McCoolidge v. Oyvetsky

Nebraska Supreme Court Online Library
www.nebraska.gov/courts/epub/
03/04/2016 09:16 AM CST
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292 Nebraska R eports
McCOOLIDGE v. OYVETSKY
Cite as 292 Neb. 955
James McCoolidge, appellant,
v. Daniel Oyvetsky et al.,
appellees.
___ N.W.2d ___
Filed March 4, 2016. No. S-14-1135.
1. Trial: Judgments: Appeal and Error. In a bench trial of a law action,
the trial court’s factual findings have the effect of a jury verdict, which
an appellate court will not disturb unless clearly wrong.
2. Judgments: Appeal and Error. An appellate court independently
reviews questions of law.
3. Uniform Commercial Code: Breach of Warranty. The seller breaches
the warranty of title in Neb. U.C.C. § 2-312 (Reissue 2001) if there is
a substantial cloud or shadow over the title, even if no third party has
come forward with a superior claim.
4. ____: ____. A seller breaches the warranty of title in Neb. U.C.C.
§ 2-312 (Reissue 2001) by delivering a defective certificate of title to
the buyer.
5. Uniform Commercial Code: Breach of Warranty: Damages: Proof.
Buyers asserting a breach of warranty under the Uniform Commercial
Code must not only prove the warranty and breach thereof, but also the
cause of their loss and the extent of their damages.
6. ____: ____: ____: ____. Buyers asserting a breach of warranty under
the Uniform Commercial Code do not have to prove damages with
mathematical certainty, but the evidence must be sufficient to allow
the trier of fact to estimate the actual damages with reasonable
certainty.
7. Uniform Commercial Code: Damages. If the buyer accepts defec-
tive goods, damages are measured under Neb. U.C.C. § 2-714 (Reissue
2001).
8. Uniform Commercial Code: Damages: Proof. The existence of “spe-
cial circumstances” under Neb. U.C.C. § 2-714 (Reissue 2001) is not a
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precondition to a buyer’s recovery of incidental and consequential dam-
ages under Neb. U.C.C. § 2-715 (Reissue 2001).
9. Motor Vehicles: Damages. The reasonable value of the loss of use of
a motor vehicle is generally the fair rental value of a like vehicle for
a reasonable length of time or the amount actually paid, whichever
is less.
10. Motor Vehicles: Breach of Warranty: Damages: Time. The period
for which the buyer of a motor vehicle can recover loss of use damages
should generally correspond to the length of time that the buyer would
have used the vehicle but for the breach of warranty.
Appeal from the District Court for Douglas County: Shelly
R. Stratman, Judge. Affirmed.
Thomas M. White, C. Thomas White, and Amy S. Jorgensen,
of White & Jorgensen, for appellant.
Terry J. Grennan, of Cassem, Tierney, Adams, Gotch &
Douglas, for appellee Travelers Casualty and Surety Company
of America.
Heavican, C.J., Wright, Connolly, Miller-Lerman, Cassel,
and Stacy, JJ.
Connolly, J.
SUMMARY
James McCoolidge bought a used automobile over the
Internet and had trouble registering the certificate of title
in Nebraska. He sued the man with whom he directly dealt,
a dealership in Tennessee, and an insurer that had issued a
surety bond to the dealership. The trial court concluded that
although the sellers initially breached the warranty of title,
McCoolidge had not proved the damages he suffered from
the delay in obtaining good title. McCoolidge appeals, argu-
ing that even if he could register a certificate of title, other
problems remained. We conclude that McCoolidge did not
prove his damages and therefore affirm the court’s judgment
for the defendants.
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BACKGROUND
McCoolidge’s Employment
Before multiple sclerosis forced him to retire, McCoolidge
worked as an automobile mechanic and salesperson. He was a
“part owner” of Cars on Keystone, a used car dealership, and
held a sales license in that capacity.
