Loury v. Westside Auto. Grp.

199 N.E.3d 62

Pamela LOURY, Plaintiff-Appellant/Cross-Appellee,

v.WESTSIDE AUTOMOTIVE GROUP, et al., Defendants-Appellees/Cross-Appellants.

No. 111319

Court of Appeals of Ohio, Eighth District, Cuyahoga County.

Released and Journalized: October 13, 2022

Joanne Brown, for appellant and cross-appellee.

Brouse McDowell, LPA, Clair E. Dickinson, Joseph T. Dattillo, Akron, Anastasia J. Wade, Cleveland, and Alexandra V. Dattillo, for appellees and cross-appellants.

JOURNAL ENTRY AND OPINION

EILEEN T. GALLAGHER, J.:

{¶ 1} Plaintiff-appellant/cross-appellee, Pamela M. Loury ("Loury"), appeals a judgment, rendered following a bench trial, that did not award her damages against defendant-appellees/cross-appellants, Westside Automotive Group, March Hodge Lamarch, and March Hodge Lamarch Cleveland L.L.C. (collectively referred as "Westside"). Loury claims the following errors:

1. The trial court erred in not ruling that defendant-appellee violated the consumer sales practices act.

2. The trial court erred in not awarding statutory damages for defendant-appellees’ sales practices act violation.

3. The trial court erred in not awarding actual damages because plaintiff-appellant could have rescinded the contract.

4. The trial court erred in not allowing for attorney fees damages for defendant-appellees’ consumer sales practices act violation.

{¶ 2} Westside filed a cross-appeal of the trial court's judgment and claims the following error:

The trial court incorrectly determined that Westside breached its contract with Ms. Loury by canceling it when it was unable to find financing for her.

{¶ 3} We affirm the trial court's judgment.

I. Facts and Procedural History

{¶ 4} Loury and her brother, Bruce Edwards ("Edwards"), visited Westside's automobile dealership on December 18, 2017, to purchase a 2016 Cadillac SUV they had seen advertised. The SUV was already sold when they arrived, and a salesperson showed them a 2017 Cadillac XTS sedan ("the Cadillac" or "the car") instead. Loury and Edwards test-drove the Cadillac and liked it, but they wanted a moonroof installed. Westside agreed to install a moonroof, and Loury agreed to buy the car.

{¶ 5} To complete the transaction, Loury executed several documents, including a "Conditional Delivery Agreement" and a "Retail Installment Sales Contract." The Conditional Delivery Agreement states that Westside will deliver the car to Loury on the date she signs the agreement, but it also provides that the transaction is contingent on Loury obtaining financing. The Conditional Delivery Agreement provides, in relevant part:

a. The Dealership (also called "we", "us", and "our") agrees to deliver the vehicle identified above (the "Vehicle") to you on the date this Conditional Delivery Agreement is signed by us and you. You understand that it may take a few days for us to verify your credit and to obtain financing directly from the third party lender whose loan documents we have had you sign (the "Lender") or, if you signed, a Retail Installment Sale or Lease Contract with us, to assign the Contract to a third party financial institution. You agree that we have 30 days to obtain financing from the Lender or to assign the Retail Installment Contract. If we are unable to obtain financing from the Lender or to assign the Contract to any one of the financial institutions with whom we regularly do business, within this period of time, you or we may cancel the sale of the Vehicle. If the sale is canceled, the Lender's loan documents or Contract you have signed will be null and void and of no effect. This limited right to cancel will end at the earlier of (i) the date we obtain financing from the Lender or assign the Contract or (ii) the end of the stated time period.

{¶ 6} In a separate provision, the agreement provides that the sale of the car is contingent on Loury's ability to obtain financing. The second paragraph of the Conditional Delivery Agreement states, in relevant part:

b. You understand that the consummation of the transaction is specifically contingent on your credit worthiness and your ability to be financed for the amount stated. * * * You understand that the Dealership does not control your credit rating for financing purposes and did not guarantee that you would be financed or the finance rate. * * *

{¶ 7} Loury signed the Conditional Delivery Agreement on December 18, 2017. On that same day, Loury also executed a "Retail Installment Sales Contract" that set forth the amount Loury was borrowing to finance the purchase as well as the interest rate, the amount financed, the total number of payments, and finance charges. The Retail Installment Sales Contract contains the following "Limited Right to Cancel" provision:

You agree that we have 30 days from the date you sign this contract to assign this contract. If we are unable to assign this contract within this time period, you or we may cancel this contract. This limited right to cancel will end at the earlier of the date we assign the contract or the end of the stated time period. Please see the back of this contract for important terms of this limited right to cancel.

