KLRA202400485
Tribunal De Apelaciones De Pue...Oct 22, 2024Background
- Jessica Morales purchased a 2017 Dodge Journey from Walter Pérez Montaz (doing business as Hormigueros Auto) and Popular Auto for $13,995 on February 10, 2023.
- Soon after the purchase, Morales experienced repeated and significant mechanical problems with the vehicle, including engine overheating and transmission and air conditioning issues.
- Morales reported defects multiple times, and the car underwent various repairs from February through July 2023, but issues persisted.
- Morales filed a complaint before DACO (Department of Consumer Affairs) after the defendants failed to satisfactorily repair the vehicle despite several opportunities.
- On June 26, 2024, DACO ruled in Morales's favor, ordering a full refund, return of a trade-in payment, rescission of the contract, and cancellation of financing.
- Walter Pérez Montaz appealed, arguing DACO erred in both facts and law by granting contract rescission.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Existence of substantial hidden defects | Vehicle had serious, persistent defects undermining its utility and purpose. | Defects were minor, car was used for over 8,000 miles; problems were repaired or easily fixable. | Defects were serious, not accessory; they impaired vehicle’s use and justified rescission. |
| Negligence in repair and warranty service | Morales gave ample opportunity for repair, but dealer was negligent and unresponsive. | Dealer provided repairs, was diligent, and always offered service; delays not deliberate. | Dealer was negligent in effecting repairs, failing to honor warranty, and not providing proof of service. |
| Administrative record sufficiency | Testimony and documentary evidence uncontroverted, supporting relief. | Administrative record (incl. inspection report) contradicted Morales’s claims and showed repairs. | Testimony accepted as credible; no transcript provided to challenge administrative findings. |
| Legal grounds for rescission | Contract rescission warranted under Civil Code due to redhibitory defects. | No legal grounds as elements of rescission not met; defects not substantial or were already repaired. | DACO rightfully found all elements met for rescission due to hidden and substantial defects. |
Key Cases Cited
- Otero Rivera v. Bella Retail Group, 2024 TSPR 70 (presumption of validity and deference to agency decisions in appellate review)
- Capote Rivera v. Voili Voila Corporation, 2024 TSPR 29 (limits of judicial deference, standards for overturning agency fact-finding)
- Bosques v. Echevarría, 162 DPR 830 (doctrine regarding consent, error, and fraud in contract validity)
- Super Asphalt v. AFI, 206 DPR 803 (bases for judicial intervention in agency action: evidence, legality, reasonableness)