Thomas Monteith, an accountant, testified that he was the
“owner” of Cars on Keystone, which was the trade name of
Classic Auto Rental Service, LLC. Monteith explained that
McCoolidge had a “profit interest” in the dealership, meaning
that “if it makes money, he gets a percentage, if it loses, I get
the loss since I am funding the company.” The articles of orga-
nization for Classic Auto Rental Service identify two members:
McCoolidge and Monteith Brothers, Inc.
Monteith did not take an active role in Cars on Keystone.
He said that McCoolidge took “care of anything” and that
the “only thing I see is the bank statement.” No one else was
involved in the business. Cars on Keystone was defunct by the
time of trial.
Purchase of the Automobile
Because of the progressive nature of multiple sclerosis,
McCoolidge wanted a vehicle that could accommodate a per-
son in a wheelchair. He found a vehicle “sitting at a salvage
yard” with a “motorized ramp and other accessories necessary
to convert a Honda Element into a handicapped-accessible
vehicle.” He had the opportunity to remove the equipment at
no cost. Having found the equipment, McCoolidge searched for
a suitable vehicle in which to install it.
In March 2011, McCoolidge saw a 2008 Honda Element
with structural damage (Element) advertised in an online auc-
tion. He contacted the seller, who identified himself as Daniel
Oyvetsky. According to McCoolidge, Oyvetsky said that he
was selling the Element for Car and Truck Center L.L.C., a
licensed dealer in Nashville, Tennessee. McCoolidge verified
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Oyvetsky’s representation by calling Car and Truck Center and
speaking with Alexander Davidoff.
When the auction closed without a buyer, Oyvetsky reached
out to McCoolidge. McCoolidge agreed to buy the Element for
$7,500 and transferred the purchase price to a PayPal account
associated with Oyvetsky or Car and Truck Center.
McCoolidge instructed Oyvetsky and Car and Truck Center
to assign the title to Cars on Keystone. McCoolidge explained
that he wanted the title assigned to the dealership because it
would give him more time to register the certificate of title in
Nebraska and because he wanted to use the dealership’s facili-
ties to repair the Element. He expected that Cars on Keystone
would transfer title to him once the repairs were finished.
About a week after the purchase, McCoolidge received
the Element followed by a certificate of title. McCoolidge,
however, had trouble registering the certificate. He spoke to
Oyvetsky, who was unable or unwilling to solve the problem.
McCoolidge said he also spoke with Davidoff, who “didn’t
want anything to do with it.”
In July 2011, McCoolidge filed a complaint against Car and
Truck Center with the Tennessee Motor Vehicle Commission.
He told the commission that Car and Truck Center had not
provided him with a valid certificate of title. McCoolidge
acknowledged that he received a certificate of title which “my
DMV said . . . might be ok,” but he was “not comfortable
with might.”
In an affidavit, Davidoff stated that he bought the Element
from “W. McInnis” in September 2010 and asked Oyvetsky to
advertise the vehicle. Davidoff said he shipped the Element
to McCoolidge, but a problem arose because it “was title[d]
to [a] Lease Company and not McInnis.” Davidoff stated that
McCoolidge had “pulled back 4000.00 of the 7500.00 paid” and
that Davidoff would not send the correct certificate of title to
McCoolidge until he returned the money.
At trial, Davidoff denied buying or selling the Element.
Rather, he “sen[t] title to Car of Keystone in the favor and the
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request for . . . Oyvetsky.” Davidoff said he told the Tennessee
Motor Vehicle Commission that “the previous owner of this
Element came from a leasing company and did not transfer
the vehicle to his name.” He said that the “previous owner”
was “Veritas Video.” Davidoff said that the “owner” when
McCoolidge bought the Element was Igor Tavakalov.
Tavakalov testified that he “bought [the Element], but never
registered it on my name.” He said the “previous owner” was
“McGinnis and Veritas,” with “McGinnis” being a natural per-
son who owned a “production company” called Veritas.
Certificates of Title
There are numerous certificates of the title issued by the
State of Tennessee in the record, some of which appear to be
copies of the same certificate. The dates on which McCoolidge
received the various certificates are less than clear.
