Doiron v Bayside Chrysler Dodge Ltd
(1999), 210 NBR (2d) 201, 536 APR 201.
New Brunswick Court of Queen's Bench
Trial Division
Judicial District of Bathurst
Temp. Cite: [1999] N.B.R.(2d) TBEd. MR.025
Reproduced with permission of Maritime Law Book Ltd.,
which claims copyright in the headnote and indexing.
Maritime Law Book Ltd. Summary:
The plaintiff purchased a 1990 half-ton truck for $11,300. Within a week following the purchase, it was discovered that the vehicle needed repairs for an oil leak, the brakes and the battery. The plaintiff sued the defendant car dealership for the cost of the repairs. The defendant's defence was that it was not the vendor. The New Brunswick Court of Queen's Bench, Trial Division, granted the plaintiff judgment against the defendant for $807.80.
Sale of goods - Seller or merchant - What constitutes - The plaintiff purchased a used half-ton truck - Within a week, it was discovered that the vehicle needed repairs -The plaintiff sued the defendant car dealership for the cost of the repairs - The defendant's defence was that it was not the vendor - The defendant submitted that the plaintiff wanted to buy a truck and Comeau wanted to trade his truck for a new one and that in order to save Comeau a portion of the HST on the purchase of the new truck the defendant temporarily took Comeau's vehicle as a trade-in and then transferred it to the plaintiff - The sale contract was between the defendant as vendor and the plaintiff as purchaser - The plaintiff's cheque was made out to the defendant - The New Brunswick Court of Queen's Bench, Trial Division, granted the plaintiff judgment against the defendant - The plaintiff believed that he was purchasing the vehicle from the defendant dealer -See paragraphs 1 to 14.
Sale of goods - Statutory warranties - General - Examination by buyer - Section 10(2)(c) of the Consumer Product Warranty and Liability Act provided that there was no implied warranty under s. 10(1)(a) of the Act "if the product is a used product and the buyer examines it before the contract is made, as regards any defect that that examination ought to reveal" - The New Brunswick Court of Queen's Bench, Trial Division, in dealing with a case involving the purchase of a used half-ton truck, stated that when the purchase was made through a dealer the inspection referred to in s. 10(2)(c) should not be interpreted to mean having to remove or dismantle any parts of the automobile - See paragraphs 16 to 17.
Sale of goods - Statutory warranties - Particular warranties - Of fitness for purpose - The plaintiff purchased a 1990 half-ton truck from the defendant car dealership for $11,300 - The plaintiff did not inspect the vehicle but took it for a test drive and detected no apparent defects - He relied on the representations of the salesman that the truck was in very good condition - Within a week following the purchase, it was discovered that the vehicle needed repairs for an oil leak, the brakes and the battery -The plaintiff sued the defendant for the cost of the repairs - The New Brunswick Court of Queen's Bench, Trial Division, granted the plaintiff judgment for the cost of the repairs and his out of pocket expenses - The plaintiff was entitled to expect that the vehicle was "of such quality, in such shape or condition, and as fit for the purpose" for which a vehicle of that year and at that price should be - See paragraphs 17 to 18.
Contracts - Topic 521
Parties - Who constitutes a party - General - [See Consumer Law - Topic 1603].
Sale of Goods - Topic 4104
Conditions and warranties - Implied or statutory terms as to quality or fitness - Duties of buyer - [See Consumer Law - Topic 1685].
Sale of Goods - Topic 4106
Conditions and warranties - Implied or statutory terms as to quality or fitness - Fitness or suitability of goods - [See Consumer Law - Topic 1728].
Sale of Goods - Topic 4115
Conditions and warranties - Implied or statutory terms as to quality or fitness - Respecting used goods - [See Consumer Law - Topic 1685 and Consumer Law - Topic 1728].
Statutes Noticed:
Consumer Product Warranty and Liability Act, S.N.B. 1978, c. C-18.1, sect. 10(2)(c) [para. 16].
Counsel:
Edouard Doiron, on his own behalf;
Arnold Robinson, for the defendant.
This action was heard on November 10, 1998, before McIntyre, J., of the New Brunswick Court of Queen's Bench, Trial Division, Judicial District of Bathurst, who delivered the following decision on February 8, 1999.
[1] McIntyre, J. : On February 11, 1997 the plaintiff purchased a used vehicle, a 1990 GMC half-ton truck for $11,300. Within a week following the date of purchase it was discovered that the vehicle required repairs, the cost of which the plaintiff claims in this small claim action. The defendant's defence is that it was not the vendor.
