Judge Joel L. Lofton, Case Number: 22AHCV01275, Date: 2024-04-30 Tentative Ruling

Judge: Joel L. Lofton, Case: 22AHCV01275, Date: 2024-04-30 Tentative Ruling

Case Number: 22AHCV01275 Hearing Date: April 30, 2024 Dept: X

Tentative Ruling

Judge Joel L. Lofton, Department X

HEARING DATE: April 30, 2024 TRIAL DATE: June 4, 2024

CASE: GREGORIO SALAZAR MONTES aka GREGORIO MONTES and EDUARDO SALAZAR v. SIERRA MONROVIA CDJR, LLC dba SIERRA CHRYSLER DODGE JEEP RAM OF MONROVIA, FCA US LLC, and DOES 1 through 10, inclusive.

CASE NO.: 22AHCV01275

MOTION FOR SUMMARY JUDGMENT

MOVING PARTY: Defendant FCA US LLC

RESPONDING PARTIES: Plaintiffs Gregorio Salazar Montes aka Gregorio Montes and Eduardo Salazar

SERVICE: Filed January 24, 2024

OPPOSITION: Filed April 16, 2024

REPLY: Filed April 25, 2024

RELIEF REQUESTED

Defendant FCA US LLC moves for summary judgment.

BACKGROUND

This is a lemon law action. Plaintiffs Gregorio Salazar Montes aka Gregory Montes and Eduardo Salazar (collectively, “Plaintiffs”) filed this action against Defendants Sierra Monrovia CDJR, LLC dba Sierra Chrysler Dodge Jeep Ram of Monrovia, FCA US LLC (“FCA”), and Does 1 through 10, inclusive, asserting causes of action for (1) violation of Song-Beverly Act – breach of express warranty, and (2) negligent repair.

TENTATIVE RULING

Defendant’s motion for summary judgment is DENIED.

REQUESTS FOR JUDICIAL NOTICE

No requests for judicial notice were filed.

EVIDENTIARY OBJECTIONS

The Court rules on FCA’s objections (filed April 25, 2024) to the declaration of Armando Lopez (Plaintiffs’ counsel) as follows.

Objection Nos. 1, 2, 3, 4, and 5: OVERRULED.

Objection Nos. 6, 7, and 8: SUSTAINED.

LEGAL STANDARD

“The purpose of the law of summary judgment is to provide courts with a mechanism to cut through the parties’ pleadings in order to determine whether, despite their allegations, trial is in fact necessary to resolve their dispute.” (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal. 4th 826, 843.) “A party may move for summary judgement in an action or proceeding if it is contended that the action has no merit or that there is no defense to the action or proceeding.” (Code Civ. Proc., § 473c, subd. (a)(1).) “The motion for summary judgment shall be granted if all the papers submitted show that there is no triable issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.” (Code Civ. Proc., § 473c, subd. (c).)

A three-step analysis is employed in ruling on motions for summary judgment. First, the court identifies the issues framed by the pleadings. Next, the court determines, when the moving party is the defendant, whether it has produced evidence showing one or more of the elements of the cause of action cannot be established or there is a complete defense to that cause of action. If the defendant does so, the burden shifts to the plaintiff to show the existence of a triable issue of material fact as to that cause of action or defense. (Kline v. Turner (2001) 87 Cal.App.4th 1369, 1373.) The court must “view the evidence in the light most favorable to the opposing party and accept all inferences reasonably drawn therefrom.” (Ibid.; see also Dore v. Arnold Worldwide, Inc. (2006) 39 Cal. 4th 384, 389 [Courts “liberally construe the evidence in support of the party opposing summary judgment and resolve doubts concerning the evidence in favor of that party.”].)

“A defendant moving for summary judgment must show that one or more elements of the plaintiff's cause of action cannot be established or that there is a complete defense. The defendant can satisfy its burden by presenting evidence that negates an element of the cause of action or evidence that the plaintiff does not possess and cannot reasonably expect to obtain evidence needed to establish an essential element. (Veera v. Banana Republic, LLC, (2016) 6 Cal.App.5th 907, 914.)

