Dvoskin v Levitz Furniture Co., Inc.

[*1] Dvoskin v Levitz Furniture Co., Inc. 2005 NY Slip Op 51784(U) [9 Misc 3d 1125(A)] Decided on October 6, 2005 Suffolk District Court Hackeling, J. Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. This opinion is uncorrected and will not be published in the printed Official Reports.

Decided on October 6, 2005
Suffolk District Court

Karen Dvoskin, Plaintiff,

against

Levitz Furniture Co. Inc., Defendant.



HUSC 3013-05

C. Stephen Hackeling, J.

Facts

The plaintiff purchased a living room furniture set from the defendant Levitz Furniture Company, Inc. (hereafter "Levitz") in August of 2003 for $3,463.82. The plaintiff's testimony was that the furniture started to fall apart within six to nine months of its delivery on July 29, 2003. The subject dispute involves the terms, conditions and circumstances surrounding the new furniture's warranties. Plaintiff asserts that she paid several hundred dollars above the furniture's purchase price, in order to extend the Levitz's one year warranty to five years, and that the oral warranty representations made by the Levitz salesman were all encompassing with no mention of any warranty limitations.

Levitz relies upon Exhibits 2 and 3 to assert the defense that its warranty is limited to one year and that plaintiff should have known that the extended warranty was with a third party (a Florida Corporation). Levitz contends that the reverse side of the sales order contains all its warranty limitations and disclaimers; and that it has no obligation to honor its one year warranty, as its phone records indicate that Levitz did not receive notice of the furniture defects until October 6, 2004, (14 months later). The plaintiff disputes this and asserts that she made repeated calls to Levitz in June and July of 2004, which calls were not returned. Plaintiff responds that she was in no rush as she thought she purchased a five year warranty.

Factual Issues Presented

Plaintiff contends that she timely placed Levitz on notice of a warranty claim and that it waited until after the one year anniversary to return her call and log same. Plaintiff's alternative complaint asserts that Levitz duped her into thinking she was paying extra for a bona fide five year warranty with them; when in fact they were taking her money and giving a worthless [*2]promise that someone else would fix her furniture after one year. Levitz denies these contentions as factually incorrect.

Legal Standard and Issues

Discussion

The legal standard to be utilized by this Court when conducting small claims proceedings is "to do substantial justice... according to the rules of substantive law ... not bound by statutory rules of practice, procedure, pleading or evidence". UDCA Sec. 1804. The informal nature of the layman facilitated small claims process dispenses with written answers as well as the need for plaintiffs to articulate all requisite elements of causes of action and instead places the responsibility upon the tribunal [FN1] to ascertain from the proof what legal issues have been joined for disposition. See Giarratano v. Midas Muffler, 166 Misc 2d 390 ( City Ct. 1995). The Court's assessment of the legal issues presented are: first, whether Levitz can bind purchasers to contractual terms and warranty limitations which are not readily apparent; second, is Levitz a disclosed agent for the purpose of limiting its liability on the extended warranty; last, is the subject sale a deceptive business practice.

One Year Warranty

Levitz's one year from purchase warranty is resolved with a simple factual determination. It is not disputed that Levitz warranted that "the furniture [would] be free from defects in material and workmanship for a period of one full year from the date of the original delivery". No mention is made in the sale's order that a claim must be made within the warranty period. Two witnesses testified that the defects were apparent within six to nine months of delivery. Levitz defends by asserting its phone logs to prove the defect arose fourteen months after delivery, although its store manager conceded that there was no written policy in effect requiring the logging of all complaints, and that not all calls were logged. The Court need not address the issue of the plaintiff's reliance upon a five year warranty and her non diligence in pursuing her extended warranty claim. Timely notice of claim is not required by the Levitz contract. Additionally, the Court adopts the plaintiff and her mother's testimony and finds that the defects occurred within six to nine months of delivery.

Levitz also contends that the defects shown in the photographs (plaintiff's Exhibit No.1) are expressly excluded from its limited warranty. A review of the broad exclusions listed on the back of the "Reprint-Sale Order" appears superficially to give Levitz the right to contest most defect claims. However, the Court rejects Levitz's attempt to limit its [*3]express one year warranty [FN2] as the front page of its "sale order"(Plaintiff's Exhibit #2 ) contains no reference to nor any mention of the limiting terms and conditions contained on the reverse side thereof. In this regard the Court notes that the front page of the sale order, which is the only place upon which the plaintiff's signature appears, bears the description "Page 1 of 1". The plaintiff's signature appears within a small box on the front of the sale order, which box contains only three sentences. The purported limited warranty language which the defendant attempts to rely on appears on the reverse side of this one page "sale order". The defendant has not demonstrated and the Court does not conclude that the plaintiff was aware of or intended to be bound by the terms which appear on the reverse side of the sale order. This language in no way binds the plaintiff. Had the agreement stated clearly, above the signature line, that the terms appearing on the reverse side of the agreement were part of the contract, or had the agreement included a notation conspicuously placed, indicating that the terms appearing on the reverse side of the sale order had been disclosed to and reviewed by the plaintiff, the Court may have reached a different result. See, Fleet Capital Leasing/Global Vendor Fin v. Angiuli Motors, inc. 15 AD3d 535 (NY App. Div. 2d Dept. 2005). The photographic evidence, together with the testimony of plaintiff's two witnesses, establish a clear breach of Levitz's salesman's warranty representations. The Court will limit plaintiff's damages to the $3,231.00 she paid for the furniture as her two reupholstery estimates exceed this sum.