One of the certificates states that title is vested in “HONDA
LEASE TRUST.” On the reverse, Honda Lease Trust assigned
title to “VERITAS F AND VIDEO, WILLIAM W MCINNES,”
who reassigned title to Car and Truck Center, which reassigned
title to Cars on Keystone.
Other certificates state that title is vested in “VERITAS F
AND VIDEO” and “WILLIAM W MCINNIS,” with various
permutations of assignments and reassignments on the reverse.
For example, on the reverse of one certificate, “Veritas Film
& Video” assigned title to Car and Truck Center, which reas-
signed title to Cars on Keystone. On the reverse of another,
“William W. McInnes” assigned title to Cars on Keystone. On
the reverse of yet another certificate, “Veritas F & Video” and
“William W. McInnes” assigned title to Cars on Keystone.
McCoolidge testified that he never received “clear” or
“usable” title. He believed he needed a certificate that “showed
transfer from the lessor and Honda into Car and Truck, Inc.
and then to Cars on Keystone.” Later, he testified that the
title should be “declared up from Veritas Video to Cars and
Truck and then to Cars on Keystone.” Later yet, McCoolidge
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testified that the problem, as he saw it, was that title was “still
assigned” to Veritas Video, an entity with which McCoolidge
had no relationship. But he had “no idea” whether Veritas
Video was “one of the reasons for kind of the missing link in
the chain of title.” McCoolidge said he never received a bill
of sale, although, when asked about “Cars on Keystone on a
bill of sale or an actual purchase agreement,” he said “[t]here
was one tendered but then thrown away because there was no
title . . . .”
In his deposition, McCoolidge testified that he had received
a certificate of title that he could have registered in Nebraska.
Shown one of the certificates and asked if it was “good title,”
McCoolidge answered: “It’s — according to Douglas County,
with a valid vehicle inspection, which the [vehicle identifi-
cation number] matches the title, it would transfer into the
State of Nebraska as a valid Nebraska title.” He had shown
the certificate to the Nebraska Department of Motor Vehicles,
and “[t]hey said it looks to be transferrable in its form.” But
McCoolidge said he would not register the title “until this is
settled,” because he had “no idea which way this is going to
go.” His attorney explained that he could “get a title issued,”
but that he preferred to “present it to the court and have the
court tell us what should be done.”
McCoolidge reviewed his deposition testimony during his
cross-examination at trial. He said: “I’ve seen several titles in
reference to this, and I don’t remember which title. But if I was
presented with a title that was transferable, it’s possible. If it
was transferable, I told you the truth. It would be transferable.”
But on redirect, McCoolidge said the Department of Motor
Vehicles rejected the certificate of title that the attorney repre-
senting the insurer “was talking to [McCoolidge] about earlier
that he said, as far as you know, you thought it was good.”
Damages
McCoolidge testified that he repaired the structural dam-
age to the Element “almost immediately” because he “had
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everything lined up.” He estimated he spent nearly $8,000
on repairs.
McCoolidge never drove the Element. He bought two other
automobiles that he used for transportation after he bought the
Element, paying a total of $5,000 or $6,000. He did not rent
a vehicle.
McCoolidge did not remove the motorized ramp from the
salvaged vehicle. He explained that he could have removed
the equipment but “let it go” because he did not feel that he
owned the Element. He thought the forgone equipment was
worth “[t]housands.”
McCoolidge stored the Element at Cars on Keystone until
July 2012, when he moved it to the garage at his residence.
McCoolidge never paid to store the Element but testified that
Monteith sent him a bill for storage fees. He produced a May
2011 bill from “Classic Auto Rental & Repair Services”—
which he said was Cars on Keystone’s “parent company”—
stating that the “Unit Price” for “Store inside facility” was $30
per day. He said that “Douglas County” charges $45 per day to
store towed vehicles.