{¶ 8} Additional information regarding the limited right to cancel on the back of the contract provides, in relevant part:

You agree that we have the number of days stated on the front of this contract to assign this contract. If we are unable to assign this contract within this period of time to any of one of the financial institutions with whom we regularly do business, you or we may cancel this contract. This limited right to cancel will end at the earlier of the date we assign the contract or the end of the stated period of time.

{¶ 9} Finally, the agreements provide that if either party canceled the agreement, Loury was required to return the car to Westside and to pay Westside for the mileage accrued while it was in her possession.

{¶ 10} Loury took possession of the car on December 18, 2017, and the moonroof was installed shortly thereafter in January 2018. As the 30-day right-to-cancel deadline was approaching, the bank to which Westside submitted the Retail Installment Sales Contract for financing advised Westside that Loury would have to sign a new Retail Installment Sales Contract before it would approve financing for her purchase. (Tr. 70.) The only difference between the original Retail Installment Sales Contract and the new Retail Installment Sales Contract was the date the first payment was due; under the original contract the first payment was due on February 1, 2018, and under the revised contract the first payment was due on March 15, 2018.

{¶ 11} Ghassan Cherry ("Cherry"), a sales representative from Westside, called Loury and informed her of the need to sign the revised Retail Installment Sales Contract. She indicated she would come to the dealership to sign the revised agreement, but she never came. Cherry called Loury again, but this time Loury refused to sign the revised Retail Installment Sales Contract. Cherry explained to Loury that if she did not sign the revised agreement, Westside would have to cancel the sale.

{¶ 12} On January 24, 2018, Loury's lawyer faxed a letter to Westside demanding that Westside deliver a certificate of title or memorandum of title ("title") to the Cadillac to Loury. Westside's counsel advised Loury's lawyer that Westside was terminating the sale agreement because Loury refused to sign the revised Retail Installment Sales Agreement that would have provided the financing necessary to consummate the transaction. Westside's counsel emailed the notice of termination of the sale to Loury's counsel on February 2, 2018, 46 days after Loury signed the Conditional Delivery Agreement and the original Retail Installment Sales Contract. Westside's lawyer explained that if Loury provided Westside an opportunity to pick up the car, it would waive the mileage fee it was entitled to receive. Loury, through counsel, cooperated with Westside's repossession of the vehicle.

{¶ 13} Loury later filed a complaint against Westside, alleging fraud and multiple violations of the Consumer Sales Practices Act, R.C. Chapter 1345. In the prayer for relief, Loury requested a declaration that Westside engaged in unfair, deceptive, and unconscionable sales practices, actual and statutory damages, treble damages, and attorney fees.

{¶ 14} At a bench trial, Cherry and Joseph Stefanini ("Stefanini"), a vice president of Westside, testified that Westside canceled the sale with Loury due to lack of financing after she refused to sign the revised Retail Installment Sales Contract. Loury testified that after she took possession of the car, she investigated the car's history on CARFAX.com and discovered that Westside had misrepresented the car's history. According to Loury, Westside never informed her that the Cadillac had been used as a rental car or that it had been involved in an accident.

{¶ 15} Cherry and Stefanini each testified that neither of them were aware that the car had been used as a rental or that it had been in an accident. Westside purchased the vehicle from Manheim, an auction house, and Westside pays for a preinspection before it buys any cars from Manheim. (Tr. 88.) Cherry also explained that Westside operates 17 stores and purchases a large volume of cars from Manheim such that it would not be in Manheim's interest to make misrepresentations regarding a car's history or condition. (Tr. 90-91.) Cherry further stated that if an accident had been reported on CARFAX, Manheim would have known about it. (Tr. 91.) Loury did not present any documents from CARFAX at trial verifying her claim that the car had been a rental or that it had been involved in an accident. (Tr. 66-67.)

{¶ 16} Loury also claimed she was forced to rent a car after her temporary tags expired because Westside refused to provide her a memorandum of title, which would have allowed her to obtain license plates for the car. She also alleged that Westside damaged her credit score by requesting her credit...