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Klein v. AJV Auto Air & Service, Inc.

A-3682-01T3 (N.J. Super. App. Div. 2003) (Unpublished)

CONTRACTS; DAMAGES; RESCISION—A complaining car buyer who drive a car for 40,000 miles, where the car also has been rear-ended, is not entitled to rescission as a remedy for deceit because rescission is an equitable remedy only applicable when the parties can each be returned to their original positions.

A seller placed his car on a used car sales lot for sale by the owner of the lot. A buyer saw the car and asked the lot owner about it. The lot owner referred him to the actual car owner. A sale was concluded and a related purchase form was checked stating that “No Warranty/‘AS IS’ - Sale of used vehicle.” Handwritten on the purchase order were the words: “SOLD AS IS NO WARRANTY.” The car had emission problems but, after certain adjustments, it passed inspection and received an official sticker. When the car experienced later problems, the buyer learned that the vehicle was “grey market” car and was “not manufactured in compliance with American safety and emission standards.” The identifying data “had been ground from the vehicle’s engine.” The buyer’s insurance carrier refused to issue comprehensive and collision coverage, but would issue liability coverage. The buyer sued, alleging consumer fraud, common law fraud, breach of warranty” and sought recision. The buyer was not entitled to recision because it is “an equitable remedy which can only be invoked if the court is able to return the parties to their original positions.” Here, the buyer drove the car for more than 40,000 miles and the car had been rear-ended. The original manufacturer’s wheels had been replaced and the new tires originally on the car were replaced with used tires. Further, paint was peeling from the body. Moreover, the car was sold “as is,” and because of the age of the car, “it was not subject to mandatory limited statutory warranties governing the sale of used cars.”

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