L. SCOTT COOGLER, UNITED STATES DISTRICT JUDGE.
Plaintiffs Brett and Jessica LaFerrera (the "LaFerreras") sued Defendants Emerald Coast RV Center LLC d/b/a Camping World RV Sales ("Camping World") and Thor Motor Coach ("Thor") because of
Brett and Jessica LaFerrera purchased a Palazzo motor home in October 2013 from Camping World. The Palazzo line of motor homes was manufactured by Thor. While using the Palazzo, the LaFerreras experienced repeated problems with it, and they discussed trading it in for a different model. They largely dealt with Steve Schriver, who was the general manager of Camping World at the time, but they also spoke with Phil Houser of Thor during the trade-in process. The parties eventually agreed that the LaFerreras would trade the Palazzo for a Tuscany model motor home, which was also manufactured by Thor. Thor gave Camping World $5,000 to facilitate the trade-in and to obtain a release of liability for any claims related to the Palazzo.
Thor provided a written one year limited warranty on the Tuscany beginning on October 31, 2013.
Camping World and the LaFerreras entered into a sales agreement that was separate from the warranty provided by Thor. This agreement stated that Camping World sold the Tuscany "`AS IS', WITH NO EXPRESS OR IMPLIED WARRANTIES." (Doc. 62-14 at 2). It also stated,
(Doc. 62-14 at 3). Moreover, the agreement contained a merger clause that said the written document contained the entire agreement between the parties. It — along with an acknowledgement of receipt of warranty document provided by Thor — also stated that the Tuscany had eight miles on its odometer. However, Defendants have admitted that the mileage was actually closer to 800 miles because it was driven from Indiana to Alabama after manufacturing. Regardless, they contend that the odometer always showed the correct mileage. Brett LaFerrera insists he saw the number eight on the odometer when he purchased the Tuscany and did not know that it was driven from Indiana to Alabama.
Following the purchase, the LaFerreras experienced several problems with the Tuscany. The motor home would lose electrical power sporadically, specifically in the dash control panel. The washing machine and dishwasher did not drain. The windshield was cracked and would leak, and the heat and air conditioning failed at times. The motor home vibrated because of alignment issues, and one of its TVs was scratched.
On June 19, 2014, the LaFerreras agreed to release both Thor and Camping World:
(Doc. 62-17 at 2) (release executed on June 19, 2014). In exchange for the release, Thor provided the LaFerreras a one year warranty beginning November 1, 2014, the day after the original warranty expired. The release does not address the Tuscany, other than as stated above. It also does not mention what Thor or Camping World knew about the Tuscany's problems. Further, the LaFerreras have not provided any parol evidence concerning any other relevant representations made at or about the time of the release.
Thor returned the Tuscany to the LaFerreras on October 6, 2014, and Brett LaFerrera stated that someone from Thor or Camping World told him they could not identify and fix the electrical failure with the dash control panel. Two days later, on October 8, 2014, Brett LaFerrera drove the Tuscany from Alabama to Dixie Motors in New Orleans, Louisiana and traded it for a different RV made by a different manufacturer. Although Brett LaFerrera stated that some of the problems were not fixed, he did not experience any problems while driving the Tuscany to New Orleans. The LaFerreras filed this lawsuit on March 20, 2015.
Summary judgment is appropriate "if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a). A fact is "material" if it "might affect the outcome of the suit under the governing law." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). There is a "genuine dispute" as to a material fact "if the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Anderson, 477 U.S. at 248, 106 S.Ct. 2505. The trial judge should not weigh the evidence but must simply determine where there are any genuine issues that should be resolved at trial. Id. at 249, 106 S.Ct. 2505.
