Filed 4/30/14

CERTIFIED FOR PUBLICATION

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

FOURTH APPELLATE DISTRICT

DIVISION THREE

MEGA RV CORPORATION,

 Cross-complainant, Cross-defendant 

and Appellant,

v.

HWH CORPORATION,

 Cross-defendant, Cross-complainant 

and Respondent.

 G047718

 (Super. Ct. No. 30-2007-00100242)

 O P I N I O N 

Appeal from a judgment of the Superior Court of Orange County, Jamoa A.

Moberly, Judge. Affirmed as modified.

Adam K. Obeid for Cross-complainant, Cross-defendant and Appellant.

David B. Dimitruk for Cross-defendant, Cross-complainant and 

Respondent.

 
2

This case began with a prosaic dispute. John and Dawn Ertz (collectively 

the Ertzes) purchased a motor home from retailer Mega RV Corporation (Mega RV). 

Citing alleged defects in the motor home, the Ertzes sued Mega RV, Country Coach, 

L.L.C. (Country Coach; the manufacturer of the motor home), and Bank of America, 

N.A. (Bank of America; the financier of the transaction) under the Song-Beverly 

Consumer Warranty Act (the Act; Civ. Code, § 1790 et seq.).

1

Mega RV seemingly had 

little to fear. According to Mega RV’s appellate brief, “Country Coach was providing 

Mega RV with defense and indemnity in this case pursuant to contract and statute.” 

Unfortunately for all parties to this case, an involuntary bankruptcy petition 

was filed against Country Coach in 2009. Suddenly, Mega RV faced the prospect of 

paying for its own defense and for any award of damages and attorney fees obtained by 

the Ertzes under the Act. (See § 1794.)

Mega RV devised a clever response to its predicament. Citing section 

1792, which states in relevant part that “[t]he retail seller shall have a right of indemnity 

against the manufacturer in the amount of any liability under this section,” Mega RV 

posited that component part manufacturers (not just the ultimate manufacturer of the final 

consumer good) are subject to liability and indemnity obligations under the Act. HWH 

Corporation (HWH) manufactured hydraulic components incorporated by Country Coach 

into the motor home ultimately sold to the Ertzes by Mega RV. Mega RV filed a crosscomplaint against HWH, seeking total or partial indemnification from HWH under the 

Act. 

But Mega RV’s stratagem backfired. The trial court concluded HWH was 

not required to indemnify Mega RV under the Act for any relief obtained by the Ertzes. 

Moreover, ruling on HWH’s cross-complaint, the court awarded $166,000 in damages to 

 

1

All statutory references are to the Civil Code unless otherwise stated. 
3

HWH and against Mega RV, reasoning that the “tort of another” doctrine justified this 

departure from the typical rule that a party pays its own attorney fees. 

We agree with the portion of the judgment declaring that Mega RV is not 

entitled to indemnity from HWH. As we shall explain, a component part manufacturer is 

only subject to section 1792 obligations if it has provided an express warranty to the 

consumer pertaining to the component part at issue. But we disagree with the court’s 

application of the tort of another doctrine. We therefore strike the award of damages to 

HWH and affirm the judgment as modified.

FACTS

Pre-trial Procedural History

The Ertzes’ initial complaint was filed in December 2007; a first amended 

complaint was filed in October 2008. Both complaints featured causes of action under 

the Act and alternative causes of action under the California Uniform Commercial Code. 

The only difference between the two complaints was the addition of Bank of America as 

a defendant in the first amended complaint, alongside Country Coach and Mega RV. 

An involuntary bankruptcy petition was filed against Country Coach in 

2009. Mega RV moved to compel the joinder of HWH as a defendant in June 2010. The 

court granted the motion, thereby compelling plaintiffs (the Ertzes) to name HWH as a 

defendant. HWH was named as a defendant in the Ertzes’ December 2010 second 

amended complaint. 

Mega RV’s August 2010 cross-complaint sought indemnity from HWH as 

well as declaratory relief. The key paragraph in Mega RV’s cross-complaint alleged as 

follows: The motor home “was designed and manufactured by Country Coach, 

integrating hydraulic systems and hydraulic parts . . . designed and manufactured by 

HWH. Specifically, the hydraulic system, hydraulic lines, and hydraulic parts that 
4

comprise the mechanisms that move the [motor home’s] slide outs were manufactured 

and supplied by HWH. Moreover, HWH provided an express warranty . . . for each of 

the hydraulic systems, hydraulic lines and hydraulic parts that it manufactured and 

which were integrated into the design and manufacture of the [motor home].” (Italics 

added.) Mega RV alleged it was entitled to indemnity under section 1792 based on an 

alleged breach of the implied warranty of merchantability by HWH. 

In its cross-complaint for declaratory relief and equitable indemnity, HWH 

contended the Act did not apply to it for several reasons, among which was the following 

allegation: The Act “does not apply to HWH because HWH did not issue an express 

warranty . . . to Country Coach, the Ertzes or Mega RV.” As part of its equitable 

indemnity cause of action, HWH alleged that cross-defendants (including Mega RV and 

the Ertzes) “were negligent in the way they either designed or manufactured the motor 

home or its component parts, diagnosed the causes and conditions in the motor home, and 

effectuated and failed to effectuate repairs to the motor home. . . . [S]uch negligence (1) 

caused the Ertz[es] damages, if any, (2) also caused the conditions in the motor home to 

not be repaired on which the Ertz[es] base their lawsuit against Mega RV, and (3) 

impaired HWH’s rights to effectuate repairs, if it was required to do so at all, and avoid 

the costs of this lawsuit.” 

In June 2011, HWH and the Ertzes entered into a settlement agreement.

Pursuant to the settlement agreement, the Ertzes paid HWH $2,000 and dismissed HWH 

from the lawsuit with prejudice in exchange for a release of all claims by HWH. As 

recited in the settlement agreement, the Ertzes “independently determined to their own 

satisfaction that HWH . . . did not cause or contribute to causing the hydraulic leaks 

that . . . the Motor Home [is alleged to have] sustained.” The court denied HWH’s Code 

of Civil Procedure section 877.6 motion for an order determining the settlement was in 

good faith. 
5

Just before trial was set to begin, the Ertzes, Mega RV, and Bank of 

America agreed to submit the matter to binding arbitration. The court stayed Mega RV’s 

cross-complaint against HWH. But HWH opposed a stay of the trial on its crosscomplaint. The court allowed HWH’s cross-complaint to proceed to a separate trial 

(even though it was premised on indemnity and declaratory relief issues that only needed 

to be decided if the Ertzes established the liability of Mega RV in the first place).

2

Evidence at Trial

HWH is located in Iowa. HWH does not manufacture motor homes. HWH 

manufactures component parts and supplies those parts (primarily “leveling systems and 

slide-out mechanisms”) to manufacturers of motor homes (and other vehicles). HWH

does not manufacture every part used in its slide-out hydraulic systems. For instance, 

HWH purchases hoses from Eaton Corporation and Parker Hannifin Corporation. HWH 

has sold components to Country Coach for more than 20 years. Country Coach placed 

purchase orders and HWH shipped the components from Iowa to Country Coach in 

Oregon by common carrier. HWH did not provide engineering services to Country 

Coach regarding the construction of its motor homes. 

At all relevant times, Mega RV was an authorized Country Coach warranty 

repair and service center, but was not an authorized HWH warranty repair or service 

center. Country Coach maintained a policy of requesting its warranty repair providers to 

send replaced parts to Country Coach, in part to effectuate reimbursement from the 

manufacturer of the part or component when appropriate. 

