Plaintiffs, buyers of an allegedly defective motor home, appealed a judgment from the Superior Court of San Joaquin County (California), which, after sustaining defendant assignee’s demurrer to some of the buyers’ claims, granted summary adjudication in favor of the assignee on the buyers’ remaining causes of action.
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Overview
The buyers returned the motor home to the dealership and stopped paying. The assignee took possession of the motor home and informed credit reporting agencies that the buyers had defaulted. The buyers sued on various contract, tort, and consumer protection causes of action. The court held that the Holder Rule, 16 C.F.R. § 433.2, allowed the buyers to assert the same claims and defenses against the seller’s assignee that they could have asserted against the seller. The Rees-Levering Automobile Sales Finance Act, Civ. Code, § 2981 et seq., did not limit the buyers to rescission. The Holder Rule did not itself provide a cause of action and did not allow recovery of more than the amount paid. The demurrer was correctly sustained as to a claim for negligent credit defamation, preempted by 15 U.S.C. § 1681t(b), but not as to a negligence claim based on failure to repair. Declaratory and injunctive relief were unavailable because the buyers were not third party beneficiaries of the dealer agreement. The adequacy of prefiling letters sent under Civ. Code, § 1782, subd. (a)(2), could not be decided on demurrer. Inadequate briefing forfeited a challenge to the summary adjudication order.
Outcome
The court reversed the judgment insofar as the trial court (1) sustained the demurrer to the buyers’ causes of action for negligence and under the Consumer Legal Remedies Act, Civ. Code, § 1770 et seq., and (2) awarded attorney fees to the assignee, and it remanded for further proceedings.