Rhоnda MASQUAT, Appellee, v. DAIMLERCHRYSLER Corporation, Appellant.
No. 104,971.
Supreme Court of Oklahoma.
July 1, 2008.
Rehearing Denied Oct. 27, 2008.
2008 OK 67
CERTIFIED QUESTIONS ANSWERED.
WINCHESTER, C.J., EDMONDSON, V.C.J., HARGRAVE, OPALA, KAUGER, WATT, TAYLOR, COLBERT, JJ., concur in the answer to the first question.
WINCHESTER, C.J., EDMONDSON, V.C.J., HARGRAVE, WATT, TAYLOR, COLBERT, JJ., concur in the answer to the second question.
OPALA, KAUGER, JJ., concur in result in the answer to the second question.
REIF, J. not voting.
OPALA, J., with whom KAUGER, J., joins, concurring in the court‘s answer to the first question and concurring in result in the court‘s answer to the second question.
¶ 1 As affected as today‘s answer to the second question must be by several unknown fact-dependent considerations, it is incapable of a concrete and precise formulation without making unacceptable assumptions. The text of the court‘s answer to the second question should hence be accepted with that understanding.
George D. Davis; Walls Walker Harris & Wolfe, PLLC, Oklahoma City, OK, Raymond M. Kethledge; Bush Seyferth Kethledge & Paige, PLLC, Troy, MI, James F.B. Daniels; McDowell Rice Smith & Buchanan, Kansas City, MO, for Appellant.
COLBERT, J.
¶ 1 This interlocutory appeal challenges the trial court‘s certification of a class of plaintiffs who assert breach of warranty claims based on an alleged defect in the steering mechanism of certain vehicles manufactured by DaimlerChrysler Corporation (Defendant). The trial cоurt‘s order certifying the class is affirmed.
FACTS AND PROCEDURAL HISTORY
¶ 2 Plaintiff and class representative, Rhonda Masquat, brought this action asserting that LH platform vehicles contain a defect in the power rack and pinion steering system. These vehicles were sold as the Dodge Intrepid, the Eagle Vision, the Chrysler New Yorker, the Chrysler LHS, the Chrysler Concorde, and the Chrysler 300M during model years 1993 through most of 2001.
¶ 3 Plaintiff alleges that shortly after production and sale of the LH vehicles began, Defendant began to receive reports from consumers of steering related problems with the entire LH family of vehicles. After unsuccessful attempts to remedy the problem, Defendant eventually introduced a newly designed bolt, which attached the inner tie rods to the rack and pinion steering gear, in late calendar year 2000 to keep the steering systems from failing. Plaintiff‘s theory is that the cure and repair to the problem developed by Defendant was never provided to already-produced LH platform vehicles, and consumers were not informed that the fix was available and that the repair should be made.
¶ 4 Plaintiff purchased a 1994 Dodge Intrepid on June 21, 1999. She replaced the attachment bolts and the inner tie rod bushings on October 11, 2000, shortly before the bolt change implemented by Defendant. Plaintiff filed this action on January 28, 2005, asserting that, by its failure to provide the bolt fix, Defendant breached its express and implied warranty obligations to thе class consisting of Plaintiff and others similarly situated and that Defendant should be required to compensate the class for the cost of the bolt fix and steering-related repairs.
¶ 5 Defendant answered with a motion to dismiss asserting that the claim of Plaintiff and the claims of most of the proposed class members were time-barred. Plaintiff was ordered to amend her petition to address the defense. Plaintiff‘s amended petition asserted that the applicable statute of limitations was tolled based on “Defendant‘s active concealment” of the alleged defect in the steering system.
¶ 6 On May 22, 2007, the trial court held a hearing on Plaintiff‘s motion for class certification and certified the following class:
All entities and adult persons domiciled or residing in the fifty (50) states of the United States of America and the District of Columbia who currently (as of May 21, 2007) own at least one model year 1993-2001 (through week 30 of model year 2001 production) automobile marketed by DA-
IMLERCHRYSLER Corporation as the Dodge Intrepid, the Eagle Vision, the Chrysler New Yorker, the Chrysler LHS, the Chrysler Concorde and the Chrysler 300M, or who have paid for repair costs to the steering system tie rods on any of the aforementioned vehicles. Excluded from the class are (a) defendant and all directors, officers, agents and employees of defendant; (b) judges and judicial personnel; (c) any entity or person who timely opts out of this proceeding; (d) аny person who has suffered personal injury from the steering system failures alleged herein; and (e) any entity or person who has given a valid release of the claims asserted in this suit.