DISCUSSION

“‘The pleadings delimit the issues to be considered on a motion for summary judgment. [Citation.]’ [Citation.] Thus, a ‘defendant moving for summary judgment need address only the issues raised by the complaint; the plaintiff cannot bring up new, unpleaded issues in his or her opposing papers.’ [Citation.]” (Laabs v. City of Victorville (2008) 163 Cal.App.4th 1242, 1253].)

Here, the Complaint alleges the following. “On March 2, 2020, Plaintiffs entered into a warranty contract with FCA US LLC regarding a 2018 Jeep Wrangler Unlimited, VIN: 1C4HJWDG7JL938457, (‘the Subject Vehicle’).” (Compl., ¶ 15.) Defects and nonconformities to warranty manifested themselves within the applicable express warranty period, including but not limited to electrical, engine, and brakes. (Compl., ¶ 16.) The nonconformities substantially impair the use, value, and/or safety of the Subject Vehicle. (Compl., ¶ 17.) Plaintiffs delivered the Subject Vehicle to an authorized FCA repair facility to repair the nonconformities. (Compl., ¶ 18.) FCA could not conform the Subject Vehicle to the applicable express warranty after a reasonable number of repair attempts. (Compl., ¶ 19.)

FCA’s sole argument in the instant motion for summary judgment is that Plaintiff’s first cause of action for violation of the Song-Beverly Act – breach of express warranty of Action is barred because Plaintiffs purchased a “used” vehicle, which, according to the holding in Rodriguez v. FCA US LLC (2022) 77 Cal.App.5th 209 (rev. granted 295 Cal.Rptr.3d 351) (“Rodriguez”), is not considered a “new motor vehicle” under the Song-Beverly Consumer Warranty Act (the “Act” or “Song-Beverly Act”).

Plaintiffs do not deny that when they bought their vehicle, it had 18,615 miles. (See Plaintiffs’ Separate Statement of Undisputed Material Facts, filed April 16, 2024, ¶ 2, left column [arguing that there is no evidence to support that fact, but the document FCA has cited in the separate statement states that the odometer read 18,815 at purchase. Plaintiffs have not disputed that fact].)

In opposition, Plaintiffs argue that Jensen v. BMW of North America, Inc. (1995) 35 Cal.App.4th 112 (“Jensen”) is the sole binding authority directly addressing the definition of “new motor vehicle” in the Song-Beverly Act as applying to used cars sold with a still-pending warranty. Plaintiffs insist that Rodriguez is a non-binding case with no precedential effect.

Although the California Supreme Court has granted review of Rodriguez, the Supreme Court has stated that the case “may be cited, not only for its persuasive value, but also for the limited purpose of establishing the existence of a conflict in authority that would in turn allow trial courts to exercise discretion under [Auto Equity Sales, Inc. v. Superior Court (1962) 57 Cal.2d 450, 456], to choose between sides of any such conflict.” (Rodriguez v. FCA US (Cal. 2022) 295 Cal.Rptr.3d 351; Cal. Rules of Court, rule 8.1115(e)(3) [emphasis added].)

Therefore, to the extent there is a conflict between Jensen and Rodriguez, the Court has the discretion to choose which side to follow per the Supreme Court.

“‘The Song–Beverly Act is a remedial statute designed to protect consumers who have purchased products covered by an express warranty. [Citation.]’” (Martinez v. Kia Motors America, Inc. (2011) 193 Cal.App.4th 187, 191 (“Martinez”).)

Civil Code “[s]ection 1793.2 [“Section 1793.2”] incorporates several aspects of the Act’s comprehensive regulation of express warranties for consumer goods.” (National R.V., Inc. v. Foreman (1995) 34 Cal.App.4th 1072, 1077 (“National”).)

Where manufacturers give express warranties under the Act, Section 1793.2 “requires [those] manufacturers … to arrange for sufficient service and repair facilities to carry out the terms of warranties § 1793.2, subd. (a)); it sets a time limit for the repair of consumer goods (§ 1793.2, subd. (b)); it delineates rules for delivering nonconforming goods for service and repair (§ 1793.2, subd. (c)); and it requires a manufacturer to replace the consumer good or reimburse the buyer if the manufacturer or its representative is unable to repair the consumer good after a reasonable number of attempts (§ 1793.2, subd. (d)).” (National, supra, 34 Cal.App.4th at pp. 1077-1078.)

