes of action, affirmative defenses, claims for damages, or issues of duty, which may be made by a standalone motion or as an alternative to a motion for summary judgment and proceeds in all procedural respects like a motion for summary judgment. (Code Civ. Proc., § 437c, subds. (f)(1)-(2), (t); see Lilienthal & Fowler v. Superior Court (1993) 12 Cal.App.4th 1848, 1854-1855, questioned by dictum in Bagley v. TRW, Inc. (1999) 73 Cal.App.4th 1092, 1094, fn. 2 [finding that summary adjudication may be granted as to separate factual grounds supporting a claim stated as a single count because the separate grounds state a separate cause of action].) The moving party bears the initial burden of production to make prima facie showing no triable material fact issues. (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 850.) This burden on summary judgment or adjudication “is more properly one of persuasion rather than proof, since he must persuade the court that there is no material fact for a reasonable trier of fact to find, and not to prove any such fact to the satisfaction of the court itself as though it were sitting as the trier of fact.” (Id. at p. 850, fn. 11.) If the moving party meets this burden, the burden shifts to the opposing party to make a rebuttal prima facie showing that a triable issue of material fact exists. (Id. at p. 849.) “[I]n ruling on motions for summary judgment courts are to ‘“liberally construe the evidence in support of the party opposing summary judgment and resolve doubts concerning the evidence in favor of that party.”’ [Citations].” (Cheal v. El Camino Hospital (2014) 223 Cal.App.4th 736, 760.)

I.

Summary Judgment, Prompt Offer to Repurchase or Replace: DENIED.

In its motion, Volkswagen argues that it cannot be held liable under the SBA for any of the Complaint’s three causes of action because, after Plaintiff requested a replacement or repurchase of the Vehicle, Volkswagen offered to repurchase the Vehicle within 55 days. (Mot., pp. 6-7.)

For legal support, Volkswagen cites to Dominguez v. American Suzuki (2008) 160 Cal.App.4th 53, 60 (Dominguez) to establish that its repurchase offer was prompt, where the repurchase offer of a motorcycle per the SBA in Dominguez was made within six weeks (42 days) of the repurchase or replace demand. (Mot., pp. 6-7.)

A review of Dominguez shows that it notes that where there is prompt replace or repurchase offer, the manufacturer has complied with the SBA, such that a consumer pursuing or continuing litigation after the manufacturer had made its offer does not amount to filing suit to force the manufacturer to comply with the SBA, but rather, amounts to filing suit simply to recover civil penalties and/or attorney’s fees, which the Legislature could not have intended. (Dominguez, supra, 160 Cal.App.4th at pp. 59-60.)

Volkswagen also provides evidence showing that Plaintiff asked Volkswagen for repurchase or replacement on February 1, 2022 and that Volkswagen made a repurchase offer on March 29, 2022. (Mot., pp. 5-6, citing to Mot., Separate Statement (Sep. St.), Undisputed Material Fact (UMF) Nos. 3, 11, 21 [demand by Plaintiff] & 4, 12, 22 [repurchase offer by Volkswagen].)

A review of the evidence cited at UMF Nos. 3, 11, and 21 shows references to the same exhibit: “EIS Tab 2A (Rupp Decl. ¶ 3, Ex. A).” (See Mot., Sep. St., UMF Nos. 3, 11, 21.) A review of that evidence shows the contact log of the communications between Plaintiff and Volkswagen. That log shows that, on February 1, 2022, Plaintiff requested a repurchase of the Vehicle. (Mot., Sep. St., Evidence, Rupp Decl., Ex. A, Activity Overview, pp. 17-18 [“[Plaintiff Villanueva] state[d] [that the] vehicle [wa]s back in shop with [the] same issue [and that] [Plaintiff Villanueva] would like to discuss buy back options[;] [Plaintiff Villanueva] seeks buy back”]; see id. at pp. 17-20.)

A review of the identical evidence cited at UMF Nos. and 4, 12, 22 shows references to the contact log to show that Volkswagen emailed Plaintiff a written offer to repurchase the Vehicle on March 29, 2022. (Mot., Sep. St., UMFs Nos. 4, 12, 22, collectively citing to Mot., Evidence, Rupp Decl., Ex. A, Activity Overview, pp. 34-36.)

