Opinion
NOT TO BE PUBLISHED
Contra Costa County Super. Ct. No. C07-00745
NEEDHAM, J.
Franca De Paoli (De Paoli) appeals from a judgment entered after the court granted the summary judgment motion of respondent Hendrick Automotive Group (Hendrick). De Paoli contends the court erred in concluding that Hendrick’s representations in selling her a vehicle, concerning the vehicle’s fuel efficiency, safety features and warranty, were mere puffery and not susceptible to justifiable reliance. We agree the court erred, and we will accordingly vacate the judgment and reverse the order that granted Hendrick’s motion.
I. FACTS AND PROCEDURAL HISTORY
In March 2006, De Paoli purchased a new Honda Civic hybrid automobile (Civic) from Hendrick. She later discovered she was not getting the gas mileage she expected, and she believed Hendrick had misled her into buying additional security features and an extended warranty or service contract. After raising the issues with Hendrick without success, she sued.
A. De Paoli’s Complaint
De Paoli filed her complaint against Hendrick in April 2007, asserting causes of action for violation of the California Consumer Legal Remedies Act (Civ. Code, § 1750 et seq.) (CLRA), intentional misrepresentation, and negligent misrepresentation. As relevant here, she alleged as to each cause of action that during the negotiations for the purchase of the Civic, “defendants” (including Hendrick) represented to her that the vehicle would easily average the advertised 50 miles per gallon (MPG), so that the money she saved in fuel costs, along with the tax benefits associated with purchasing the Civic, would cover her new monthly car payments of $323.75. Hendrick allegedly further represented that De Paoli needed a Karr alarm upgrade and LoJack system for $1,400, and an 8-year/84,000 mile service contract for $1,500 because the hybrid components would be expensive to fix if they failed. Based on Hendrick’s representations, De Paoli traded in her vehicle and purchased the Civic. She later discovered the Civic came factory-equipped with a security system and immobilizer theft deterrent system.
B. Hendrick’s Motion for Summary Judgment
Hendrick filed a motion for summary judgment, contending that each of the causes of action failed as a matter of law because the alleged representations amounted to mere sales puffery, upon which De Paoli could not reasonably rely.
1. Hendrick’s Evidence
Hendrick’s separate statement of undisputed material facts, supported by admissible evidence, set forth the events as follows.
De Paoli is employed by Contra Costa County as a licensed clinical therapist, with college and master degrees. She has purchased between 20 and 30 cars in her lifetime. She owned a 2001 Mercedes Benz, but when gasoline prices started going up, she decided to look into the purchase of a new hybrid vehicle. De Paoli went to Hendrick, because Hendrick had the Honda Civic in stock.
De Paoli disputed this assertion and maintained that she believed she had bought more than 10 cars in her lifetime. This factual dispute is not material to the resolution of this appeal.
While De Paoli was looking at a car in Hendrick’s lot, a Hendrick salesperson approached and started talking to her about how beautiful the car was and the mileage obtained by Honda Civic hybrids. She observed a sticker on the Civic, purportedly prepared by the National Highway Traffic Safety Administration and the New Car Assessment Program, which stated that the vehicle had annual fuel costs of $660.
The Hendrick salesperson allegedly told De Paoli that the money she would save on the car would “make the payments” and the car would “pay for itself.” When she replied it was the EPA who determined fuel efficiency and inquired how the salesperson could be sure of the car’s fuel efficiency, he allegedly told her that customers had attested to the fuel efficiency of the car and that the savings in gasoline costs would cover the car payments. De Paoli realized at the time that she was negotiating a business transaction with the salesperson, who was trying to sell her the vehicle and make money from the sale.
2. De Paoli’s Opposition
De Paoli opposed the summary judgment motion, contending the representations were not mere puffery and that she had alleged misrepresentations in addition to those addressed by Hendrick’s motion. She did not dispute the material facts in Hendrick’s separate statement, except in minor respects not material to the outcome of this appeal. She did, however, set forth additional undisputed material facts.