“Section 1793.2, subdivision (d)—the replace-or-refund provision of the Act—consists of two parts or paragraphs, one for consumer goods in general § 1793.2, subd. (d)(1)) and one strictly for new motor vehicles (§ 1793.2, subd. (d)(2)).” (National, supra, 34 Cal.App.4th at pp. 1078-1079 [footnote omitted].)

“[S]ubdivision (d)(2), differs from section 1793.2, subdivision (d)(1), in that it gives the new motor vehicle consumer the right to elect restitution in lieu of replacement, provides specific procedures for the motor vehicle manufacturer to follow in the case of replacement (subparagraph (A)) and in the case of restitution (subparagraph (B)), and sets forth rules for offsetting the amount attributed to the consumer’s use of the motor vehicle in the case of both replacement and restitution (subparagraph (C)). These ‘Lemon Law’ provisions clearly provide greater consumer protections to those who purchase new motor vehicles than are afforded under the general provisions of the Act to those who purchase other consumer goods under warranty.” (National, supra, 34 Cal.App.4th at pp. 1078-1079 [footnote omitted].)

The issue here is whether Plaintiff’s Vehicle is a “new motor vehicle” as that term is defined under Section 1793.22, subdivision (e)(2) (“Section 1793.22(e)(2)”).

“‘[The] fundamental task in interpreting a statute is to determine the Legislature’s intent so as to effectuate the law’s purpose.’ [Citation.]” (Ailanto Properties, Inc. v. City of Half Moon Bay (2006) 142 Cal.App.4th 572, 582 (“Ailanto”).) “[T]he process of determining legislative intent is one that may involve up to three steps.” (Ibid.)

The court starts by looking at the statutory language, and if it is clear, the court “‘must generally follow its plain meaning unless a literal interpretation would result in absurd consequences the Legislature did not intend.’ [Citation.]” (Ailanto, supra, 142 Cal.App.4th at p. 582; People v. Valencia (2017) 3 Cal.5th 347, 357 [“We have long recognized that the language used in a statute or constitutional provision should be given its ordinary meaning, and ‘[i]f the language is clear and unambiguous there is no need for construction, nor is it necessary to resort to indicia of the intent of the Legislature (in the case of a statute) or of the voters (in the case of a provision adopted by the voters).’ [Citation.] To that end, we generally must ‘accord[ ] significance, if possible, to every word, phrase and sentence in pursuance of the legislative purpose,’ and have warned that ‘[a] construction making some words surplusage is to be avoided.’ [Citation.]”].)

“When the plain language of the statute does not resolve the interpretive question, we proceed to the second step of our inquiry.” (Ailanto, supra, 142 Cal.App.4th at p. 582.)

“At [the second] stage, we ‘may turn to rules or maxims of construction “which serve as aids in the sense that they express familiar insights about conventional language usage.”’ [Citations.] In addition, ‘[i]f the statutory language permits more than one reasonable interpretation, courts may consider other aids, such as the statute’s purpose, legislative history, and public policy. [Citations.]’ [Citation.]” (Ailanto, supra, 142 Cal.App.4th at pp. 582-583.)

If the statute's meaning is still unclear, then in the third and final step, the court would apply “‘reason, practicality, and common sense to the language at hand.’ [Citation.]” (Ailanto, supra, 142 Cal.App.4th at p. 583.) “‘The words of the statute should be interpreted ‘to make them workable and reasonable.’ [Citation.] [The court would] also consider the consequences that will flow from a particular statutory interpretation.” (Id. at p. 583.)

1. Plain Meaning of the Phrase “Other Motor Vehicle Sold With a Manufacturer’s New Car Warranty”

a. This Court’s Interpretation of the Phrase

Section 1793.22(e)(2), the statute in question, states:

‘New motor vehicle’ means a new motor vehicle that is bought or used primarily for personal, family, or household purposes. ‘New motor vehicle’ also means a new motor vehicle with a gross vehicle weight under 10,000 pounds that is bought or used primarily for business purposes by a person, including a partnership, limited liability company, corporation, association, or any other legal entity, to which not more than five motor vehicles are registered in this state. ‘New motor vehicle’ includes the chassis, chassis cab, and that portion of a motor home devoted to its propulsion, but does not include any portion designed, used, or maintained primarily for human habitation, a dealer-owned vehicle and a ‘demonstrator’ or other motor vehicle sold with a manufacturer’s new car warranty but does not include a motorcycle or a motor vehicle which is not registered under the Vehicle Code because it is to be operated or used exclusively off the highways. A demonstrator is a vehicle assigned by a dealer for the purpose of demonstrating qualities and characteristics common to vehicles of the same or similar model and type.

