Judge: Serena R. Murillo, Case: 22STCV02000, Date: 2023-08-14 Tentative Ruling
Case Number: 22STCV02000 Hearing Date: August 14, 2023 Dept: 31
TENTATIVE
BMW of North
America, LLC’s unopposed motion for judgment on the pleadings is DENIED.
Request
for Judicial Notice
Defendant seeks judicial notice of the
following items: (1) Plaintiff’s purchase agreement for the subject vehicle;
(2) the warranty booklet; (3) a minute order from a Los Angeles Superior Court
case, Brian McLcucas v. Kia, America, Inc., case number 21CMCV00317,
June 7, 2022, granting defendant KIA America, Inc.’s motion for judgment on the
pleadings on the basis that plaintiff’s used vehicle purchased without a new
warranty issued at the time does not qualify under Song-Beverly as a “new”
vehicle; (4) CACI 3210 model jury instruction for breach of implied warranty of
merchantability, CACI 3201 model jury instruction for failure to promptly
repurchase or replace a new motor vehicle, and CACI 3211 model jury instruction
for breach of implied warranty of fitness for a particular purpose; and (5) BMW
NA’s official website establishing that BMW NA is a distributor, and not a
manufacturer or retail seller of BMW vehicles in North America.
Defendant’s request for judicial notice of the purchase
agreement and warranty booklet are GRANTED. Plaintiff attaches these documents
to the complaint. (See City of Port Hueneme v. Oxnard Harbor Dist. (2007) 146
Cal.App.4th 511, 513-514.) However, the Court will not take judicial notice of
the truth of the matters asserted within the letter.
Defendant’s request for judicial notice of the minute
order is GRANTED pursuant to Evidence Code section 452(d). However, the Court
will not take judicial notice of the truth of the matters asserted.
The request for the model jury instructions
is GRANTED pursuant to Evidence Code section 452(h).)
The request for judicial notice of information on BMW’s
website is DENIED. “Simply because
information is on the Internet does not mean that it is not reasonably subject
to dispute.” (Jolley v. Chase Home Finance, LLC (2013) 213
Cal.App.4th 872, 889.)
Legal Standard
A defendant may move for judgment on the pleadings where the court has no jurisdiction of the subject of the cause
of action alleged in the complaint or the complaint does not state facts sufficient to
constitute a cause of action against that defendant. (Code Civ. Proc., §
438 subd. (c)(1)(B).) A non-statutory motion for judgment on the
pleadings may be made any time before or during trial. (Stoops v. Abbassi (2002) 100 Cal.App.4th 644, 650.) “Such motion may
be made on the same ground as those supporting a general demurrer, i.e., that
the pleading at issue fails to state facts sufficient to constitute a legally
cognizable claim or defense.” (Ibid.)
“In the construction of a pleading, for the purpose of
determining its effect, its allegations must be liberally construed, with a
view to substantial justice between the parties.” (Code Civ. Proc., §
452; see also Stevens v. Superior Court (1999) 75 Cal.App.4th 594, 601.) “When a
court evaluates a complaint, the plaintiff is entitled to reasonable inferences
from the facts pled.” (Duval v. Board of Tr. (2001) 93 Cal.App.4th 902, 906.) “In deciding or reviewing a judgment on the pleadings,
all properly pleaded material facts are deemed to be true, as well as all facts
that may be implied or inferred from those expressly alleged.” (Fire
Ins. Exch. v. Superior Court (2004) 116 Cal.App.4th 446, 452.) A motion for
judgment on the pleadings normally does not lie as to a portion of a cause of
action. (Ibid.) “In the case of either a demurrer or a motion for
judgment on the pleadings, leave to amend should be granted if there is any
reasonable possibility that the plaintiff can state a good cause of
action.” (Gami v. Mullikin Medical Ctr. (1993) 18 Cal.App.4th 870, 876.)
Meet and Confer
The motion is accompanied by the
declaration of Abtin Amir, which satisfies the meet and confer
requirements. (Code Civ. Proc. § 439(a)(2).)
Discussion
First Cause of Action for Violation of Song Beverly Consumer Warranty
Act
Defendant
moves for judgment on the pleadings, on the basis that Plaintiff bought her
vehicle used without a new warranty, and as a result, her cause of action for Violation
of Song Beverly Consumer Warranty Act fails to state a cause of action. Defendant argues that the Song-Beverly
Act’s express warranty provisions apply only to “new motor vehicles,” not
Plaintiffs’ used vehicle. Defendant relies exclusively on Rodriguez v.