De Paoli provided further detail about Hendrick’s statements concerning the fuel efficiency of the Civic. By her account, the salesperson told her that she would easily attain the 50 MPG average indicated on the EPA sticker, which listed an average of 49 MPG for city driving and 51 MPG for highway driving. When she questioned how he knew this, the salesperson told her that Hendrick’s customers were reporting they were in fact getting the indicated miles per gallon.
De Paoli requested judicial notice that the EPA had revised its testing methods to reflect modern driving more accurately, beginning with 2008 model automobiles, and the old city and highway combined 50 MPG estimate for the subject 2006 Honda Civic Hybrid would be a combined 42 MPG based on the new testing methods. The court denied De Paoli’s request for judicial notice. The ruling has not been made an issue in this appeal. We deny De Paoli’s request for judicial notice as well.
In addition, De Paoli discussed with the salesperson that she was driving about 20,000 to 25,000 miles per year, averaging about 21 MPG, and filling her tank several times a week. They discussed the price of gas. The salesperson obtained from his manager a trade-in value for her Mercedes and told her what her monthly payment would be. He also performed some calculations with the information she had provided, and he represented that the amount De Paoli would save in gas costs would be enough to cover her car payments. The finance manager later verified that the gas mileage sticker was accurate and that the amount De Paoli would save in gas would be enough to make the car payments. De Paoli trusted the specific representations made by Hendrick’s salesperson and finance manager regarding gas mileage and savings, and she purportedly purchased the vehicle in reliance on their statements.
De Paoli also recounted additional representations alleged in her complaint, which Hendrick had not addressed in its motion. Hendrick’s finance manager convinced De Paoli to purchase an alarm for the Civic, by telling her that hybrids were often stolen and the alarm would cause the horn to honk and lights to flash to scare away potential thieves. The finance manager persuaded De Paoli to purchase a Lo-Jack protection system as well, by stating it was the only system used by law enforcement to recover stolen cars, and if her car was stolen she would still have to make the car payments. Based upon the finance manager’s representations, De Paoli purchased the alarm and Lo-Jack system.
Lastly, the finance manager convinced De Paoli to purchase the Hendrick service contract covering the vehicle for seven years or 80,000 miles, by telling her that the manufacturer’s warranty covered the expensive hybrid repairs only for three years or 36,000 miles.
De Paoli later came to realize that Hendrick had not disclosed to her that the Civic she purchased, according to the owner’s manual, came equipped from the factory with car keys electronically linked to the car’s immobilizer system, the audio system would disable itself if disconnected from the car, a security system would honk the horn and flash the lights if someone attempted to break into the car or remove the radio, and an immobilizer system would disable the fuel system if an incorrectly-coded key or other device were used to try to start the car. Furthermore, the finance manager had not disclosed that, in addition to the three-year or 36,000 miles manufacturer’s warranty, the Civic was also already covered by the manufacturer’s five-year or 60,000-mile drive train warranty and 100-month battery warranty.
3. Hendrick’s Reply
Hendrick disputed all of the material facts set forth by De Paoli, based on its objection to her declaration as self-serving and in contradiction of her deposition testimony, and based further on its boilerplate objections on grounds including hearsay, speculation, improper opinion, relevance, lack of foundation and assumption of facts not in evidence.
4. Court’s Ruling
After a hearing, the trial court granted Hendrick’s motion for summary judgment. Although it overruled De Paoli’s and Hendrick’s objections to the evidence, the court found no triable issue of material fact. The court explained its ruling as follows: “All of plaintiff’s causes of action require misrepresentations of fact on which a reasonable consumer could have justifiably relied. [¶]... There are no triable issues of material fact as to whether there are ‘factual’ misrepresentations about the quality or characteristics of the car plaintiff purchased. [¶]... Representations at issue are either ‘puffery’ by defendants or are based on facts set out in EPA mileage sticker on which defendants could reasonably rely. See Consumer Advocates v. Echostar Satellite Corp. (2003) 113 Cal.App.4th 1351, 1361-1362; Pacesetter Homes, Inc. v. Brodkin (1970) 5 Cal.App.3d 206, 211. [¶]... In addition, no reasonable consumer would be justified in relying on defendants boasting regarding her savings and need for add-on items.”