(Emphasis added.)

The parties dispute whether the underlined portion includes “used cars” sold with a “remaining balance” on a manufacturer’s new car warranty.

As outlined above, courts start statutory interpretation by looking at the language of the bolded language above. If that language is clear, the Court can follow the plain meaning of that language unless a literal interpretation would result in absurd consequences.

Here, the use of the word “other” means that the words that come after that word (i.e., “motor vehicles sold with a manufacturer’s new car warranty”) represent a catchall category that encompasses dealer-owned and demonstrator motor vehicles. Otherwise, the word “other” would be unnecessary. To illustrate this catchall interpretation, the Court can remove the word “other” from Section 1793.22(e)(2), allowing the relevant portion to read: “‘New motor vehicle’ includes … a dealer-owned vehicle and a ‘demonstrator’ or motor vehicle sold with a manufacturer’s new car warranty ….” When the word “other” is excluded, the sentence appears to list three unrelated things (i.e., a dealer-owned vehicle, demonstrator, or motor vehicle sold with a manufacturer’s new car warranty). However, as stated above, the Court must avoid an interpretation that makes words surplusage. Here, the only way to give the word “other” meaning under Section 1793.22(e)(2), is to interpret the phrase “motor vehicle sold with a manufacturer’s new car warranty …” as a catchall category that includes dealer-owned vehicles and demonstrators.

Therefore, according to the plain meaning of the language of Section 1793.22(e)(2), the phrase “other motor vehicle sold with a manufacturer’s new car warranty …” means a motor vehicle that is like a dealer-owned vehicle and a demonstrator, which are encompassed within a group of motor vehicles sold with a manufacturer’s new car warranty.

However, the catchall interpretation still does not answer the question at issue: whether the phrase “other motor vehicle sold with a manufacturer’s new car warranty …” includes used cars that were sold with a remaining balance on the manufacturer’s new car warranty.

“[S]tatutory language cannot be read in isolation; like all language, statutory language takes its meaning from the context in which it appears.” (Monterey Peninsula Water Management Dist. v. Public Utilities Com. (2016) 62 Cal.4th 693, 699.)

Here, as stated above, Civil Code section 1793.2, subdivision (d)(2), which is part of the replace-or-refund provision of the Song-Beverly Act, strictly concerns “new motor vehicles.”

The opening paragraph of Civil Code section 1793.2 reveals that that section only concerns manufacturers of “consumer goods.” (See Civ. Code, § 1791, subd. (a) [“Every manufacturer of consumer goods sold in this state and for which the manufacturer has made an express warranty shall … [for example, maintain in California sufficient service and repair facilities]” (emphasis added)].)

The Song-Beverly Act defines “consumer goods” as all new products except assistive devices. (See Civ. Code, § 1791, subd. (a) [“‘Consumer goods’ means any new product or part thereof that is used, bought, or leased for use primarily for personal, family, or household purposes, except for clothing and consumables. ‘Consumer goods’ shall include new and used assistive devices sold at retail].)

The Act defines a manufacturer as “any individual, partnership, corporation, association, or other legal relationship that manufactures, assembles, or produces consumer goods.” (Civ. Code, § 1791, subd. (j) [emphasis added].)