Monteith was unaware of any storage fees at Cars on
Keystone and had never seen a bill for the Element. He testi-
fied that he did not know if McCoolidge kept the Element at
Cars on Keystone, because “I haven’t been in the building for
two years.” Asked about McCoolidge’s reference to a “parent
company” that “wants to charge a lot of storage,” Monteith
said “[t]here is no parent company that I know of.” If some-
one charged for storage at Cars on Keystone, Monteith said it
would have been McCoolidge.
Procedural Background
In 2011, McCoolidge sued Oyvetsky, Car and Truck Center,
and Travelers Casualty and Surety Company of America. The
insurance company had issued a surety bond to Car and Truck
Center for the “protection of any person who suffers loss
because of . . . [t]he dealer’s failure to deliver in conjunction
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with the sale of a vehicle a valid vehicle title certificate free
and clear of any prior owner’s interests . . . .”
McCoolidge accused the defendants of failing to deliver
“clear title” for the Element. He claimed the following dam-
ages: (1) storage costs; (2) loss of use; (3) repair costs “wasted
in light of the defective title”; and (4) “[c]ost of cover in the
attempt to obtain a clear title.”
In 2014, the court entered a judgment for the defendants. It
found that McCoolidge initially contracted with Oyvetsky, but
that Car and Truck Center “inserted itself into the transaction
to become a party to the contract,” thus triggering the protec-
tion of the surety bond. In the court’s findings of fact section, it
stated that McCoolidge “admitted that he was presented with a
title that he could use to register the [Element], but was waiting
for the resolution of this lawsuit to do so.”
The court concluded that the defendants initially breached
the warranty of title in Neb. U.C.C. § 2-312 (Reissue 2001), but
that McCoolidge eventually “received good title in 2011, some-
time after May and before [his] deposition.” McCoolidge could
recover damages caused by the delay but had failed to prove
them. For example, the court explained that McCoolidge was
“entitled to the difference in value of the [Element] with good
title compared to what he received, but there is no evidence
of that amount in the record.” As to McCoolidge’s request for
storage costs, loss of use, repair costs, and cover costs, the
court found that any such expenses were not “‘directly attribut-
able’” to the defendants’ breach.
McCoolidge appeals.
ASSIGNMENTS OF ERROR
McCoolidge assigns, consolidated, that the court erred by (1)
determining that he received “good title” despite the absence
of a bill of sale or “other supporting documentation” and the
presence on the certificate of title of a “third party who was a
complete stranger to the transaction” and (2) determining that
he failed to prove damages.
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STANDARD OF REVIEW
[1,2] In a bench trial of a law action, the trial court’s factual
findings have the effect of a jury verdict, which an appellate
court will not disturb unless clearly wrong.1 We independently
review questions of law.2
ANALYSIS
The district court determined that the sellers stood in breach
of the warranty of title until they delivered a certificate of
title to McCoolidge “sometime in 2011” that he could reg-
ister in Nebraska. McCoolidge argues that, despite receiving
a registrable certificate of title, he still did not have good
title because he lacked a “bill of sale or other customary
documentation” and the certificate “name[d] a third party to
the transaction.”3
Two legislative enactments are particularly relevant to the
sale of automobiles. The first is article 2 of the Uniform
Commercial Code, which governs the sale of “goods,” includ-
ing automobiles.4 The second is the Motor Vehicle Certificate
of Title Act.5 We consider article 2 “concurrently with the cer-
tificate of title act.”6
1
Timberlake v. Douglas County, 291 Neb. 387, 865 N.W.2d 788 (2015).
See, also, Koperski v. Husker Dodge, Inc., 208 Neb. 29, 302 N.W.2d 655
(1981); Larutan Corp. v. Magnolia Homes Manuf. Co., 190 Neb. 425, 209
N.W.2d 177 (1973).
2
See Timberlake v. Douglas County, supra note 1.
3
Brief for appellant at 8, 9.
4
See, Neb. U.C.C. § 2-102 (Reissue 2001); Worley v. Schaefer, 228 Neb.
