Court Opinion

ID: 1059387
Source: CourtListenerOpinion
Date Created: 2013-10-09 18:36:39.386634+00
Date Added: 2024-06-11T12:37:25.196411
License: Public Domain

Present:     All the Justices

BONITA M. LOVE

                          OPINION BY JUSTICE LEROY R. HASSELL, SR.
v.   Record No. 010351                January 11, 2002

KENNETH HAMMERSLEY MOTORS INCORPORATED

           FROM THE CIRCUIT COURT OF THE CITY OF LYNCHBURG
                       J. Michael Gamble, Judge

      In this appeal, we consider whether a purchaser of a car,

who revoked her acceptance of the car and sought monetary

damages as permitted by Code § 8.2-608, properly filed her

claim as an action at law.

      Bonita M. Love filed her motion for judgment against

Kenneth Hammersley Motors, Inc. (Hammersley Motors).    She

alleged that she purchased a 1994 Lexus ES300 car from

Hammersley Motors, which was unable to cure certain defects in

the car.    She sought damages and attorney's fees.

      Hammersley Motors filed responsive pleadings and a motion

requesting that the circuit court require that the plaintiff

elect between her claim for "all monies paid for the vehicle,

in effect, a [rescission] of contract, and . . . for an award

of damages proximately incurred by plaintiff as a result of

defendant's breach of [contract]."    The court required the

plaintiff to make an election, and she chose to pursue her

claim for monetary damages.     At the conclusion of a trial, the
jury returned a verdict in favor of the plaintiff and awarded

her monetary damages in the amount of $21,174.89.

     Hammersley Motors filed a post-verdict motion and

requested, among other things, that the circuit court set the

jury verdict aside because the plaintiff's claim was in the

nature of "rescission" and, therefore, should have been

prosecuted in equity as opposed to at law.    The circuit court

granted Hammersley Motors' motion and ordered a new trial in

equity.    At the conclusion of the proceeding in equity, the

chancellor entered a decree in favor of the plaintiff and

awarded her damages in the amount of $8,780.61.   The

chancellor also awarded her a portion of her requested

attorney's fees and entered a final decree.   The plaintiff

appeals.

     Hammersley Motors does not challenge on appeal the

following facts that were considered by the jury in the law

proceeding.   The plaintiff purchased a 1994 Lexus car from

Hammersley Motors on August 17, 1998.   The purchase price of

the car was $19,508.90.   When the plaintiff purchased the car,

she received a three-month or 3,000-mile power train warranty

at no additional cost, and she purchased an extended service

contract.   Pursuant to the terms of the extended service

contract, Hammersley Motors agreed to "make repairs or

replacement as a result of failure . . . to any part" of the

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car covered by the warranty, including the engine and all

internally lubricated engine parts.

     The day after the plaintiff purchased the car, it began

to malfunction.   The car emitted large quantities of "white

smoke" from the exhaust pipe.    The car consumed "a quart to

two quarts of oil every week."   The plaintiff returned the car

to Hammersley Motors at least five or six times for repair of

the defects, but Hammersley Motors was unable to correct them.

Even though Hammersley Motors eventually installed a new

engine in the car, the car continued to malfunction.    The car

continued to emit white smoke and would not accelerate

properly.   Ultimately, the plaintiff returned the car and keys

to Dirk W. Beasley, Hammersley Motors' general manager, and

requested that she receive a refund of the purchase price.

Beasley refused to refund the purchase price to her.

     The plaintiff argues that she was entitled to file her

motion for judgment on the law side of the circuit court

because she only sought a recovery of monetary damages.

Responding, Hammersley Motors contends that the plaintiff

sought the equitable remedy of rescission and, therefore, she

was required to file her claim in chancery.   Hammersley Motors

relies upon our decision in Gasque v. Mooers Motor Car Co.,

227 Va. 154, 313 S.E.2d 384 (1984), in support of its

position.   We disagree with Hammersley Motors.

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     As the litigants correctly recognize, Virginia has

maintained a longstanding distinction between law and

chancery.   And, "[t]he marked distinction between law and

chancery, a product of the English legal system, continues to

exist in the Commonwealth."   Wright v. Castles, 232 Va. 218,

222, 349 S.E.2d 125, 128 (1986).    When a party seeks solely

monetary damages "caused by another's tortious conduct, he

must bring his action on the law side of the court, and either

party has a right to a jury trial."    Id.; see Stanardsville

Vol. Fire Co. v. Berry, 229 Va. 578, 583, 331 S.E.2d 466, 469-

70 (1985); O'Brien v. Snow, 215 Va. 403, 405, 210 S.E.2d 165,

167 (1974).

     The plaintiff based her cause of action on Code § 8.2-

608, a part of Virginia's Uniform Commercial Code, which

permitted her to revoke her acceptance of the car at issue in

this appeal.   This statute states:

          "(1) The buyer may revoke his acceptance of a
     lot or commercial unit whose non-conformity
     substantially impairs its value to him if he has
     accepted it

               "(a) on the reasonable assumption that its
     nonconformity would be cured and it has not been
     seasonably cured; or

               "(b) without discovery of such nonconformity if
     his acceptance was reasonably induced either by the
     difficulty of discovery before acceptance or by the
     seller's assurances.

