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2005-UP-058 - Johnson v. Fort Mill Chrysler Plymouth Dodge

THIS OPINION HAS NO PRECEDENTIAL VALUE.  IT SHOULD NOT BE CITED OR RELIED ON AS
PRECEDENT IN ANY PROCEEDING EXCEPT AS PROVIDED BY RULE 239(d)(2), SCACR.

THE STATE OF SOUTH CAROLINA
In The Court of Appeals

Darrell R. Johnson and Sheryll K. Johnson, Appellants,

v.

Fort Mill Chrysler Plymouth Dodge, Respondent.


Appeal From York County
 John C. Hayes, III, Circuit Court Judge


Unpublished Opinion No.  2005-UP-058
Heard December 7, 2004 – Filed January 24, 2005


AFFIRMED IN PART, REVERSED IN PART AND REMANDED


Mitchell K. Byrd, of Rock Hill, for Appellants

Michael E. Kozlarek, of Columbia, and Michael S. Malloy, of Charlotte, for Respondent.

PER CURIAM:  Darrell Johnson and his wife Sheryl (the Johnsons) appeal the trial court’s grant of directed verdict for Fort Mill Chrysler Plymouth Dodge regarding claims for breach of contract and violations of both the Motor Vehicle Dealers Act and the Unfair Trade Practices Act.  We affirm in part, reverse in part, and remand.

FACTS

In March 2000, Darrell Johnson attempted to purchase a Chrysler PT Cruiser automobile from Fort Mill Chrysler Plymouth Dodge (Fort Mill Chrysler).  The dealership was taking deposits from customers for the vehicles, although the vehicles had not yet arrived on its lot. 

Darrell spoke with Fort Mill Crysler salesman Isaac Byers, who told him he could purchase a shale green PT Cruiser that had been originally ordered for Morris, a customer who no longer wanted the vehicle. The Johnsons paid a $500 deposit to the dealership, indicating on the check it was for the Morris automobile.  Darrell received a New Car Order or Locate Sheet for a shale green PT Cruiser and his name was written next to the Morris order on a vehicle display board in the dealership showroom.  Byers informed Darrell no other documents could be provided because the dealership would lose its allocation from Chrysler, but assured him that the car would be available in June or July. [1]

A few weeks later, Darrell returned to the dealership and asked Byers if he could change the color of the car because Sheryl did not like the shale green color and did not want the Morris vehicle.  Byers informed Darrell he could have a taupe PT Cruiser originally ordered for a customer named Darmer.  Byers removed Darrell’s name from beside Morris on the display board and wrote it next to Darmer.  No documents were signed regarding the Darmer vehicle, but Byers gave Darrell a Darmer vehicle specifications sheet and again cited Fort Mill Chrysler’s limited allocation as the reason for not signing any documents referencing the transaction. 

Darrell checked on the availability of his car periodically and each time Byers told him the automobile was in production.  In late September when he checked on whether the taupe PT Cruiser had arrived, Darrell was unable to speak with Byers, who was out of work due to a car accident.  Instead, he spoke with a new manager, Tim Parker, who told Darrell the dealership had no file showing the Johnsons’ order.  The next day, Parker told Darrell the only taupe vehicle had been sold to another customer.  Subsequently, the dealership found evidence of the Johnsons’ deposit check and refunded the $500 to them on September 27, 2000.  The Johnsons later purchased another PT Cruiser from a different dealership.

The Johnsons filed suit against the dealership for breach of contract, violation of the Act to Regulate Manufacturers, Distributors, and Dealers, and violation of the South Carolina Unfair Trade Practices Act.  In the complaint, the Johnsons allege breach of the contract to sell them the Darmer vehicle.  The second and third causes of action incorporate by reference the preceding allegations and claim causes of action under the Dealers Act and the Unfair Trade Practices Act.  The case was tried before a jury and at the end of the plaintiffs’ case, the trial court directed a verdict in favor of the dealership as to all three causes of action.  The Johnsons appeal.