Five Year Warranty

The plaintiff also paid $230.00 for the five year extended warranty on three pieces of furniture. Levitz received this money. At sale, Levitz tendered Exhibit #3, which is an unsigned two page declaration that the furniture comes with a five year promise of "Stain Safe" protection. The document does not indicate that the alleged promises were provided by a separate entity and does not indicate that this entity, is a corporation. No address is given and no individual or corporate office is identified as making the representations. It is not a contract as no signatures are included.

Levitz seeks to avoid liability by asserting that it is merely the agent of Stain Safe and as such is immune from a claim of breach of warranty. However, agency is only a defense if the agency relationship is disclosed. See Kestral v. Modsakowski, 249 NY 406 (NY 1928). In this case it was not. Levitz again asserts that the one line, buried on the back page of its sale order, stating "extended warranties are provided by a third party", provides the requisite agency disclosure. The Court finds this argument unpersuasive for the same reasons stated before; any limiting conditions must be disclosed prior to the agreement which is evidenced by [*4]

the purchaser's signature. Likewise, it rejects Levitz's contention that it has an unwritten policy that all its salespeople expressly disclose its agency relationship when they sell the five year warranty. The Court accepts plaintiff's testimony that no affirmative disclosure occurred, in addition to the writings contained in Exhibit 3, which was handed over after the sales transaction was complete.

Deceptive Business Practice

Section 349 of the New York General Business Law provides:



§349. Deceptive acts and practices unlawful

(a) Deceptive acts or practices in the conduct of any business trade or commerce or in the furnishing of any service in this state are hereby declared unlawful.

(b) a person who has been injured by reason of any violation of this sectionmay bring any action... to recover his actual damages or fifty dollars whichever is greater, or both... The Court may in its discretion, may increase the award to an amount not to exceed three times the actual damages up to one thousand dollars, if the Court finds the defendant willfully or knowingly violated this section.

To state a claim under this consumer protection statute a plaintiff must demonstrate that the disputed act has a broad impact on consumers at large. Exxon Mobil Inter. America Inc. V. AIE Services Inc., 328 F. Supp. 2d 443.(SDNY 2004). It can not be seriously disputed that Levitz's business practice of seeking to add contractual limitations and third party warranties via the reverse side of its sale order impacts all its numerous customers. New York Courts have construed Sec. 349 of the GBL to include breach of express warranty claims provided the deceptive act caused an injury. See generally Gale v. IBM 781 NYS 2d 45 (NY AD2d Dept. 2004); Giarrantano v. Midas Muffler, supra. The test to be applied is whether the misleading representation or act would deceive a reasonable consumer in the plaintiff's circumstances. Solomon v. Bell Atlantic Corp., 9 AD3d 49 (NYAD 1st Dept. 2004) citing to Goshen v. Mutual Life Insurance Co. of New York, 98 NY2d 314 (NY 2002).

Putting aside the factual controversy over what oral representations were made by the Levitz salesman; the Court finds that the solicitation and sale of an extended warranty to be honored by an entity that is different from the selling party is inherently deceptive if an express representation is not made disclosing who the purported contracting party is. It is reasonable to assume that the purchaser will believe the warranty is with the Seller to whom she gave consideration, unless there is an express representation to the contrary. The providing of a vague two page sales brochure, after the sale transaction, which brochure does not identify the new party as either a corporation or an individual d/b/a/, and which contains no signature or address, [*5]is clearly deceptive.[FN3] Accordingly, the Court finds Levitz's actions concerning its sale of an extended illusory warranty to be deceptive and awards plaintiff $690.00 [ representing three times the amount of damages(of $230.00) incurred to plaintiff]. No attorneys fees are awarded as none were incurred.

Judgment is awarded to the plaintiff in the sum of $3,921.00, plus interest from June 30, 2004.

Dated: October 6, 2005 ________________________

J.D.C. Footnotes

Footnote 1: In Suffolk County the matters are initially submitted to compulsory arbitration. -2-

Footnote 2: It should be noted that absent an express warranty that the plaintiff would be entitled to argue implied warranties of "merchantability" ( NY UCC Sec. 2-314), and possibly "fitness for a particular purpose" (NY UCC Sec. 2-315). -3-

Footnote 3: The Court also notes that the subject Stain Safe Protection Plan document (Exhibit 3) contains language which is less than 8 point print and as such is not admissible evidence pursuant to New York CPLR Sec 4544, Bauman v. Eagle Chase Associates, 226 AD2d 488 (NYAD 2d Dept.1996). -5-