484, 423 N.W.2d 748 (1988); Dugdale of Nebraska v. First State Bank,
227 Neb. 729, 420 N.W.2d 273 (1988), overruled in part on other
grounds, Aken v. Nebraska Methodist Hosp., 245 Neb. 161, 511 N.W.2d
762 (1994). See, also, Annot., 47 A.L.R. 5th 677 (1997).
5
See Neb. Rev. Stat. §§ 60-101 to 60-197 (Reissue 2010, Cum. Supp. 2014
& Supp. 2015).
6
See Dugdale of Nebraska v. First State Bank, supra note 4, 227 Neb. at
734, 420 N.W.2d at 277.
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The district court determined that the sellers initially
breached the warranty of title in § 2-312(1). That section
provides:
[T]here is in a contract for sale a warranty by the seller
that
(a) the title conveyed shall be good, and its transfer
rightful; and
(b) the goods shall be delivered free from any security
interest or other lien or encumbrance of which the buyer
at the time of contracting has no knowledge.
[3] The seller breaches the warranty of title in § 2-312 if
there is a substantial cloud or shadow over the title, even if no
third party has come forward with a superior claim.7 Section
2-312(1)(a) guarantees the buyer “a good, clean, title trans-
ferred to him or her also in a rightful manner so that he or she
will not be exposed to a lawsuit in order to protect it.”8
McCoolidge directs us to § 60-140 of the Motor Vehicle
Certificate of Title Act, which we have referred to as an “inval-
idating provision.”9 Section 60-140(1) provides:
[N]o person acquiring a vehicle from the owner thereof,
whether such owner is a manufacturer, importer, dealer,
or entity or person, shall acquire any right, title, claim,
or interest in or to such vehicle until the acquiring person
7
See, Saber v. Dan Angelone Chevrolet, Inc., 811 A.2d 644 (R.I. 2002);
Colton v. Decker, 540 N.W.2d 172 (S.D. 1995); Maroone v. Chevrolet, Inc.
v. Nordstrom, 587 So. 2d 514 (Fla. App. 1991); U-J Chevrolet Co., Inc. v.
Marcus, 460 So. 2d 1341 (Ala. Civ. App. 1984); City Car Sales, Inc. v.
McAlpin, 380 So. 2d 865 (Ala. Civ. App. 1979); Ricklefs v. Clemens, 216
Kan. 128, 531 P.2d 94 (1975); 77A C.J.S. Sales § 458 (2008). But see, C.F.
Sales, Inc. v. Amfert, Inc., 344 N.W.2d 543 (Iowa 1983); Skates v. Lippert,
595 S.W.2d 22 (Mo. App. 1979).
8
§ 2-312, comment 1. See, also, Stauffer v. Benson, 288 Neb. 683, 850
N.W.2d 759 (2014); Omermiller v. Baasch, 284 Neb. 542, 823 N.W.2d 162
(2012).
9
Worley v. Schaefer, supra note 4, 228 Neb. at 489, 423 N.W.2d at 751
(citing former Neb. Rev. Stat. § 60-105 (Reissue 1984)).
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has had delivered to him or her physical possession
of such vehicle and (a) a certificate of title or a duly
executed manufacturer’s or importer’s certificate with
such assignments as are necessary to show title in the
purchaser, (b) a written instrument as required by sec-
tion 60-1417, (c) an affidavit and notarized bill of sale as
provided in section 60-142.01, or (d) a bill of sale for a
parts vehicle as required by section 60-142.
Other relevant sections of the Motor Vehicle Certificate of
Title Act include § 60-139, which prohibits a purchaser from
possessing a “certificate of title which does not contain such
assignments as are necessary to show title in the purchaser or
transferee.” One who operates a motor vehicle for which a cer-
tificate of title is required without having such a certificate is
guilty of a misdemeanor under § 60-180.
