Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

NOVOSEL v. NORTHWAY MOTOR CAR CORP.

October 24, 1978

Paul NOVOSEL, Plaintiff,
v.
NORTHWAY MOTOR CAR CORP. and General Motors Corporation, Defendants



The opinion of the court was delivered by: FOLEY

MEMORANDUM-DECISION and ORDER

This action presents what may be a question of first impression under 15 U.S.C. § 2301 Et seq. (Consumer Product Warranties Act), popularly known as the Magnuson-Moss Warranty Act. Plaintiff, Paul Novosel, has brought suit against defendants Northway Motor Car Corporation (Northway), an authorized Buick dealer with its principal place of business in Albany, New York; and, its franchisor, General Motors Corporation (GM). Ostensibly, jurisdiction is predicated solely upon 15 U.S.C. § 2310(d). Although it is alleged that defendant GM is a foreign corporation, plaintiff does not allege any other jurisdictional predicate to sustain this Court's subject matter jurisdiction.

 The gravamen of the complaint, set forth in a single claim, is that defendants allegedly breached the express and implied warranties covering a new 1977 Buick automobile purchased by plaintiff; and, for which breach, plaintiff now seeks $ 9,638.55 in compensatory damages and $ 50,000 in punitive damages. It is plaintiff's request for punitive damages which raises a novel question under the Magnuson-Moss Warranty Act.

 Presently before the Court is defendant GM's motion to strike plaintiff's claim for punitive damages upon the ground that the complaint fails to state sufficient facts warranting recovery of punitive damages; and, to dismiss the complaint for failure to state a claim upon which relief can be granted. The allegations of the complaint and the respective contentions of the parties are set forth below.

 Plaintiff alleges that defendant GM engaged in an extensive sales promotion campaign for its 1977 model Buick automobile; that plaintiff purchased a 1977 Buick Regal automobile on April 21, 1977 for the purchase price of $ 6,148.55; that such purchase was made in reliance upon the express warranty furnished by GM and adopted by Northway, as well as reliance upon an implied warranty of merchantability; that such automobile, in fact, was not fit for the ordinary purposes for which it was to be used; that the automobile displayed numerous defects in mechanical operation and appearance; that such defects were pointed out to defendants Northway and GM; that defendants failed and refused to correct such defects although the automobile was returned to Northway on numerous occasions for service and repair; that finally the transmission locked in gear while the car was in plaintiff's garage; that defendant Northway refused to tow the automobile unless the plaintiff signed a general "release"; that plaintiff had the automobile towed to defendant Northway's premises at his own expense; and, that prior to the expiration of the warranty, plaintiff revoked his acceptance by surrender and transfer of the title certificate and registration to the defendant Northway.

 Generally, in this motion the contentions of the respective parties focus upon the necessary technicalities of pleading specific averments upon which an award of punitive damages may be sustained. Plaintiff specifically urges that the absence of specific statutory authority in the Magnuson-Moss Warranty Act does not preclude the imposition of such an award.

 DISCUSSION

 For the purposes of this litigation, the analysis necessarily begins with the critical limitations upon Federal jurisdiction which are embodied in 15 U.S.C. § 2310(d)(3):

 
No claim shall be cognizable in a suit brought under paragraph (1)(B) of this subsection (A) if the amount in controversy of any individual claim is less than the sum or value of $ 25; (B) If the amount in controversy is less than the sum or value of $ 50,000 (exclusive of interest and costs) computed on the basis of all claims to be determined in this suit; or (C) if the action is brought as a class action, and the number of named plaintiffs is less than one hundred (underscoring supplied).

 An examination of the legislative history reveals that the purpose of these jurisdictional provisions is twofold: 1) to avoid trivial or minor actions being brought as class actions in the federal district courts; and, 2) to overcome the absence of an amount in controversy requirement in 28 U.S.C. § 1337, since the Magnuson-Moss Warranty Act is an act regulating commerce. H.R.Rep.No.1107, 93rd Cong., 2d Sess., Reprinted in (1974) U.S.Code Cong. & Admin.News, pp. 7702, 7724. See also Barnette v. Chrysler Corp., 434 F. Supp. 1167 (D.Neb.1977).

 The Act and legislative history, however, are silent upon the question of whether exemplary and punitive damages may be considered with actual damages in order to exceed the requisite amount in controversy. Indeed, the act is virtually silent as to the amount and type of damages which may be awarded for breach of warranty. It is noted that the remedies set forth in 15 U.S.C. § 2304 are applicable only to "full" warranties. See 15 U.S.C. § 2303(a)(1).

 Given this circumstance, resort to the well-established rules governing the determination of the amount in controversy in jurisdictional statutes is essential. The cardinal rule was announced by the Supreme Court in the leading case of St. Paul Mercury Indemnity Co. v. Red Cab Co., 303 U.S. 283, 288-89, 58 S. Ct. 586, 590, 82 L. Ed. 845 (1938):

 
The rule governing dismissal for want of jurisdiction in cases brought in the federal court is that, unless the law gives a different rule, the sum claimed by the plaintiff controls if the claim is apparently made in good faith. It must appear to a legal certainty that the claim is really for less than the jurisdictional amount to justify dismissal.

 For the most part, this "legal certainty" test renders it difficult to secure dismissal of a case premised upon the failure to satisfy the jurisdictional amount. See e.g., Moore v. Betit, 511 F.2d 1004 (2d Cir. 1975). Nevertheless, the legal certainty standard is clearly applicable in those cases where recovery is limited by the terms of a contract, E. g., Doucet v. Travelers Insurance Co., 362 F.2d 263 (5th Cir. 1966); where the governing law places limits upon the damages recoverable, James v. Lusby, 162 U.S.App.D.C. 352, 499 F.2d 488 (1974); and, where the amount demanded is merely Colorable for the purpose of ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.