The Act consistently distinguishes between “new” and “used” motor vehicles and “new” and “used” consumer goods. (Cf. Civ. Code, §§ 1793.23, subd. (h) [defining a “dealer” as a person engaged in the business of selling, offering for sale, or negotiating the retail sale of a “used motor vehicle,” among other things]; subd. (a)(2) [stating that the Legislature finds and declares that “used and irreparable motor vehicles” are being resold in the marketplace, and, thereby, distinguishing those types of vehicles from “new motor vehicles”]; 1795.5 [stating “[n]otwithstanding the provisions of subdivision (a) of Section 1791 defining consumer goods to mean ‘new’ goods, the obligation of a distributor or retail seller of used consumer goods in a sale in which an express warranty is given shall be the same as that imposed on manufacturers under this chapter except [that] …,” among other things, “the provisions of Section 1793.5 [which makes manufacturers liable to distributors and retailers for failing to have repair and service facilities] shall not apply to the sale of used consumer goods sold in this state” (subd. (b) [emphasis added]), thereby distinguishing new and used consumer goods].)

Therefore, FCA’s interpretation of Section 1793.22(e)(2), that the definition of “new motor vehicle” does not include used cars sold with a balance remaining on a manufacturer’s new car warranty, is reasonable.

However, Plaintiffs’ interpretation is also reasonable for the following reasons.

Civil Code section 1795.51 of the Song-Beverly Act refers to “a used vehicle” as that phrase is defined under “Vehicle Code section 665.” (See Civ. Code, § 1795.51, subd. (a) [“No buy-here-pay-here dealer, as that term is defined in Section 241 of the Vehicle Code, shall sell or lease a used vehicle, as defined in Section 665 of the Vehicle Code, at retail price without giving the buyer or lessee a written warranty that shall have a minimum duration of at least 30 days from the date of delivery or when the odometer has registered 1,000 miles from what is shown on the contract, whichever occurs first” (emphasis added)].)

“When the Legislature uses the same language in a related statute, we presume the Legislature intended the language to have the same meaning.” (Garibotti v. Hinkle (2015) 243 Cal.App.4th 470, 478; see also In re Do Kyung K. (2001) 88 Cal.App.4th 583, 589 [“‘To understand the intended meaning of a statutory phrase, we may consider use of the same or similar language in other statutes, because similar words or phrases in statutes in pari materia [that is, dealing with the same subject matter] ordinarily will be given the same interpretation.’ [Citations]”].)

Here, Vehicle Code section 665’s definition of a “used vehicle” includes “demonstrators.” (Veh. Code, § 665 [defining a “used vehicle” as “a vehicle that has been sold, or has been registered with the department, or has been sold and operated upon the highways, or has been registered with the appropriate agency of authority, of any other state, District of Columbia, territory or possession of the United States or foreign state, province or country, or unregistered vehicles regularly used or operated as demonstrators in the sales work of a dealer or unregistered vehicles regularly used or operated by a manufacturer in the sales or distribution work of such manufacturer. The word ‘sold’ does not include or extend to: (1) any sale made by a manufacturer or a distributor to a dealer …” (emphasis added)].)

Therefore, if the definition of “used vehicle” under the Song-Beverly Act is the same under Vehicle Code section 665, and, therefore, a demonstrator can be a “used vehicle,” then Plaintiff’s argument that the phrase “other motor vehicle sold with a manufacturer’s new car warranty” under Section 1793.22(e)(2) includes “used vehicles” sold with a remaining balance of a manufacturer’s new car warranty is reasonable.

b. Jensen’s Plain Meaning Interpretation of the Phrase “Other Motor Vehicle Sold With a Manufacturer’s New Car Warranty”

It is worth noting that in Jensen, the Third District Court of Appeal did not find Section 1793.22(e)(2) ambiguous.

The appellate court “conclude[d] [that] the words of section 1793.22 are reasonably free from ambiguity and cars sold with a balance remaining on the manufacturer’s new motor vehicle warranty are included within its definition of ‘new motor vehicle.’” (Jensen, supra, 35 Cal.App.4th at p. 123.) In so holding, the Court of Appeal did not consider the meaning of the word “other” and, therefore, did not find (as this Court has found above) that the phrase “motor vehicle sold with a manufacturer’s new car warranty” serves as a catchall phrase that includes demonstrators and dealer-owned vehicles. Instead, the Court found that “[t]he use of the word ‘or’ in the statute indicates ‘demonstrator’ and ‘other motor vehicle’ are intended as alternative or separate categories of ‘new motor vehicle’ if they are ‘sold with a manufacturer’s new car warranty.” (Ibid.)

c. Rodriguez’s Plain Meaning of the Phrase “Other Motor Vehicle Sold With a Manufacturer’s New Car Warranty”

Rodriguez’s reading of the statute is closer to this Court’s understanding of the phrase “other motor vehicle sold with a manufacturer’s new car warranty,” as the Court has discussed above.

