Case Title: Ranger v. Hyundai Motor America

Citation: 

Docket Number: 220058

State: virginia

Court: Virginia Supreme Court

Date: 2023-04-06T00:00:00Z

Document:
PRESENT:  All the Justices 
 
NICHOLAS DAVID RANGER 
 
 
 
OPINION BY 
v.  Record No. 220058 
JUSTICE STEPHEN R. McCULLOUGH 
 
 
 
April 6, 2023 
HYUNDAI MOTOR AMERICA 
 
 
FROM THE CIRCUIT COURT OF ACCOMACK COUNTY 
William Revell Lewis, III, Judge 
 
 
Nicholas David Ranger appeals from the circuit court’s grant of summary judgment in a 
case arising under Virginia’s “Lemon Law,” Code § 59.1-207.9 et seq.  The case turns on 
whether a proper refund under the Lemon Law includes the recovery of pre-litigation attorney’s 
fees.  We conclude that to satisfy the refund requirements under Virginia’s Lemon Law, a 
manufacturer is not required to pay pre-litigation attorney’s fees.  Because the manufacturer’s 
refund satisfied the requirements of the Lemon Law, we will affirm the trial court’s grant of 
summary judgment. 
BACKGROUND 
 
Ranger purchased a new Hyundai vehicle in 2018.  Ranger experienced some problems 
with the vehicle, and it had to be repeatedly repaired.  He retained a lawyer, who wrote a demand 
letter to Hyundai.  The letter demanded a refund of the purchase price “along with all interest 
paid on the finance note as well as attorney fees and incidental and consequential damages.”  
Hyundai responded by offering to repurchase the vehicle “pursuant to the applicable statutes” 
and offered to pay some of the attorney’s fees.  Ranger refused the offer on the basis that 
Hyundai failed to sufficiently reimburse him for his pre-litigation attorney’s fees.  Ranger then 
filed a complaint, alleging, as relevant here, a violation of the Lemon Law. 
 
2 
 
Hyundai moved for summary judgment, contending that once it offered to repurchase the 
vehicle, it complied with the Lemon Law, and “[p]laintiff is barred from seeking relief under the 
statute as a matter of law.”  The circuit court agreed and granted Hyundai’s motion for summary 
judgment.  The court entered a final order dismissing the case with prejudice.  This appeal 
followed. 
ANALYSIS 
I. 
COLLATERAL AND INCIDENTAL DAMAGES UNDER THE LEMON LAW. 
The Lemon Law is a statutory creation.  This statute offers some advantages to both 
consumers and manufacturers.  The statute benefits consumers by prodding manufacturers to 
repair a vehicle, replace a vehicle, or offer a refund.  The statute benefits manufacturers, because 
compliance avoids costly litigation – litigation that can be more expensive than the cost of 
repairing or replacing a vehicle, or of offering a refund.  The General Assembly’s stated intent is 
that “a good faith motor vehicle warranty complaint by a consumer should be resolved by the 
manufacturer, or its agent, within a specified period of time” and that “a consumer may receive a 
replacement motor vehicle, or a full refund, for a motor vehicle which cannot be brought into 
conformity with the express warranty issued by the manufacturer.”  Code § 59.1-207.10. 
More specifically, if the manufacturer does not, or is unable to, bring a defective vehicle 
into conformity with the warranty within the specified time, the manufacturer must 
[a]ccept return of the motor vehicle and refund to the consumer . . . the full 
contract price, including all collateral charges, incidental damages, less a 
reasonable allowance for the consumer’s use of the vehicle up to the date 
of the first notice of nonconformity that is given to the manufacturer, its 
agents or authorized dealer. 
 
Code § 59.1-207.13(A)(2).  The statute thus specifies that a proper refund includes the 
recovery of “collateral charges” and “incidental damages.” 
 
3 
The term “collateral charges” is specifically defined to cover “any sales-related . . . 
charges including but not limited to sales tax, license fees, registration fees, title fees, finance 
charges and interest, transportation charges, dealer preparation charges or any other charges for 
service contracts, undercoating, rust proofing or installed options, not recoverable from a third 
party.”  Code § 59.1-207.11.  This definition does not mention or contemplate attorney’s fees. 
The Lemon Law defines “incidental damages” by referencing the definition found in a 
provision of the Uniform Commercial Code.  Code § 59.1-207.11 (incorporating by reference 
Code § 8.2-715).  The definition of “incidental damages” found in the applicable provision of the 
Uniform Commercial Code provides that such damages 
include expenses reasonably incurred in inspection, receipt, 
transportation and care and custody of goods rightfully rejected, 
any commercially reasonable charges, expenses or commissions in 
connection with effecting cover and any other reasonable expense 
incident to the delay or other breach. 
 
Code § 8.2-715(1).  This definition of “incidental damages” also does not mention or 
contemplate attorney’s fees.  The official commentary to this provision explains that this 
subsection “is intended to provide reimbursement for the buyer who incurs reasonable expenses 
in connection with the handling of rightfully rejected goods or goods whose acceptance may be 
justifiably revoked, or in connection with effecting cover where the breach of the contract lies in 
non-conformity or non-delivery of the goods.”  U.C.C. § 2-715 cmt. 1.  The official commentary 
also makes no mention of attorney’s fees. 
According to one writer discussing incidental damages under the U.C.C., 
[w]hen the goods involved in the breached contract are vehicles, 
typical items of incidental damages include: sales tax paid on the 
purchase price; insurance costs following rejection or 
revocation; interest or finance charges paid for any loan on the 
purchase price; [and] the cost of license plates, storage charges, 
 
4 
and related items from the time of rejection or revocation until 
entry of judgment. 
 