The Facts
[2] In early February 1997 the plaintiff contacted a number of car dealers looking to purchase a used half-ton truck in good condition.
[3] On February 8 th he received a call from Marcel Paulin, a salesman for the defendant Bayside Chrysler Dodge Ltd. Paulin advised the plaintiff that a 1990 GMC truck in good condition would become available in the next few days. On February 11 th the plaintiff testified that he attended at the defendant's place of business where the salesman Paulin showed him the truck. According to the plaintiff, Paulin told him the truck was in "very good shape". He took the vehicle for a test drive and decided to buy it. He wrote a cheque made out to the defendant Bayside for $11,300 and left with the truck.
[4] Two days after purchasing the truck the plaintiff started to have problems with it. On February 13 th and again on February 14th he could not get it started. On February 17 th he noticed that it was leaking oil somewhere between the engine block and the transmission. He contacted Paulin and was informed that the manager was away and that any decision would have to be made by him.
[5] In the meantime the plaintiff took the vehicle to a licensed mechanic who confirmed that the oil leak had to be repaired as well as the braking system and a new battery had to be installed.
[6] On March 4 th the plaintiff met with the defendant's manager who informed him that the defendant had no obligation to perform any repairs on the plaintiff's truck since the defendant was not the vendor. According to the manager, the plaintiff had purchased the vehicle from its previous owner, one Roger Comeau, and the defendant had only acted as "middleman" to accommodate the parties.
[7] The defendant's position is that the plaintiff wanted to buy a truck and Roger Comeau wanted to trade his for a new one. The defendant maintains that in order to save Comeau a portion of the HST on the purchase of a new truck it temporarily took Comeau's vehicle as a trade-in and transferred it right back to the plaintiff. In that fashion, Comeau ended up paying the HST on the difference only between the value placed on the used vehicle ($11,300) and the price of the new truck. The plaintiff gained nothing because he ended up paying the HST on the full amount of the purchase price of the used vehicle.
[8] According to the plaintiff, he was never made aware of this " arrangement". He said he never met Roger Comeau and has no idea who he is. He says he thought all along that he was purchasing the vehicle from the defendant car dealer. Indeed, there is before the court a contract dated February 11, 1997 between Bayside Chrysler Dodge Ltd. as vendor and the plaintiff Doiron as purchaser confirming the purchase and sale of a 1990 GMC truck for $11,291.15. Also before the court is a copy of the plaintiff's cheque for $11,300 payable to the defendant Bayside. The defendant takes no issue with those documents.
The Issue
[9] Did the plaintiff purchase the vehicle from Roger Comeau or from the defendant Bayside? If he purchased the vehicle from Comeau, the plaintiff gets no protection from the Consumer Product Warranty and Liability Act , S.N.B. 1978, c. C-18.1. On the other hand, if he purchased it from the defendant, he falls under the protective umbrella of the Act .
[10] Although the plaintiff says he did not meet Roger Comeau, I accept the evidence of M. Robinson and the salesman Paulin to the effect that Comeau was present on February 11 th when the plaintiff took the vehicle for a test drive. There is no evidence or at least no convincing evidence however that it ever crossed the plaintiff's mind that he was purchasing the vehicle directly from Comeau. Comeau did not testify. If he was the vendor as alleged by the defendant, one has to wonder why the defendant did not call him as a witness.
[11] I quite agree with the defendant that these contracts of accommodation or convenience are common in the trade. In other words, if A is buying a new vehicle and has already made arrangements with B to sell him his used vehicle, some dealers may agree to make it appear as a trade- in and a resale in order that A may avoid payment of a portion of the HST. It is evident that there is not only no advantage to B in that situation but he is considerably disadvantaged in that he has no written warranty and no protection under the Consumer Product Warranty and Liability Act.
[12] In my view it is only in the clearest of cases and upon evidence that all parties were aware of the real nature of the transaction and agreed to it that those contracts of "accommodation" may be held valid.
[13] The purchaser of the used car must have full knowledge of the fact that the transaction is really between him and the previous owner and that the dealer makes no representations and gives no guarantees. The owner of the used vehicle should likewise acknowledge that the transaction for the sale of his used vehicle is between him and the purchaser.
