Gibson v Whalen et al
New Brunswick Court of Queen's Bench
Trial Division
Judicial District of Saint John
Currently being edited for NBR (2d) - judgment temporarily in rough form.
Temp. Cite: [1999] NBR (2d) TBEd DE.010
Reproduced with permission of Maritime Law Book Ltd.,
which claims copyright in the headnote and indexing.
Maritime Law Book Ltd. Summary:
A buyer of a 1997 Cavalier in 1998 sued the seller and its salesperson under the Consumer Product
Warranty and Liability Act, for reimbursement and/or damages resulting from the negligent
misrepresentation and/or fraudulent misrepresentation. The New Brunswick Court of Queen's Bench, Trial Division, allowed the action against the seller and salesperson.
Sale of goods - Deceptive acts - Misleading conduct or representations - Gibson purchased a 1997 Cavalier in 1998 for $12,862 from Pacific Auto Clinic Ltd. - Pacific's advertisement stated the vehicle was in "like new condition" - Gibson testified that Whalen, Pacific's salesperson, stated the car had never been in an accident - A dealer advised Gibson that the Cavalier was " salvage" and the warranty was invalid - An American insurance company imported the Cavalier to Pacific under Whalen's signature - Gibson sued Pacific and Whalen under the Consumer Product Warranty Act for reimbursement and/or damages resulting from the negligent and/or fraudulent misrepresentation - The New Brunswick Court of Queen's Bench, Trial Division, held that Pacific and Whalen had, at best, made negligent misrepresentations and awarded damages of the original purchase price less the vehicle's appraisal, general damages and interest.
Consumer Law - Topic 1804
Sale of goods - Breach - Remedies of buyer - Damages - [See Consumer Law - Topic 1745].
Counsel:
Priscilla Gibson, on her own behalf;
James Whalen, on his own behalf;
Pacific Auto Clinic Ltd., noted in default.
This matter was heard on November 22, 1999, by Higgins, J., of the New Brunswick Court of Queen's Bench, Trial Division, Judicial District of Saint John, who delivered the following decision on November 25, 1999.
[1] Higgins, J. : This matter arises from a claim by the plaintiff under the Consumer Product Warranty Act , R.S.N.B., c-18.1 for reimbursement and/or damages she alleges resulted from the negligent misrepresentation and/or fraudulent misrepresentation of the defendants in the sale to her of a 1997 Cavalier motor vehicle on April 18, 1998 in Moncton, N.B.
[2] The defendant Pacific Auto Clinic Ltd. has been noted in default as a result, according to defendant James Whalen who represented himself at trial, of the principal owner Dwaye Murphy having suffered serious brain injury in an accident in July 1998.
[3] The defendant Whalen said he was a commission salesman for Pacific at the relevant times giving rise to this matter and otherwise denied any ownership or participation in Pacific. He said he appears in his own interest and to answer on behalf of Pacific because of Murphy's incapacitation.
[4] The parties had retained legal counsel who withdrew just before trial without explanation.
[5] The facts are essentially as follows and I so find.
[6] The plaintiff, 23, responded to the following ad in the Moncton Times in early April 1998:
"1997 CAVALIER, 2 dr, auto, PS PB, air, Dark green, like new condition, $11,500. 855-3608" (Ex. #1).
[7] The plaintiff test drove the Cavalier for approximately forty-five minutes and then requested that her licensed mechanic Tim Hicks check the vehicle, Whalen agreed and next day drove it himself to the Hicks garage and requested that Hicks carry out a motor vehicle inspection at the same time.
[8] Hicks testified he checked "the fluids, belts, listened to the engine and walked around the car - all the normal requirements for safety inspection" and issued the certificate of inspection. He did however note some paint on the right rear area and was told by Whalen that his wife had hit a pole in a parking lot and that he had replaced the molding and painted the scratched areas.
[9] At the Hicks garage the plaintiff along with her mother Sylvia Gibson specifically asked Whalen if the Cavalier had ever been in an accident and were told by Whalen "No it was never in an accident".
[10] The Cavalier is a U.S. make and registered 27-28,000 miles at the time of the sale.
[11] The plaintiff owned a 1991 Ford Tempo which she had assessed at a " starting value for asking purposes of about $3,700".
[12] The plaintiff and Whalen negotiated an agreement resulting in the following contract - Purchase price for Cavalier $12,862 to be paid by the trade-in of her 1991 Tempo $2,700; $100 deposit and cash balance including taxes of $10,062.
[13] The plaintiff secured a bank draft from the National Bank of Canada dated April 15, 1998 in the sum of $10,062 payable to both Pacific and Whalen which they both endorsed and cashed (Ex. #3).