The trial court decided against including former owners who did not incur any repair costs related to the steering system tie rods. The trial court also decided there should be a cap on the amount of compensation paid to class members. That court later determined that “[t]he cap for the bolt fix remedy for current owners shall be $310.00 and the cap for repairs to the steering system by reason of the absence of a bolt remedy shall be $400.00.”
ANALYSIS
¶ 7 Class action is a procedural device governed by
¶ 8 “A trial court‘s class certification order is reviewed for abuse of discretion.” Ysbrand v. DaimlerChrysler Corp., 2003 OK 17, ¶ 5, 81 P.3d 618, 622 cert. den. sub. nom. DaimlerChrysler Corp. v. Ysbrand, 542 U.S. 937 (2004). “If the record does not demonstrate that the requisites for class action have been met, the trial court has abused it[s] discretion.” Harvell v. Goodyear Tire & Rubber Co., 2006 OK 24, ¶ 9, 164 P.3d 1028, 1032. Moreover, this Court “review[s] de novo whether the trial court applied the correct legal standard to grant certification.” Scoufos v. State Farm Fire & Cas. Co., 2001 OK 113, ¶ 1, 41 P.3d 366, 367. “If the trial court incorrectly decided a question of law in certifying the class, reversal will be ordered.” Id.
¶ 9 “The party who seeks certification has the burden of proving each of the requisite elements for class action.” Harvell, 2006 OK 24, ¶ 10, 164 P.3d at 1032. These elements include numerosity, commonality, typicality, and adequacy of representation.
¶ 10 In considering a motion to certify a class, the trial court is not to resolve the merits of the claims or defenses asserted. See Harvell, 2006 OK 24, ¶ 11, 164 P.3d at 1032. Rather, “the Oklahoma Supreme Court subscribes to the modern view that a
¶ 11 Defendant‘s challenge to the trial court‘s clаss certification order centers on whether issues common to the class predominate or whether a lack of uniform law and factual variations in the claims of individual class members preclude class certification. Defendant urges that individual questions of the applicable law and factual variations in the claims of class members will “overwhelm the court and jury, making class-wide determinations of the claims impracticable.” Plaintiff counters stating that common class-wide issues predominate because one state‘s law applies to the breach of warranty claims of the class and one state‘s law applies to the statute of limitations defense to those claims. She also urges that the issues and evidence concerning the claims and defenses in this litigation are essentially uniform across the class.
¶ 12 There is no dispute that this Court‘s decision in Ysbrand requires the ap-
¶ 13 The hotly contested issue in this matter is whether common issues predominate over individual issues in regard to Defendant‘s statute of limitations defense. Defendant asserts that the breach of warranty claims of most of the class members are facially time-barred by the statute of limitations found at section 2-725(2) of the Uniform Commercial Code.2 A determination of which state or states’ limitations period applies is pivotal in determining whether the legal issue can be uniformly decided across the class.
¶ 14 Plаintiff asserts that the statute of limitations was tolled because Defendant actively concealed information regarding the
¶ 15 Defendant, on the other hand, asserts that the choice of law rule applicable to this Court‘s determination of the proper limitation period, and thus the appropriate requirements for tolling that provision, must be found in Oklahoma‘s “borrowing statute” which provides that “[t]he period of limitation applicable to a claim accruing outside of this state shall be that prescribed either by the law of the place where the claim accrued or by the law of this state, whichever last bars the claim.”
¶ 16 The issue of the applicable statute of limitations is controlled by the choice of law provision found in Oklahoma‘s borrowing statute found at section 105 of title 12 of the Oklahoma Statutes. This provision was adopted in 1965 as part of the Uniform Statutes of Limitations on Foreign Claims Act,
¶ 17 Michigan adopted the uniform version of section 2-725 of the Uniform Commercial Code and therefore “An action for breach of any contract for sale must be commenced within four years after the cause of action has accrued....”
