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Hodges v. Johnson

March 14, 2008


Appeal from Saline District Court; JEROME P. HELLMER, judge.


1. Whether a breach of the implied warranty of merchantability has occurred is a question of fact. However, before the issue of a breach can be addressed, there must be a finding that an implied warranty of merchantability applies to the item sold. That is a question of law.

2. There is an implied merchantability for goods sold if the seller is a merchant with respect to goods of that kind. To be merchantable, the goods must be fit for the ordinary purpose for which they are used.

3. To establish a breach of the implied warranty of merchantability, the buyer must prove the ordinary purpose of the type of goods involved and that the goods sold were not fit for that purpose. The buyer must show that the goods were defective, that the defect was present when the goods left the seller's control, and that the defect caused injury.

4. A buyer of a used car has a right to expect that it will not turn out to be completely worthless but cannot reasonably expect that the car will be the finest of all possible goods of that kind. The implied warranty of merchantability varies with the particular car. A late model, low mileage car, sold at a premium price, is expected to be in far better condition and to last longer than an old, high mileage car.

5. An implied warranty of merchantability warrants the operation of major components that are necessary for the car to operate, such as the engine and transmission, and it is the responsibility of the buyer to ensure that the components incidental to operation are in working condition.

The opinion of the court was delivered by: Marquardt, J.

Affirmed in part and reversed in part.


Merle J. "Boo" Hodges, M.D., and Melissa R. Hodges (hereafter Dr. Hodges, Mrs. Hodges, or the Hodges) appeal from the district court's denial of an award of attorney fees. Jim Johnson, d/b/a Johnson and Associates, cross-appeals claiming he did not breach the warranty of merchantability and that the Hodges failed to adequately prove their damages. We affirm in part and reverse in part.

Johnson is a car dealer who sells used cars. Johnson sold the Hodges a 1995 Mercedes 320 with 135,945 miles on it in January 2005 for $17,020. Johnson testified that he told the Hodges the vehicle was a nice car in good condition. Dr. Hodges testified that Johnson said the car "was just pretty much a perfect car. He loved driving it." There was no discussion about the air conditioning, heating, or other components on the car at the time of the sale.

Both Johnson and Dr. Hodges testified that they had no reason to believe the air conditioner did not work when it was sold to the Hodges. Virgil Anderson, the Hodges' mechanic, could not determine whether the air conditioner problem existed when the Hodges bought the car, or occurred later.

Dr. Hodges testified that the vent did not cool the car in February and the car had a funny smell. In late March 2005, Mrs. Hodges testified that she noticed a problem with the air conditioner and contacted Anderson, who put freon in the air conditioner. About a month later, the air conditioner was not working and more freon was added. Mrs. Hodges phoned Johnson to inform him of the problem and Johnson explained that older vehicles may need a boost of freon every year. In May 2005, the air conditioner failed to work again. Anderson informed the Hodges that the air conditioning evaporator, condenser, and compressor needed to be replaced and would cost approximately $3,000 to $4,000.

Mrs. Hodges testified that in May 2005, or on a subsequent visit, a mechanic who worked for Anderson informed her for the first time that Johnson had a product called Super Seal put in the air conditioning unit in May 2003. The mechanic said the use of the Super Seal complicated the repair of the air conditioner. Johnson testified that he recalled no problems with the air conditioner after the Super Seal was added in May 2003. Johnson could not say with certainty whether freon was added after that time. Johnson testified that the May 2003 air conditioner problem only involved the evaporator. Anderson diagnosed the condenser as the main problem in 2005.

Mrs. Hodges asked Johnson to pay for the air conditioner repair. Johnson refused. The Hodges filed a small claims action against Johnson alleging damages of $3,474. The small claims court found in favor of the Hodges and awarded them $3,474 plus interest. The small claims court made no findings of fact or conclusions of law. Johnson appealed to the district court.

The district court held a de novo hearing and found that Johnson gave the Hodges a written limited warranty which covered "lubricated internal parts of engine only" and was for ...

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