In considering a motion for summary judgment, trial courts must give deference to the non-moving party by "considering all of the evidence and the inferences it may yield in the light most favorable to the nonmoving party." McGee v. Sentinel Offender Services, LLC, 719 F.3d 1236, 1242 (11th Cir.2013) (citing Ellis v. England, 432 F.3d 1321, 1325 (11th Cir.2005)). In making a motion for summary judgment,
The LaFerreras allege eight counts in their Complaint regarding the Tuscany: (1) Revocation of Acceptance and Nonconformity, (2) Misrepresentation During Sale, (3) Concealment of Nonconformities and Defects, (4) Misrepresentation During Repair Attempts, (5) Breach of Express Warranties, (6) Breach of Implied Warranty of Merchantability, (7) Breach of Implied Warranty of Fitness for a Particular Purpose, and (8) MMWA. They further allege that Defendants spoliated various pieces of evidence.
Defendants argue that the LaFerreras' revocation of acceptance claim fails as a matter of law. The LaFerreras did not respond to this argument, and they did not mention revocation of acceptance in their own motion for summary judgment. Generally, "grounds alleged in the complaint but not relied upon in summary judgment are deemed abandoned." Resolution Trust Corp. v. Dunmar Corp., 43 F.3d 587, 599 (11th Cir.1995); see also Road Sprinkler Fitters Local Union No. 669 v. Indep. Sprinkler Corp., 10 F.3d 1563, 1568 (11th Cir.1994) ("[The court] could properly treat as abandoned a claim alleged in the complaint but not even raised as a ground for summary judgment."). Because the LaFerreras did not pursue their revocation of acceptance claim either in response to Defendants' motion or in their own motion for summary judgment, the Court will treat that claim as abandoned and dismiss it.
Even if the LaFerreras did not abandon their revocation of acceptance claim, it would otherwise fail. When buyers receive nonconforming goods, they may revoke their acceptance if the nonconformity substantially impairs the goods' value to the buyer and the nonconformity was difficult to discover before acceptance. Ala. Code § 7-2-608. However, a buyer must provide the seller notice of revocation before it is effective. See id. The LaFerreras have not presented any evidence that they notified Defendants that they were revoking their acceptance prior to selling the Tuscany to a dealership in New Orleans. Their Complaint states that they notified Defendants of defects and nonconformities soon after delivery, but they have not provided evidence that they notified Defendants that they intended to revoke acceptance or otherwise return the Tuscany. In fact, the LaFerreras took the Tuscany in for repairs multiple times after delivery and retrieved it after the repairs were made, or at least attempted. These actions do not indicate that they did not want the Tuscany or intended to revoke their acceptance. Accordingly, even if the LaFerreras did not abandon their claim, they have not otherwise presented evidence to create a genuine issue of material fact.
The LaFerreras argue that Defendants spoliated four items of evidence: (1) an email, (2) an electric dash control panel
In diversity cases, "federal law governs the imposition of spoliation sanctions." Flury, 427 F.3d at 944. Applying federal spoliation law is consistent with the general applicability of the Federal Rules of Evidence in diversity cases. See id. However, "[f]ederal law in this circuit does not set forth specific guidelines," so courts have relied on state law for guidance insofar as they are "consistent with federal spoliation principles." Id. Alabama law defines spoliation as "an attempt by a party to suppress or destroy material evidence favorable to the party's adversary." Wal-Mart Stores, Inc. v. Goodman, 789 So.2d 166, 176 (Ala.2000). Importantly, a court may only draw an adverse inference from spoliation when the "absence of that evidence is predicated on bad faith." Bashir v. Amtrak, 119 F.3d 929, 931 (11th Cir. 1997). Although bad faith does not require malice, "mere negligence in losing or destroying records is not sufficient to draw an adverse inference." Mann v. Taser Intern., Inc., 588 F.3d 1291, 1310 (11th Cir. 2009).
Notably, the LaFerreras did not file a motion to compel the production of the allegedly spoliated evidence. Instead, they waited until summary judgment to bring the Court's attention to the non-production. A motion to compel would have been more appropriate because it would have required the parties to confer in good faith and attempt to resolve their issues before bringing them to the Court's attention. At least in the case of the folder of information, which was produced after the LaFerreras moved for sanctions, a good faith attempt to resolve these problems would have obviated court involvement. However, the Court will address the merits of the spoliation claims.