¶ 18 Oklahoma‘s statute of limitations for warranty claims provides that it does not displace the common law concerning tolling of the statute. See
Fraudulent concealment constitutes an implied exception to the statute of limitations, and a party who wrongfully conceals material facts and thereby prevents a discovery of his wrong, or the fact that a cause of action has accrued against him, is not allowed to take advantage of his own wrong
by pleading the statute, the purpose of which is to prevent wrong and fraud.
Waugh v. Guthrie Gas, Light, Fuel & Improvement Co., 1913 OK 42, ¶ 0, 131 P. 174, Syl. No. 2. Further:
The mere failure to disclose such material facts is not sufficient to prevent the running of the statute; but when there is something more than mere failure to disclose, when there is some actual artifice or some affirmative act of concealment, оr some misrepresentation which induces the other party to inaction, or to forgo inquiry, the guilty party may not cover up the harm he has thus wrought by aid of the statute of limitations.
Loyal Protective Ins. Co. v. Shoemaker, 1936 OK 491, ¶ 0, 63 P.2d 960, Syl. No. 1. “One relying on fraudulent concealment to toll the statute of limitations must not only show that he did not know the facts constituting a cause of action, but that he exercised reasonable diligence to ascertain said facts.” Kansas City Life Ins. v. Nipper, 1935 OK 1127, ¶ 0, 51 P.2d 741, 742, Syl. No. 9. “[I]f the means of knowledge exist and the circumstances are such as to put a man of ordinary prudence on inquiry, it will be held that there was knowledge of what could have been readily ascertained by such inquiry” and a plaintiff cannot successfully assert fraudulent concealment in answer to the dеfense of the statute of limitations. Id. ¶ 35, 51 P.2d at 747.
¶ 19 Defendant argues that predominance is defeated by the asserted need to question each class member individually as to whether the class member exercised reasonable diligence in learning of the allegedly concealed defect. Defendant speculates that some class members “might well have been more diligent than others” and that “[s]ome class members may have known more about the alleged defect than others, based on their own experience, or the experience of people they know, or conversations with dealer personnel....” This Court‘s decision in KMC Leasing v. Rockwell-Standard Corp., 2000 OK 51, 9 P.3d 683, is cited for the proposition that the issue of whether the class members exercised reasonable diligence can never be determined on a class-wide basis.
¶ 20 In KMC, this Court affirmed the trial court‘s refusal to certify a proposed class of aircraft owners who asserted products liability and other claims including a claim of fraud. This Court determined that common questions did not predominate over the need for individual fact finding because the differing terms of hundreds of non-uniform sales contracts would “require the trial court to analyze fraud issues under differing laws of numerous jurisdictions.” Id. ¶ 26, 9 P.3d at 691. Thus, it was the need to apply the law of numerous jurisdictions which defeated predominance in KMC just as that same need defeated predominance as to the fraud claim asserted in Ysbrand. See Ysbrand, 2003 OK 17, ¶ 18, 81 P.3d at 627. When, however, the problem of variations in applicable law are absent in a class action, this Court has permitted a fraud claim to proceed on a class-wide basis because the defendant‘s alleged fraud in failing to disclose information was based upon “the same or similar acts or omission for each class member.” See Burgess v. Farmers Ins. Co., 2006 OK 66, ¶ 17, 151 P.3d 92, 101.
¶ 21 As discussed, the need to apply the law of numerous jurisdictions is not found in this matter. However, the question remains as to whether Defendant‘s alleged concealment of the defect from the class members and their asserted lack of knowledge concerning the alleged defect are issues susceptible to detеrmination as a common class-wide issue.
