Case Law Summaries

Scibek v. Longette

• Opinion Date: April 5, 2001
• Business Law
• E-Mail

CONSUMER FRAUD ACT; AUTOMOBILES—Intent is not an element of an unlawful practice and a consumer’s waiver of the Consumer Fraud Act’s requirements for a written estimate from an automobile repair shop must be in writing, even if the consumer is well aware of the requirement for a written estimate.

A repair shop worked on a customer’s two automobiles. Contrary to regulations promulgated under the Consumer Fraud Act, the repair shop failed to give the owner a written estimate and did not obtain a written authorization to complete the repairs. Under the Act, these omissions constitute “deceptive practices in the conduct of the business of an automobile repair dealer.” The lower court dismissed the owner’s claims under the Consumer Fraud Act, finding that the owner had waived the protection of the Act. In reaching this conclusion, the lower court emphasized that the owner “had owned and operated an automobile repair shop for many years, and obviously knew of, and agreed to disregard, the regulations requiring a dealer to give a customer a written estimate and obtain a written authorization to perform specified repairs.” Further, the lower court held that violation of the regulations did not result in any ascertainable loss to the car owner. The Appellate Division found it undisputed that the dealer violated the regulatory provisions of the Act as they apply to automobile repair facilities. Further, “[t]hat he meant no harm is irrelevant.” Intent is not an element of an unlawful practice. The Appellate Division allowed that it would be “at least arguable that the somewhat rigid approach adopted in [a prior New Jersey case] should not be followed where the consumer has obtained the benefit of his bargain and attempts to use the Act as a sword rather than a shield.” In this case, however, the Court believed that the dispute over an unpaid balance for car repairs would never have happened had there been a written estimate and a written authorization. This then left the issue of waiver. Waiver is the intentional relinquishment of a known right and must be evidenced by a clear, unequivocal and decisive act from which an intention to relinquish the right can be based. A particular difficulty in this case was that the regulations under the Act specify the means for effectuating a waiver. Specifically, they state that the customer can only “waive [] his right to a written estimate in a written statement, signed by the customer.” In fact, the regulation requires that automobile repair facilities conspicuously post a sign to that effect. The Court also rejected the repair shop’s argument that its customer should be estopped from asserting the Act. For such a defense to be successful, the repair shop would have needed to show that it had relied on its customer’s acts. The Court was not prepared to find such to be the case. Further, although the Appellate Division agreed with the lower court that the car owner did not suffer an ascertainable loss by reason of the repair shop’s violation of the Act, it pointed out that “an award of ... attorney’s fees is mandatory,” and remanded the matter to the lower court to determine the amount of those fees.

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