[14] In the present case I conclude that the plaintiff was under the belief that he was purchasing the vehicle from the dealer. He was never told otherwise and the only contract executed was between the plaintiff and the defendant dealer. The contract reads at the top of the standard form:
"I hereby offer to purchase from the above dealer, the following vehicle on the terms and conditions herein set forth including the conditions on the back hereof."
It is followed by a description of the 1990 GMC truck. As for the conditions on the back of the contract, the plaintiff was only given a photocopy of the front page. The salesman's name is indicated as Marcel Paulin.
The Plaintiff's Claim
[15] There is overwhelming evidence that the plaintiff experienced problems with the vehicle from the beginning. The plaintiff testified that he did not conduct a thorough inspection of the vehicle choosing rather to rely on the representations of the salesman, Paulin, who assured him that the truck was in very good condition. As it turned out, the battery was done, the brakes required immediate repairs and there was an oil leak in the transmission. The plaintiff produced detailed receipts for those repairs totalling $581.80.
[16] The Consumer Product Warranty and Liability Act applies in the present case. For ease of reference I have reproduced what I perceive to be the pertinent parts for the purpose of the present case.
"4(1) In every contract for the sale or supply of a consumer product the following statements are express warranties given by the seller to the buyer:
(a) any oral statement in relation to the product that the seller makes to the buyer, unless the circumstances show that the buyer does not rely, or that it is unreasonable for him to rely, on the seller's statement;
. . . . .
"4(2) The seller shall be deemed to have made any statement
(a) made by his agent or employee, unless he proves that the agent or employee was not acting within the scope of his actual, usual or apparent authority; or
. . . . .
"5 Where there is a written contract, oral and other extrinsic evidence is admissible in any court to establish an express warranty notwithstanding that it adds to, varies or contradicts the written contract.
"8(1) In every contract for the sale or supply of a consumer product, other than one to which subsection (2) applies, there is an implied warranty given by the seller to the buyer
(a) that the seller has a right to sell the product, or will have a right to sell the product at the time of its delivery to the buyer;
. . . . .
"10(1) Subject to subsection (2), in every contract for the sale or supply of a consumer product there is an implied warranty given by the seller to the buyer
(a) that the product is of such quality, in such state or condition, and as fit for the purpose or purposes for which products of that kind are normally used as it is reasonable to expect having regard to the seller's description of the product, if any, the price, when relevant, and all other relevant circumstances; and
(b) that the product complies with all mandatory federal and provincial standards in relation to health, safety and quality.
"10(2) There is no implied warranty under paragraph (1)(a)
. . . . .
(c) if the product is a used product and the buyer examines it before the contract is made, as regards any defect that that examination ought to reveal;"
[17] The plaintiff admitted that he did not inspect the vehicle but he took it for a test drive and he detected no apparent defects. He did say that he relied on the representations of the salesman who told him that the vehicle was in very good condition. It was also the plaintiff's evidence that the oil leak was only discovered on February 17 th , six days after the purchase date. There was no evidence of an oil leak prior to that date. The defect with respect to the brakes was only discovered after the plaintiff's mechanic removed the wheels and inspected the braking system. In my view, an inspection of the vehicle prior to purchase in the present case would not have revealed the oil leak from the transmission nor the defect in the braking system unless parts were removed or dismantled. When the purchase is made through a dealer the inspection referred to in s. 10(2)(c) should not be interpreted to mean having to remove or dismantle any parts of the automobile.
[18] In the present case the plaintiff was paying $11,300 for a 1990 truck. He had the right to expect that the vehicle was "of such quality, in such state or condition, and as fit for the purpose" for which a vehicle of that year and at that price should be. On the whole of the evidence I conclude that it was not. The plaintiff attempted to give the defendant an opportunity to repair the defects but the defendant refused. The evidence before the court indicates that the plaintiff expended $228.80 to fix the brakes, $258 to repair the oil leak in the transmission and $95 for a new battery, for a total of $581.80. The plaintiff also made numerous trips from Caraquet to the defendant's place of businesses in Bathurst in an attempt to resolve this matter. He should be compensated for his loss of time and out-of-pocket expenses which I arbitrarily set at $100. The plaintiff is also entitled to interest at the rate of 8% on $681.80 from March 17, 1997 to date which I have calculated at $91. The plaintiff is also entitled to his costs of $35.
[19] There will be judgment for the plaintiff against the defendant in the amount of $807.80.
Judgment for plaintiff.
Editor: Angela E. McKay/pdk
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