¶ 22 This Court has not been presented with the opportunity to address the class action predominance requirement in the context of an asserted fraudulent concealment exception to the statute of limitations. However, this Court has acknowledged that “[t]he essence of fraudulent concealment is knowledge in possession of the person committing the fraud.” Karriman v. Orthopedic Clinic, 1973 OK 141, ¶ 17, 516 P.2d 534, 539 (quoting Clinard v. Pennington, 59 Tenn.App. 128, 438 S.W.2d 748, 753 (1968) (overruled on other grounds)). Thus, in this matter, the principal focus of Plaintiff‘s response to Defendant‘s statute of limitations defense will
¶ 23 “When representations are made or actions are taken on an individual basis, common questions will usually not predominate.” 4 Alba Conte & Herbert Newberg, Newberg on Class Actions § 13:10, at 405 (4th ed.2002). Hоwever, “[w]here plaintiffs in a class action allege similar representations, the reliance issues may be presumed similar as well.” Allapattah Servs., Inc. v. Exxon Corp., 188 F.R.D. 667, 674 (S.D.Fla.1999) citing Town of New Castle v. Yonkers Contracting Co., Inc., 131 F.R.D. 38, 43 (S.D.N.Y.1990) (common questions pervade fraudulent concealment inquiry); Fisher Bros. v. Mueller Brass Co., 102 F.R.D. 570, 579 (E.D.Pa.1984) (“The key question on the issue of fraudulent concealment will relate to whether the defendants successfully concealed the existence of the alleged conspiracy, and the proof of this contention will necessarily be common among the class members.“); In re Screws Antitrust Litig., 91 F.R.D. 52, 58 (D.Mass.1981)
¶ 25 In this matter, the common questions arising from Plaintiff‘s assertion of fraudulent concealment are (1) whether Defendant affirmatively concealed the alleged defect, and thus concealed a breach of warranty, and (2) whether the class members, by exercising due diligence, could have determined that a breach had occurred. Common to the class are both the evidence of the alleged acts of concealment and the evidence of whether knowledge of the alleged defect was readily available so as to put an ordinary prudent class member on inquiry.
¶ 26 Predominance does not require that there be no individual issues. It requires that the issues which can be answered as to all class members have more significance and weight than individual issues. Here, any question of variation in individual reliance is eclipsed by the common questions surrounding the allegation of fraudulent concealment. The critical inquiry will be whether Defendant actively and successfully concealed the existence of the alleged defect from the class. The proof of the active concealment which Plaintiff alleges will be common to each class member.
¶ 27 Again, the mere presence of individual issues does not defeat predominance. For example, “[t]here is a consensus ... that the need for individual damages calculations does not diminish the appropriateness of class action certification where common questions as to liability predominate.” Newberg, supra § 13:10, at 404 (footnote omitted); See, e.g., Burgess, 2006 OK 66, ¶ 17, 151 P.3d at 101 (“Even though damages amounts may vary, common questions predominate where the acts or omissions are the same.“). If the need to address individual issues arises as to whether due diligence would have revealed the alleged defect, those issues may be adjudicated at the same time and in the same fashion as any individual damages issues. See In re Flat Glass Antitrust Litig., 191 F.R.D. 472, 489 (W.D.Pa.1999).
¶ 28 Common issues predominate in this matter as to the warranty claims and as to the alleged fraudulent concealment asserted in response to Defendant‘s statute of limitations defense. The primary issues to be resolved are common to each class member and Plaintiff‘s claim has the essential characteristics common to the claims of the class. Thereforе, the class action requirements of commonality and typicality are satisfied. The class is made up of current and some past owners of certain LH platform vehicles, over two million of which were sold. There is no doubt the class is so numerous as to make joinder impracticable and therefore the numerosity requirement is met. Certification of the class in this matter is also superior to countless individual suits with the inevitable “inconsistent results” for parties similarly situated and the likely prospect that most claims will be left unpressed because the individual “claims are not substantial enough to support individual litigation.” Ysbrand, 2003 OK 17, ¶ 25, 81 P.3d at 628. Finally, there is no dispute as to whether the class representative or her cоunsel will fairly and adequately protect the interests of the class.
AFFIRMED.
CONCUR: WINCHESTER, C.J.; EDMONDSON, V.C.J.; HARGRAVE, KAUGER, WATT, TAYLOR, COLBERT, JJ.
CONCURS IN PART: OPALA, J.
OPALA, J., concurring in part.
¶ 1 This case presents several serious questions, which, if resolved against the plaintiff, would pose insuperable barricades to class certification. Oral argument would have been most helpful here to extend our attention to and familiarity with those prominent issues that escapе today‘s concern and inclusion in the opinion‘s text. Because the court does not reach for analysis, discussion or resolution all of these important issues that stand submitted by the manufacturer‘s brief but received no place in the court‘s pronouncement, I concur in part of today‘s answer.