The LaFerreras claim that an email from a chain of forwarded messages was not produced. They allege that these emails would be relevant to proving that they were fraudulently induced into signing the June 19, 2014 release, but they do not allege that the emails are related to their fraud claims concerning the purchase and repair of the Tuscany. The allegedly missing email was an email David Jones of
However, even if an email existed and was not produced, the LaFerreras have not provided any evidence of bad faith or intent to destroy the email. Although the LaFerreras say that the emails were altered, they provide no proof beyond that allegation. They have not shown a system-wide email deletion or circumstantial proof of other clearly deleted emails, and they present no evidence showing whether the alleged spoliation occurred after the duty to preserve the emails arose. At most they argue that the alleged non-production occurred against the backdrop of other failures to produce discovery. In the absence of bad faith, the Court cannot grant an adverse inference based on the emails.
The LaFerreras further argue that Thor did not preserve the dash control panel replaced when the Tuscany was in Indiana being repaired. However, the repair records (Doc. 80-4 at 15) show that the Freightliner Service Center replaced the dash control panel. The LaFerreras have failed to show that Thor or Camping World had custody or control of the panel after it was replaced or that they had a duty to preserve it. Thus, they failed to show how that evidence was spoliated. The Court cannot grant the requested adverse inference. See Callahan v. Schultz, 783 F.2d 1543, 1545 (11th Cir.1986) (stating that an adverse inference is appropriate when a party does not produce evidence "within his control").
The LaFerreras argue that a folder of information that accompanied the Tuscany's unit history file was also spoliated. However, Thor produced those documents, (Doc. 80-4), and the Plaintiffs have not responded with any arguments as to how
The LaFerreras argue that Thor did not produce certain "sealed documents" that detail the Tuscany's inspection process. Based on this non-production, they want an adverse inference on their implied misrepresentation claims about defects that manifested during the manufacturing and inspection process. However, those claims arose before the June 19, 2014 release. As explained below, the release is valid, and any alleged spoliation of evidence relating to the released claims is irrelevant.
"[I]n the absence of fraud, a release supported by a valuable consideration, unambiguous in meaning, will be given effect according to the intention of the parties from what appears within the four corners of the instrument itself...." Cleghorn v. Scribner, 597 So.2d 693, 696 (Ala.1992). Courts may not look at parol evidence if the terms of the release are unambiguous, absent a clear showing of fraud. See Jehle-Slauson Const. Co. v. Hood-Rich Architects and Consulting Eng'rs, 435 So.2d 716, 720 (Ala.1983). Additionally, if stated in the release, the parties can release causes of action they did not know about at the time. See id.; Boles v. Blackstock, 484 So.2d 1077, 1082 (Ala. 1986).
However, a release will be invalid if a party was fraudulently induced into executing it. See Cleghorn, 597 So.2d at 695. "A party who has been the victim of a misrepresentation of a material fact or the suppression of a material fact when there is a duty to speak upon which it reasonably relied during negotiations can claim fraud in the inducement." Exxon Mobil Corp. v. Alabama Dept. of Conservation and Natural Res., 986 So.2d 1093, 1129 (2007) (emphasis in original). Specifically, the fraud must "underlie the execution of the contract of release." Jehle-Slauson Constr. Co., 435 So.2d at 719 (quoting Barbour v. Poncelor, 203 Ala. 386, 83 So. 130, 133 (1919)).