FCA US, LLC (2022) 77 Cal.App.5th 209 (Rodriguez). The
California Supreme Court has granted review of Rodriguez and, when doing
so, stated that the Court of Appeal opinion “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 [citation],
to choose between sides of any such conflict.” (Rodriguez v. FCA US
(Cal. 2022) 295 Cal.Rptr.3d 351.)
A “new motor vehicle” includes “a dealer-owned vehicle and a
‘demonstrator’ or other motor vehicle sold with a manufacturer’s new car
warranty.” (Civ. Code, § 1793.22, subd. (e)(2).) The Rodriguez
court “acknowledge[d] that in isolation the phrase ‘other motor vehicle sold
with a manufacturer’s new car warranty’ could arguably refer to any car sold
with a manufacturer’s warranty still in force,” but it agreed “that context
clearly requires a more narrow interpretation.” (Rodriguez, supra,
77 Cal.App.5th at p. 220.) The court noted that “the phrase appears in a
definition of new motor vehicles,” strongly suggesting that “the
Legislature did not intend the phrase to refer to used (i.e., previously sold)
vehicles.” (Ibid.) The court also noted that “more
importantly, the phrase is preceded by ‘a dealer-owned vehicle and
demonstrator,’ which comprise a specific and narrow class of vehicles.” (Ibid.)
The Rodriguez court therefore concluded that “the phrase ‘other motor vehicles
sold with a manufacturer’s new car warranty’ refers to cars sold with a full
warranty, not to previously sold cars accompanied by some balance of the
original warranty.” (Id. at p. 225.)
On the other hand, the Court of Appeal in Jensen v. BMW of
North America, Inc. (1995) 35 Cal.App.4th 112 (Jensen) previously
concluded that “cars sold with a balance remaining on the manufacturer’s new
motor vehicle warranty are included within its definition of ‘new motor
vehicle.’” (Id. at p. 123.) The court determined that “the
words of section 1793.22 are reasonably free from ambiguity” because “[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.)
The court also considered the legislative history of the statute due to the
“peculiar grammatical structure” of the section. (Ibid.)
After reviewing the amendments to former section 1793.2, documents relating to
those legislative proceedings, and the statutory scheme as a whole, the court
“conclude[d] the plain meaning and the legislative intent are one and the
same.” (Ibid.)
The Rodriguez court distinguished Jensen as
involving a lease by a manufacturer-affiliated dealer who issued a full new car
warranty along with the lease. (Rodriguez, supra, 77 Cal.App.5th
at p. 223.) However, those facts were not relevant to the Jensen
court’s interpretation of the statute based on the statute’s plain meaning and
legislative intent. (See Jensen, supra, 35 Cal.App.4th at pp.
122-127.)
The Court finds the reasoning and holding of Jensen
more persuasive and more consistent with the plain language and legislative
history of the statute. Accordingly, Plaintiff’s used vehicle with a
balance of coverage remaining under the Warranty is not excluded from the
Song-Beverly Act’s express warranty provisions. The motion is DENIED as to the
first cause of action.
Second Cause of Action
for Breach of Implied Warranty of Merchantability
Defendant also argues that Plaintiff’s
cause of action for breach of implied warranty of merchantability do not apply
to Defendant BMW of North America, LLC, because it is a distributor, and not a
manufacturer or retail seller (the only types of defendants who can be liable
for such implied warranties under the plain terms of the Act).
The
Song-Beverly Act defines the implied warranties that accompany the sale of
consumer goods, and it permits a buyer to bring an action for damages and other
relief when the implied warranties are breached. (See Civ. Code, §§
1791.1, 1794.) “[I]n the sale of used consumer goods, liability for
breach of implied warranty lies with distributors and retailers, not the
manufacturer, where there is no evidence the manufacturer
played any role in the sale of the used car to plaintiff.” (Nunez v.
FCA US LLC (2021) 61 Cal.App.5th 385, 398 (Nunez).) “[O]nly distributors or
sellers of used goods—not manufacturers of new goods—have implied
warranty obligations in the sale of used goods.” (Id. at p.
399.)
A distributor is
an entity "that stands between the manufacturer and the retail seller in
purchases, consignments, or contracts for sale of consumer goods." (§
1791, subd. (e).)
Thus, because under Nunez,
distributors can be liable for beach of implied warranty in the sale of used
cars, the motion for judgment on the pleadings is denied as to this cause of
action.