STANDARD OF REVIEW

When ruling on a directed verdict, the trial court must view the evidence and the inferences reasonably drawn therefrom in the light most favorable to the nonmoving party.  Sabb v. South Carolina State Univ., 350 S.C. 416, 427, 567 S.E.2d 231, 236 (2002).  If the evidence is susceptible to more than one reasonable inference, the case should be submitted to the jury. Heyward v. Christmas, 357 S.C. 202, 207, 593 S.E.2d 141, 144 (2004).

LAW/ANALYSIS

I.                   Breach of Contract

The Johnsons assert the trial court erred in granting the dealership’s motion for directed verdict on the breach of contract claim.  We disagree. 

To succeed in a breach of contract claim, the Johnsons need to prove the Statute of Frauds does not bar their action.  A contract for the sale of goods for $500 or more will not be enforced unless the parties have made a sufficient writing signed by the party against whom enforcement is sought.  See S.C. Code Ann. § 36-2-201(1) (2003).  A contract may be evidenced by one or more writings that “are connected either expressly or through internal evidence of the subject matter and occasion.”  Young v. Indep. Publ’g. Co., 273 S.C. 107, 110, 254 S.E.2d 681, 683 (1979) (citation omitted).  However, when several writings must be considered, they must set forth all essential terms such that the contract is proved without resort to parol evidence.  Id. at 111, 254 S.E.2d at 683 (citations omitted).   

To modify a contract within the Statute of Frauds, the modification must also be in writing.  See S.C. Code Ann. § 36-2-209(3) (2003).   Part performance by part payment may make the contract enforceable when the contract is divisible.  See South Carolina Reporter’s Comments, S.C. Code Ann. § 36-2-201 (2003).  When the subject matter of the contract is a single object, the contract would not be enforceable without full payment.  Id.

Considering together all the documents involved in the alleged transaction, no writing exists that satisfies the Statute of Frauds.  If the Order and Locate Sheet and the deposited $500 check form a contract, it is for the Morris vehicle, which the Johnsons decided they did not want.  Darrell’s request to change the deal to one for the Darmer vehicle fails to satisfy the Statute of Frauds’ requirement for written modification.  The only writing referencing the Darmer vehicle is not signed by an agent of the dealership.  In addition, no oral modification would be enforceable based on part performance, because the Johnsons did not pay the full purchase price for the automobile. 

Because only one reasonable inference can be drawn from the facts, the trial court correctly granted the motion for directed verdict to the dealership regarding the breach of contract claim.

II.                Dealers Act

The Johnsons also assert the trial court erred in granting a directed verdict to the dealership on their claim for violation of the Act to Regulate Manufacturers, Distributors, and Dealers.  We agree. [2]  

Damages can be recovered under the Dealers Act if an automobile dealer engages “in any action which is arbitrary, in bad faith, or unconscionable and which causes damage to any of the parties or to the public.”  S.C. Code Ann. §56-15-40(1) (1991);  see also, deBondt v. Carlton Motorcars, Inc., 342 S.C. 254, 263, 536 S.E.2d 399, 404 (Ct. App. 2000).  Arbitrary acts include those that are “unreasonable, capricious or nonrational; not done according to reason or judgment; depending on will alone.”  Taylor v. Nix, 307 S.C. 551, 555, 416 S.E.2d 619, 621 (1992).   This does not require dealerships to interact with customers solely by fixed rules and standards but does require “some reasonable basis” for their conduct.  Id. at 556, 416 S.E.2d at 621.  Bad faith is “[t]he opposite of good faith, generally implying or involving actual or constructive fraud, or a design to deceive or mislead another, or a neglect or refusal to [fulfill] some duty or some contractual obligation, not prompted by an honest mistake as to one’s rights or duties, but by some interested or sinister motive.” deBondt, 342 S.C. at 263, 536 S.E.2d at 404 (citations omitted). Generally, unconscionable as it relates to an act or transaction means “showing no regard for conscience; affronting the sense of justice, decency, or reasonableness.”  Black’s Law Dictionary (8th ed. 2004). Unconscionability has been found in a situation lacking meaningful choice due to one-sided contract terms.  Fanning v. Fritz’s Pontiac-Cadillac-Buick, Inc., 322 S.C. 399, 403, 472 S.E.2d 242, 245 (1996).

