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Ventura v. Ford Motor Corp. - 180 N.J. Super. 45, 433 A.2d 801 (Super. Ct. App. Div. 1981)

Rule:

If a warranty is a full warranty, plaintiff is entitled to a refund of the purchase price under the Magnuson-Moss Federal Trade Commission Improvement Act, 15 U.S.C.S. § 2304. However, if a warranty is a limited warranty the court must look to state law to determine plaintiff's right to damages or other legal and equitable relief. 15 U.S.C.S. § 2310(d)(1). Once privity is removed as an obstacle to relief there is no reason why a purchaser cannot also elect the equitable remedy of returning the goods to the manufacturer who is a warrantor and claiming a refund of the purchase price less an allowance for use of the product.

Facts:

Plaintiff Giuseppi Ventura purchased an automobile manufactured by defendant Ford Motor Corp. at an authorized Ford dealership, defendant Marino Auto Sales, Inc. The automobile had engine problems that Marino could not repair despite repeated efforts. Ventura sued under the Magnuson-Moss Warranty-Federal Trade Commission Improvement Act, 15 U.S.C.S. §§ 2301 et seq.; after a trial, Ventura was awarded rescission of the automobile's purchase price, damages against defendant Marino, and attorney's fees. The dealer, Marino, in turn, was awarded damages against the manufacturer, Ford Motor, on its indemnification cross-claim. The manufacturer, Ford Motor, appealed, claiming that there was no basis for rescission, indemnification, or counsel fees.

Issue:

Could an automobile manufacturer be held liable for the defects of the automobile?

Answer:

Yes.

Conclusion:

The state appellate court affirmed the decision, holding that because Ford Motor Corp. had provided a limited warranty, under federal law, the dealer's subsequent disclaimer of product's implied warranty of merchantability and fitness was ineffective, and state law determined the purchaser Ventura's legal and equitable relief. Since under New Jersey law, the dealer Marino was bound to those implied warranties, Marino was liable to Ventura for their breach, and Ventura was entitled to a refund of his purchase price. Additionally, award of counsel fees was proper.

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