RV manufacturer prevails against warranty breach claims 

Although sympathetic toward a couple who bought an RV riddled with problems, the 7th Circuit Court of Appeals affirmed an award of judgment for the RV’s manufacturer after finding no breach of the warranty or its provisions.

Immediately after purchasing an RV from Mellott Brothers Trailer Sales, Inc., Vanessa and Randy Mathews encountered problems with their new ride. Initially, the couple had troubles with the interior lights, the refrigerator and the RV’s leveling system. Down the road, the Mathewses also experienced issues with the TV and DVD players, which didn’t work, and found the converter was blowing fuses. The RV’s curbside slide cable broke and its air conditioner and water tank also were malfunctioning.

REV Recreation Group, Inc., which manufactured the RV, informed the Mathews that they could go to a local dealer near them for repairs, but they would need to obtain approval from REV before the dealer performed repairs that would be covered under the warranty.

That warranty limited both express and implied warranties to one year from the date of purchase, and the Mathews had to notify REV or an authorized dealer within five days of discovering a defect to take advantage of it. The warranty also stated that if a replacement or repair failed to remedy the defect after REV was given a reasonable opportunity to fix it, then “your sole and exclusive remedy shall be limited to Warrantor paying you the costs of having an independent third party perform repair(s) to the defect(s).”

Repairs were made by a local dealer, but the Mathewses never let REV know about the performed work. Soon after, more repairs were needed, and REV took the RV in its care. When it was returned, REV issued an extended goodwill warranty for “defective workmanship or materials in manufacturing,” but the warranty specifically excluded an extension of the limited warranty “or any other warranties.”

When the Mathewses asked REV to buy back the RV a few months before the its one-year purchase date, REV refused, and the couple sued for breach of the express and implied warranties on the RV. The complaint also alleged violations of both the Indiana Deceptive Consumer Sales Act and the Magnuson-Moss Warranty Act, claiming that REV had failed to fix the TV, DVD player, and air conditioning/slide out seals.

The Northern District Court awarded summary judgment in REV’s favor concluding that because REV was not given a reasonable opportunity to cure any defects, it did not breach its express or implied warranties. Even though the RV had numerous problems, the district court found all the Mathewses’ claims failed.

A sympathetic 7th Circuit agreed, upholding the lower court’s decision in Vanessa Mathews v. REV Recreation Group, Inc., 18-1982. First, the appellate court noted that although REV was given a chance to fix certain issues with the RV, they were only given two chances to fix the problems.

“Under Indiana law, two chances is not a reasonable opportunity to cure the defects such that the warranty failed of its essential purpose,” Circuit Judge Amy Coney Barrett wrote. “And even if the Mathews could show that REV had a reasonable opportunity to repair the RV’s defects, the limited warranty did not fail in its essential purpose because the Mathews did not avail themselves of the contract’s back‐up remedy — which required that if REV failed to cure a defect, the Mathews’ ‘sole and exclusive remedy shall be limited to Warrantor paying you the costs of having an independent third party perform repair(s) to the defect(s).’”

It additionally agreed with the district court that the contract’s limited warranty was not unconscionable and not one that “no honest and fair man” would accept.

“Finally, because the Mathews have not established that a warranty was breached or that the limitations in the warranty were unconscionable, their remaining claims under the IDCSA and Magnuson-Moss Warranty Act, which were based on the same arguments, fail as well,” the panel concluded.

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