[14] The plaintiff transferred her Tempo to Pacific and the Cavalier registration was transferred to the plaintiff from "previous owner Pacific" by registration certificate dated April 18, 1998 (Ex. #7).
[15] It was clear throughout that the plaintiff made it known that she wanted to buy an "almost new car".
[16] Approximately two weeks after the registration the plaintiff began hearing "crunching sounds and some shaking in the front end" and went to Lounsbury's GM dealership in Moncton seeking to have the warranty transferred to her name as there were then only 27,000 miles registered and the warranty allowed 36,000. A GM printout denied a warranty on the ground the vehicle was "salvage".
[17] The plaintiff searched the Cavalier title history at the New Brunswick Motor Vehicle Branch and learned that the immediate previous registered owner to Pacific was State Farm Mutual Insurance Company, 1165 South Highway 41, Gibsonton, Florida, U.S.A. and that it had been imported at Houlton/Woodstock via Hoppy's Vette Shack Inc. of Brandon, Florida to importer Pacific under the signature and home address of James Whalen on March 20, 1998, a few weeks prior to the sale to the plaintiff (Ex. #7).
[18] Mr. James Morrison, director of the New Brunswick Motor Vehicle Branch, testified that the Florida certificate of title which his department accepts as a "state to province" transfer validation had a whited out section where normally it is noted whether or not the vehicle is "salvage/rebuildable". Morrison verified all the motor vehicle title documentation entered at trial by the plaintiff.
[19] The plaintiff then noticed the trunk leaked and again took it to her mechanic Hicks who found under the trunk floor mat that the right side of the trunk floor had been "wrinkled - crunched and straightened with a mig welding bar still evident and some misalignment of the trunk lid" (Photo Ex. #5).
[20] The plaintiff through her then solicitor made a demand for reimbursement and damages from the defendants in compliance with section 16 of the Act .
[21] The defendant Whalen testified that Murphy on behalf of Pacific offered to provide the plaintiff with a substitute warranty and to pay for some repairs but that the plaintiff insisted on returning the vehicle and being paid monies "that Pacific did not have".
[22] Whalen testified he did not know the car had been in an accident.
[23] The evidence is clear that the Cavalier was not, as advertised, "in like new condition" and in fact had been in an accident contrary to the clear unqualified representation by the defendant Whalen that "it had never been in an accident".
[24] The Cavalier was appraised for the plaintiff July 8, 1998 by Sam Girvan, Toyota dealership owner in Moncton at $6,000 "not for retail - wholesale only - as is" listing several defects in support of the appraisal (Ex. #6).
[25] Under cross-examination the plaintiff acknowledged that in November 1998 while the Cavalier was parked in her driveway "someone walked over the roof", the cost of repairs, as appraised by MacDonald Pontiac Buick of Moncton being $1,744.96 (Ex. #13).
[26] On February 3, 1999 the Cavalier was reinspected by Motor Vehicle Department officer Camille LeBlanc whose report notes that for the issuance of a certificate the following is to be corrected: a torn wiper blade, right signal light not working, rear seat unhooked and "the rear section of the frame be rewelded (not a very big job)". The report further notes however that the plaintiff's mother states that she and her daughter are not prepared to repair anything as they are seeking full reimbursement which resulted in LeBlanc affixing a rejection certificate on the vehicle ( Ex. #11).
[27] In my view the evidence is clear that both defendants were jointly and severally involved in the importing and sale of this vehicle to the plaintiff and, at best negligently, misrepresented to the plaintiff that the vehicle was "in like new condition" and "had never been in an accident" knowing or being willfully blind to the fact that this was false.
[28] I find that the plaintiff has complied with and is entitled to remedies under the Act .
[29] The plaintiff specifically seeks an order from this Court that she may sell the Cavalier rather than return it to the defendants, that the defendants be ordered to either assume the balance of her debt with the National Bank or pay her the difference between the full original purchase price and the Girvan/Toyota appraisal plus interest, out of pocket expenses, punitive damages and costs.
[30] The defendant Whalen, at the conclusion of trial, said he tried to negotiate a settlement "to meet her half-way" but was unable to do so.
[31] I find the plaintiff has suffered damages and is entitled to redress under section 17 of the Act on the following basis:
Original purchase price $12,862.00
Less Girvan/Toyota appraisal 6,000.00
-------------
Balance $6,862.00
General damages $2,500.00
Interest at the rate of 8%
from April 1998 to date
in the sum of $1,500.00
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Total $10,862.00
[32] In the result there will be judgment for the plaintiff against both defendants jointly and severally in the sum of $10,862 plus costs which I fix in the sum of $1,500 plus $500 for disbursements.
[33] The plaintiff may dispose of the Cavalier as she sees fit.
[34] I direct that judgment be entered accordingly.
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