The Country Coach motor home purchased by the Ertzes from Mega RV

featured four slideout rooms. A slideout is a box that extends from the motor home to 

 

2 We reserve additional discussion of this case’s tortured procedural history 

until the end of this opinion.
6

provide additional living space. Hydraulic components sold by HWH to Country Coach 

were integral to the operation of the slideout rooms in the Ertzes’ motor home.

John Ertz received two written warranties from Country Coach at the time 

he purchased the motor home. There is no mention in John’s testimony about any 

warranty from HWH. Much of John’s testimony pertains to the problems he had with his 

motor home and the efforts undertaken to repair his motor home. HWH is not mentioned 

during this testimony. John does not recall receiving any communications at any time 

from HWH. John did not attempt to notify HWH at any time of problems with his motor 

home. John filed this lawsuit because he could not enjoy the use of his motor home as a 

result of problems with the slideout rooms. 

Vincent Edward Anderson is a service technician at Mega RV. In response 

to a January 2007 complaint about the slideouts, Anderson found a leaking hydraulic 

hose and replaced it. Anderson received permission to replace the hose from Country 

Coach; the work was performed under the Country Coach warranty. Country Coach paid 

Mega RV for the repair. 

Ryan Smith worked as a dealer service representative for Country Coach 

prior to its demise. There were multiple calls with regard to issues with the slideout 

rooms on the model sold to the Ertzes; “[i]t seemed like it was becoming a repetitive 

issue.” Smith talked to John on April 26, 2007 about problems with the slideouts, which 

were not working. Smith arranged for an unspecified repair service (not Mega RV) to 

perform a repair on the Ertzes’ motor home in Las Vegas. Smith also personally replaced 

a “solenoid” because “the pressure relief portion of the solenoid valve was bent,” 

resulting in leaking hydraulic fluid. The slide-out rooms continued to cause problems for 

the Ertzes. Mega RV performed additional repairs in May 2007. Smith authorized work 

at Temecula Valley R.V. in June 2007 because John did not want to return to Mega RV

for additional servicing. 
7

A family-owned repair firm in Arizona also worked on the motor home in 

November 2007. A Country Coach representative requested the work on behalf of John. 

A hydraulic hose was leaking on the passenger rear side of the motor home. The hose 

had detached from a brass fitting previously attached to the motor home at some 

unknown time. This brass fitting was not on the motor home in January 2007 and should 

not have been attached to the motor home and the HWH hydraulic components. The 

brass fitting was not manufactured by HWH. There was no direct evidence in the record 

regarding who attached the brass fitting and when it was attached. HWH argued this 

fitting must have been attached in April 2007 by the unspecified repair firm hired by 

Smith. HWH argued this showed Mega RV’s negligence because Mega RV should have 

discovered the fitting in its May 2007 servicing of the motor home.

HWH Chief Executive Officer Paul Hanser testified, both as a percipient 

and expert witness. Hanser opined that none of the HWH products were defective on the 

Ertz motor home. Hanser stated, “HWH provides warranty information to Country 

Coach, and then they distribute it. We did not specifically hand Mr. Ertz a warranty 

card.” There is only one warranty provided by HWH and it pertains to “the leveling 

system.” The Ertzes “could have contacted HWH for warranty service under the 

warranty” if there was an issue with the leveling system. HWH did not provide any 

written warranty to Mega RV. According to Hanser, Mega RV completed a normal 

replacement job of the hydraulic hose in January 2007 and he “found nothing on the 

[replaced] hose that was of concern.” Instead, the fundamental problem with the motor 

home was the Country Coach design, which exposed hydraulic components to 

temperatures above 180 degrees. 

Court’s Ruling and Judgment

The court ultimately ruled in favor of HWH, determining HWH had no 

obligation to indemnify Mega RV. The court also ruled that HWH was entitled to 
8

damages in the amount of $166,000 pursuant to the tort of another rule, based on Mega 

RV’s negligence “with regard to a service that it performed on the motor home owned by 

the plaintiffs.”3Based on its rulings on HWH’s cross-complaint, the court also granted 

HWH’s motion for judgment on the pleadings as to Mega RV’s cross-complaint. The 

court entered a separate judgment on the cross-complaints filed by Mega RV and HWH 

in accordance with these rulings.

4

DISCUSSION

Mega RV contends the court erred (1) in its conclusion that HWH cannot 

be held liable for indemnity, (2) in its award of damages to HWH, and (3) in its decision 

to try HWH’s cross-complaint separately from the rest of the case.

HWH is Not Obligated to Indemnify Mega RV

As to whether HWH must indemnify Mega RV under section 1792, we are 

presented primarily with questions of statutory interpretation and construction. Does the 

Act (and in particular § 1792) apply only to the single manufacturer occupying the 

terminal stage of the manufacturing process? If so, HWH cannot be liable in indemnity

under the Act to Mega RV regardless of the factual circumstances of this case. 

 

3

Extensive portions of the record and the parties’ briefs are devoted to 

voluminous motion practice by the parties (e.g., wrangling as to the propriety of several 

different versions of the statement of decision, motions for judgment on the pleadings, 

motion for a new trial). For the most part, because our analysis is driven by de novo 

review of the legal issues in this case, we can ignore this morass. As noted above, 

however, we shall return to the procedural history of the case at the end of the opinion.

4

By a January 10, 2014 order, this court determined that the separate 

judgment adjudicating the rights of HWH and Mega RV was appealable and that the case 

should not be dismissed for lack of jurisdiction. 
9

Conversely, does section 1792 potentially apply to multiple entities participating in the

manufacturing chain of production? If so, under what circumstances are component part 

manufacturers subject to the Act? In answering these questions, “our task is to ascertain 

the intent of the Legislature so as to effectuate the purpose of the enactment. [Citation.] 

We look first to the words of the statute, which are the most reliable indications of the 

Legislature’s intent. [Citation.] We construe the words of a statute in context, and 

harmonize the various parts of an enactment by considering the provision at issue in the 

context of the statutory framework as a whole.” (Cummins, Inc. v. Superior Court (2005) 

36 Cal.4th 478, 487 (Cummins).) “[I]f the statutory language ‘is clear and unambiguous 

there is no need for construction, nor is it necessary to resort to indicia of the intent of the 

Legislature . . . .’” (Atkinson v. Elk Corp. (2003) 109 Cal.App.4th 739, 750.)

We thus turn to our independent interpretation and construction of section 

1792. “Unless disclaimed in the manner prescribed by this chapter, every sale of 

consumer goods that are sold at retail in this state shall be accompanied by the 

manufacturer’s and the retail seller’s implied warranty that the goods are merchantable. 

The retail seller shall have a right of indemnity against the manufacturer in the amount 

of any liability under this section.” (§ 1792, italics added.) In isolation, section 1792

does not definitively answer the question presented. Section 1792 uses singular nouns 

when referring to “the manufacturer,” both with regard to the provision of an implied 

warranty to the consumer and an indemnity right to the retail seller. But, in interpreting 

the Civil Code, the use of “the singular number” can “include[] the plural.” (§ 14.) 

Without additional context, it is unclear whether the Legislature intended section 1792 to 

apply to only the ultimate manufacturer, to any manufacturer playing a role in the 

production process, or to some but not all component manufacturers.

5

 

5

The current version of section 1792 took effect after the 1978 amendment 

of the Act. (Stats. 1978, ch. 991, § 3, p. 3060.) The original version of section 1792 

stated, “Unless disclaimed in the manner prescribed by this chapter, every sale or 
10

The definitions section of the Act lends some credence to both parties’ 

contentions. “‘Manufacturer’ means any individual, partnership, corporation, 

association, or other legal relationship that manufactures, assembles, or produces 

consumer goods.” (§ 1791, subd. (j), italics added.) “‘Consumer goods’ means any new 

product or part thereof that is used, bought, or leased for use primarily for personal, 

family, or household purposes, except for clothing and consumables.” (Id., subd. (a), 

italics added.) “‘Buyer’ or ‘retail buyer’ means any individual who buys consumer goods 

from a person engaged in the business of manufacturing, distributing, or selling consumer 

goods at retail.” (Id., subd. (b).) “‘Retail seller’ . . . means any individual, partnership, 

corporation, association, or other legal relationship that engages in the business of selling 

or leasing consumer goods to retail buyers.” (Id., subd. (l).)