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          "(2) Revocation of acceptance must occur within
     a reasonable time after the buyer discovers or
     should have discovered the ground for it and before
     any substantial change in condition of the goods
     which is not caused by their own defects. It is not
     effective until the buyer notifies the seller of it.

          "(3) A buyer who so revokes has the same rights
     and duties with regard to the goods involved as if
     he had rejected them."

     Code § 8.2-711, which is also a part of Virginia's

Uniform Commercial Code, enumerates a buyer's remedies upon

revocation of acceptance:

          "(1) Where the seller fails to make delivery or
     repudiates or the buyer rightfully rejects or
     justifiably revokes acceptance then with respect to
     any goods involved, and with respect to the whole if
     the breach goes to the whole contract (§ 8.2-612),
     the buyer may cancel and whether or not he has done
     so may in addition to recovering so much of the
     price as has been paid

               "(a) 'cover' and have damages under the next
     section [§ 8.2-712] as to all the goods affected whether
     or not they have been identified to the contract; or

               "(b) recover damages for nondelivery as
     provided in this title (§ 8.2-713).

          "(2) Where the seller fails to deliver or
     repudiates the buyer may also

               "(a) if the goods have been identified recover
     them as provided in this title (§ 8.2-502); or

               "(b) in a proper case obtain specific
     performance or replevy the goods as provided in this
     title (§ 8.2-716).

          "(3) On rightful rejection or justifiable
     revocation of acceptance a buyer has a security
     interest in goods in his possession or control for
     any payments made on their price and any expenses

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     reasonably incurred in their inspection, receipt,
     transportation, care and custody and may hold such
     goods and resell them in like manner as an aggrieved
     seller (§ 8.2-706)."

     The plaintiff, relying upon these provisions, filed her

motion for judgment, and she sought damages at law and

attorney's fees pursuant to the Magnuson-Moss Warranty Act, 15

U.S.C. § 2301, et seq.    She sought no equitable remedies.

Code §§ 8.2-608 and -711 permit a buyer, such as the

plaintiff, to recover monetary damages upon revocation of

acceptance, which may include the purchase price.   Therefore,

we hold that the plaintiff properly filed her motion for

judgment on the law side of the court, and the circuit court

erred when it set aside the jury verdict that awarded damages

to her.

     Contrary to Hammersley Motors' contention, our decision

in Gasque does not compel a different conclusion.   In Gasque,

the buyers of an automobile filed a suit in equity against a

retail car dealership and the manufacturer of the car.   The

buyers alleged that they purchased a new car from the

dealership and that after delivery, they discovered numerous

defects in the car.   The dealer made several attempts to

correct the defects without success, and the buyers demanded

rescission of the sale and the return of the purchase price or

replacement of the car.   In their bill of complaint, the

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buyers sought cancellation of the sale and return of the

purchase price or, alternatively, replacement of the car with

a new one of similar model.     227 Va. at 157, 313 S.E.2d at

387.

        In Gasque, the circuit court heard evidence ore tenus and

ruled that the buyers failed to establish certain elements

required by Code § 8.2-608.     The court concluded that the

buyers failed to prove that the car suffered substantial

impairment of value by reason of the defects and that the

buyers failed to revoke their acceptance within a reasonable

time.     Id.   The circuit court did not consider, and was not

requested to consider, whether the proceeding was filed

properly in chancery.

        On appeal, we held that the buyers did not effectively

revoke their acceptance of the car because they drove the car

2,600 miles after they gave their purported notice of

revocation of acceptance.      Id. at 161-62, 313 S.E.2d at 389-

90.    We pointed out in Gasque that "[a]lthough the U.C.C.

'Official Comment' appended to [Code § 8.2-608] makes clear

that the buyer is no longer required to elect between

rescission and damages for breach, the buyers in this case did

so by their pleading.     The prayer of the bill is purely for a

restoration of the parties to the status quo ante, including

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such incidental damages as would accomplish that purpose."

Id. at 159, 313 S.E.2d at 388.

     In the present case, there is no dispute that the

plaintiff satisfied each of the elements necessary to

establish that she properly revoked her acceptance as required

by Code § 8.2-608.   And, unlike the buyers in Gasque, the

plaintiff filed her motion for judgment for monetary damages

on the law side of the court, and she contested the circuit

court's post-trial ruling that her case should have been tried

in chancery.

     Accordingly, we will reinstate the jury verdict that

awarded the plaintiff compensatory damages in the amount of

$21,174.89.    Hammersley Motors does not dispute that the

plaintiff is entitled to attorney's fees pursuant to the

Magnuson-Moss Warranty Act.   Therefore, we will remand this

case to the circuit court so that it can enter an award of

attorney's fees for the plaintiff.   The attorney's fees award

should include the attorney's fees that the plaintiff incurred

during the initial jury trial, the proceeding in equity, and

on appeal.

                                           Reversed and remanded.

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