Royal Auto Sales, LLC v. Jumanda Price
2021 CA 000731
| Ky. Ct. App. | Mar 24, 2022Background
- On April 25, 2017 Royal Auto Sales sold Jumanda Price a 2016 Nissan Altima for a financed amount of $17,448.40 (total payments $24,283.90).
- The Altima had been in a prior collision while in Hertz’s rental fleet; appraiser David Rose documented deployed side curtain and seat airbags, extensive damage, and estimated repairs of $9,575.40; a vehicle history report showed a total-loss designation.
- Royal’s owner, Salaheddin Kurdi, bought the salvage vehicle at auction, performed limited repairs (itemized at $1,861), did not disclose the prior crash or repairs to Price, and testified falsely that airbags had been replaced (no receipts produced).
- Months after purchase Price’s warning light prompted dealer diagnostics showing about $8,000 in needed repairs; she could not trade or afford repairs and sued under Kentucky’s Consumer Protection Act (KRS Ch. 367) and KRS 186A.540 nondisclosure rules.
- After a bench trial the Jefferson Circuit Court found Royal violated the CPA, awarded Price nearly $35,000 in damages, punitive damages, and attorney’s fees ($22,725); Royal appealed asserting hearsay errors, lack of willfulness, and improper punitive/fee awards.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Admissibility / preservation of hearsay objections | Price relied on admissible evidence (appraiser report, testimony) supporting claims | Royal says hearsay tainted case and was preserved as objection | Court found appellant failed to preserve record-based hearsay challenge; substantial admissible evidence supported judgment |
| Liability under Consumer Protection Act (failure to disclose repairs) | Kurdi knowingly concealed crash/repairs or manipulated repair invoice to avoid KRS 186A.540 disclosure | Royal contends mere incompetence or mistake; CPA should not apply absent clear/convincing fraud | Court held evidence showed willful unfair/deceptive acts (failure/manipulation to avoid disclosure); CPA liability affirmed |
| Punitive damages | Price sought punitive damages for deceit/manipulation and wrongful conduct | Royal argued no reckless disregard or intentional wrongdoing warranting punitive damages | Court upheld punitive award—CPA and KRS 411.184 permit punitive damages for oppression, fraud, or malice; trial court credibility findings supported award |
| Attorney’s fees | Fees authorized by CPA and appropriate here | Royal sought fees/sanctions, calling the suit frivolous and hearsay-based | Court affirmed award of attorney’s fees to Price under KRS 367.220; rejected Royal’s sanctions request |
Key Cases Cited
- Capitol Cadillac Olds, Inc. v. Roberts, 813 S.W.2d 287 (Ky. 1991) (distinguishes simple contractual incompetence from intentional/grossly negligent conduct under CPA)
- Craig & Bishop, Inc. v. Piles, 247 S.W.3d 897 (Ky. 2008) (CPA provides remedy for purchaser suffering ascertainable loss from unlawful trade act)
- Stevens v. Motorists Mut. Ins. Co., 759 S.W.2d 819 (Ky. 1988) (CPA construed broadly to give consumers wide protection)
- Clay v. WesBanco Bank, Inc., 589 S.W.3d 550 (Ky. App. 2019) (standard of review for bench-trial findings; conclusions of law reviewed de novo)
- Gosney v. Glenn, 163 S.W.3d 894 (Ky. App. 2005) (definition of substantial evidence supporting factual findings)
- Commonwealth v. Roth, 567 S.W.3d 591 (Ky. 2019) (appellate practice requirements for preservation of issues and record citations)