Relying on these definitions, Mega RV posits HWH logically must be 

classified as a manufacturer under the Act and section 1792: (1) HWH manufactured 

hydraulic components; (2) the hydraulic components became a “part” (§ 1791, subd. (a)) 

of the motor home upon assembly by Country Coach; (3) Country Coach delivered the 

motor home to the retail seller, Mega RV; (4) Mega RV sold the motor home, of which 

the hydraulic system was a “part,” to buyers (the Ertzes) for their personal use as a

consumer good; and (5) a motor home is clearly a consumer good under the Act (see 

National R.V., Inc. v. Foreman (1995) 34 Cal.App.4th 1072, 1076-1083 (Foreman)). 

 

consignment of consumer goods in this state by a manufacturer shall be accompanied by 

an implied warranty that the goods are merchantable.” (Stats. 1970, ch. 1333, § 1, p. 

2480.) Section 1792 was amended the next year as follows, “Unless disclaimed in the 

manner prescribed by this chapter, every sale or consignment for sale of consumer goods 

that are sold at retail in this state shall be accompanied by the manufacturer’s implied 

warranty that the goods are merchantable.” (Stats. 1971, ch. 1523, § 4, p. 3003.) 

Arguably, references to consignments in these earlier versions tend to suggest that section 

1792 was meant to apply only to the final manufacturer (the one that had a relationship 

with the retail seller, to whom the goods would presumably be consigned). But this 

analysis of legislative history is hardly conclusive with regard to the prior versions of 

section 1792, let alone the current version eschewing mention of consignment.
11

While not an irrefutable syllogism, Mega RV’s position is certainly a plausible reading of 

the Act.

HWH, on the other hand, emphasizes the distinction between the 

acquisition of the hydraulic components by Country Coach and the purchase of the motor 

home by the Ertzes. The HWH hydraulic components were not consumer goods when 

Country Coach acquired them from HWH in Iowa, both because they were not yet sold at 

retail as consumer goods and because they were not sold in California. (See Cummins, 

supra, 36 Cal.4th at p. 483 [Act only applies to goods purchased in California].) The 

hydraulic components only became part of a consumer good once the Ertzes purchased 

the entire motor home from Mega RV in California. According to HWH, it makes no 

sense for component part manufacturers to be included within the scope of the Act, given 

the lack of a necessary relationship between the component manufacturer and the retail 

seller or buyer. By HWH’s reasoning, the inclusion of the phrase “or part thereof” in the 

definition of “‘[c]onsumer goods’” (§ 1791, subd. (a)) is meant only to make clear that 

the Act applies to individual parts of a larger whole that are sold separately to a retail 

buyer (i.e., the consumer is entitled to the remedies provided by the Act even if the 

consumer purchases only a part to be used in a larger item, such as a new battery for a

previously purchased automobile), not to sweep component manufacturers of parts sold 

within a greater whole into the reach of the Act.

6

 

6

This position has some support in legislative history. The original 

definition of “‘[c]onsumer goods’” in the Act was “any motor vehicle, machine, 

appliance, or like product that is used or bought for use primarily for personal, family, or 

household purposes.” (Stats. 1970, ch. 1333, § 1, p. 2478.) The next year, the definition 

of “‘[c]onsumer goods’” was amended to “any new mobilehome, motor vehicle, machine, 

appliance, like product, or part thereof that is used or bought for use primarily for 

personal, family or household purposes. ‘Consumer goods’ also means any new good or 

product, except for soft goods and consumables, the retail sale of which is accompanied 

by an express warranty to the retail buyer thereof and such product is used or bought for 

use primarily for personal, family, or household purposes.” (Stats. 1971, ch. 1523, § 2, p. 

3001, italics added.) Perhaps casting some light on the history of this amendment “and 
12

Other sections of the Act inform the debate, but not definitively. What 

exactly is the implied warranty of merchantability “the manufacturer” is deemed to 

provide to consumers pursuant to section 1792 absent an effective disclaimer thereof? 

“‘Implied warranty of merchantability’ . . . means that the consumer goods meet each of 

the following: [¶] (1) Pass without objection in the trade under the contract description. 

[¶] (2) Are fit for the ordinary purpose for which such goods are used. [¶] (3) Are 

adequately contained, packaged, and labeled. [¶] (4) Conform to the promises or 

affirmations of fact made on the container or label.” (§ 1791.1, subd. (a).) “Unlike 

express warranties, which are basically contractual in nature, the implied warranty of 

merchantability arises by operation of law. [Citation.] It does not ‘impose a general 

requirement that goods precisely fulfill the expectation of the buyer. Instead, it provides 

for a minimum level of quality.’” (American Suzuki Motor Corp. v. Superior Court

(1995) 37 Cal.App.4th 1291, 1295-1296 [discussing similar Commercial Code implied 

warranty of merchantability].) The nature of the implied warranty of merchantability

tends to argue against the wholesale application of the Act to component part 

 

the arguments before the Legislature when it considered the matter” (see County of San 

Diego v. Superior Court (1986) 176 Cal.App.3d 1009, 1021) is March 1971 

correspondence between Senator Alfred Song (a sponsor of the Act) and James Hamilton, 

the Executive Vice President of the California Automotive Wholesalers Association. 

Hamilton inquired as to whether “the definition of consumer goods includes the 

component parts of motor vehicles, such as engine parts, fuel pumps, starters, 

carburetors, brake shoes, and the thousands of other replacement parts our members 

handle.” (Executive Vice-president James E. Hamilton, Cal. Automotive Wholesalers’ 

Assn., letter to Sen. Alfred H. Song, Mar. 18, 1971.) Senator Song replied, “It was 

certainly our intent to include component parts of motor vehicles under the coverage of 

the Act when such parts are sold on a retail basis to consumers. We believe that the retail 

sale of such parts is presently covered by the Act, and we will shortly be introducing 

clarifying amendments, one a provision of which we will specifically list parts under the 

definition of consumer goods.” (Sen. Alfred H. Song, letter to Executive Vice-president 

James E. Hamilton, Mar. 26, 1971.) Our review of legislative history does not disclose 

any concern with the problem of manufacturers whose components had been integrated 

into a consumer good that was then sold at retail.
13

manufacturers. Some of the categories are not in tune with the typical role of a 

component part manufacturer, such as the container, packaging, and labeling of the good.

In addition, to warrant that all components are fit for an ordinary purpose would be 

strange, given that the components have often been utilized for a particular purpose 

within the larger consumer good of which they became a part. Unless it were easy to 

separate the performance of the specific component at issue from the whole, the overall 

thrust of this warranty seems more suited to the final product rather than the component 

parts therein.

