Watanabe vs. Maserati North America, Inc.

(Cal. U. Com. Code, § 2313.)

“The essential elements of a cause of action under the California Uniform Commercial Code for breach of an express warranty to repair defects are (1) an express warranty [citation] to repair defects given in connection with the sale of goods; (2) the existence of a defect covered by the warranty; (3) the buyer’s notice to the seller of such a defect within a reasonable time after its discovery [citation]; (4) the seller’s failure to repair the defect in compliance with the warranty; and (5) resulting damages [citations].” (Orichian v. BMW of North America, LLC (2014) 226 Cal.App.4th 1322, 1333–1334).

Defendant contends that this cause of action fails because Plaintiff failed to allege any privity between Defendant and Plaintiff as the buyer.

Recently, courts have held that:

The Commercial Code’s express warranty provisions are limited to warranties given by the seller directly to the buyer. [Citations.] Moreover, “the warranty sections ... are not designed in any way to disturb those lines of law growth which have recognized that warranties need not be confined either to sales

contracts or to the direct parties to such a contract.” [Citation.] In other words, while express warranties apply under the Commercial Code only to a seller in privity with the buyer, the buyer may sue a third-party manufacturer for breach of an express warranty in the absence of privity. [Citation.]

(Ballesteros v. Ford Motor Co. (2025) 109 Cal.App.5th 1196, 1216- 1217, italics in original). The court went on to state: “Similarly, implied warranties arise under the Commercial Code only for a merchant or seller in privity with the buyer.” (Id. at 1217).

In Davis v. Nissan North America, Inc. (2024) 100 Cal.App.5th 825, a motion to compel arbitration case, Nissan argued that equitable estoppel applied to preclude the buyer from contesting arbitration because manufacturer warranties are considered part of a retail sale contract under Division 2 of the California Uniform Commercial Code. (Id. at 837-838). The court rejected this argument, holding that “Division 2 of the UCC governs the relationship of the parties to a sale, and its warranty provisions are limited to warranties given directly by the seller to the buyer. The UCC's express warranty provision by its terms applies only to ‘[e]xpress warranties by the seller ....’ (Cal. U. Com. Code, § 2313, subd. (1)(a), italics added.) ‘The section gives a cause of action only against ‘the seller.’ ’ (White, et al., Uniform Commercial Code (6th ed. 2023) § 10:10.).” (Id. at 838).

Plaintiff alleges the following in his First Amended Complaint:

“Privity is not required here because Plaintiff is the intended thirdparty beneficiary of contracts between Defendants and its dealers, included the dealer from which Plaintiff purchased the Subject Vehicle and specifically, of Defendants’ implied warranties.” (FAC, ¶ 19) “Defendant made affirmations of fact and promises, including written warranties, relating to the Subject Vehicle’s condition and performance.” (FAC, ¶ 24). “These affirmations and promises became part of the basis of the bargain, creating an express warranty that the goods shall conform to the description.” (FAC, ¶ 25). “Defendant breached the express warranty by delivering a defective vehicle and failing to repair the defects within a reasonable time.” (FAC, ¶ 26).

In his Opposition, Plaintiff does not contest that he failed to allege privity. Rather, Plaintiff argues that his claim is based upon Defendant's own express warranty obligations, which remained in effect at the time Plaintiff purchased the subject vehicle. Plaintiff

contends that privity is not required, citing to both Ballesteros, supra, and Davis, supra. However, as mentioned above, these two cases held that the Commercial Code's express warranty provisions are limited to warranties given by the seller directly to the buyer. (Ballesteros, supra, 109 Cal.App.5th at 1216 [citing Davis, supra, 100 Cal.App.5th at 838]). Rather, the court in Ballesteros held that “[t]he Song-Beverly Act explicitly governs manufacturer warranties and does not require privity.” (Ballesteros, supra, 109 Cal.App.5th at 1218). Plaintiff does not bring a claim under the Song Beverly Act.

Accordingly, the demurrer is sustained with leave to amend.

3rd COA – Breach of Implied Warranty of Merchantability (Cal. Com. Code § 2314) and 4th COA - Breach of Implied Warranty of Fitness for a Particular Purpose (Cal. Com. Code § 2315)

Cal. Com. Code § 2314 provides:

(1) Unless excluded or modified (Section 2316), a warranty that the goods shall be merchantable is implied in a contract for their sale if the seller is a merchant with respect to goods of that kind. Under this section the serving for value of food or drink to be consumed either on the premises or elsewhere is a sale. (2) Goods to be merchantable must be at least such as (a) Pass without objection in the trade under the contract description; and (b) In the case of fungible goods, are of fair average quality within the description; and (c) Are fit for the ordinary purposes for which such goods are used; and (d) Run, within the variations permitted by the agreement, of even kind, quality and quantity within each unit and among all units involved; and (e) Are adequately contained, packaged, and labeled as the agreement may require; and (f) Conform to the promises or affirmations of fact made on the container or label if any. (3) Unless excluded or modified (Section 2316) other implied warranties may arise from course of dealing or usage of trade.

Cal. Com. Code § 2315 provides: “Where the seller at the time of contracting has reason to know any particular purpose for which the goods are required and that the buyer is relying on the seller's skill or judgment to select or furnish suitable goods, there is unless excluded

or modified under the next section an implied warranty that the goods shall be fit for such purpose.”

As stated above, the court in Ballesteros, supra, held that “implied warranties arise under the Commercial Code only for a merchant or seller in privity with the buyer.” (Ballesteros, supra, 109 Cal.App.5th at 1217).

Plaintiff concedes there is no privity, but the only cases Plaintiff relies on in support of his argument that privity is not required are Ballesteros and Davis, which support the opposite conclusion. Accordingly, the demurrer is sustained with leave to amend.

1st COA – Violation of Magnuson-Moss Warranty Act (MMWA)

Defendant demurrers to this cause of action on the basis that Plaintiff has not stated a viable state law claim.

As the court held in Clemens v. DaimlerChrysler Corp. (9th Cir. 2008) 534 F.3d 1017, 1022: “the claims under the Magnuson–Moss Act stand or fall with his express and implied warranty claims under state law.”

Plaintiff concedes Defendant’s argument that MMWA claims “stand or fall” with the state-based claim. (Opp., 3:3). Plaintiff argues that because the Commercial Code claims are viable, so too is the MMWA claim. However, because Plaintiff’s other causes of action under the Commercial Code fail, the court sustains the demurrer as to this cause of action with leave to amend as well.

Should Plaintiff wish to file an amended complaint that addresses the issues in this ruling, Plaintiff must file and serve it within 30 days of service of notice of ruling.

Defendant shall give notice.

3 Church vs. TENTATIVE RULING: Rancho Madrina Petition to Confirm Arbitration Award Community Association Petitioner Rancho Madrina Community Association moves to confirm the arbitration award made on October 16, 2023. For the following reasons, the petition is GRANTED.