This appeal followed.
II. DISCUSSION
In reviewing the grant of summary judgment, we conduct an independent review to determine whether there is a triable issue of material fact and the moving party is entitled to judgment as a matter of law. (Code Civ. Proc., § 437c, subd. (c); Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 860; Buss v. Superior Court (1997) 16 Cal.4th 35, 60; Ochoa v. Pacific Gas & Electric Co. (1998) 61 Cal.App.4th 1480, 1485.) We construe the moving party’s evidence strictly, and the non-moving party’s evidence liberally, in determining whether there is a triable issue. (See D’Amico v. Board of Medical Examiners (1974) 11 Cal.3d 1, 20; Alex R. Thomas & Co. v. Mutual Service Casualty Ins. Co. (2002) 98 Cal.App.4th 66, 72 (Thomas).)
A defendant seeking summary adjudication must show that at least one element of the plaintiff’s cause of action cannot be established, or that there is a complete defense to the cause of action. (Code Civ. Proc. § 437c, subd. (p)(2).) The burden then shifts to the plaintiff to show there is a triable issue of material fact on that issue. (See Code Civ. Proc., § 437c, subd. (p)(2); Thomas, supra, 98 Cal.App.4th at p. 72.)
De Paoli’s first cause of action asserted a violation of the CLRA. The CLRA prohibits specified unfair methods of competition and unfair or deceptive acts or practices undertaken by any person in a transaction intended to result or which results in the sale or lease of goods or services to any consumer, including “[r]epresenting that goods or services have... characteristics, ingredients, uses, benefits, or quantities which they do not have....” (Civ. Code, § 1770, subd. (a)(5).) Relief under the CLRA is limited to “[a]ny consumer who suffers any damage as a result of the use or employment by any person of a method, act, or practice” unlawful under Civil Code section 1770. (Civ. Code, § 1780, subd. (a).)
De Paoli’s other causes of action were for intentional and negligent misrepresentation. These claims require proof of, among other things, a misrepresentation of fact (or, under certain situations, an actionable statement of opinion or omission) and justifiable reliance. (See Engalla v. Permanente Medical Group, Inc. (1997) 15 Cal.4th 951, 974.)
For purposes of its summary judgment motion, Hendrick did not dispute that the alleged statements were made, that they were untrue, or that De Paoli suffered damages as a proximate result. Hendrick contended only that the alleged representations constituted mere puffery and were not statements on which De Paoli could justifiably rely (or presumably, as to the CLRA, statements that would be misleading to a reasonable consumer). For purposes of brevity, and because the same representations supporting the CLRA claim allegedly supported the misrepresentation claims, we address the issues by representation rather than by cause of action.
Although the CLRA does not use the phrase “justifiable reliance,” it does require a showing that members of the public are likely to be deceived (Consumer Advocates v. Echo Star Satellite Corp. (2003) 113 Cal.App.4th 1351, 1360 (Consumer Advocates)), which requires a probability that a significant portion of the general consuming public or of targeted consumers, acting reasonably in the circumstances, could be misled. (People ex rel. Department of Motor Vehicles v. Cars4Causes (2006)139 Cal.App.4th 1006, 1016 [under Bus. & Prof. Code, § 17500].) We consider Hendrick’s and the trial court’s remarks as to justifiable reliance to refer to this element of a CLRA claim. The parties do not contend that whether a reasonable consumer could be misled differs for purposes of this case from the element of justifiable reliance in a common law fraud cause of action.
A. Representations that De Paoli Would Obtain an Average of 50 MPG
De Paoli asserted that she was told by Hendrick’s salesperson, while he directed her attention to the EPA sticker, that she would “easily” get an average of 50 MPG as indicated on the sticker. When De Paoli questioned his ability to know whether the EPA fuel efficiency sticker was accurate, he represented that other customers had attested to the fuel efficiency they obtained. The finance manager also reassured De Paoli that the EPA-indicated mileage estimate was accurate.