Roy Ryden Anderson, Incidental and Consequential Damages, 7 J.L. & COM. 327, 347 (1987) 
(footnotes omitted). 
Although we could not find a Virginia case on point, the “overwhelming weight of 
authority” from other courts concludes that attorney’s fees are not available under this provision 
of the Uniform Commercial Code.  Nick’s Auto Sales, Inc. v. Radcliff Auto Sales, Inc., 591 
S.W.2d 709, 711 (Ky. Ct. App. 1979) (collecting cases).  We agree.  Pre-litigation attorney’s fees 
are not a component of collateral or incidental damages under the Lemon Law.  Therefore, when 
a manufacturer provides a refund, it is not required to pay pre-litigation attorney’s fees to satisfy 
its obligations under the Lemon Law. 
The Lemon Law further provides a judicial remedy in the event the manufacturer fails to 
abide by its obligations under the law.  “Any consumer who suffers loss by reason of a violation 
of any provision of this [act] may bring a civil action to enforce such provision.”  Code 
§ 59.1-207.14.  For there to be a civil action, however, there must be a “violation of any 
provision” of the Lemon Law.  If there is no violation, there can be no viable civil action.  A 
manufacturer who has offered a refund that satisfies the Lemon Law requirements is not in 
violation of the statute.  The only time a consumer can recover attorney’s fees is when a 
consumer has filed an action and prevailed.  See id.  In that instance, the consumer is entitled to 
“recover reasonable attorney’s fees, expert witness fees and court costs incurred by bringing such 
action[].”  Id. 
 
 
 
5 
 
II. 
THE TRIAL COURT PROPERLY GRANTED SUMMARY JUDGMENT WHEN THE ONLY  
 
 
DISPUTE WAS OVER A CLAIM FOR PRE-LITIGATION ATTORNEY’S FEES, WHICH THE  
 
 
LEMON LAW DOES NOT ALLOW. 
 
 
Summary judgment is appropriate in cases where no “material fact is genuinely in 
dispute” and the moving party is entitled to judgment as a matter of law.  Va. Sup. Ct. R. 3:20; 
Mount Aldie, LLC v. Land Trust of Va., Inc., 293 Va. 190, 196 (2017).  In an appeal from a 
circuit court’s decision to grant or deny summary judgment, we review the application of the law 
to undisputed facts de novo.  Deutsche Bank Nat’l Trust Co. v. Arrington, 290 Va. 109, 114, 772 
S.E.2d 571 (2015). 
Virginia has long adhered to the “American Rule” for attorney’s fees.  Under this rule, 
“absent a specific contractual or statutory provision to the contrary, attorney’s fees are not 
recoverable by a prevailing litigant from the losing litigant.”  REVI, LLC v. Chi. Title Ins. Co., 
290 Va. 203, 213 (2015) (quoting Mullins v. Richlands Nat’l Bank, 241 Va. 447, 449 (1991)).  
The Lemon Law does permit a recovery of reasonable attorney’s fees, but only when a consumer 
(1) has suffered a violation of the Lemon Law, and (2) brings a successful action to enforce his 
or her rights.  Code § 59.1-207.14.  As noted above, although the “refund” definition includes 
“collateral charges,” such damages, as defined in the Lemon Law, do not include attorney’s fees.  
See Code § 59.1-207.11.  A refund also includes “incidental damages” – but again, as defined in 
the statute, such damages do not include attorney’s fees either.  See Code § 8.2-715(1); Nick’s 
Auto Sales, Inc., 591 S.W.2d at 711. 
The record here establishes that the manufacturer offered the consumer a refund within 
the intendment of the statute, and that the only dispute was over the question of whether a proper 
refund under the statute included pre-litigation attorney’s fees.  See Appellant’s Br. at 2 (“Ranger 
 
6 
declined the offer since it did not fully reimburse his attorney’s fees incurred during the pre-
litigation settlement process.”). 
We hold that the manufacturer did not violate the Lemon Law by failing to pay 
pre-litigation attorney’s fees because the Lemon Law does not provide for such fees.  The refund 
offered by the manufacturer was in conformity with the requirements of the Lemon Law.  The 
facts in dispute – the payment of and the amount of pre-litigation attorney’s fees – were not 
material under the law because Ranger was not entitled to recover those fees.  Because there was 
no genuine dispute of material fact, the trial court correctly granted summary judgment to 
Hyundai. 
We hasten to add that if the manufacturer has not been able to bring a vehicle into 
conformity with the warranty, and also does not offer an acceptable replacement vehicle or a full 
refund as defined by the Lemon Law, then the consumer can bring an action for damages under 
the Lemon Law and, if the consumer prevails, recover attorney’s fees.  This is not such a case. 
CONCLUSION 
 
For the foregoing reasons, the judgment of the circuit court will be affirmed. 
Affirmed.