CACI 3230 Continued Reasonable Use Permitted

New June 2012; Revised May 2020

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Give this instruction to make it clear to the jury that the fact that the buyer continued to use the product after delivering it for repair does not waive the buyer’s right to reimbursement and damages. (See Jiagbogu v. Mercedes-Benz USA (2004) 118 Cal.App.4th 1235, 1240–1244 [13 Cal.Rptr.3d 679].) Continued use is relevant, however, to the jury’s consideration of whether the vehicle was substantially impaired. See CACI No. 3204, “Substantially Impaired” Explained, factor (d).

There may be some uncertainty about the defendant’s right to a damages offset for continued use. In an older case, the court held that principles of rescission under the Uniform Commercial Code survive under the Song-Beverly Consumer Warranty Act, and that the seller remains protected through a recoupment right of setoff for the buyer’s use of the good beyond the time of revoking acceptance. (Ibrahim v. Ford Motor Co. (1989) 214 Cal.App.3d 878, 898 [263 Cal.Rptr. 64].) However, a more recent case rejected the proposition that pre Song-Beverly Commercial Code rules on continued use survive under Song-Beverly. (See Jiagbogu, supra, 118 Cal.App.4th at p. 1240.) The last sentence of this instruction is based on Jiagbogu, but in light of the potential uncertainty on the damages offset issue, the trial court will need to decide whether Jiagbogu or Ibrahim states the applicable rule.

•“[Defendant] contends that [plaintiff]’s request for restitution amounted to a rescission. But [Civil Code] section 1793.2 does not refer to rescission or any portion of the Commercial Code that discusses rescission. The [Song-Beverly] Act does not parallel the Commercial Code; it provides different and more extensive consumer protections. [Plaintiff] did not invoke rescission, or any of the common law doctrines or Commercial Code provisions relating to that remedy. It would not matter if he had referred to rescission in his buyback request, as long as he sought a remedy only under the Act, which contains no provision requiring formal rescission to obtain relief. [Defendant] acknowledges in its brief that [plaintiff] requested refund or replacement. That comports with a claim under the Act, not with a traditional cause of action for rescission.” (Jiagbogu, supra, 118 Cal.App.4th at p. 1240, original italics, internal citations omitted.)

•“Within the context of the California Uniform Commercial Code courts around the country are in general agreement that reasonable continued use of motorized vehicles does not, as a matter of law, prevent the buyer from asserting rescission (or its U.Com.Code equivalent, revocation of acceptance). This consensus is based upon the judicial recognition of practical realities—purchasers of unsatisfactory vehicles may be compelled to continue using them due to the financial burden to securing alternative means of transport for a substantial period of time. The seller remains protected through a recoupment right of setoff for the buyer’s use of the good beyond the time of revoking acceptance.” (Ibrahim, supra, 214 Cal.App.3d at pp. 897–898, internal citations omitted.)

•“Nothing in the language of either the Uniform Commercial Code or the Song-Beverly Act suggests that abrogation of the common law principles relating to continued use and waiver of a buyer’s right to rescind was intended. The former expressly specifies that ‘the principles of law and equity … shall supplement its provisions.’ (Cal. U. Com. Code, § 1103.) The legal principles governing continued use quoted previously are thus still applicable, as are the rules regulating the equitable right of setoff.” (Ibrahim, supra, 214 Cal.App.3d at p. 898, internal citations omitted.)

•“Since we reject [defendant]’s basic argument that a request for replacement or refund under the Act constitutes rescission, we find no error in the trial court’s refusal to instruct on waiver of right to rescind or on statutory offsets for postrescission use.” (Jiagbogu, supra, 118 Cal.App.4th at p. 1242.)

•“[Civil Code] Section 1793.2, subdivision (d)(2)(C), and (d)(2)(A) and (B) to which it refers, comprehensively addresses replacement and restitution; specified predelivery offset; sales and use taxes; license, registration, or other fees; repair, towing, and rental costs; and other incidental damages. None contains any language authorizing an offset in any situation other than the one specified. This omission of other offsets from a set of provisions that thoroughly cover other relevant costs indicates legislative intent to exclude [post-delivery use] offsets.” (Jiagbogu, supra, 118 Cal.App.4th at pp. 1243–1244.)