Title: Volkswagen of America, Inc. v. Dillard

State: alabama

Issuer: Alabama Supreme Court

Document:

579 So. 2d 1301 (1991)
VOLKSWAGEN OF AMERICA, INC.
v.
Edwin O. DILLARD.
89-1736.

Supreme Court of Alabama.
March 8, 1991.
Rehearing Denied April 11, 1991.
H. Dean Mooty, Jr. of Capell, Howard, Knabe & Cobbs, Montgomery, for appellant.
George H.B. Mathews, Montgomery, for appellee.
HOUSTON, Justice.
This is an appeal from a judgment based on a jury verdict entered against Volkswagen United States, Inc., a division of Volkswagen of America, Inc. ("Volkswagen"), in favor of Edwin O. Dillard and awarding him money damages based on a *1302 breach of a warranty given on the sale of a new 1987 Volkswagen automobile. We affirm.
Dillard sued Volkswagen, alleging the breach of an express warranty and claiming damages for loss of the value of the car, damages for mental anguish, and attorney fees and costs. The jury returned the following verdict:
The trial court entered judgment on the verdict and also awarded attorney fees of $15,000 and costs of $231.81. Volkswagen appealed, arguing that the trial court improperly charged the jury that it could award damages for mental anguish on Dillard's breach of warranty claim. That charge reads as follows:
The sole issue presented on appeal is whether damages for mental anguish are recoverable in a breach of warranty action relating to the sale of a new automobile.
The facts of the case are essentially undisputed.
In July 1988, Dillard purchased a new 1987 Volkswagen Scirocco automobile for $16,449.56. In connection with this purchase, Dillard received the Volkswagen warranty booklet and a folder in which the warranty was delivered, entitled the "VW Partnership." At the time Dillard purchased the automobile, he said, he thought it would be reliable and safe.
Dillard purchased the automobile from Southern States Collections, the then authorized Volkswagen dealer in Montgomery, which was succeeded by Parks Imports, Inc., as the local Volkswagen dealer. In April 1990, while Dillard's automobile was still under warranty, Parks Imports closed, leaving no Volkswagen dealership in Montgomery. Subsequently, Volkswagen appointed Jack Ingram Motors as its Volkswagen dealer, but kept this information from Dillard, even though his automobile was still in warranty and needed repairs. During the first year Dillard owned the automobile, he turned the automobile in for repair from 12 to 14 times. Repair reports indicate that he turned the automobile in on 21 occasions during the first year and a half. On one occasion, the automobile was kept for two months. Altogether, as of the date of the trial, the automobile had been in the shop for mechanical repairs for a period of four months. Not only had Dillard spoken with numerous people in the local Volkswagen dealerships and with Volkswagen's own representative about the problems with the automobile, but he had also written Volkswagen.
Dillard experienced "a hesitation, stalling, jerking problem" with the car and also "a grinding noise in the gear shift." There was no pattern to the loss of power, hesitation, and stalling problems. According to Dillard, the jerking problem, which occurs in every gear, suggests that there is "air or water in the gas line."
Although he had turned the automobile in for repairs, these problems continued. Because the automobile "cut off" and "stopped" when he pulled out in front of *1303 oncoming traffic, he had to make allowances for the possibility that the automobile might not accelerate properly. On occasion, when the car "died," Dillard could not get it to crank and was forced to push the automobile out of the street until the automobile reached normal operating temperatures  oftentimes, he had to wait as long as 15 or 20 minutes. The automobile broke down one night and he had to walk home, the walk taking approximately three hours.
In addition to the problems heretofore discussed, the automobile also had a problem that caused white or light blue smoke to come out of the exhaust. The severity of the problem varied, but, at its worse, Dillard described the problem as follows:
When the automobile was smoking badly and was stopped at a light, it filled with smoke, which Dillard tried to combat by opening the window and vents and by turning on the air conditioner "full blast." There was no way to predict when the smoking problem was going to occur.
The automobile did not idle properly  it would race, slow down, and then race. The automobile had a sun roof that leaked when it rained, so that Dillard used plastic to try to keep the rain out.
Dillard contends that the automobile's "stalling, cutting off, [and] losing power in the face of on coming traffic has caused him anxiety, embarrassment, and anger"; that "He has had near misses in driving his car as a result of its loss of power"; and that "When that happens it frightens him." Dillard also contends that the automobile's performance caused him frustration and disappointment and that the automobile had not been reliable or dependable, had put his life in jeopardy, had not provided him with safe transportation, and had caused him to worry. In fact, according to Dillard, it is the worst situation that he has ever been in in his life.
A Volkswagen representative testified that automobile owners have more emotional attachment to new cars than to used ones; that the situation he observed concerning the automobile's hesitation would have frustrated him; that he had no doubts about the legitimacy of the "stack full" of complaints about the performance of the automobile; that he agreed Dillard had some reason for questioning the durability and reliability of this particular automobile; and that Dillard's ownership of the automobile had been anything but pleasurable for a good portion of the time. In fact, with respect to the claim found in the VW brochure on the 1987 Volkswagen Scirocco that "[a] nationwide network of authorized Volkswagen dealers stands" behind the car, Volkswagen's representative testified that that "hasn't been the reality of the situation here."
Specifically, the Volkswagen representative testified as follows:
"FAHRVERGNÜGEN,"[1] THIS WAS NOT.
Although the general rule in Alabama is that mental anguish is not a recoverable *1304 element of damages arising from breach of contract, this Court has traditionally recognized the following exception to the rule:
B & M Homes, Inc. v. Hogan, 376 So. 2d 667, 671 (Ala.1979) (citations omitted) (emphasis added), quoting F. Becker Asphaltum Roofing Co. v. Murphy, 224 Ala. 655, 657, 141 So. 630, 631 (1932), which was quoted in Stead v. Blue Cross-Blue Shield of Alabama, 346 So. 2d 1140, 1143 (Ala. 1977).