In that case, the Fourth District Court of Appeal first “consider[ed] the broader statutory context in which the definition of ‘new motor vehicles’ applies before turning to the definition itself.” (Rodriguez, supra, 77 Cal.App.5th at p. 218.)

The appellate court started its relevant analysis by noting that “a hallmark of the Act is that its consumer protections apply against the party who sold the product to the buyer and issued the express warranty.” (Rodriguez, supra, 77 Cal.App.5th at p. 218.)

“With [that] framework in mind, [the Fourth District] turn[ed] to the refund-or-replace provision at issue and the definition of ‘new motor vehicle.’” (Rodriguez, supra, 77 Cal.App.5th at p. 218.)

Upon reviewing the language of Section 1793.22(e)(2), the Court of Appeal found it significant that the phrase “other motor vehicle sold with a manufacturer’s new car warranty” “appear[red] in a definition of new motor vehicles.” (Rodriguez, supra, 77 Cal.App.5th at p. 220 [italics removed].) “That fact alone [according to the Court of Appeal] strongly suggest[ed] [that] the Legislature did not intend the phrase to refer to used (i.e., previously sold) vehicles. But, more importantly, the phrase is preceded by ‘a dealer-owned vehicle and demonstrator,’ which comprise a specific and narrow class of vehicles. Though they have not been previously sold to a consumer, demonstrators and dealer-owned cars are used in the sense that they will have been driven for various purposes before sale. As such, they will necessarily have more miles on their odometers than the typical vehicle in a dealer’s new car inventory. What makes these vehicles unique is that even though they aren't technically new, manufacturers (or their dealer-representatives) treat them as such upon sale by providing the same type of manufacturer's warranty that accompany new cars. ¶ In other words, demonstrators and dealer-owned vehicles comprise a narrow category of basically new vehicles—they have never been previously sold to a consumer and they come with full express warranties.” (Ibid. [italics removed].)

Given that context, that demonstrators and dealer-owned vehicles are “basically new” vehicles, the Fourth District in Rodriguez, like the Court in Jensen, found that Section 1793.22(e)(2) was not ambiguous.

However, unlike in Jensen where the Third District found that the phrase “other motor vehicle sold with a manufacturer’s new car warranty” includes used cars sold with a balance remaining on the manufacturer’s new motor vehicle warranty, the Court of Appeal in Rodriguez found that the statute was not ambiguous as to the opposite; the phrase did not include those type of cars.

The Rodriguez court held: “[W]e think the most natural interpretation of the phrase ‘other motor vehicle sold with a manufacturer’s new car warranty’ is that it, too, refers to vehicles that have never been previously sold to a consumer and come with full express warranties.” (Rodriguez, supra, 77 Cal.App.5th at p. 220.)

In so holding, the Rodriguez court rejected the plaintiff’s argument that “the phrase ‘other motor vehicle sold with a manufacturer’s new car warranty’ as a distinct item in a list of three types of vehicles—a standalone category of previously sold vehicles that are conceptually distinct from dealer-owned vehicles and demonstrators.” (Rodriguez, supra, 77 Cal.App.5th at p. 220.) According to the appellate court, “the provision’s grammatical structure signals the list contains two types of vehicles, not three. If the list contained three distinct types of vehicles, we would expect to see commas separating the types. Instead, the use of ‘and’ and ‘or’ to separate the three items indicates the Legislature structured the provision as a list of two vehicles (dealer-owned vehicles ‘and’ demonstrators) followed by an adjectival clause qualifying or describing those vehicles.” (Ibid.) “[That grammatical] organization reveals that, rather than create a new and different class of vehicles, the phrase was intended to function as a catchall provision to cover a narrow class vehicle—the previously driven, but basically new (i.e., not previously sold) car.” (Ibid. [emphasis added].)

