Judge: Lee W. Tsao, Case: 22NWCV01324, Date: 2023-05-09 Tentative Ruling

Case Number: 22NWCV01324    Hearing Date: May 9, 2023    Dept: C

GRANADOS v. WALTERS AUTO SALES AND SERVICE, INC.

CASE NO.:  22NWCV01324

HEARING:  5/9/23 @ 9:30 AM

 

#1

TENTATIVE RULING

 

I.             Defendant Mercedes-Benz USA, LLC’s demurrer to Plaintiff’s complaint is SUSTAINED without leave to amend. 

 

II.            Defendant Walters Auto Sales and Service, Inc.’s demurrer to Plaintiff’s complaint is SUSTAINED with 10 days leave to amend.

 

Moving Parties to give NOTICE.

 

 

Defendants Mercedes-Benz USA, LLC and Walters Auto Sales and Service, Inc. demurs to the complaint ground that the claims fail to state facts sufficient to constitute a cause of action. 

 

Plaintiffs Gloria Granados and Hector Jimenez allege that “[o] n December 28, 2018, Plaintiffs entered into a warranty contract with MERCEDES-BENZ regarding a 2019 Mercedes-Benz C-Class, VIN: 55SWF8DB2KU294717, ("the SubjectVehicle”). The terms of the express warranty are described in full in Exhibit 1.”  (Complaint, ¶ 14.)  “Defects and nonconformities to warranty manifested themselves within the applicable express warranty period, including but not limited to transmission.”  (Id., ¶ 15.)  “The nonconformities substantially impair the use, value and/or safety of the Subject Vehicle.”  (Id., ¶ 16.)  “Plaintiffs delivered the Subject Vehicle to an authorized MERCEDES-BENZ repair facility for repair of the nonconformities.”  (Id., ¶ 17.)  Defendant was unable to conform the Subject Vehicle to the applicable express warranty after a reasonable number of repair attempts.”  (Id., ¶ 18.)  “Under the Song-Beverly Act, Defendant had an affirmative duty to promptly offer to repurchase or replace the Subject Vehicle at the time if failed to conform the Subject Vehicle to the terms of the express warranty after a reasonable number of repair attempts.”  (Id., ¶ 19.)  “Defendant MERCEDES-BENZ has failed to either promptly replace the Subject Vehicle or to promptly make restitution in accordance with the Song-Beverly Act.”  (Id., ¶ 20.)  “Plaintiffs delivered the Subject Vehicle to Defendant WALTER’S MERCEDES-BENZ OF RIVERSIDE for repair of on numerous occasions.”  (Id., ¶ 27.)  “Defendant WALTER’S MERCEDES-BENZ OF RIVERSIDE owed a duty to Plaintiffs to use ordinary care and skill in storage, preparation and repair of the Subject Vehicle in accordance with industry standards.”  (Id., ¶ 28.)  “Defendant WALTER’S MERCEDES-BENZ OF RIVERSIDE breached its duty to Plaintiffs to use ordinary care and skill by failing to properly store, prepare and repair of the Subject Vehicle in accordance with industry standards.”  (Id., ¶ 29.)  “Defendant WALTER’S MERCEDES-BENZ OF RIVERSIDE’s negligent breach of its duties owed to Plaintiffs was a proximate cause of Plaintiffs’ damages.”  (Id., ¶ 20.)  Based thereon, the Complaint asserts causes of action for:

 

1.    Violation of Song-Beverly – Breach of Express Warranty (v. Mercedes)

2.    Negligent Repair (v. Walters Auto)

 

1st CAUSE OF ACTION

 

VIOLATION OF SONG-BEVERLY:  Used car purchasers who do not receive a new warranty from the distributor/manufacturer defendant in connection with the sale, lack standing to bring claims under the Song-Beverly Act. Such rights are created only for purchasers of “new motor vehicles,” which are defined as brand-new vehicles or nearly new vehicles with new warranties issued in connection with the sale.  (Rodriguez v. FCA US, LLC (2022) 77 Cal.App.5th 209.)

 

Used goods are not considered “consumer goods” except in certain limited circumstances and only as it pertains to distributors of used goods and sellers of used goods, not the manufacturer/original warrantor. (CC §§ 1791 and 1795.5.)

 

Plaintiffs did not oppose Mercedes’s demurrer.  Accordingly, the demurrer is SUSTAINED without leave to amend.

 

2nd CAUSE OF ACTION

 

NEGLIGENT REPAIR: The elements are: 1) Legal duty owed to plaintiffs to use due care; 2) breach of duty; 3) causation; and 4) damage to plaintiff. (Ladd v. County of San Mateo (1996) 12 Cal.4th 913, 917.)

 

The economic loss rule provides that “where a purchaser’s expectations in a sale are frustrated because the product he bought is not working properly, his [or her] remedy is said to be in contract alone, for he [or she] has suffered only economic losses.” (Robinson Helicopter Co., Inc. v. Dana Corp. (2004) 34 Cal.4th 988.)  “Tort damages have been permitted in contract cases where a breach of duty directly causes physical injury; for breach of the covenant of good faith and fair dealing in insurance contracts; for wrongful discharge in violation of fundamental public policy; or where the contract was fraudulently induced…. in each of these cases, the duty that gives rise to tort liability is either completely independent of the contract or arises from conduct which is both intentional and intended to harm.”  (Robinson, supra, 34 Cal.4th at 989–990.)

 

In Robinson, the California Supreme Court carved out a “narrow” and “limited” exception to the economic loss rule, holding that “a defendant's affirmative misrepresentations on which a plaintiff relies and which expose a plaintiff to liability for personal damages independent of the plaintiff's economic loss” is excluded from the economic loss rule. (Robinson, supra, 34 Cal.4th at 993.)

 

Here, Plaintiff alleges a claim for negligent repair, which does not fall within the narrow exceptions carved out by the California Supreme Court in Robinson. Plaintiff does not allege that Defendant engaged in any intentional misconduct or made any affirmative misrepresentations.

 

Plaintiff asserts that “California courts clearly recognize an exception to the economic loss rule in cases involving negligent performance of services.” (Opp. p. 4.) In support of this claim, Plaintiff relies upon North American Chemical Co. v. Superior Court (1997) 59 Cal.App.4th 764 and Robinson Helicopter Co., Inc. v. Dana Corp. (2004) 34 Cal.4th 979.  Various courts have questioned the validity of North American Chemical and this court declines to follow it. As previously discussed, the California Supreme Court’s opinion in Robinson provides no support for Plaintiff’s position.  Accordingly, the economic loss rule bars Plaintiff’s recovery under the second cause of action.

 

The demurrer to the 2nd cause of action is SUSTAINED with 10 days leave to amend.