These cases have not required mental anguish to be corroborated by the presence of physical symptoms. Rather, the only requirement in such cases is the presentation of evidence of mental anguish. Thereafter, the question of damages for mental anguish becomes a question of fact for the jury to decide. B & M Homes, Inc., supra. For actions on contracts for the repair or construction of houses or dwellings or the delivery of utilities thereto, where the breach affected habitability, see Orkin Exterminating Co. v. Donavan, 519 So. 2d 1330 (Ala.1988); Lawler Mobile Homes, Inc. v. Tarver, 492 So. 2d 297 (Ala.1987); Alabama Power Co. v. Harmon, 483 So. 2d 386 (Ala.1986); B & M Homes, Inc. v. Hogan, supra; Alabama Water Service Co. v. Wakefield, 231 Ala. 112, 163 So. 626 (1935); Becker Roofing Co. v. Pike, 230 Ala. 289, 160 So. 692 (1935); F. Becker Asphaltum Roofing Co. v. Murphy, supra; Hill v. Sereneck, 355 So. 2d 1129 (Ala.Civ.App. 1978); for actions on contracts of carriage, see Nashville C.S.L. Ry. v. Campbell, 212 Ala. 27, 101 So. 615 (1924), and for contracts to provide special accommodation, see Pullman Co. v. Meyer, 195 Ala. 397, 70 So. 763 (1915); and for actions on a physician's breach of contract to deliver a baby, thereby causing the mother to deliver a stillborn child, see Taylor v. Baptist Medical Center, Inc., 400 So. 2d 369 (Ala.1981).
In general, the Court has never applied this exception to the sale of a new automobile, so there is no precedent in Alabama for the recovery of damages for mental anguish resulting from a breach of contract or warranty in the sale of a new car. See Ford Motor Co., Inc. v. Phillips, 551 So. 2d 992 (Ala.1989).[2]
In the instant case, we are asked to widen the breach in the general rule beyond its present limits so as to allow the recovery of damages for mental anguish in a breach of warranty action involving the sale of a new automobile. Although the parties argue whether the facts of this case fit within the exception to the general rule as heretofore stated, because this case involves the sale of an automobile, we must examine this case in light of the Uniform Commercial Code, Article 2, Ala.Code 1975, § 7-2-101 et seq., dealing with sales, for *1305 guidance as to the proper measure of damages.[3]
The measure of damages for breach of warranty in the sale of goods is set forth in § 7-2-714(2), (3):
Section 7-2-715 reads, in pertinent part, as follows:
The fundamental rule of statutory construction is to ascertain and give effect to the intent of the legislature in enacting the statute. If possible, the intent of the legislature should be gathered from the language of the statute itself. However, if the statute is ambiguous or uncertain, the Court may consider conditions that might arise under the provisions of the statute and examine the results that will flow from giving the language in question one particular meaning rather than another. John Deere Co. v. Gamble, 523 So. 2d 95, 96-97 (Ala.1988), quoting from Clark v. Houston County Comm'n, 507 So. 2d 902, 903-04 (Ala.1987).
The language of the above-cited sections is not ambiguous. Rather, the legislature expressly stated that it did not intend to limit "the seller's liability for damages for injury to the person in the case of consumer goods" and emphasized that such "[d]amages in an action for injury to the person [was to] include those damages ordinarily allowable in such actions at law."
Therefore, in order to resolve the issue before us, we must determine what the legislature intended by the words "injury to the person," as they relate to an award of damages for breach of warranty.
Black's Law Dictionary 786 (6th ed. 1990). (Emphasis added.)
Black's Law Dictionary 985-86 (6th ed. 1990). (Emphasis added.) (Citation omitted.)
When we researched further, looking to the section of the Alabama digest entitled "MEASURE OF DAMAGES  (A) INJURIES TO THE PERSON," as it relates to contract and tort law, we found that the cases that are cited specifically therein allow for damages not only for physical injury but also for mental suffering. See 7A, Alabama Digest, Key nos. 95, 102.
Furthermore, over 75 years ago, in Vinson v. Southern Bell Telephone & Telegraph Co., 188 Ala. 292, 304-05, 66 So. 100, 103 (1914), the Court, in effect, explained what constituted "injury to the person" so as to justify an award of damages:
(Emphasis added.)
In addition, as previously stated, although Alabama historically did not allow the recovery of damages for mental distress where there was no accompanying physical injury, we have now adopted the rule that recovery may be had for mental suffering without the presence of physical injury, concluding in 1981 in Taylor v. Baptist Medical Center, supra, at 374, that "to continue to require physical injury ... would be an adherence to procrustean principles which have little or no resemblance to medical realities." (Emphasis added.) Consistent with the conclusion in Taylor v. Baptist Medical Center, consistent with contract and tort law in Alabama where damages for injury to the person are allowed for both physical injury and for mental anguish, and based on the express language of the UCC allowing damages for injury to the person in the case of a breach of warranty to include those damages ordinarily allowable in such actions at law, we do not interpret the UCC as restricting damages for breach of warranty for injury to the person solely to physical injury. Rather, we interpret that language as allowing *1307 the jury to award such damages for mental anguish as it, in its sound judgment and discretion, determines would reasonably and fairly compensate the person for the mental anguish suffered.
Therefore, in the instant case, based on the undisputed facts, which evince a breach of warranty that caused Dillard to suffer anxiety, embarrassment, anger, fear, frustration, disappointment, and worry (not to mention the undisputed facts that the automobile has not been reliable or dependable and has not provided him with safe transportation); and based on our conclusion that the intent of the legislature, when it provided for an award of damages for injury to the person for breach of warranty, was that those damages include not only damages to compensate for physical injury, but also damages to compensate for mental anguish, we conclude that the trial court properly charged the jury that it could award damages for mental suffering in an action for breach of a warranty given on the sale of a new car.
AFFIRMED.
HORNSBY, C.J., and MADDOX, SHORES and INGRAM, JJ., concur.
KENNEDY, J., concurs in the result.
[1]  "Fahr" comes from "fahren," which means "to drive" or "to ride," and Vergnügen means "pleasure, enjoyment; fun; entertainment." Langenscheidt's New College German Dictionary 185, 570 (1973).