To the Rodriguez court, “nothing about the wording or structure of the provision indicates the Legislature intended to expand the definition of ‘new motor vehicle’ to include used vehicles sold with some part of the manufacturer's warranty still in force. And the expansion would be a significant one, as there is no standard length for the express warranties that manufacturers issue. Some bumper-to-bumper warranties last for one year or 12,000 miles while others for five years and 60,000 miles, and some limited warranties last 10 years or more. Even a warranty like the one [in Rodriguez]—three years or 36,000 miles—could see several different owners before it expires.” (Rodriguez, supra, 77 Cal.App.5th at p. 221.)

“[I]f the Legislature intended to expand the definition of “new motor vehicle” to include a potentially vast category of used cars …,” the Rodriguez court opined, “it would have done so more clearly and explicitly than tucking it into a reference to demonstrators and dealer-owned vehicles. (Rodriguez, supra, 77 Cal.App.5th at p. 221.)

The Fourth District’s “examination of the entire Act yield[ed] two additional reasons for concluding the phrase doesn’t cover subsequent sales of vehicles with unexpired manufacturer’s warranties.” (Rodriguez, supra, 77 Cal.App.5th at p. 222.)

“First, the Act defines ‘express warranty’ as any ‘written statement arising out of a sale to the consumer of a consumer good pursuant to which the manufacturer ... undertakes to preserve or maintain the utility or performance of the consumer good ....’ (§ 1791.2, subd. (a)(1), italics added.) In [the] plaintiffs’ case [in Rodriguez], the limited powertrain warranty did not ‘aris[e] out of’ the sale, [because] it transferred to [the] plaintiffs by operation of law along with title to the truck. The warranty arose from the initial sale to the truck’s first buyer.” (Rodriguez, supra, 77 Cal.App.5th at p. 222.)

“Second, as part of the Motor Vehicle Warranty Adjustment Programs ([Civ. Code] §§ 1795.90-1795.93), the Act requires manufacturers to notify all ‘consumers’ of any warranty adjustments regarding safety or emissions-related recalls, and defines ‘consumer’ as ‘any person to whom the motor vehicle is transferred during the duration of an express warranty.’ (§ 1795.90, subd. (a), italics added.) This definition of ‘consumer’ indicates the Legislature is aware of the distinction between warranties that arise out of a sale and those that transfer to subsequent purchasers as a result of a sale. The lack of reference to transferred warranties in the definition of ‘new motor vehicle’ suggests the Legislature made a deliberate choice not to include sales of used vehicles accompanied by unexpired express warranties.” (Rodriguez, supra, 77 Cal.App.5th at p. 222.)

“Based on all of these textual reasons, [the Fourth District] conclude[d] the phrase ‘other motor vehicle sold with a manufacturer’s new car warranty’ unambiguously refers to cars that come with a new or full express warranty.” (Rodriguez, supra, 77 Cal.App.5th at p. 222.)

Notwithstanding the above, the Court disregards the Plaintiffs’ argument that Rodriguez incorrectly assumed that demonstrators come with full warranty because the Court has sustained FCA’s objection to the document the Plaintiffs rely on to support that argument.

Accordingly, since the statutory language of Section 1793.22(e)(2) permits more than one reasonable interpretation, the Court will proceed to the second step of statutory interpretation and “consider other aids, such as the statute’s purpose, legislative history, and public policy. [Citations.]’ [Citation.]” (Ailanto, supra, 142 Cal.App.4th at pp. 582-583.)

2. Legislative History of the Phrase “Other Motor Vehicle Sold With a Manufacturer’s New Car Warranty” According to Jensen and Rodriguez

Despite finding the phrase “other motor vehicle sold with a manufacturer’s new car warranty” unambiguous, both Jensen and Rodriguez considered the legislative history of the statute. (Jensen, supra, 35 Cal.App.4th at p. 123 [“because the peculiar grammatical structure of [Section 1793.22(e)(2)] makes [manufacturer] BMW’s argument at least superficially plausible, we also consider the legislative history [of Section 1793.22(e)(2)]”]; Rodriguez, supra, 77 Cal.App.5th at p. 222 [“But even if this meaning weren’t readily apparent from the statute, the Act’s legislative history would convince us the phrase refers to vehicles sold with full warranties”].)