Sections of the Act pertaining to express warranties

7

are problematic for 

both parties’ positions. Entities regulated under the Act typically have the option of 

either providing an express warranty or not providing an express warranty in connection 

with the sale of consumer goods to retail buyers. (§ 1793 [“nothing in [the Act] shall 

affect the right of the manufacturer, distributor, or retailer to make express warranties 

with respect to consumer goods”]; Jensen v. BMW of North America, Inc. (1995) 35 

Cal.App.4th 112, 121 [“If a manufacturer elects to provide an express warranty . . . the 

Act protects buyers in a number of ways”].) Manufacturers choosing to provide an 

express warranty, however, are subject to specific requirements set forth in the Act. For 

instance, “[e]very manufacturer . . . making express warranties with respect to consumer 

 

7

“‘Express warranty’ means: [¶] (1) A written statement arising out of a 

sale to the consumer of a consumer good pursuant to which the manufacturer, distributor, 

or retailer undertakes to preserve or maintain the utility or performance of the consumer 

good or provide compensation if there is a failure in utility or performance; or [¶] (2) In 

the event of any sample or model, that the whole of the goods conforms to such sample or 

model.” (§ 1791.2, subd. (a).) “It is not necessary to the creation of an express warranty 

that formal words such as ‘warrant’ or ‘guarantee’ be used, but if such words are used 

then an express warranty is created. An affirmation merely of the value of the goods or a 

statement purporting to be merely an opinion or commendation of the goods does not 

create a warranty.” (Id., subd. (b).) “Statements or representations such as expressions 

of general policy concerning customer satisfaction which are not subject to any limitation 

do not create an express warranty.” (Id., subd. (c).)
14

goods shall fully set forth those warranties in simple and readily understood 

language . . . .” (§ 1793.1, subd. (a)(1).) Moreover, “[e]very manufacturer of consumer 

goods sold in this state and for which the manufacturer has made an express warranty 

shall” maintain repair facilities or designate independent repair facilities reasonably close 

to the areas in which the goods are sold. (§ 1793.2, subd. (a).)

A manufacturer opting not to provide an express warranty may also 

disclaim the implied warranty of merchantability by conspicuously and clearly informing 

the buyer of statutorily specified disclosures and limitations on liability. (See §§ 1792.4-

1792.5.) But “a manufacturer, distributor, or retailer, in transacting a sale in which 

express warranties are given, may not limit, modify, or disclaim the implied warranties 

guaranteed by this chapter to the sale of consumer goods.” (§ 1793.) Thus, “the 

manufacturer’s and the retail seller’s implied warranty that the goods are merchantable”

(§ 1792) fits hand in glove with the Act’s regulation of the quality of express warranties. 

By requiring an implied warranty of merchantability to accompany any express 

warranties, the Act ensures that retail buyers in receipt of an express warranty have a 

minimum level of substantive protection. This statutory structure undermines the facile 

suggestion that the manufacture of any “part” of a consumer product subjects the 

component manufacturer to section 1792. Unlike the manufacturer who ships the 

completed good to the retail seller, a component part manufacturer may not be in a 

position to craft an express warranty or disclaim an implied warranty.

But what if a component manufacturer provides an express warranty to the 

consumer?

8

 Is such an express warranty governed by the Act? Section 1795 answers this 

question in the affirmative, even assuming a component manufacturer is not a 

 

8

Consider the warranty commonly provided by tire manufacturers to 

purchasers of new cars (alongside that of the vehicle’s manufacturer). Or consider the 

warranty provided with regard to the “leveling system” by HWH in this case.
15

“manufacturer” under the Act: “If express warranties are made by persons other than the 

manufacturer of the goods, the obligation of the person making such warranties shall be 

the same as that imposed on the manufacturer under this chapter.” (Ibid.) Indeed, some

cases brought under the Act name multiple manufacturers as defendants. (See, e.g., 

Cummins, supra, 36 Cal.4th at p. 483 [suit against Winnebago Industries, Inc., and 

Cummins, Inc., the engine manufacturer]; Tiffin Motorhomes, Inc. v. Superior Court

(2011) 202 Cal.App.4th 24, 27-28, 32-33 (Tiffin) [separate manufacturers of engine, 

coach, and chassis of motor home all provided separate warranty and were sued under the 

Act; HWH also mentioned as a defendant, presumably based on its provision of 

component parts]; Foreman, supra, 34 Cal.App.4th at pp. 1074-1076 & fns. 3 & 4 

[General Motors Corporation, which expressly warranted the chassis portion of the motor

home manufactured by National R.V., Inc., was held liable by jury under the Act; no 

mention of an implied warranty action under § 1792].)

9

 At the very least, it seems the 

Act applies in some measure to component manufacturers when they provide express 

warranties to retail buyers.

10

 

9

It must be noted that these cases did not actually interpret the Act to apply 

to component manufacturers. Rather, this question was not presented for review by the 

appellate courts in any of the cases.

10

Section 1793.05 is another interesting provision of the Act for our 

interpretive purposes: “Vehicle manufacturers who alter new vehicles into housecars 

shall, in addition to any new product warranty, assume any warranty responsibility of the 

original vehicle manufacturer for any and all components of the finished product which 

are, by virtue of any act of the alterer, no longer covered by the warranty issued by the 

original vehicle manufacturer.” Section 1793.05 (without distinguishing between express 

and implied warranties) illustrates that in at least some circumstances, there can be two 

manufacturers providing warranties to consumers under the Act (the “housecar” 

alteration vehicle manufacturer and the original vehicle manufacturer with regard to any 

warranty responsibilities that have not been revoked by reason of the alterations). But by

explicitly providing for the party making the alterations to the finished vehicle to step 

into the shoes of the “original vehicle manufacturer” in the case of warranties voided 

through alteration, does section 1793.05 suggest that the ordinary state of affairs would 
16

Although yielding important insights, neither the structure of the Act nor 

legislative history definitively answers whether and in what circumstances section 1792 

applies to component part manufacturers. Without careful analysis, a federal district 

court suggested a computer chip manufacturer (NVIDIA Corporation) might be subject to 

section 1792 breach of implied warranty claims based on the presence of its allegedly 

defective chips in Hewlett Packard personal computers sold to consumers in California. 

(In re NVIDIA GPU Litig. (N.D.Cal. Nov. 19, 2009, No. C 08-04312 JW) 2009 U.S.Dist. 

Lexis 108500 [granting motion to dismiss but allowing leave to amend to limit class 

allegations to purchases in California].) Outside of this case (which is of little help), 

there is no guidance in case law applying the Act with regard to the specific question 

presented.

Having failed to discover a clear rule in the language of the Act or case 

authority, we shift our focus to the purposes of the Act. (Foreman, supra, 34 

Cal.App.4th at p. 1077.) The Act “was enacted to address the difficulties faced by 

consumers in enforcing express warranties. Consumers frequently were frustrated by the 

inconvenience of having to return goods to the manufacturer for repairs and by repeated 

unsuccessful attempts to remedy the problem. [Citation.] The Act protects purchasers of 

consumer goods by requiring specified implied warranties, placing strict limitations on 

how and when a manufacturer may disclaim those implied warranties, and providing 

mechanisms to ensure that manufacturers live up to the terms of any express warranty.” 

(Cummins, supra, 36 Cal.4th at p. 484.) “[T]he Act is manifestly a remedial measure, 

intended for the protection of the consumer; it should be given a construction calculated 

to bring its benefits into action.” (Kwan v. Mercedes-Benz of North America, Inc. (1994) 

23 Cal.App.4th 174, 184.)

 

be for a single manufacturer to provide warranties with regard to any and all components 

of the finished product or the opposite?
17

The Act consists of enhancements to the rights of consumer purchasers of 

goods. (See Krieger v. Nick Alexander Imports, Inc. (1991) 234 Cal.App.3d 205, 213 

[“The Act regulates warranty terms, imposes service and repair obligations on 

manufacturers, distributors, and retailers who make express warranties, requires 

disclosure of specified information in express warranties, and broadens a buyer’s 

remedies to include costs, attorney’s fees, and civil penalties”].) But the California 

Uniform Commercial Code still governs other sales of goods issues. (See § 1790.3; Cal. 