[Reporter of Decisions' note: The word "Fahrvergnügen," suggesting the pleasure of driving, and particularly the pleasure of driving a German-engineered automobile, was the theme of an extensive Volkswagen advertising campaign being conducted at the time this opinion was released.]
[2]  We must note at this point that the Phillips opinion could be misconstrued as setting such a precedent. See briefs of Dillard and Volkswagen; see, also, C. Gamble, Alabama Law Of Damages, § 35-18 (2d ed. 1990 Supp.) However, a close reading of that case, in light of a clear understanding of the resolution of the issues in Ford Motor Co. v. Burkett, 494 So. 2d 416 (Ala.1986) (the case on which this Court based its holding in Phillips), evinces an irreconcilable inconsistency in the two. It appears that the Court in Phillips addressed the issue of damages for mental anguish as it related to the breach of warranty claim, but then resolved the issue of such damages on the authority of Burkett, in which the trial court found evidence of misrepresentation and thus allowed an award of damages for mental anguish. Therefore, we find Phillips to be of no precedential value to the issue before us. However, even though we question the legal reasoning used by the Court in resolving the issue in Phillips, in light of our holding in the instant case, the result reached in Phillips was nonetheless correct.
[3]  The exclusive remedy provided by the usual new vehicle contract is repair or replacement of the defective parts. Whatever the engineering difficulty is that makes an automobile a "lemon," no amount of repair or replacement is adequate to solve the problem; thus the exclusive remedy fails, and the UCC remedies prevail. Riley v. Ford Motor Co., 442 F.2d 670 (5th Cir. 1971); C. Gamble, Damages, § 35-3. In other words, where, because of the circumstances, an apparently fair and reasonable limitation or exclusive remedy fails in its purpose or operates to deprive either party of the substantial value of the bargain, that part of the agreement must give way to the general remedies provided by the UCC. See Bishop v. Sales, 336 So. 2d 1340 (Ala.1976); see, also, Volkswagen of America, Inc. v. Harrell, 431 So. 2d 156 (Ala.1983); Winchester v. McCulloch Bros. Garage, 388 So. 2d 927 (Ala.1980); C. Gamble, Damages, § 35-3. In addition, any limitation or exclusion of consequential damages for injury to the person is prima facie unconscionable. Section 7-2-719(3).