Hendrick contends the statements of its salesperson and finance manager were mere puffery. “Puffery” or “puffing” is a seller’s statement of its subjective opinion about the merits of a product, as opposed to a factual description of a characteristic of the product. (Hauter v. Zogarts (1975) 14 Cal.3d 104, 111-112 (Hauter); see Consumer Advocates,, supra, 113 Cal.App.4th at pp. 1353, 1361-1362 [representations that a television system provided “ ‘crystal clear digital video’ ” and “ ‘CD-quality audio’ ” were non-actionable “boasts [and] all-but meaningless superlatives,” while representations that an on-screen program guide would allow consumers to view the schedule “up to seven days in advance” and that “50 channels” would be provided were actionable factual representations]; Newcal Industries, Inc. v. IKON Office Solution (9th Cir. 2008) 513 F.3d 1038, 1053 [“a statement that is quantifiable, that makes a claim as to the ‘specific or absolute characteristics of a product,’ may be an actionable statement of fact while a general, subjective claim about a product is non-actionable puffery”].)
While respondents suggest that any statement about a product is puffing unless it pertains to the product’s safety characteristics, that is plainly not the law. A factual statement about a safety characteristic is not puffery, but neither are other statements of fact. (Hauter, supra, 14 Cal.3d at pp. 111-114.)
The salesperson’s specific representation that De Paoli would “easily” get the advertised gas mileage might be puffery, since “easily” is vague and subjective. However, the heart of Hendrick’s representation is not that De Paoli would obtain the advertised gas efficiency “easily,” but simply that the sticker was accurate and, based on the sticker and the reported experience of other customers, she would obtain an average of 50 MPG. This is not merely a subjective boast or some vague generality about how wonderful the Civic is, but a factual representation as to the capacity of the vehicle and the fuel efficiency De Paoli would obtain. The assertion that the EPA sticker was accurate is a statement of fact, or at least an actionable opinion from one with purportedly superior knowledge. The representation that customers had attested to the fuel efficiency of the vehicle is plainly a statement of fact: either customers told Hendrick they were getting the EPA-estimated average gas mileage, or they did not. Whether the assurance of De Paoli’s future mileage constitutes a factual representation as to an existing characteristic of the Civic, or an opinion as to a future event, is a question for the trier of fact. (Pacesetter Homes, Inc. v. Brodkin (1970) 5 Cal.App.3d 206, 212 (Pacesetter Homes).) Given the record in this case, however, it is not puffery. At bottom, it cannot be said as a matter of law that Hendrick’s statements are non-actionable puffery.
In Pacesetter Homes, on which Hendrick relies, the appellant had purchased two duplexes from a developer after being told by the developer’s agents what the units would rent for and, “[i]f you receive the rents as we contemplate, it will be an excellent investment and there shouldn't be any difficulty in renting them.” (Pacesetter Homes, supra, 5 Cal.App.3d at pp. 209-210.) After appellant had difficulty renting the properties and defaulted on a note given as part of the purchase, the developer reacquired the duplexes in a foreclosure sale. (Id. at p. 210.) The developer then sued the appellant for rents collected by appellant after the reacquisition, and the appellant cross-claimed against the developer for falsely representing that the units would rent for the specified amounts. (Id. at pp. 208-209.) After a trial, the trial court found that the statements were neither representations of existing facts nor the type of opinions on which a fraud claim may be based. (Id. at p. 211.) The court of appeal affirmed, ruling that the trial court was “justified in construing the fair meaning of the statements made to appellant as those of opinion concerning future estimated rentals and not as an unqualified representation of what those rentals would be,” in light of the fact that the developer’s agents had qualified their estimates by claiming the investment would be excellent “if you receive the rents as we contemplate.” (Id. at p. 211.) The court of appeal noted that it was bound by the trial court's determination, and the record did not compel the conclusion that appellants had relied on the purchaser’s expertise or special knowledge in buying the duplexes. (Id. at p. 212.) The appellate court further concluded that the trial court did not err in finding that appellants failed to establish justifiable reliance. (Id. at p. 213.) Pacesetter Homes is distinguishable from the matter before us because: the representation there was a qualified opinion about future rents for property, not a factual statement as to the existing capacity of a vehicle; the court did not address puffery at all; and, moreover, the appellate court was reviewing the court’s findings after a trial, not a summary judgment ruling.