U. Com. Code, § 2101 et seq.) It would be misguided to view nonconsumer transactions 

(e.g., the sale of hydraulic parts by HWH to Country Coach) through the prism of the Act 

rather than the California Uniform Commercial Code. It would also be misguided to 

overstate the extent to which the Act changes sales of goods law even in consumer 

transactions. (§ 1790.3 [“The provisions of this chapter shall not affect the rights and 

obligations of parties determined by reference to the Commercial Code except that, 

where the provisions of the Commercial Code conflict with the rights guaranteed to 

buyers of consumer goods under the provisions of this chapter, the provisions of this 

chapter shall prevail”].)11

 

11 Of relevance here, “[u]nder California Commercial Code section 2314, the 

implied warranty provision . . . , a plaintiff asserting breach of warranty claims must 

stand in vertical contractual privity with the defendant. [Citation.] A buyer and seller 

stand in privity if they are in adjoining links of the distribution chain.” (Clemens v. 

DaimlerChrysler Corp. (9th Cir. 2008) 534 F.3d 1017, 1023.) Mega RV typically would 

not be entitled to sue HWH under the California Uniform Commercial Code for breach of 

an implied warranty because the two parties are not in privity with regard to the Ertzes’ 

motor home. (Ibid; but see Jimenez v. Superior Court (2002) 29 Cal.4th 473, 481 

[“manufacturers of component parts, here windows, that are installed in mass-produced 

homes can be subject to strict products liability in tort when their defective products 

cause harm”].) Of course, under the Act, the buyer can sue “the manufacturer” for breach 

of the implied warranty of merchantability despite a lack of privity. (Gusse v. Damon 

Corporation (2007) 470 F.Supp.2d 1110, 1116, fn. 9.)
18

Considering the policies, purposes, and scope of the Act, there is no 

obvious, nonspeculative benefit to including every component or part supplier within the 

scope of section 1792. To the contrary, the suggestion that section 1792 refers to every

manufacturer contributing a “part” to the finished product would at best create confusion 

for the consumer, the retail seller, and the various entities playing a role in the 

manufacturing process. At worst, such an interpretation would create legal uncertainty as 

to the liability of the ultimate manufacturer for component part defects, based on the 

theory that if the component is considered a separable consumer good for purposes of 

imposing liability on a component manufacturer, it could also be considered a separable 

consumer good for purposes of not imposing liability on the ultimate manufacturer.

12

 

Moreover, interpreting section 1792 to apply to every component part 

manufacturer would be impractical and unfair. In some cases, application of the Act by 

California courts to component part suppliers would be foreclosed by lack of personal 

jurisdiction. (See Dow Chemical Canada ULC v. Superior Court (2011) 202 

Cal.App.4th 170, 172-173.) And even if personal jurisdiction existed, it would be unfair 

in some circumstances to apply consumer protection laws to component manufacturers 

playing only an indirect role in the provision of consumer goods to California buyers,

without regard to the substantiality of the component contributed to the consumer good, 

the component manufacturer’s knowledge that its goods would ultimately be utilized in 

this way, or the component manufacturer’s opportunity to disclaim potential liability 

under section 1792. (Cf. Cummins, supra, 36 Cal.4th at pp. 492-493 [Act does not apply 

 

12

This case hints at one possible benefit to buyers in light of Country Coach’s 

bankruptcy. Had Mega RV suffered the same fate, the Ertzes might have been left in the 

lurch. A rule that extends the applicability of section 1792 to every component 

manufacturer might aid a hypothetical consumer in this circumstance, if the defect 

complained of could be linked to a component produced by a particular manufacturer. 

But this speculative benefit to consumers does not overcome the problems with imposing 

such liability as discussed in the preceding and following paragraphs.
19

to sales of consumer goods outside California].) We will not presume the Legislature 

intended an absurd result in its drafting of section 1792 and the definition of 

“‘[c]onsumer goods’” to include “any new product or part thereof” in section 1791, 

subdivision (a). We therefore hold that the section 1792 “manufacturer” does not include 

every component manufacturer contributing parts or components to a consumer good.

But, as discussed above, there are tangible benefits to retail buyers in 

applying the Act to component manufacturers that provide express warranties to buyers. 

(See Cummins, supra, 36 Cal.4th at pp. 484-485.) In light of the purposes of the Act and 

consistent with the language of relevant portions of the Act, we hold an implied warranty 

of merchantability accompanies any express warranty provided by a component 

manufacturer to a retail buyer. (See §§ 1792, 1795.) The Act’s requirement of an 

implied warranty of merchantability is part and parcel of the Act’s regulation of express 

warranties. If a component manufacturer provides an express warranty, it cannot 

disclaim the implied warranty of merchantability. (§ 1793.) Once section 1792 is 

interpreted to require a component manufacturer’s implied warranty of merchantability in 

certain circumstances, it follows that a retail seller has a right to indemnity from the 

component manufacturer in those same circumstances. 

Just as the scope of the express warranty provided by a component 

manufacturer would undoubtedly be limited to the component part at issue, the implied 

warranty of merchantability (and accompanying retail seller’s right to indemnification) 

would likewise be adapted to the scope of the “part” provided by the component 

manufacturer. (See Tiffin, supra, 202 Cal.App.4th at p. 33 [in multiple defendant 

warranty claim under Act, court observes defendants’ “will rarely[] have caused the same 

harm to the plaintiffs. Each will, however, be liable for the contract damages stemming 

from the breach of the contract into which that defendant entered. These obligations are 

neither ‘joint’ nor ‘joint and several’ and, therefore, do not give rise to any right of 

contribution”].) 
20

In sum, contrary to the parties’ positions, the best interpretation of the Act 

is that some (but not all) component manufacturers (i.e., those providing express 

warranties to the buyer) are subject to the Act, including section 1792. If component 

manufacturers provide an express warranty to buyers of consumer goods under the Act, 

they will also be deemed to have provided an implied warranty of merchantability. In 

turn, such component manufacturers potentially will be liable in indemnity to retail 

sellers under section 1792. If a component manufacturer does not provide the consumer 

with an express warranty, neither the consumer nor the retail seller can seek recovery 

from the component manufacturer under section 1792.

Our interpretation of the Act is supported by reference to comparable 

interpretations of the Uniform Commercial Code in certain federal courts. Putting to one 

side the question of privity (as some states other than California have done), a buyer 

ordinarily does not have an implied warranty claim against a manufacturer of an 

integrated component part. (Hininger v. Case Corp. (5th Cir. 1994) 23 F.3d 124, 125 

[affirming judgment on implied warranty claim in favor of component manufacturer,

whose wheels were incorporated into agricultural combines].) This is because, unlike the 

buyer’s relationship with “the manufacturer of the finished product,” buyers of goods 

generally have “no expectation that . . . manufacturers of unbranded components would 

resolve any problem they might experience.” (Id. at p. 128.) It “may be difficult or even 

impossible for a component supplier to disclaim its warranty liability,” which places 

component suppliers in a difficult position compared to manufacturers of finished 

products. (Id. at p. 129; see In re General Motors Corp. Anti-Lock Brake Products

Liability Litigation (E.D. Mo. 1997) 966 F.Supp. 1525, 1533-1534 [dismissing breach of 

implied warranty claim against manufacturer of brake system in General Motors vehicles; 

“none of the states in this action have specifically extended liability for breach of implied 

warranty to manufacturers of component parts”].) 
21

This does not mean, however, that a self-described component part 

manufacturer is always immune from breach of warranty claims. Component part 

manufacturers of goods that could “easily be considered a stand-alone product,” like a 

refrigerator attached to a motor home, can be held liable for breach of warranty. (Teague 

v. Norcold, Inc. (N.D. Tex. 2011) 774 F.Supp.2d 817, 821.) The Teague court denied a 

motion to dismiss an undifferentiated breach of warranty claim (i.e., the pleading did not 

specify whether it included implied warranties) brought by the motor home purchaser

against the refrigerator manufacturer (Norcold). (Id. at pp. 822-823.) The allegations in 

the complaint suggested Norcold was in communication with its customers regarding a 

defect in its product; moreover, there were factual questions in the complaint regarding 

“the extent to which the [refrigerator] was a selling point of the RV, the extent to which 

the [refrigerator] was a stand-alone product from the RV, and the nature of and the extent 

to which Norcold warranted the Unit.” (Id. at p. 822, italics added; see also Metro Nat’l

Corp. v. Dunham-Bush, Inc. (S.D. Tex. 1997) 984 F.Supp. 538, 558-559 [component 

compressors were “centerpiece of the ice harvesters” sold to the plaintiff and component 

manufacturer was directly involved in design of final product and communication with 

customers, including delivery of written warranty].)

