Crouse v Moncton Ford
New Brunswick Court of Queen's Bench
Trial Division
Judicial District of Moncton
Currently being edited for NBR (2d) - judgment temporarily in rough form.
Temp. Cite: [2004] NBR (2d) TBEd NO.031.
(M/C/0566/03; 2004 NBQB 407; 2004 NBBR 407)
November 23, 2004
Reproduced with permission of Maritime Law Book Ltd.,
which claims copyright in the headnote and indexing.
Counsel:
Jason T. Dempsey, for the plaintiff;
Guy C. Couturier, for the defendant.
[1] Landry, J.: The Plaintiff bought a 2001 Lincoln Town Car Signature from the Defendant on November 28, 2001 for the sum of $43,494.35 including taxes. The Plaintiff was the co-buyer along with his company A-1 Excavating. The vehicle was a used car having been driven 26,209 kilometres.
[2] The Plaintiff seeks rescission of the contract and the return of the full purchase price of the vehicle, alleging that the car has been vibrating at normal highway speeds, causing numerous and regular visits to the dealership of the Defendant who failed to fix the problem.
[3] The vehicle also developed brake vibrations but the Defendant succeeded in resolving that problem. It is the problem of the vibration while driving which is at the core of this litigation.
[4] The Plaintiff, a licensed mechanic, age 63, told the Defendant he was interested in a new Grand Marquis or a good used Lincoln. The Defendant located the vehicle in question on a Ford of Canada website accessible exclusively by Ford dealerships. The website shows all corporate repurchase luxury or Lincoln vehicles available throughout Canada. The vehicle in question was brought over to Moncton from where it was stored at the ADESA auction site in Halifax. The Plaintiff inspected it and bought it.
[5] The Plaintiff testified that he thought he was buying a "Ford executive car", that is a car that had been driven by a Ford representative. At discovery, the Plaintiff and the Defendant learned that the vehicle had in fact first been sold to Budget Rent-A-Car in Moncton on January 22, 2001 by the Defendant itself. The Defendant's Sales Manager Mike Gayton and Salesman Frank Fitzgerald did not know or recall at the time of the sale that the car had earlier been sold to Budget Rent-A-Car and testified that they made no representations to the Plaintiff, simply that it was a used car with 26,209 kilometres. No one at the time checked the ownership history of the vehicle.
[6] The Parties at the time of the sale did not know or realize that the car had been a rental car. The Defendant made no misrepresentations but simply stated that the vehicle was found on the Ford of Canada Corporate Repurchase Luxury Vehicle Remarketing website. The Plaintiff understood that he was buying what he called a "Ford executive car". He thought he was buying what is sometimes called a "demo".
[7] The Plaintiff knew that the vehicle already showed 26,209 kilometres, a considerable amount of usage for a demonstrator car.
[8] After seven visits to the Defendant's service department between July 26, 2002 and April 3rd, 2003, the Plaintiff says that the Defendant has failed to repair the problem of vibration while driving. The Plaintiff has refused to accept the vehicle after the April 3, 2003 repairs. The vehicle has not been driven since then but sits in the Plaintiff's driveway. The odometer shows 64,198 kilometres.
[9] To resolve the problem, the Defendant has offered to allow the Plaintiff $24,000.00 and possibly as much as $27,000.00 on a trade-in but the Plaintiff refused and chose to bring this action.
[10] The main issue before the court is whether the ongoing mechanical problem, that is the vibration while driving, and the alleged failure to repair is sufficient ground for rescission of the contract.
[11] It is necessary to look closely at the evidence and in particular the repairs done by the Defendant on the occasion of the seven visits to the Defendant's service department of July 26, 2002, November 7, 2002, November 12, 2002, November 22, 2002, December 16, 2002, January 6 to 31, 2003 and April 3, 2003.
1. July 26, 2002 : The Defendant was asked to check the cause of vibration while driving at highway speeds of between 100 and 110 kilometres per hour. The Defendant did some repairs including replacing the pin and axle seal.
2. November 7, 2002 : The Defendant was asked to check the cause of vibration at highway speeds. The Defendant found a driveline vibration, removed the dry shaft, sent it to be balanced and reinstalled it. This resolved the driveline vibration problem. The $153.16 charge was paid by Ford of Canada under the warranty.
3. November 12, 2002 : The Defendant was asked to check the vibration in the rear of the vehicle. The Defendant performed extensive repairs totalling $2,643.07 which sum was paid by Ford of Canada under the warranty. The repairs included replacing the crown and pinion and the housing.
4. November 22, 2002 : The Defendant was asked to check the cause of vibration in the vehicle at 100 kilometres per hour all the time and found the crown and pinion to be out of round. The crown and pinion were replaced and new bearings were installed at the cost of $644.05 paid by Ford of Canada under the warranty.
5. December 16, 2002 : The Defendant was asked to check the cause of the rear driveline howl and also the cause of vibration while driving over 100 kilometres per hour. The Defendant performed some minor repairs and absorbed the charges internally.
6. January 6 to January 31, 2003 : The Plaintiff's vehicle was at the service department of Taylor Ford Sales Ltd. for repairs for approximately 3 1/2 weeks. Extensive repairs were performed and the invoice containing 7 pages describes the work done. To fix the howling noise coming from the rear, repairs were done. The charge of $806.64 for this item was paid by Ford of Canada under the warranty. Repairs to the dry shaft and transmission assembly was also made at a cost of $2,585.17, paid by Ford of Canada under the warranty.
