Chamrad v. Volvo Cars of N Amer ( 1998 )

UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
No. 97-40557
JAMES R. CHAMRAD, ET AL.,
Plaintiffs,
JAMES R. CHAMRAD,
Plaintiff-Appellant,
versus
VOLVO CARS OF NORTH AMERICA,
Defendant-Appellee.
Appeal from the United States District Court
for the Southern District of Texas
June 17, 1998
Before POLITZ, Chief Judge, GARWOOD and BARKSDALE, Circuit Judges.
POLITZ, Chief Judge:
James Chamrad appeals an adverse summary judgment in favor of Volvo
Cars of North America which was based on the conclusion that Chamrad lacks
standing as a “consumer” under the Texas Deceptive Trade Practices--Consumer
Protection Act (DTPA). Finding no error, we affirm.
BACKGROUND
In 1989, Chamrad and Nancy O’Connor, Chamrad’s girlfriend, began
shopping for a car for O’Connor. They made three trips to the Royal Motors Volvo
dealership in San Francisco, where they then were living. They were informed that
the air bags would deploy in collisions at 15 miles per hour and up, protecting the
driver and passenger.
O’Connor subsequently purchased a 1989 Volvo station wagon from a Texas
dealer. On December 18, 1994, Chamrad had an accident while driving
O’Connor’s vehicle. The airbag did not deploy and Chamrad suffered serious
injuries in the accident.
Chamrad and O’Connor were married in June 1995 and in October 1995 they
filed suit against the defendant in state court alleging breach of express warranties
and violation of the DTPA. Volvo removed the action to federal court and was
granted summary judgment as to all of the plaintiffs’ claims. Chamrad appeals the
district court’s dismissal of his claim under the DTPA.
ANALYSIS
On appeal of a summary judgment our review of the record is plenary and we
apply the same standard as that used by the district court, viewing the facts and
2
drawing inferences in favor of the nonmoving party.1 Summary judgment is only
appropriate when there is no genuine issue as to any material fact and the moving
party is entitled to judgment as a matter of law.2
Under the DTPA, only a consumer may allege deceptive trade practices.3
We agree with the district court’s conclusion that Chamrad failed to qualify as a
“consumer,” which is defined as an individual “who seeks or acquires by purchase
or lease, any goods or services.” 4
Chamrad claims that he is a consumer under the Act. He contends that direct
contractual privity between an individual and the defendant is not a factor in
determining an individual’s status as a consumer, and that the appropriate focus is
the individual’s relationship to the transaction.5 Prior to the purchase of the car
1
Elliott v. Lynn, 38 F.3d 188 (5th Cir. 1994).
2
Fed. R. Civ. P. 56 (c); Celotex Corp. v. Catrett, 477 U.S. 317 (1986).
3
TEX. BUS. & COM. CODE. ANN. § 17.50; The elements of a DTPA cause of
action are: 1) The plaintiff is a consumer; 2) the defendant engaged in false,
misleading, or deceptive acts; and 3) these acts constituted a producing cause of the
consumer’s damages. TEX. BUS. & COM. CODE. ANN. § 17.41 et seq.; Doe v.
Boys Clubs of Greater Dallas, Inc., 907 S.W.2d 472 (Tex. 1995).
4
TEX. BUS. & COM. CODE. ANN. § 17.45(4).
5
Birchfield v. Texarkana Mem. Hosp., 747 S.W.2d 361 (Tex. 1987); See
Wellborn v. Sears, Roebuck & Co., 970 F.2d 1420 (5th Cir. 1992); Arthur
Andersen & Co. v. Perry Equip. Corp., 945 S.W.2d 812 (Tex. 1997).
3
Chamrad and O’Connor, who were engaged to be married, shopped for a vehicle
with the intentions of purchasing a safe, family car. Chamrad maintains that his
relationship to the purchase of the vehicle qualifies him as a consumer. We are not
persuaded. Based on the facts presented in this case, Chamrad’s relationship to the
transaction was tenuous and he was no more than an incidental beneficiary.