Viewed in a light most favorable to the Johnsons, the facts raise more than one reasonable inference creating a jury question and rendering a directed verdict improper.  Byers recalled a practice of returning deposit checks to customers after selling the vehicles associated with those deposits to other customers. Fort Mill Chrysler accepted deposits for vehicles for which it knew it did not have a definite inventory.  According to Darrell’s testimony, the dealership indicated to him that a specific vehicle was being identified for his purchase both by changing the name on a specification sheet and on a display board.  The dealership later claimed to have no record of a transaction with the Johnsons and Parker informed Darell that the dealership sold the only taupe vehicle.  In addition, after accepting the Johnsons’ $500 deposit, Fort Mill Chrysler held the check for six months before returning it to them.  Byers’ testimony indicates that the dealership had a practice of accepting deposits for vehicles not in stock with full knowledge that there would not be enough PT Cruisers to satisfy the orders they procured.  At the very least, a question of fact exists as to whether the dealership acted arbitrarily, in bad faith, or unconscionably.  Therefore, the trial court erred in granting the dealership’s motion for directed verdict on the Dealers Act cause of action.

III.             South Carolina Unfair Trade Practices Act

The Johnsons also argue the trial court erred in granting the dealerships motion for directed verdict involving their claim for a violation of the Unfair Trade Practices Act.  We agree. 

To recover under this Act, the plaintiff must prove an “ascertainable loss of money or property” because of an unfair or deceptive method, act, or practice.  S.C. Code Ann. §§ 39-5-20, 39-5-140 (1985).  The plaintiff must also show the actions of the defendant adversely affect the public interest, which can be shown by proving the potential for repetition.  Daisy Outdoor Adver. Co., Inc. v. Abbott, 322 S.C. 489, 493, 473 S.E.2d 47, 49 (1996). 

Darrell’s testimony regarding paying a higher price for the PT Cruiser he purchased from another dealership could lead a jury to infer that Fort Mill Chrysler’s actions caused the Johnsons an ascertainable financial loss referenced by the Act.  Darrell testified that he paid $23,000 for a PT Cruiser, $3,900 more than the price he claims Fort Mill Chrysler quoted to him.  There was sufficient evidence from which a jury could have found that the dealership accepted deposits for vehicles not in stock and delayed the return of the deposits even after it became clear that the stock would not meet the demands of those who had given deposits.  A jury could have found the Johnsons were under the impression that their deposit reserved them a specific PT Cruiser. The dealership promising more cars than inventory would ever permit seems to have been the common practice—clearly repeated and potentially repeatable. Again viewed in a light most favorable to the Johnsons, sufficient evidence exists that indicates the dealership may have engaged in practices that were unfair or deceptive based on its dealings with them.  Therefore, the trial court erred in granting a directed verdict as to the Unfair Trade Practices Act claim.

The trial court was correct to grant a directed verdict to the dealership on the breach of contract claim.  However, questions of fact were created as to the alleged violations of both the Dealers Act and the Unfair Trade Practices Act, and those questions should have been submitted to the jury. 

AFFIRMED IN PART, REVERSED IN PART and REMANDED.

ANDERSON, STILWELL, and SHORT, JJ., concur.


[1] Due to a successful marketing campaign, Chrysler experienced high demand from customers prior to the arrival of the new PT Cruiser on dealership lots; therefore, dealerships were allotted only a limited number of the vehicles. 

[2] The dealership suggests the causes of action under the Dealers Act and the Unfair Trade Practices Act must fail because they are derived from the breach of contract claim.  Neither the Dealers Act nor the Unfair Trade Practices Act contemplates a Statute of Frauds requirement.  See S.C. Code Ann § 56-15-10 et seq. (1991), S.C. Code Ann. § 39-5-10 et seq. (1985).  Thus, the second and third causes of action do not fail for this reason.