In this case, the parties executed a release on June 19, 2014 in which the LaFerreras released Thor and Camping World
The parties agreed to release certain claims the LaFerreras might have had against the Defendants. However, the release is ambiguous about which claims were released. The parties appear to dispute the meaning of the phrase "arising prior to the date of this letter agreement" in the release. The Defendants argue that the release encompassed claims based on acts or omissions occurring before the release, even those the LaFerreras did not know about at the time. The LaFerreras assert that the release did not encompass claims they discovered the factual basis for after signing the release. The plain text does not unambiguously indicate which interpretation is correct. Alabama courts have addressed releases using similar language. See Illinois Cent. R. Co. v. Johnston, 205 Ala. 1, 87 So. 866, 867 (1920) (addressing release saying, "arising in any manner ... from or on account of personal injuries sustained by me on or
Despite this ambiguity, the release is effective for all claims the LaFerreras had reason to know of before they signed the release — including all valid misrepresentation claims, except for those dealing with the odometer discrepancy, and all valid suppression claims. Therefore, to the extent that the ambiguity is relevant, a question of material fact exists as to which claims were released. Whitetail Dev. Corp. v. Nickelson, 689 So.2d 865, 867 (Ala.Civ. App.1996) ("When the terms of a contract are ambiguous in any way, however, the determination of the true meaning of that contract is a question of fact for the finder of fact.").
Furthermore, the LaFerreras have not produced any evidence that they were fraudulently induced into signing the release. They first claim that the allegedly spoliated emails would have shown fraud, but the Court has rejected their spoliation argument. Further, they have not otherwise pointed to a misrepresentation regarding the release on which they relied to their detriment. At most, the LaFerreras might argue that their misrepresentation claims as to the purchase of the Tuscany might relate to the release. They claim that the Defendants promised that the Tuscany was new and would be defect free. However, the LaFerreras have not shown how they "reasonably relied during negotiation[ ]" of the release on these initial promises made eight months earlier. Exxon Mobil, 986 So.2d at 1129. In fact, any potential reliance on a promise that the Tuscany was defect free is belied by the numerous problems the LaFerreras experienced. They took it in for repairs four times claiming several problems — showing that they knew long before signing the release that the Tuscany was not defect free. Therefore, the LaFerreras have failed to meet their burden to show fraud in the inducement with regard to the release.
The LaFerreras make several interrelated misrepresentation and suppression claims about the Tuscany. First, they claim that numerous defects manifested with the Tuscany during the manufacturing and inspection phase. They maintain that Thor attempted to repair these defects but did not disclose them to the LaFerreras. They claim that these repairs were so substantial that the Tuscany could not be considered new as it was represented to be.
Misrepresentation requires a showing of "(1) a false representation (2) concerning a material existing fact (3) relied upon by the plaintiff (4) who was damaged as a proximate result." Fisher v. Comer Plantation, Inc., 772 So.2d 455, 465 (Ala.2000) (quoting Baker v. Bennett, 603 So.2d 928, 935 (Ala.1992)); see Ala Code § 6-5-101. Suppression requires a showing "(1) that [the defendant] had a duty to disclose the existing material fact; (2) that [the defendant] suppressed this material fact; (3) that [the defendant's] suppression of this fact induced [the plaintiff] to act or to refrain from acting; and (4) that [the plaintiff] suffered actual damage as a proximate result." State Farm Fire and Casualty Co. v. Owen, 729 So.2d 834, 837 (Ala. 1998); see Ala Code. § 6-5-102. Suppression differs from misrepresentation in that it is based on a party's silence on or concealment of a material fact, rather than a false statement about that material fact. See Marshall v. Crocker, 387 So.2d 176, 179 (1980).
The LaFerreras released their misrepresentation and suppression claims about the defects that manifested during manufacturing and inspection because they knew about those problems before they signed the release. These claims are based on problems that manifested when Thor employees inspected the Tuscany after manufacturing — including electrical issues, generator issues, water leakage, dishwasher problems, washing machine problems, windshield wiper malfunctions, and a scratched TV. Although Thor attempted to repair these issues before sending the Tuscany to Camping World, the LaFerreras experienced problems with the dash control panel, exposed wiring, the generator, the windshield leaking, and the alignment in or before December 2013. (Doc. 58-8 at 4-5, Brett LaFerrera Dep. 244:18-246:6). Further, in April 2014, the LaFerreras took the Tuscany to Camping World to repair the windshield wipers, the washing machine, the dishwasher, and electrical issues. (Doc. 58-8 at 9, Brett LaFerrera Dep. 264:7-18). Thus, the LaFerreras knew of a substantial number of problems that put them on notice that the Tuscany might not have been a "new" vehicle and that the Defendants might have known of the defects. As such, the release encompassed these claims.