We note that the Motor Vehicle Certificate of Title Act is
the exclusive method of transferring title to a vehicle, but it is
not conclusive of ownership.10 Between the buyer and seller
of a motor vehicle, the certificate of title is only prima facie
evidence of ownership.11 If the seller wrongly refuses to deliver
a valid certificate, Neb. U.C.C. § 2-401 (Cum. Supp. 2014)
dictates when title passes.12
[4] Here, the court determined that the sellers initially
breached the warranty of title by failing to deliver a certificate
that McCoolidge could register. Neither Oyvetsky nor Car
and Truck Center challenge this conclusion. A seller breaches
the warranty of title in § 2-312 by delivering a defective cer-
tificate of title to the buyer.13 We agree with the court that
the sellers breached the warranty of title by failing to provide
10
Hanson v. General Motors Corp., 241 Neb. 81, 486 N.W.2d 223 (1992).
11
Id.; Alford v. Neal, 229 Neb. 67, 425 N.W.2d 325 (1988).
12
Alford v. Neal, supra note 11.
13
See, Jefferson v. Jones, 286 Md. 544, 408 A.2d 1036 (1979); 67A Am. Jur.
2d Sales § 710 (2014).
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McCoolidge with the documentation necessary to complete one
of the titling methods in § 60-140.
But the court determined that the sellers gave McCoolidge
a registrable certificate sometime in 2011. McCoolidge, the
court stated, could have registered one of the certificates in
Nebraska but abstained from doing so because he wanted to
wait for the outcome of this litigation.
McCoolidge contends that “[t]he fact that [he] was even-
tually provided with a document which he could register in
Nebraska does not cure the earlier breach.”14 “The ability to
register a vehicle,” McCoolidge asserts, “is not even remotely
the same as ‘good title . . . .’”15 He identifies two defects that
remained despite his ability to register the certificate of title:
(1) the lack of a bill of sale or similar documentation and (2)
the presence on the certificate of title of a third party who was
“a complete stranger to the transaction.”16
[5,6] McCoolidge is correct that the buyer’s ability to obtain
a certificate of title stating that he is the owner is not always
dispositive in warranty of title cases.17 But we need not decide
whether a shadow remained over McCoolidge’s title, because
he failed to show what damages, if any, he incurred from the
alleged breach. Buyers asserting a breach of warranty under
the Uniform Commercial Code must not only prove the war-
ranty and breach thereof, but also the cause of their loss and
the extent of their damages.18 They do not have to prove dam-
ages with mathematical certainty, but the evidence must be
14
Reply brief for appellant at 2.
15
Id.
16
Brief for appellant at 5.
17
See, Colton v. Decker, supra note 7; Jefferson v. Jones, supra note 13; 1
James J. White et al., Uniform Commercial Code § 10:41 (6th ed. 2012).
18
See Settell’s, Inc. v. Pitney Bowes, Inc., 209 Neb. 26, 305 N.W.2d 896
(1981).
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sufficient to allow the trier of fact to estimate the actual dam-
ages with reasonable certainty.19
[7] If the buyer accepts defective goods, damages are meas­
ured under Neb. U.C.C. § 2-714 (Reissue 2001). The court
determined that the measure of damages in § 2-714(2) applied,
thus implicitly finding that McCoolidge had accepted the
Element—although he clearly never accepted the sufficiency
of any of the certificates of title. The record supports a find-
ing that McCoolidge did not effectively reject the Element.20
For example, McCoolidge testified that he never tried to “just
send [the Element] back.” Furthermore, he did not allege in
his complaint that he rejected or revoked his acceptance of the
Element and he never claimed that he was entitled to recover
the purchase price.21
As with other breaches of warranty, § 2-714 is the usual
starting place for measuring damages for breach of the war-
ranty of title.22 Section 2-714 provides:
(1) Where the buyer has accepted goods and given
notification [of the breach to the seller] he may recover
as damages for any nonconformity of tender the loss
resulting in the ordinary course of events from the
seller’s breach as determined in any manner which is
reasonable.