7. April 3, 2003 : Extensive repairs were made to the vehicle to resolve the vibration problem on or about April 3rd, 2003. Christian Avoine, a Ford of Canada engineer from Montreal came to Moncton to supervise the repairs. The documents relating to the repairs in question have been mislaid and were not available to the court. Exhibit D-2 however indicates that a $1,862.32 charge was made under the warranty for the repairs in question.
[12] Christian Avoine told the Plaintiff on April 3rd, 2002 that the vehicle would be ready for a road test on April 4th, 2002. However, when Avoine road tested the vehicle on April 3rd, 2002, he determined that further parts were needed, as well as several special shims. When the Plaintiff arrived on Friday, April 4th, 2002 to road test the vehicle, he found it on a hoist, waiting for parts. He felt frustrated and left. The parts only arrived early the following week and were installed by the Defendant.
[13] After these last repairs, the vehicle was test driven by Mr. Brown, General Manager, Mr. Thorne, Service Manager at Taylor Ford and Mr. Hanson, Service Development Manager at Taylor Ford. All three felt the problem was completely resolved.
[14] After this last road test the Defendant called the Plaintiff to tell him that the vibration was gone and that he could pick up his vehicle. The Plaintiff refused to accept the vehicle and requested rescission of the contract for the purchase of the vehicle and return of the purchase price.
[15] Ford of Canada has apparently cancelled the warranty on the vehicle as it has not been driven since April, 2003.
[16] Exhibit D-2 indicates that a total of $11,392.96 has been charged for repairs on the warranty. I calculate that $8,694.41 of that amount was for the seven visits referred to above relating to the vibration problem.
[17] The following two sections of the Consumer Product Warranty and Liability Act, S.N.B. 1978, c.C.-18.1, govern the Defendant's liability in this case:
12(1) In every contract for the sale or supply of a consumer product there is an implied warranty given by the seller to the buyer that the product and any components thereof will be durable for a reasonable period of time.
12(2) In determining a reasonable period of time for the purposes of subsection (1), regard shall be had to all relevant circumstances, including the nature of the product, whether it was new or used, its use as contemplated by the seller and buyer at the time of the contract, its actual use and whether it was properly maintained.
28 The rights and remedies provided in this Act are in addition to any other rights or remedies under any other law in force in the Province, unless a right or remedy under such law is expressly or impliedly contradicted by this Act"
[18] The Defendant is in breach of the contract for the sale of the vehicle as it was defective and also it was not durable for a reasonable period of time.
[19] Section 16 of the Act reads as follows:
16(1) Where the seller is in breach of a warranty provided by this Act and does not rectify the breach pursuant to any opportunity that the buyer gives him under section 14 or otherwise, the buyer may reject the product if he does so within a reasonable time after he discovers the breach and he discovers the breach not later than sixty days after delivery of the product.
16(2) Notwithstanding that the buyer discovers the breach later than sixty days after delivery of the product, where the breach is a major breach the buyer may reject the product if he does so within a reasonable time after he ought to have discovered the breach .
16(3) The buyer's rejection is not effective until the seller knows or ought to know that the buyer does not accept the product." (The underlining is mine)
[20] I find that the vibration problem of this luxury vehicle, which lasted at least between July 26, 2002 and April 3rd, 2003 and was the subject of at least $8,694.41 of repair over that period, constituted a major breach of the purchase contract and that pursuant to the terms of the Act the Plaintiff is entitled to rescission.
[21] The term "major breach" is not a technical term. It connotes something less than a fundamental breach. It is a breach that would lead an ordinary person to say, under all of the circumstances, "that's very serious". The situation in the case at bar meets that test. (See Sirois v. Centennial Pontiac Buick , 89 N.B.R.(2d) 244)
[22] The Plaintiff, to be protected by the Act, had to reject the vehicle within a reasonable time after he ought to have discovered the breach.
[23] At the beginning, on July 26, 2002, the problem was not yet a major breach, however, with the passing of time, the problem became more and more serious as the Defendant could not repair the vibration and I find that after the April 3, 2002 episode the breach was major and the Plaintiff justified in rejecting the vehicle. The Plaintiff rejected the vehicle within a reasonable time after the problem became a major breach of the contract.
[24] The Plaintiff is entitled to a return of the purchase price of $ 43,494.35 subject to a monetary adjustment for the use of the vehicle between the date of the purchase on November 28, 2001 until July 26, 2002 when the problem was first reported to the Defendant, a period of eight months during which the Plaintiff drove the vehicle a total of 20,647 kilometres and also for the use of the vehicle between July 26, 2002 and the date the Plaintiff rejected the vehicle on April 3, 2003, an additional period of eight months during which the Plaintiff complained of vibration but nevertheless added another 17,342 kilometres to the vehicle. In all, the Plaintiff drove the vehicle a total of 37,989 kilometres.
[25] To adjust for these 16 months of usage of the vehicle, an adjustment of $12,000.00 will be made in favour of the Defendant. The Plaintiff's monthly financing payments were $750.00 per month after a down payment of approximately $6,000.00. This $12,000.00 assessment takes the HST into account.
[26] The Plaintiff never accepted return of the vehicle although it was delivered to his residence by the Defendant. He cannot be held responsible for its maintenance since April 3, 2002 when he requested rescission of the contract.
[27] This is not a case where an interest award is warranted.
[28] Rescission of the contract is therefore granted. The Plaintiff shall have judgment against the Defendant in the amount of $31,494.35 and ownership of the vehicle reverts to the Defendant.
[29] The Defendant shall pay costs to the Plaintiff in the amount of $3,500.00 based on scale 3 of Tariff "A" of the Rules of Court and taxable disbursements.
Back to New Brunswick's Consumer Product Warranty Legislation Home Page.