COURT OF APPEALS DECISION DATED AND RELEASED AUGUST
15, 1995 |
NOTICE |
A party may file with the Supreme Court a petition to review an
adverse decision by the Court of Appeals. See
§ 808.10, and Rule 809.62, Stats. |
This opinion is subject to further editing. If published, the official version will appear in the bound volume
of the Official Reports. |
No. 95-0556-FT
STATE OF WISCONSIN IN
COURT OF APPEALS
DISTRICT I
WALTER
F. TESCH and
BETTY
TESCH,
Plaintiffs-Respondents,
v.
BEST
MOTORS, INC.,
Defendant-Appellant.
APPEAL
from a judgment of the circuit court for Milwaukee County: LAURENCE C. GRAM, JR., Judge. Affirmed.
Before
Wedemeyer, P.J., Sullivan and Schudson, JJ.
PER
CURIAM. Best Motors, Inc., appeals from
a summary judgment in favor of Walter and Betty Tesch. The issues are: (1) whether Best Motors had a duty to disclose repairs made to a
vehicle they sold to the Tesches; and, if they did, (2) whether the Tesches
were entitled to rescission of the contract.
Pursuant to this court's order dated March 27, 1995, this case was
submitted to the court on the expedited appeals calendar. See Rule
809.17, Stats. We conclude that Best Motors had a duty to
disclose the repairs and that rescission is an appropriate remedy. We affirm.
The
facts are not in dispute. The Tesches
purchased a new 1991 Ford Mustang automobile from Best Motors on February 8,
1992. The retail price of the car, as
listed on the automobile's sticker, was $16,027. The Tesches purchased the car for $14,000, including sales
tax. Prior to the sale, the vehicle had
been vandalized while on Best Motor's show lot. The culprits stole the tires, broke glass, and caused damage to
the rocker panels. Best Motors repaired
the damage, totalling $4,031, but did not inform the Tesches about the damages
prior to the purchase.
When
the Tesches learned of the vandalism, they brought this action against Best
Motors, arguing that Best had a duty to disclose the damages under Wis. Adm. Code § Trans 139.05(6) because the damages to
the vehicle exceeded six percent of the manufacturer's suggested retail
price. The trial court granted summary
judgment in favor of the Tesches.
In
reviewing an order for summary judgment, we follow the same methodology as the
trial court. Dobratz v. Thomson,
161 Wis.2d 502, 513, 468 N.W.2d 654, 658 (1991). That methodology has been often stated and need not be repeated
here. See id. at
513, 468 N.W.2d at 657-58. Summary
judgment must be granted where there is no genuine issue as to any material
fact and the moving party is entitled to judgment as a matter of law. Id.
Wis. Adm. Code § Trans
139.05(6), provides:
Damage disclosure. On any new
vehicle or demonstrator or executive vehicle, any corrected damage exceeding 6%
of the manufacturer's suggested retail price as measured by retail repair
costs, and all uncorrected damage shall be disclosed in writing to the
purchaser prior to delivery. Damage to
glass, tires, or bumpers is excluded from the 6% rule when replaced by
identical manufacturer's original equipment.
Best
Motors contends that it did not have a duty to disclose the repairs made to the
vehicle. Noting that "glass,
tires, or bumpers" are excluded from the six percent disclosure rule when
they are replaced by "identical manufacturer's original equipment,"
Best argues that the price of the tires should be excluded from the cost of the
repairs it made to the vehicle, thus bringing the total repair cost to less
than six percent of the suggested retail price. Acknowledging that it replaced the damaged tires with performance
tires, rather than all season tires as listed on the vehicle sticker, Best
contends that the tires were, in effect, identical to the original tires
because the car comes equipped from the manufacturer with either of the two
kinds of tires, regardless of what the automobile sticker indicates.
We
agree with the trial court that Best Motors did not replace the damaged tires
with "identical manufacturer's original equipment." The vehicle's sticker indicated that the car
was equipped with all season performance tires when manufactured. Ford Motor Company records also indicate
that the vehicle was manufactured with all season performance tires. According to a statement Walter Tesch made
in a deposition, one of the reasons he bought the car was because of the all
season tires. The performance tires,
which were apparently of a lower quality than the all season performance tires,
were not "identical manufacturer's original equipment." Therefore, Best Motors had an obligation to
notify the Tesches of the corrected damages prior to the sale of the car
because, when the cost of replacing the tires was included, the damages to the
vehicle exceeded six percent of its suggested retail price.
Best
Motors next argues that Wis. Adm. Code
§ Trans. 139.05(6) only
requires disclosure of "corrected damage," while, in this case, the
tires were completely removed, not damaged.
Therefore, the cost of replacing the missing parts does not fall within
the mandate of the six percent-disclosure rule. We reject this overly-technical reading of the rule. To accept Best Motor's interpretation would
require differing results depending on whether, for example, automobile tires
were punctured by vandals and, thus, "damaged," or whether the tires
were completely removed. Common sense
suggests that "damage" to a vehicle includes theft which results in
removal of parts of the vehicle. This
reading is in accord with the purpose of the rule—to protect consumers from
unwittingly purchasing a vehicle which is no longer in the same condition as it
was when it was manufactured.
Best
Motors next argues that rescission was not the appropriate remedy because the
breach of contract was "only ancillary or insubstantial." See Appleton State Bank v. Lee,
33 Wis.2d 690, 692, 148 N.W.2d 1, 2-3 (1967) (rescission is only appropriate
where there is a substantial breach of contract). However, given that the cost of repairs ($4,031) totalled
approximately twenty-five percent of the list price of the automobile
($16,027), we conclude that the breach was substantial and that rescission was
an appropriate remedy.
By
the Court.--Judgment affirmed.
This
opinion will not be published. See
Rule 809.23(1)(b)5, Stats.