This evidence, in light of Dominguez, carry Volkswagen’s burden of showing that it promptly complied with its obligations under the SBA such that it should not be held liable under the Complaint’s three causes of action (breach of express and implied warranties and failure to commence repairs within a reasonable time) where Volkswagen made a repurchase offer within 56 (not 55) days of Plaintiff’s buyback request. (See Dominguez, supra, 160 Cal.App.4th at p. 60 [span of six weeks between demand for repurchase or replacement of motorcycle]; cf. id. 59 [noting that the “Dominguez [plaintiff] d[id] not complain [of] the number of attempts to repair the Motorcycle were unreasonable”]; Complaint, ¶¶ 43-56 [alleging failure to repair to warranty within reasonable number of attempts].)

In opposition, Plaintiff cites Krotin v. Porsche Cars (1995) 38 Cal.App.4th 294, 302-303 (Krotin) for the purpose of showing that the SBA “‘does not require [a] consumer to take any affirmative steps to secure relief’ under the” SBA. Plaintiff then cites evidence showing that on nine dates between October 4, 2021 and March 29, 2022, Plaintiff made service requests that should have triggered Volkswagen’s duty to repurchase or replace the Vehicle. (Opp’n, pp. 8, 11-13; see also Mot., pp. 3-6, citing to Opp’n, Sep. St., Additional Material Fact (AMF), Nos. 29-33.)

In reply, Volkswagen argues that Volkswagen did not have an affirmative duty to repurchase or replace until Plaintiff made a request in February 1, 2022. Volkswagen also distinguishes Krotin by arguing that unlike Krotin, Volkswagen promptly made an offer here, and that Krotin involved whether an affirmative duty existed to offer replacement or repurchase, where as here, the issue is whether the offer was prompt. (Reply, pp. 2-6.)

Here, the Court finds in favor of Plaintiff as to carrying his burden on the question of “promptness” in a replace or repurchase offer.

In response to amici curiae, the Krotin Court noted that the consumer need not take affirmative steps to secure relief under the SBA “other than … permitting the manufacturer a reasonable opportunity to repair the vehicle.” (Krotin, supra, 38 Cal.App.4th 302-303.) As held in Krotin, an automobile manufacturer “need not read minds to determine which vehicles are defective; it need only read its dealers’ service records.” (Krotin, supra, 38 Cal.App.4th at p. 303.) Manufacturers are “capable of becoming aware of every failed repair attempt . . . even without any direct contact from the consumer to the manufacturer or any request for replacement or reimbursement to the dealership.” (Id.)

Here, Plaintiff’s declaration and dealership invoices support a showing that Plaintiff presented the Subject Vehicle for repair at least five times between September 7, 2021 and March 29, 2022. (Opp’n, Sep. St., AMF Nos. 29-33, respectively citing Opp’n, Villanueva Decl., ¶¶ 7-11, Exs. 3-7.) At the first two and latter two repair attempts, Plaintiff raised electrical issues—a defect alleged in the Complaint. (Ibid.; Complaint, ¶ 10.) The repurchase offer was made on March 29, 2022. Based on that timeline, there is a triable issue of whether the offer by Volkswagen was promptly made. If Plaintiff had no affirmative duty under Krotin in relation to the repurchase or replacement of the Vehicle other than to present it for inspection, which he did for the first time on September 7, 2021, and four more times before March 29, 2022, and if the repurchase offer here was made well beyond the timeframe of the 42-day repurchase offer in Dominguez, i.e.,  here, 173 days (approx. 5 ½ months) between September 7, 2021 and March 29, 2022 (Dominguez, supra, 160 Cal.App.4th at p. 60), then there is a triable issue as to promptness.

Summary judgment based on Volkswagen complying with its repurchase or replace duties under the SBA is therefore DENIED.

The Court briefly notes that summary judgment is not proper as to the mileage offset issue. (Mot., pp. 8-9.) The mileage question does not dispose of the three causes of action and is not even discussed in the opposition. (Code of Civ. Proc., § 437c, subd. (c).) Neither does this question involve summary adjudication of a cause of action, affirmative defense, damages, or issue of duty. (Code Civ. Proc., § 437c, subds. (f)(1)-(2), (t).)

Summary adjudication of the fees and penalties “damages” in the motion are also DENIED because that argument is derivative of the Court finding no triable issues for summary judgment as to the promptness in Volkswagen’s repurchase or replace offer. (Mot., p. 9.)

II.

Summary Adjudication, Civil Penalties: GRANTED in Part and DENIED in Part.

The Song-Beverly Act provides for civil penalties through two separate means: (1) where the manufacturer’s non-compliance with the Act is willful (i.e., intentional violation of the Act); and (2) penalties where the manufacturer violates its express warranty obligations penalties. (Civ. Code, § 1794, subd. (c), (e)(1)-(5).)