(2) The measure of damages for breach of warranty
is the difference at the time and place of acceptance
between the value of the goods accepted and the value
they would have had if they had been as warranted, unless
special circumstances show proximate damages of a dif-
ferent amount.
19
Id.
20
See Neb. U.C.C. §§ 2-602 and 2-606(1)(b) (Reissue 2001).
21
See Neb. U.C.C. § 2-711(1) (Reissue 2001).
22
See Metalcraft, Inc. v. Pratt, 65 Md. App. 281, 500 A.2d 329 (1985).
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(3) In a proper case[,] any incidental and conse-
quential damages under the next section may also be
recovered.
We have referred to the difference between the value of the
goods as accepted and the value as warranted under § 2-714(2)
as “‘the keystone for computing buyer’s damages.’”23
McCoolidge established the purchase price of the Element,
which is strong evidence of its value as warranted.24 For the
value as accepted, McCoolidge argues that the Element “has
absolutely no value to [him] without a clear chain of own-
ership and good title.”25 Some breaches of the warranty of
title may render the value of the accepted goods zero.26 But
McCoolidge did not show that the Element was worthless
to him, at least after he received a certificate of title that he
could register in Nebraska. He presented no evidence what-
soever of how the lack of a bill of sale and the presence of
a “third party” on the certificate of title affected the value of
the Element.
Similarly, the court did not err by denying McCoolidge
damages for the money he spent repairing the Element’s
structural damage. McCoolidge argues that because he “has
not and will not receive good title, the repairs were wasted
on a vehicle that he cannot use.”27 If a buyer repairs a motor
vehicle without good title, courts generally consider repairs
as evidence of the vehicle’s value under a temporally modi-
fied calculation of diminution in value under § 2-714(2).28
23
Settell’s, Inc. v. Pitney Bowes, Inc., supra note 18, 209 Neb. at 30, 305
N.W.2d at 898.
24
See id.
25
Reply brief for appellant at 7.
26
1 White et al., supra note 17, § 10:45.
27
Reply brief for appellant at 9.
28
See, Schneidt v. Absey Motors, Inc., 248 N.W.2d 792 (N.D. 1976); Ricklefs
v. Clemens, supra note 7; Annot., 94 A.L.R. 3d 583 (1979). See, also,
Marino v. Perna, 165 Misc. 2d 504, 629 N.Y.S.2d 669 (N.Y. Civ. 1995).
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But, as noted, McCoolidge did not show how the alleged
title defects affected the Element’s value. Courts may invoke
the “special circumstances” exception in § 2-714(2) to award
repair costs as damages.29 Here, though, the court found there
were not special circumstances, and that finding was not
clearly wrong.30
[8] In addition to damages under § 2-714(2), a buyer may
also recover incidental and consequential damages.31 The exis-
tence of “special circumstances” under § 2-714(2) is not a
precondition to a buyer’s recovery of incidental and conse-
quential damages.32 Courts invoke the “special circumstances”
exception to award damages for repair or replacement costs33
or, more commonly in warranty of title cases, to shift the valu-
ation date under § 2-714(2) from “the time . . . of acceptance”
to the date on which the buyer’s possession of the automobile
was interrupted because of a title defect.34 Section 2-714(3)
states that a buyer can recover incidental and consequential
cases in a “proper case.” Such damages are proper when
the buyer meets the requirements of Neb. U.C.C. § 2-715
(Reissue 2001).35
The recovery of incidental and consequential damages is
governed by § 2-715, which provides:
29
See 1 Roy Ryden Anderson, Damages Under the Uniform Commercial
Code § 10:10 (2015-16 ed.). See, also, Hillcrest County Club v. N.D. Judds
Co., 236 Neb. 233, 461 N.W.2d 55 (1990).
30
See Hillcrest County Club v. N.D. Judds Co., supra note 29.
31
Miller v. Stan Ortmeier Constr. Co., 229 Neb. 259, 426 N.W.2d 272
(1988).
32
1 Anderson, supra note 29, § 10:13.
33
See id., § 10:10.