13

 

The results in these federal cases hinge in large measure on the existence of 

component manufacturer express warranties received by the ultimate purchasers of the 

goods. One practical lesson from these cases is that application of the Act (including 

§ 1792) to component part manufacturers will likely occur with readily identifiable and 

 

13

These cases do not necessarily hold that the component part manufacturers 

provided implied warranties of merchantability to the ultimate purchaser of the product. 

(See Metro Nat’l Corp. v. Dunham-Bush, Inc., supra, 984 F.Supp. at p. 561, fn. 50 

[implied warranty of fitness for a particular purpose but not merchantability applied in 

this case because of specialized design of product; unstated implication is that an implied 

warranty of merchantability would be appropriate in other circumstances].)
22

relatively important component parts, often featuring the brand name of the component 

part manufacturer on the component even when sold to the buyer as part of an integrated 

consumer good. This is because, as a matter of common sense, component part 

manufacturers will only provide express warranties to consumers in these circumstances.

Thus, having construed section 1792 to apply to component manufacturers 

under certain circumstances, we must return to the record in this case. Country Coach 

finalized the assembly and manufacture of the motor home at issue under its brand name, 

but others (including HWH) manufactured components and parts utilized in the final 

product delivered by Country Coach to Mega RV. Did the court correctly conclude 

HWH was not subject to section 1792 obligations under the specific circumstances of this 

case? The answer to this question is an unequivocal yes. The appellate record contains 

no evidentiary document, trial exhibit or otherwise, suggesting HWH provided an express 

warranty to the Ertzes (or even Mega RV or Country Coach) with regard to the hydraulic 

system at issue in this case (i.e., the mechanism whereby the slide-out rooms were 

manipulated). Nor is there trial testimony establishing such an express warranty.

14

 

Indeed, Mega RV’s appellate briefs are silent as to this factual question. Mega RV’s 

entire theory of the case on appeal is that a component part manufacturer is subject to 

section 1792 as a matter of law once it has been determined it manufactured a component 

comprising a “part” of the consumer good in question. We reject this position. HWH 

was not subject to section 1792 indemnity obligations. Any defect in the court’s 

reasoning on this point in the statement of decision is beside the point, as there is no 

evidence to support finding HWH provided warranties to the Ertzes with regard to the 

hydraulic system operating the slide-out rooms.

 

14 HWH’s chief executive officer testified that a warranty was provided to the 

consumer with regard to the leveling system but that this was the only warranty provided 

by HWH. The evidence does not suggest there was any problem with the leveling system 

in the motor home.
23

Tort of Another Doctrine

The court erred as a matter of law in awarding damages (consisting of

HWH’s attorney fees) to HWH pursuant to the tort of another doctrine. Ordinarily, 

pursuant to the American Rule, a party must pay for its own attorney fees unless a 

contract or statute provides authority for recovery of attorney fees from a litigation 

opponent. The tort of another doctrine holds that “[a] person who through the tort of 

another has been required to act in the protection of his interests by bringing or defending 

an action against a third person is entitled to recover compensation for the reasonably 

necessary loss of time, attorney’s fees, and other expenditures thereby suffered or 

incurred.” (Prentice v. North Amer. Title Guar. Corp. (1963) 59 Cal.2d 618, 620

(Prentice).) The tort of another doctrine is not really an exception to the American Rule, 

but simply “an application of the usual measure of tort damages.” (Sooy v. Peter (1990) 

220 Cal.App.3d 1305, 1310 [equating recovery of attorney fees as damages to medical 

fees recovered in personal injury action]; see § 3333 [“the measure of damages . . . is the 

amount which will compensate for all the detriment proximately caused thereby, whether 

it could have been anticipated or not”].)

HWH premises its claim on the notion that Mega RV (the “other” party) 

was negligent (the “tort”) in its servicing of the Ertzes’ motor home, thereby causing 

HWH to incur damages (its attorney fees in this action). Even assuming the propriety of 

allowing HWH to raise this claim through the backdoor,

15 HWH’s position fails as a 

matter of law because there was no tort in this case. (See Behniwal v. Mix (2005) 133 

Cal.App.4th 1027, 1043 [“The problem we now have is, ‘where’s the tort?’”].)

We must first clarify the alleged tort at issue. There was no tort committed 

by any defendant vis-à-vis the Ertzes. The Ertzes never sued Mega RV or any other party 

 

15 To wit, HWH’s negligence allegations were only present in an indemnity 

cause of action in its cross-complaint, in a case in which there was nothing to indemnify 

because the Ertzes paid HWH pursuant to the settlement agreement.
24

for negligence (or any other tort), and never alleged they suffered any personal injury or 

damages to other property (besides the portions of the motor home that were alleged to be 

defective) as a result of the alleged defects in the motor home. “It appears doubtful that a 

cause of action could be stated in tort [under these circumstances], as a claim based on 

negligence or even strict liability will not lie where the wrong has resulted only in 

economic loss rather than actual damage to person or property.” (Tiffin, supra, 202 

Cal.App.4th at p. 31, fn. 11; see Robinson Helicopter Co., Inc. v. Dana Corp. (2004) 34 

Cal.4th 979, 988-993 [discussing economic loss rule generally].) As made clear in a case 

holding that statutory good faith settlement rules do not apply in pure warranty actions 

brought under the Act, HWH’s pleading of the case as one sounding in tort for purposes 

of indemnity did not change the essential nature of this warranty dispute. (See Tiffin, at 

pp. 32-33 [cross-complaint seeking indemnity did not convert defendants into 

tortfeasors].)

HWH alleges Mega RV was negligent to HWH in its servicing of the 

Ertzes’ motor home. Like the Ertzes, HWH did not suffer personal injury or injury to 

other property as a result of Mega RV’s alleged tort. HWH alleges it suffered 

consequential economic damages (its attorney fees incurred in this case, allegedly as a 

result of negligent repair of the motor home by Mega RV years earlier). Unlike the 

Ertzes and Country Coach, HWH did not have a contractual relationship with Mega RV. 

HWH essentially contends this court should recognize HWH’s right to recover its

economic losses from Mega RV in tort.

The most fundamental problem with this line of argument is that Mega RV 

did not owe a duty of care to HWH in connection with its servicing of the Ertzes’ motor 

home.

16

 “Duty . . . is a legal issue and must be determined by the court. [Citation.] A 

 

16 We reject HWH’s contention that Mega RV “abandoned or waived” the 

argument that it had no duty to HWH. We also note that by limiting our analysis to the 

question of duty, we by no means endorse the notion that HWH’s attorney fees in this 
25

duty of care may arise through statute, contract, the general character of the activity, or 

the relationship between the parties.” (Ratcliff Architects v. Vanir Construction 

Management, Inc. (2001) 88 Cal.App.4th 595, 604.) “[E]ntities generally have no duty to 

prevent purely economic loss to a potential plaintiff. [Citation.] Under the common law, 

it is only where a ‘special relationship’ exists, giving rise to such a duty [citation], that a 

plaintiff may recover purely economic loss.” (Greystone Homes, Inc. v. Midtec, Inc.