Chamrad has not established that his relationship to the transaction was
significant. In Rodriguez v. Ed Hicks Imports,6 the plaintiff suffered injuries when
the radiator on his girlfriend’s automobile exploded, spraying him with scalding
liquid. Rodriguez brought a personal injury action against the seller of the
automobile alleging several causes of action, including a claim under the DTPA.
The Texas Court of Appeals affirmed summary judgment for the defendant on the
DTPA claim, concluding that Rodriguez was not a consumer. He was not involved
in the purchase of the car and therefore he did not acquire by purchase or lease any
goods or services that formed the basis of the complaint.7
Although he visited several Volvo dealerships in San Francisco, Chamrad
6
767 S.W.2d 187 (Tex. App.--Corpus Christi 1989); See Also Plumley v.
Landmark Chevrolet, Inc., 122 F.3d 308 (5th Cir. 1997) (decedent was not
considered a consumer even though as guarantor, he provided $500 of the purchase
price for his son’s car and was to be the co-signor of the car note.)
7
Rodriguez, 767 S.W.2d at 191.
4
never visited the Advantage Leasing dealership in Victoria, Texas, where the
subject vehicle was purchased, nor did he make logistical or financial arrangements
for the purchase. O’Connor paid for the car and placed the title in her name.
Chamrad had no relationship whatsoever to that transaction.8
Chamrad was no more than an incidental beneficiary of the purchase. In
order to claim “consumer” status, the underlying transaction must be consummated
with an intent to benefit the claimant. In Arthur Andersen & Co. v. Perry Equip.
Corp.,9 Perry Equipment sued Arthur Andersen for making a faulty audit, which
Perry relied on in deciding to purchase Maloney Pipeline Systems. Arthur
Andersen contended that Perry was not a consumer under the DTPA because it did
not purchase the services which were the basis of the DTPA claim. The Texas
Supreme Court, however, held that “the DTPA does not require the consumer to be
an actual purchaser or lessor of the goods or services as long as the consumer is the
beneficiary of those goods or services.”10 It is clear in Arthur Andersen that not
only was there an underlying relationship, the audit at issue was for the benefit of
8
In fact, O’Connor’s business manager Ray Riggs, negotiated and physically
purchased the Volvo for O’Connor.
9
945 S.W.2d 812 (Tex. 1997) (citing Kennedy v. Sale, 689 S.W.2d 890 (Tex.
1985).
10
Id. at 814-815.
5
both Perry and Maloney. Arthur Andersen was aware that Perry had required the
audit as a condition of sale and would rely on the accuracy of its work. 11
In Wellborn v. Sears Roebuck & Co.,12 we concluded that a young boy, killed
when he was pinned underneath a garage door when the automatic door opener
failed to reverse, was a consumer under the DTPA because he was a beneficiary of
his mother’s purchase of the door opener. We found that because the door was
purchased for his benefit, installed in his home, and used by him; he was a
consumer.13
In this case, unlike in Arthur Andersen and Wellborn, there is no evidence to
support the proposition that O’Connor, in seeking to acquire or purchase a good or
service, bought the vehicle with the intent to benefit Chamrad. Neither at the time
of the purchase nor the accident were Chamrad and O’Connor married. At all
relevant times Chamrad owned his own vehicle. The Volvo belonged to O’Connor
and was for her use. Finally, the record reflects that over approximately a five-year
period Chamrad drove the vehicle on only one occasion, the night of the accident.
11
Id. at 815.
12
970 F.2d 1420 (5th Cir. 1992).
13
Id. at 1427; See Also, Kennedy v. Sale, 689 S.W.2d 890, 892 (Tex. 1985) (an
employee covered by group insurance, purchased by his employer, was a consumer
because he acquired benefits of the services of the policy).
6
We are persuaded that the record does not support the claim that Chamrad
had a relationship to the transaction or that he was more than an incidental
beneficiary of the purchase of the car. He therefore was not a consumer under the
Act and lacks standing to invoke the DTPA.
The judgment appealed is AFFIRMED.
7