An interesting appellate case upheld a jury verdict in favor of a woman who bought a new Mercedez-Benz C320. Isip v. Mercedes-Benz USA, LLC, (Sept. 12, 2007; Review Denied Nov. 28, 2007) 155 Cal. App. 4th 19.
The buyer’s new car soon car began to issue headache-inducing smells, lurch like a slingshot when shifting gears, hesitate and pull when slowing down, besides tugging, clanking, leaking and emitting white smoke. Nobody seemed to be able to fix it even though the car could be driven.
The buyer claimed breach of the implied warranty of merchantability applicable to consumer goods under the Federal Magnuson-Moss Warranty Act and California Song-Beverly Consumer Warranty Act. The jury found for the buyer after being instructed that to meet the implied warranty of merchantability, the car must be “in a safe condition and substantially free of defects.” Pp. 23, 25-26. Mercedez-Benz USA argued that the verdict should be reversed because the proper test of merchantability was the lower standard of whether the car was “unfit for ordinary transportation.” P. 25.
The court relied on the Uniform Commercial Code Sections to uphold the jury instructions. UCC Section 2-314 (Ca. Commercial Code 2314) provides that goods must be “merchantable” and “fit for the ordinary purpose” for which they are intended. UCC Section 2-315 (Ca. Commercial Code 2315) establishes an implied statutory warranty of fitness for a particular purpose. The court held that the “core test of merchantability” is “fitness for the ordinary purpose for which goods are used.”
Mere transportation from point A to point B did not meet the warranty of merchantability. The court rejected the lower “fitness for ordinary transportation” language. The buyer did not have to settle for a vehicle that “smells, lurches, clanks, and emits white smoke over an extended period of time.” P. 27. Especially when the buyer paid more than $46,000 for the car!