(2008) 168 Cal.App.4th 1194, 1215.) “Courts are reluctant to impose duties to prevent 

economic harm to third parties because ‘[a]s a matter of economic and social policy, third 

parties should be encouraged to rely on their own prudence, diligence and contracting 

power, as well as other informational tools.’” (Ratcliff Architects, at p. 605.)

The tort of another doctrine applies to economic damages (i.e., attorney 

fees incurred in litigation with third parties) suffered as a result of an alleged tort.

17

 As 

 

action were caused by Mega RV’s repair of the vehicle. Nor do we agree with the 

amount of attorney fees awarded by the court even if this were a proper tort of another 

case in the abstract (i.e., most of HWH’s attorney fees were actually incurred in 

connection with litigation against Mega RV, not against third party, the Ertzes).

17

The tort of another doctrine is not particularly relevant in cases involving 

physical injury or property damage. To state the obvious, a tortfeasor who causes 

physical damage to a person or property (for instance, in a car accident) would be subject 

to a negligence lawsuit by the affected individual. The plaintiff in this hypothetical case 

could not recover her attorney fees from the tortfeasor under the tort of another doctrine. 

The attorney fees in this straightforward negligence case would be “attorney fees qua 

attorney fees.” (Sooy v. Peter, supra, 220 Cal.App.3d at p. 1310.) To hold otherwise 

would obliterate the American Rule in tort cases. Nor does the tort of another doctrine 

apply as between multiple alleged tortfeasors (e.g., what if our hypothetical plaintiff 

unsuccessfully sued additional defendants in the car crash case, who sought recovery of 

their attorney fees from the true tortfeasor?). “The extension of the Prentice rule to the 

commonplace case of an exonerated alleged tortfeasor would go a long way toward 

abrogation of the American rule . . . . It would substantially expand the notion of duty 

under the law of torts to compensation of the litigation expenses incurred by all persons, 

however connected to any tortious event, whom the injured plaintiff elects to sue who 

succeed in establishing lack of liability.” (Watson v. Department of Transportation

(1998) 68 Cal.App.4th 885, 894.)
26

such, “nearly all of the cases which have applied the [tort of another] doctrine involve a 

clear violation of a traditional tort duty between the tortfeasor who is required to pay the

attorney fees and the person seeking compensation for those fees.” (Sooy v. Peter, supra, 

220 Cal.App.3d at p. 1310; id. at pp. 1311-1312; see also, e.g., Gray v. Don Miller & 

Associates, Inc. (1984) 35 Cal.3d 498, 502, 507-508 [real estate broker breaches fiduciary 

duty to buyer]; Prentice, supra, 59 Cal.2d at pp. 619-621 [escrow agent breaches duty of 

due care to seller]; Heckert v. MacDonald (1989) 208 Cal.App.3d 832, 834-835, 837-838 

[real estate broker breaches fiduciary duty to seller].) We are unaware of any authority 

for the existence of a special relationship or traditional tort duty between a retail 

seller/servicer of consumer goods and a component part manufacturer.

Nevertheless, HWH contends general principles of negligence law (e.g., 

§ 1714, subd. (a)) require this court to impose a duty on Mega RV.

18

 Thirty-five years 

ago, our Supreme Court analyzed the circumstances in which a party has a duty of care to 

avoid imposing economic losses on third parties. (See J’Aire Corp. v. Gregory (1979) 24

Cal.3d 799 (J’Aire).) In J’Aire, a commercial lessee alleged it suffered $50,000 in lost 

profits as a result of unreasonable delay in completing construction at the tenant’s 

business location by a contractor hired by the landlord. (Id. at pp. 802-803.) The trial 

court sustained the contractor’s demurrer to a negligence cause of action, but our 

Supreme Court reversed. (Id. at pp. 802-803, 808 [“a contractor owes a duty of care to 

the tenant of a building undergoing construction work to prosecute that work in a manner 

 

18

Tellingly, in making its argument, HWH’s brief relies primarily on tort 

cases involving physical harm to plaintiffs. It is one thing to impose routinely a duty of 

care when physical harm is at stake. (See Rest.3d Torts, Liability for Physical and 

Emotional Harm, § 7(a) [“An actor ordinarily has a duty to exercise reasonable care when 

the actor’s conduct creates a risk of physical harm”].) It is quite another to apply an 

identical rule to cases involving only economic loss. (See Rest.3d Torts, Liability for 

Economic Harm (Tent. Draft No. 1, Apr. 4, 2012) § 1(a) [“An actor has no general duty 

to avoid the unintentional infliction of economic loss on another”].) 
27

which does not cause undue injury to the tenant’s business, where such injury is 

reasonably foreseeable”].)19 In doing so, the J’Aire court observed that its holding was 

“consistent with the Legislature’s declaration of the basic principle of tort liability, 

embodied in . . . section 1714, that every person is responsible for injuries caused by his 

or her lack of ordinary care. [Citation.] That section does not distinguish among injuries 

to one’s person, one’s property or one’s financial interests. Damages for loss of profits or 

earnings are recoverable where they result from an injury to one’s person or property 

caused by another’s negligence. Recovery for injury to one’s economic interests, where 

it is the foreseeable result of another’s want of ordinary care, should not be foreclosed 

simply because it is the only injury that occurs.” (Id. at p. 806, fn. omitted.)

J’Aire set forth six “criteria” for determining whether a special relationship 

exists pursuant to which a tort duty should be imposed: “(1) the extent to which the 

transaction was intended to affect the plaintiff, (2) the foreseeability of harm to the 

plaintiff, (3) the degree of certainty that the plaintiff suffered injury, (4) the closeness of 

the connection between the defendant’s conduct and the injury suffered, (5) the moral 

blame attached to the defendant’s conduct and (6) the policy of preventing future harm.” 

(J’Aire, supra, 24 Cal.3d at p. 804; see also Biakanja v. Irving (1958) 49 Cal.2d 647, 

648-651 [applying these factors and holding that notary public who prepared defective 

will had duty to intended beneficiary].)

20

 “Ultimately, duty is a question of public policy. 

 

19 The statement of facts indicated that “[u]nder the terms of the lease the 

[landlord] was to provide heat and air conditioning.” (J’Aire, supra, 24 Cal.3d at p. 802.) 

Left unsaid in J’Aire was why this dispute was not better left to the realm of landlordtenant law. (See Rest.3d Torts, Liability for Economic Harm (Tent. Draft No. 1, supra) 

§ 1, com. e, illus. 3 HR [“[Tenant] can readily enough seek protection against the cost of 

delays in its contract with [landlord] or by other means”]; id. at reporter’s note e, illus. 3 

HR [“J’Aire has not been overruled, but the extent of its vitality in California is 

questionable . . . and it has not been influential elsewhere”].)

20

These duty factors are similar to, but not identical with, the duty factors 

identified by our Supreme Court in cases involving physical injuries rather than purely 
28

[Citation.] When determining whether a duty of care exists” in a purely economic loss 

case, courts examine and balance the factors set forth above. (Ratcliff Architects v. Vanir 

Construction Management, Inc., supra, 88 Cal.App.4th at p. 605.)