However, a question of fact remains about whether the LaFerreras released the claims about the alleged mileage discrepancy on the odometer. Brett LaFerrera stated that he did not know that the
These questions of fact directly relate to whether Defendants misrepresented the mileage by resetting the odometer and listing eight miles on sales documents, which would support a claim of intentional misrepresentation. However, these facts do not support a suppression claim, which would require the Defendants' silence on or concealment of material facts. Here, Defendants were not silent about the mileage. They each listed eight miles on documents they gave to the LaFerreras. Thus, if the LaFerreras have a claim, it is based on a false statement of the mileage, not the failure to disclose the mileage.
The LaFerreras explicitly released "any claims based upon prior warranty repairs and the time taken to complete the same." This language demonstrates that the parties contemplated releasing claims based on repair attempts made before June 19, 2014. However, even if they had not released the claims, the LaFerreras failed to make out a claim for misrepresentation as to the repairs made before the release. They claim that the Defendants misrepresented to them that the Tuscany was fixed after every repair attempt. Yet, they have not provided evidence of any specific instances of problems, misrepresentations about repairs made, and the recurrence of those same problems, beyond saying, "they represented that it was fixed and that this was not true." (Doc. 76 at 25). Moreover, the LaFerreras have not pointed to which Defendant allegedly made these assurances that the problems were fixed.
After the release, Thor attempted repairs in September 2014, including an attempt to repair the electrical issues. The LaFerreras say that the electrical problems were not fixed after this repair attempt. However, they state that a Thor or Camping World employee said that they could not guarantee that problem was fixed. Because they did not point the Court to a representation by a specific person claiming that the electrical problems were fixed, the LaFerreras misrepresentation claim as to this repair fails.
Lastly, the LaFerreras have not demonstrated that either Defendant was under a duty to tell them that Thor's contribution to the trade was in exchange, at least in part, for the Palazzo release. They have not shown a confidential relationship or other special circumstances giving rise to a duty. See State Farm, 729 So.2d 834 (stating that a duty generally required a confidential relationship or other special circumstances). Additionally, the LaFerreras have not shown how they would have acted differently if they knew Thor's intent in making the contribution. They have not provided evidence showing they would not have traded the Palazzo in
Generally, goods sold by merchants have an implied warranty of merchantability and, on some occasions, an implied warranty of fitness for a particular purpose. See Ala. Code §§ 7-2-314, 315. Sellers can disclaim these implied warranties if they follow certain statutory requirements. Ala. Code § 7-2-316. For the implied warranty of merchantability, if a disclaimer is in writing, it must mention merchantability and be conspicuous. Id. For the implied warranty of fitness for a particular purpose, the disclaimer must be in writing and conspicuous. Id. Additionally, "[u]nless the circumstances indicate otherwise, all implied warranties are excluded by expressions like `as is.'" Id. However, a seller may not necessarily disclaim an express warranty in the same manner. When words or conduct tending to create an express warranty are negated by other words or conduct limiting such express warranty, they shall be construed as consistent when reasonable, but otherwise, the negation of the warranty shall be inoperative, subject to the parol evidence rule. Id. The parol evidence rule provides that "[t]erms ... set forth in a writing intended by the parties as a final expression of their agreement with respect to such terms as are included therein may not be contradicted by evidence of any prior agreement or of a contemporaneous oral agreement." Ala. Code § 7-2-202.