Accordingly, given the limited scope of Hendrick’s arguments in the trial court, Hendrick failed to establish that its statements relating to the fuel efficiency of the Civic could not, as a matter of law, be actionable representations of fact for purposes of De Paoli’s common law misrepresentation claims. Furthermore, for purposes of the CLRA, the statements represented a characteristic or benefit of the Civic that Hendrick sold to De Paoli: that the vehicle had the capacity to obtain, and would obtain, the estimated gas mileage on the sticker. If untrue, the statements would qualify as representations that the Civic had “characteristics [or] benefits” it did not have. (Civ. Code, § 1770, subd. (a)(5).)
We next must consider whether Hendrick’s statement would warrant De Paoli’s justifiable reliance or mislead a reasonable consumer. As De Paoli acknowledged in her deposition, she was initially skeptical of the salesperson’s knowledge of the fuel efficiency of the car and his ability to confirm the accuracy of the EPA sticker, since it is the government who ascertains the fuel efficiency. On the other hand, Hendrick’s salesperson promptly assuaged her concern by representing that other customers had, in fact, obtained the gas mileage indicated on the sticker, and the finance manager further confirmed the accuracy of the gas mileage estimate. De Paoli could reasonably rely on the salesperson’s representation as to other customers’ reports, since he was in a vastly superior position to know what Hendrick customers had in fact reported.
Of course, the fuel efficiency figure on the sticker is an estimated average, which some drivers might not attain. The mileage obtained by Hendrick’s other customers reflected how they drove the vehicle, and the sticker itself stated that fuel efficiency is subject to driving conditions and practices. There remains, however, a triable issue of fact as to whether a reasonable consumer would be misled by Hendrick’s representations and whether De Paoli justifiably relied on its representations. A reasonable trier of fact could conclude that De Paoli had a sufficient basis for believing that she, like Hendrick’s other customers, would attain an average of 50 MPG.
To make sure our ruling is clear, we note that there are other elements of De Paoli’s CLRA and misrepresentation claims that were not addressed by Hendrick’s summary judgment papers. For example, Hendrick did not attempt to demonstrate in its summary judgment motion that its alleged representations – that De Paoli would attain the fuel efficiency indicated on a sticker that expressly warned the mileage would vary depending on driving conditions – were true, or that those representations were not the legal cause of De Paoli’s alleged damage. Because these issues were not raised in Hendrick’s motion, they are irrelevant to this appeal, and we express no opinion as to whether De Paoli would survive a summary judgment motion that raised those issues or whether she would ultimately prove her case at trial.
Based on the record, Hendrick failed to show that its representations concerning the gas efficiency De Paoli would obtain could not, as a matter of law, support a claim for violation of the CLRA or intentional or negligent misrepresentation.
The trial court ruled in part that Hendrick was justified in relying on the EPA sticker in making its representations. That is immaterial to whether Hendrick’s representations were puffery or whether De Paoli was justified in relying upon them, and the finding thus does not support the trial court’s grant of Hendrick’s motion.
B. Other Alleged Representations
De Paoli also bases her CLRA and misrepresentation causes of action on an alleged representation that the cost savings in fuel efficiency would make up for her monthly car payment, as well as certain representations or omissions that purportedly convinced her to purchase an alarm, a Lo-Jack system, and an extended warranty or service contract. Because we must reverse the order granting summary judgment due to the alleged representations concerning gas efficiency, we need not and do not address whether these additional representations or omissions could support De Paoli’s causes of action.
III. DISPOSITION
The judgment is vacated and the order granting Hendrick’s summary judgment motion is reversed. Costs on appeal are awarded to appellant.
We concur. JONES, P. J., BRUINIERS, J.
Judge of the Superior Court of Contra Costa County, assigned by the Chief Justice pursuant to article VI, section 6 of the California Constitution.