Third Cause of
Action for Negligent Repair
Defendant next argues that
Plaintiff’s cause of action for negligent repair is barred by the economic
loss doctrine which prohibits Plaintiff from seeking tort remedies for
contractual claims without any allegation of personal injury or other loss
that falls within any exception to this doctrine.
Economic loss
consists of “‘damages for inadequate value, costs of repair and replacement of
the defective product or consequent loss of profits—without any claim of
personal injury or damages to other property....’
”
[Citation.]” [Citation.] Simply stated, the economic loss rule provides:
“‘“[W]here a purchaser's expectations in a sale are frustrated because the
product he bought is not working properly, his remedy is said to be in contract
alone, for he has suffered only ‘economic’ losses.”' This doctrine hinges on a
distinction drawn between transactions involving the sale of goods for
commercial purposes where economic expectations are protected by commercial and
contract law, and those involving the sale of defective products to individual
consumers who are injured in a manner which has traditionally been remedied by
resort to the law of torts.” [Citation.] The economic loss rule requires a
purchaser to recover in contract for purely economic loss due to disappointed
expectations, unless he can demonstrate harm above and beyond a broken
contractual promise. [Citation.] Quite simply, the economic loss rule
“prevent[s] the law of contract and the law of tort from dissolving one into
the other.” [Citation.]
In Jimenez v.
Superior Court [(2002) 29 Cal.4th 473], we set forth the rationale for the
economic loss rule: “‘The distinction that the law has drawn between tort recovery
for physical injuries and warranty recovery for economic loss is not arbitrary
and does not rest on the “luck” of one plaintiff in having an accident causing
physical injury. The distinction rests, rather, on an understanding of the
nature of the responsibility a manufacturer must undertake in distributing his
products.’ [Citation.] We concluded that the nature of this responsibility
meant that a manufacturer could appropriately be held liable for physical
injuries (including both personal injury and damage to property other than the
product itself), regardless of the terms of any warranty. [Citation.] But the
manufacturer could not be held liable for ‘the level of performance of his
products in the consumer's business unless he agrees that the product was
designed to meet the consumer's demands.’ [Citation.]” [Citation.]
(Robinson
Helicopter Co., Inc. v. Dana Corp. (2004) 34 Cal.4th 979, 988-989.)
“Tort damages
have been permitted in contract cases where a breach of duty directly causes physical
injury [citation]; for breach of the covenant of good faith and fair dealing in
insurance contracts [citation]; for wrongful discharge in violation of
fundamental public policy [citation]; or where the contract was fraudulently
induced. [Citation.]” [Citation.] “[I]n 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.
[Citation.]”
(Id. at
989-990.) The court in Robinson Helicopter found that the defendant’s
alleged misrepresentations in supplying false certificates of conformance, upon
which the plaintiff justifiably relied by accepting delivery and using the
nonconforming products, constituted conduct separate from the breach of
contract claim based on the provision of the nonconforming products. (Id.
at 990-991.) Thus, the court found that the fraud was a tort independent of the
contract breach and the economic loss rule did not bar the fraud claims. (Id.
at 991.)
Here, Plaintiff
alleges a cause of action for misrepresentation, which if successful, would amount
to a tort independent of the breach of contract.
Fourth Cause
of Action for Misrepresentation
Defendant argues the cause of
action for misrepresentation fails because it is undisputed that neither BMW NA
nor MINI of Universal City sold this vehicle to Plaintiff, and it is
undisputed that BMW NA did not perform any repairs to this vehicle (negligent
or otherwise).
The elements of fraud
are: “(a) misrepresentation (false representation, concealment, or
nondisclosure); (b) knowledge of falsity (or ‘scienter’); (c) intent to
defraud, i.e., to induce reliance; (d) justifiable reliance; and (e) resulting
damage.” (Charnay v. Cobert (2006) 145 Cal.App.4th 170, 184.)
However, the misrepresentation
cause of action is based in part on the allegations that Defendants represented
to Plaintiff that Plaintiff’s vehicle did not qualify for repurchase, and that
Plaintiff’s vehicle was not subject to repurchase under California’s Lemon
Laws. (Complaint, ¶ 88.) While Plaintiff alleges she purchased the car from
Autowholesale (Id., ¶ 10), and serviced the car with Mini, elsewhere in the
complaint, she alleges that BMWNA has willfully denied a repurchase every time.
(Complaint, ¶ 41.)
As a result, Defendant’s motion
for judgment on the pleadings is DENIED.
Conclusion
Accordingly, BMW
of North America, LLC’s motion for judgment on the pleadings is DENIED.
Moving party is ordered to give notice.