A. Civ. Code, § 1794, subds. (e)(1)-(2): Violation of Express Warranty

Volkswagen seeks summary adjudication of damages pursuant to an express warranty violation under the SBA. Volkswagen relies on the SBA’s provision that penalties are not available for express warranty violations of the SBA where “the manufacturer maintains a qualified third-party dispute resolution process [that] substantially complies with Section 1793.22.” Volkswagen also relies on evidence showing that it participates in the Better Business Bureau’s Auto Line Program, which is certified by California’s Department of Consumer Affairs Arbitration Certification Program (Program), which is in turn the agency responsible for determining if a third-party dispute resolution process is or is not in substantial compliance with section 1793.22. (Mot., pp. 10-11, citing to Bus & Prof. Code § 472 [licensing through the Program] & Mot., Sep. St. UMF No. 17, in turn citing Mot., Evidence, Rupp Decl., ¶ 8 [participation in Better Business Bureau’s Auto Line Program], Ex. F [Program’s certification for “BBB AUTO LINE” program]; see also RJN discussion supra.)

The Court finds that this showing shows no triable issues of fact as to damages relating to express warranty violations of the SBA pursuant to Civil Code section 1794, subdivisions (e)(1)-(2). (See Complaint, ¶¶ 42, 55 [damages for second and third causes of action based on “Civil Code, section 1794, et seq.” generally].)

In opposition, Plaintiff argues that he does not bring this action pursuant to Civil Code section 1794, subdivision (e)(1), but rather, pursuant to subdivision (c) of that section. (Opp’n, p.  15.)

Plaintiff thus concedes no entitlement to damages pursuant to subdivision (e)(1), for which reason summary adjudication is GRANTED as to damages pursuant to subdivision (e)(1) of Civil Code section 1794. (Lilienthal, supra, 12 Cal.App.4th at pp. 1854-1855.)

B. Civ. Code, § 1794, subd. (c): Willful Violation

In its motion, Volkswagen argues that summary adjudication should be granted as to penalties based willful violation of the SBA pursuant to Civil Code section 1794, subdivision (c) in light of the March 29, 2022 offer to repurchase by Volkswagen. (Mot., pp. 11-12.)

In support, Volkswagen points to case law holding that a “violation is not willful if ‘the defendant’s failure to replace or refund was the result of a good faith and reasonable belief the facts imposing the statutory obligation were not present[,] … for example, [where] the manufacturer reasonably believed the product did conform to the warranty, or a reasonable number of repair attempts had not been made, or the buyer desired further repair rather than replacement or refund. (Mot., p. 11, citing to Kwan v. Mercedes-Benz of N.Am., Inc. (1994) 23 Cal.App.4th 174, 185.)

Volkswagen also references evidence showing its offer to repurchase on March 29, 2022, which is intended to show that Plaintiff proceeded with this action despite the offer to repurchase being made four days after this action was filed on March 25, 2022. (Mot., p. 12; see also Mot., p. 6, citing Mot., Sep. St., UMF Nos. 4, 12, 22.)

The Court finds that this evidence does not carry Defendants’ burden pursuant to Kwan. The Court adopts its discussion in Section I supra to find that because there is a triable issue of whether the March 29, 2022 repurchase offer was prompt based on either a date of September 7, 2021 and February 1, 2022, then there is a triable issue of material fact as to whether Volkswagen willfully refused to make a repurchase offer sooner than March 29, 2022, as based on determinations available from the inspection of the Vehicle’s condition during Plaintiff’s five visits to Volkswagen’s repair facility between September 7, 2021 and February 2, 2022. (See Opp’n, pp. 13-15; cf. Reply, pp. 8-9.)

Summary adjudication of damages pursuant to Civil Code section 1794, subdivision (c) is DENIED.

III.

Summary Adjudication, Attorney’s Fees: DENIED.

The Court adopts its discussion in Sections I and II.B. to find that because triable issues remain as to whether Volkswagen could be found liable at trial for willful violation of the SBA, triable issues remain as to entitlement to attorney’s fees pursuant to Civil Code section 1794, subdivision (d), which allows the recovery of attorney’s fees for any violation of Civil Code section 1794, including subdivision (c), i.e., a willful violation of the SBA. 

Conclusion

Defendant Volkswagen Group of America, Inc.’s Motion for Summary Judgment or, in the Alternative, Summary Adjudication is GRANTED in Part and DENIED in Part as follows:

(1) DENIED as to summary judgment;

(2) GRANTED as to summary adjudication of damages pursuant to Civil Code section 1794, subdivision (e)(1); and

(3) DENIED as to summary adjudication of damages pursuant to Civil Code section 1794, subdivision (c).