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Perkins v. DaimlerChrysler Corporation

383 N.J. Super. 99, 890 A.2d 997 (App. Div. 2006)

CONSUMER FRAUD; WARRANTIES—Absent a showing of safety concerns, one cannot bring a consumer fraud action for a substandard part that outperformed the contractual warranty because that would be akin to rewriting the agreed-upon warranty.

A consumer purchased a five-year old vehicle with an odometer reading of 108,000 miles. The consumer then sued the manufacturer for violating the Consumer Fraud Act, claiming that the manufacturer had installed a substandard exhaust manifold in the vehicle. Specifically, she alleged that the manifold was made of tubular steel, which is subject to cracking, whereas a cast-iron exhaust manifold would last 250,000 miles. The lower court dismissed the consumer fraud complaint on summary judgment. It found that the consumer had not suffered any ascertainable loss. The lower court noted that the consumer never alleged that the manifold suffered a crack or needed repair. The lower court also found that the allegedly substandard exhaust manifold would have a negligible impact, if any, on the resale value of the vehicle. The lower court also found that one cannot sustain a consumer fraud action when the part outlasted the stated warranty. On appeal, the Appellate Division affirmed, agreeing with the lower court’s analysis with respect to ascertainable loss. However, it noted that it was improper for the lower court to decide the issue on a summary judgment motion. In deciding a summary judgment motion, a court must determine if, after allowing all favorable inferences to the nonmoving party, there was a cause of action. The consumer does not need to provide sufficient evidence of ascertainable loss to defeat a summary judgment motion. Nonetheless, the Court affirmed the lower court ruling on policy considerations because, absent a showing of safety concerns, one cannot bring a consumer fraud action for a substandard part that outperformed the contractual warranty. The Court viewed permitting the consumer fraud action as akin to rewriting the warranty that was freely negotiated between the parties.


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