Applying the J’Aire factors, Mega RV did not owe a duty of care to HWH 

in servicing the Ertzes motor home. Mega RV was performing its repair services on 

behalf of the Ertzes and Country Coach; as such, there is no indication the transaction 

was intended to affect HWH. It was not foreseeable that a component manufacturer like 

HWH would ultimately become involved in litigation between a buyer, retail seller, and 

manufacturer of a motor home, particularly when the component manufacturer had not 

provided an express warranty with regard to the allegedly defective components of the 

motor home or taken any direct or indirect part in the repair of the motor home. It took 

Country Coach’s bankruptcy and creative lawyering on the part of Mega RV to pull 

HWH into the case.

21

 As suggested by this analysis, the harm ultimately suffered by 

 

economic loss: “‘the foreseeability of harm to the plaintiff, the degree of certainty that 

the plaintiff suffered injury, the closeness of the connection between the defendant’s 

conduct and the injury suffered, the moral blame attached to the defendant’s conduct, the 

policy of preventing future harm, the extent of the burden to the defendant and 

consequences to the community of imposing a duty to exercise care with resulting 

liability for breach, and the availability, cost, and prevalence of insurance for the risk 

involved.’” (Cabral v. Ralphs Grocery Co. (2011) 51 Cal.4th 764, 771, quoting Rowland 

v. Christian (1968) 69 Cal.2d 108, 113.) The main difference between the two sets of 

factors is the absence of the first J’Aire factor (“the extent to which the transaction was 

intended to affect the plaintiff”) in the physical injury context. (J’Aire, supra, 24 Cal.3d 

at p. 804.) This makes sense. Recall our hypothetical negligent driver from footnote 17. 

His lack of intent to affect the particular victim of the car crash should have no bearing 

on the question of whether he had a duty to drive with due care and avoid injuring other 

drivers. But what if the accident caused a traffic jam on the freeway? Should our driver 

(who we are positing had a duty of care as to the victim who suffered physical injury and 

property damage in the crash) have a duty to the occupants of vehicles behind the traffic 

jam, such that any economic damages they suffer as a result of the traffic jam are 

recoverable? The introduction of this additional factor into the economic loss criteria is 

useful in avoiding such a result.

21 To the extent HWH finds actionable fault with Mega RV’s litigation 
29

HWH (i.e., its costs of dealing with this lawsuit, including attorney fees) was extremely 

speculative at the time Mega RV committed its supposed tort of failing to notice the 

installation of an improper part on the motor home during servicing. Of course, it is 

certain that HWH actually suffered harm in the form of attorney fees as a result of this 

litigation. But the connection between HWH’s harm and Mega RV’s servicing of the 

motor home is extremely attenuated. There is no moral blame attached to Mega RV’s 

servicing repair failures, even assuming failures occurred; there was certainly no 

evidence of reckless or purposeful behavior, or of anything other than economic damages 

suffered by anyone involved in this case. Imposing a duty on retail sellers to component 

part manufacturers like HWH would not reduce the likelihood of future harm; retail 

sellers like Mega RV already have strong incentives (relationship with retail buyers, 

relationship with manufacturers, financial liability, reputation) to perform adequate repair 

and warranty services.

In sum, because Mega RV had no duty to HWH with regard to the 

servicing of the Ertzes’ motor home, there was no tort. And because there was no tort, 

the tort of another doctrine cannot apply.

Court Did Not Abuse Its Discretion in Trying These Issues Separately

Finally, Mega RV contends the court abused its discretion by trying the

HWH cross-complaint separately from and prior to the rest of the case. (See General 

Motors Corp. v. Superior Court (1966) 65 Cal.2d 88, 91 [“related disputes should be 

heard and decided in one proceeding whenever possible”].) Obviously, determining 

questions of indemnity between Mega RV and HWH before the plaintiffs’ complaint was 

 

choices (i.e., moving to join HWH as a defendant and filing a cross-complaint against 

HWH), the appropriate remedy is a malicious prosecution cause of action, pursuant to 

which HWH’s attorney fees in this case could be recovered if liability were established. 

The tort of another doctrine cannot be used to escape the strict limits placed on the tort of 

malicious prosecution.
30

adjudicated was an interesting choice by the trial court. It must be remembered, 

however, that Mega RV contributed to this situation by agreeing to arbitrate the Ertzes’ 

claims on the eve of trial.

In between the beginning of trial and the entry of judgment, unfortunate 

procedural quirks multiplied. First, on September 20, 2011, after the close of HWH’s 

case, the court initially ruled in favor of Mega RV on its motion for directed verdict as to 

HWH’s equitable indemnity claim (which, as noted above, somehow encompassed a 

negligence claim for attorney fee damages). Although the court indicated it would rule 

against Mega RV as to the question of indemnity under the Act, Mega RV opted not to 

put on any additional witnesses. Counsel for HWH requested a statement of decision. 

On November 18, 2011, the court granted the Ertzes’ motion to return their 

complaint “to the civil active list.” Apparently, the arbitrator selected by the parties 

could not participate and the court concluded the agreement to arbitrate was contingent 

on the satisfaction of this condition. 

On December 9, 2011, the court suggested that, in the course of preparing 

its statement of decision, it was reconsidering its ruling granting judgment to Mega RV 

on HWH’s third cause of action. On January 13, 2012, the court reversed its prior ruling. 

The court denied Mega RV’s request for a mistrial. Instead, the court reopened the trial 

to allow Mega RV to call additional witnesses. In its ultimate, 62-page statement of 

decision filed in July 24, 2012, the court made a variety of factual findings pertaining to 

the causes of the motor home’s malfunctions and ruled in favor of HWH in all respects. 

On September 7, 2012, the court then granted HWH’s motion to sever Mega RV’s crosscomplaint and HWH’s motion for judgment on the pleadings with regard to Mega RV’s 

cross-complaint. 

Mega RV represents in its brief that plaintiffs (the Ertzes) now seek to use 

the statement of decision as establishing facts against Mega RV in the pending trial. 
31

Apparently, the trial is stayed pending the outcome of this appeal. HWH explicitly states 

in its brief that collateral estoppel should apply against Mega RV in the Ertz trial. 

In our view, the court did not abuse its discretion in allowing a scheduled 

trial to proceed (even though some of the claims were moved to arbitration) and 

completing a trial it had already begun under unfortunate circumstances that were created 

by the parties. But as established in our analysis of the substantive issues above, the 

court’s analysis went far afield by reaching issues unnecessary to the adjudication of the 

dispute between the parties. There are three straightforward rulings the court should have 

made. First, Mega RV was not entitled to indemnity from HWH under the Act because 

HWH was a component part manufacturer that did not provide an express warranty to the 

Ertzes with regard to the slide-out hydraulic components at issue in this case. Second, 

HWH was not entitled to equitable indemnity from Mega RV under any circumstances 

because HWH had already obtained a dismissal (and cash settlement) from the Ertzes. 

Third, Mega RV had no duty to HWH with regard to the repair of the Ertzes’ motor 

home; the tort of another doctrine therefore does not apply to the attorney fees incurred 

by HWH. Any factual findings about defects in the motor home or the causes of such 

defects were unnecessary to the adjudication of the issues between HWH and Mega RV. 

(See First N.B.S. Corp. v. Gabrielsen (1986) 179 Cal.App.3d 1189, 1196 [“When 

determination of an issue was entirely unnecessary to the former judgment, it will not 

have collateral estoppel effect”].)

DISPOSITION

The award of $166,000 in damages to HWH and against Mega RV, as well 

as language in the judgment contemplating the award of additional attorney fee damages

to HWH for postjudgment proceedings, are stricken. Declaratory relief in the judgment 

indicating that HWH is entitled to recover attorney fees is stricken. The prospective 
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award of costs to HWH in the judgment pursuant to Code of Civil Procedure section 

1032 is stricken. The judgment is affirmed as modified. The parties shall bear their own 

costs on appeal.

IKOLA, J.

WE CONCUR:

BEDSWORTH, ACTING P. J.

THOMPSON, J.