In Jensen, the Third District Court of Appeal “reviewed the amendments to former section 1793.2, documents relating to those legislative proceedings, and the statutory scheme as a whole, [and] conclude[d] the plain meaning and the legislative intent [of the phrase at issue] are one and the same.” (Jensen, supra, 35 Cal.App.4th at p. 123.)

According to the appellate court, the “amendments show the Legislature has systematically attempted to address warranty problems unique to motor vehicles, including transferability and mobility. As [that] case demonstrate[d], there [was] a national wholesale market for previously owned cars, including those under manufacturers’ warranty.” (Jensen, supra, 35 Cal.App.4th at p. 124.)

In Rodriguez, the Court of Appeal noted that the phrase “other motor vehicle sold with a manufacturer’s new car warranty,” “was added to the Act’s definition of ‘new motor vehicle’ in 1987 with the enactment of Assembly Bill Number 2057 (“AB 2057”).” (Rodriguez, supra, 77 Cal.App.5th at p. 222.)

The appellate court looked at AB 2057 and “found no reference to used vehicles in any of the legislative materials regarding Assembly Bill Number 2057. [The Court stated that] [o]ne would assume that if the amendment proposed to expand manufacturers’ liability under the Act to a large class of used vehicles, such a change to the status quo would warrant mention if not discussion.” (Rodriguez, supra, 77 Cal.App.5th at p. 223.) According to the Court of Appeal: “The enrolled bill report explains that our lawmakers deemed it necessary to add ‘dealer-owned vehicles and “demonstrator” vehicles sold with a manufacturer’s new car warranty’ to the definition of ‘new motor vehicles’ because ‘[s]ome buyers [were] being denied the remedies under the lemon law because their vehicle is a “demonstrator” or “dealer-owned” car, even though it was sold with a new car warranty.’ [Citation.] This discussion indicates the amendment was intended to provide relief to a narrow class of consumers by targeting a specific type of vehicle—the basically new car.” (Rodriguez, supra, 77 Cal.App.5th at pp. 222-223.)

Given that legislative history does not definitively reveal the answer, Jensen (but not Rodriguez) analyzed the final step in statutory construction: applying reason, practicality, and common sense to the language at issue. (Ailanto, supra, 142 Cal.App.4th at p. 583.)

3. Reason, Practicality, and Common Sense

“Addressing the final step in statutory construction which applies reason, practicality, and common sense to the language in question [citation], BMW [in Jensen] argue[d] the Legislature could not have intended to grant protection to every used car with a balance remaining on the new car warranty because of the economic impact on consumers.” (Jensen, supra, 35 Cal.App.4th at p. 126.)

To that argument, the Jensen court responded: “We acknowledge manufacturers such as BMW incur costs in honoring express warranties to service and repair the cars they sell in this state. We also presume the decision to offer a warranty of a specified length involves weighing the benefit of increased sales against the cost of providing service and repair for the effective duration of the warranty. It may be the equation factors in the impact of resale during the warranty period. However, as noted by BMW, manufacturers are free to change the terms of express warranties they offer. The Act merely reflects the Legislature’s intent to make car manufacturers live up to their express warranties, whatever the duration of coverage.” (Jensen, supra, 35 Cal.App.4th at p. 127.)

This Court finds that reason, practicality, and common sense favor reading the phrase “other motor vehicle sold with a manufacturer’s new car warranty” as a catchall phrase that includes a dealer-owned vehicle and a demonstrator. Otherwise, as discussed above at the beginning of this analysis, the Legislature would not have included the word “other” after specifying a dealer-owned vehicle and a demonstrator.

Notwithstanding that ruling, Plaintiffs have raised a valid point that there is an assumption that dealer-owned vehicles and demonstrators come with “a manufacturer’s new car warranty.”

However, that presumption has not been proven or disproven even though it is necessary for this Court to find that the Plaintiffs’ vehicle does not meet the definition of “other motor vehicle sold with a manufacturer’s new car warranty.”

For those reasons, the Court finds it proper to deny the motion for summary judgment. At the hearing the parties may also discuss staying the hearing or continuing trial until the California Supreme Court decides Rodriguez.

CONCLUSION

Defendant’s motion for summary judgment is DENIED.

Dated: April 30, 2024 ___________________________________

Joel L. Lofton

Judge of the Superior Court