The plaintiffs, both of whom had purchased Ford trucks, claimed that the trucks needed multiple repairs and sought replacement or reimbursement of the original purchase price. Ford offered refunds or replacement, subject to conditions that the plaintiffs would be responsible for missing equipment, collision damage or abnormal wear. The plaintiffs accepted Ford’s offers, accepted the refunds, compensated Ford for repair costs due to abnormal wear, and signed releases of all vehicle-related claims. A year later, the plaintiffs filed this action, claiming the settlement agreements violated the Song-Beverly Act—which allows a statutory deduction for mileage, but not abnormal wear—and the California Consumers Legal Remedies Act (CLRA).
First, the court noted that it was undisputed that there were two “fully executed and performed settlement agreements” between each of the individual plaintiffs and Ford. While parties to a contract may rescind if there is a lawful basis, the rescinding party must restore to the other everything of value received under the contract, the court said. Here, the court said the plaintiffs have “not explained” how Ford would be able to locate and return their trucks, and “they also clearly have no interest in paying back the money they accepted from Ford.” What the plaintiffs really wanted, the court said, was to sever the release and the condition relating to abnormal wear from the contract and declare them unenforceable.
The court held that the challenged provisions were not severable, and that neither the settlement agreements nor the provisions were unconscionable because both plaintiffs were represented by counsel, had a “meaningful choice” whether to accept Ford’s offers, and the agreements did not lead to “overly harsh” or “one-sided” results.
The court also held that the CLRA claim failed because the challenged conduct occurred after the sale of the vehicles, and “thus could not have constituted deceptive acts that were intended to or did result” in the plaintiffs’ purchases.