Further, sellers can limit the remedies available to a buyer for breach of warranty. For instance, a seller may limit them to repairing or replacing nonconforming goods or parts. See Ala. Code § 7-2-719. Alabama Courts have typically characterized such repair or replace warranties as express warranties.
Camping World effectively disclaimed any warranties in its agreement with the LaFerreras.
Further, it says, "This agreement contains the entire understanding between you and me and no other representation or inducement, verbal or written, has been made which is not contained in this contract." The LaFerreras did not respond to Camping World's argument that it did not adopt Thor's warranty, and they have not argued that the disclaimer of warranties does not meet the statutory requirements.
Moreover, Thor disclaimed all implied warranties
Regardless, the LaFerreras argue that the electrical problems with the dash control panel persisted because a Thor or Camping World employee told them that Thor could never isolate the problem.
Thor argues that the LaFerreras' claims under the first warranty are untimely because they failed to bring them within ninety days of the end of the one year warranty period, which would have been on January 29, 2014. The statute of limitations for contracts of sale, including those with repair or replace warranties, is four years. See Ala. Code § 7-2-725; Brown v. General Motors Corp., 14 So.3d 104, 108 (2009). The parties may agree to reduce the limitations period, as long as it is not less than one year. In a typical breach of warranty case relating to the quality of the goods, the breach occurs, and thus the cause of action accrues, when tender of delivery is made. See Ala. Code § 7-2-725. However, a cause of action for a breach of a warranty obligating the warrantor to repair or replace defects accrues when the warrantor "breaches its contractual obligation to repair that good." Brown, 14 So.3d at 113. Thus, the limitations period, whether contractual or statutory, begins to run when the warrantor fails to repair or replace a defect, rather than when tender of delivery is made. See id.; American Suzuki Motor Corp. v. Burns, 81 So.3d 320, 325 (Ala.2011).
The LaFerreras and Thor agreed to a one year repair or replace warranty, ending on October 31, 2014. The warranty agreement provided that any action brought to enforce it had to be brought by January 29, 2014. Because a cause of action accrues at the time a warrantor fails to repair or replace a defect, any breach that occurred less than one year before January 29, 2014 would necessarily have a limitations period of less than one year. Specifically, Thor returned the Tuscany to the LaFerreras on October 6, 2014 after making repairs. If the defect persisted after the repairs and caused the warranty to fail its essential purpose, then the LaFerreras had less than four months from the time of breach to bring their claim, making the limitations period less than one year. Thus, the parties' agreement to require actions for failure to repair be brought within ninety days of the end of the warranty is invalid in light of Ala. Code § 7-2-725. As a result, the statutory period of four years applies in this case, making the LaFerreras' warranty claims timely.
The MMWA, 15 U.S.C. §§ 2301-2312, is largely a disclosure statute that establishes certain requirements for written warranties. See 15 U.S.C. § 2302; Cunningham v. Fleetwood Homes of Ga., Inc., 253 F.3d 611, 617 (11th Cir.2001). In addition to its disclosure requirements, the MMWA provides a federal cause of action against a warrantor who fails to comply with an obligation under a written warranty, including an obligation to repair or replace a defect. See 15 U.S.C. § 2310; Cunningham, 253 F.3d at 617 n. 5 (11th Cir.2001). The parties do not dispute that the limited warranty provided by Thor is governed by the MMWA. Accordingly, because the LaFerreras have presented evidence that Thor failed to repair the electrical problems, they have a claim under the
For the foregoing reasons, Defendants' Motion for Summary Judgment is due to be DENIED as to the misrepresentation claims regarding the odometer against both Defendants and the breach of the limited warranty and MMWA claims against Thor. The Defendants' motion is due to be GRANTED as to all other claims. Additionally, the LaFerreras Motion for Summary Judgment and Motion to Preclude Defendants' Argument, are due to be DENIED. Further, Defendants' Motion to Strike is MOOT. A separate order consistent with this opinion will be entered.
Done and Ordered this 21st day of March 2016.