34
See, Marino v. Perna, supra note 28; U-J Chevrolet Co., Inc. v. Marcus,
supra note 7; Schneidt v. Absey Motors, Inc., supra note 28; Ricklefs v.
Clemens, supra note 7; 1 Anderson, supra note 29, § 10:12; 1 White et al.,
supra note 17, § 11:5 n.3. But see Masoud v. Ban Credit Service Agency,
128 Misc. 2d 642, 494 N.Y.S.2d 598 (N.Y. Sup. 1985).
35
See 1 Anderson, supra note 29, § 10:13.
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(1) Incidental damages resulting from the seller’s
breach include expenses reasonably incurred in inspec-
tion, receipt, transportation and care and custody of goods
rightfully rejected, any commercially reasonable charges,
expenses or commissions in connection with effecting
cover and any other reasonable expense incident to the
delay or other breach.
(2) Consequential damages resulting from the seller’s
breach include
(a) any loss resulting from general or particular require-
ments and needs of which the seller at the time of con-
tracting had reason to know and which could not reason-
ably be prevented by cover or otherwise; and
(b) injury to person or property proximately resulting
from any breach of warranty.
McCoolidge argues that he should receive damages for
storing the Element. Incidental damages include the cost of
storing defective goods.36 But McCoolidge did not actually
pay to store the Element, and Monteith’s testimony suggests
that he is under no obligation to do so. McCoolidge responds
that the absence of actual expenses is “irrelevant as he for-
feited the benefit of the space used for storage” and that he is
“entitled to the reasonable value of storing the vehicle.”37 Any
loss sustained by Cars on Keystone from storing the Element
was sustained by the corporate entity doing business as Cars
on Keystone.38 McCoolidge did not show how such a loss
affected his “profit interest” in the company. As to the period
during which McCoolidge stored the Element at his personal
residence, the court could find that evidence of the cost of
36
2 Roy Ryden Anderson, Damages Under the Uniform Commercial Code
§ 11:6 (2015-16 ed.).
37
Brief for appellant at 10.
38
See Steinhausen v. HomeServices of Neb., 289 Neb. 927, 857 N.W.2d 816
(2015).
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storing a vehicle at Cars on Keystone or the county impound
lot did not reflect McCoolidge’s actual loss.
McCoolidge also argues that uncertainty about the Element’s
title caused him to lose access to a free motorized wheel-
chair ramp. Such a loss would be an item of consequential
damages.39 Under § 2-715(2)(a), the buyer cannot recover
consequential damages if he could have reasonably prevented
the loss by cover or otherwise. Here, the court found that
McCoolidge could have stored the equipment until he received
good title. Furthermore, the buyer must make his particular
needs generally known to the seller to charge the seller with
knowledge under § 2-715(2)(a).40 McCoolidge testified that
he told Oyvetsky that he had multiple sclerosis and “that’s
why I wanted a Honda Element.” But there is no evidence
that McCoolidge made known to the sellers that he had time-
sensitive access to free accessibility equipment.
[9] McCoolidge also claims damages for the loss of use of
the Element. Loss of use is another example of consequential
damages.41 We have said that the reasonable value of the loss
of use of a motor vehicle is generally the fair rental value of a
like vehicle for a reasonable length of time or the amount actu-
ally paid, whichever is less.42
McCoolidge’s failure to actually rent another vehicle is not
necessarily fatal to his claim for loss of use damages. Most
courts award loss of use damages even if the plaintiff did
39
See Adams v. American Cyanamid Co., 1 Neb. Ct. App. 337, 498 N.W.2d 577
(1992).
40
See § 2-715, comment 3.
41
See, World Enterprises, Inc. v. Midcoast Aviation, 713 S.W.2d 606 (Mo.
App. 1986); 2 Anderson, supra note 36, § 11:33. But see Midwest Mobile
Diagnostic Imaging v. Dynamics Corp., 965 F. Supp. 1003 (W.D. Mich.
1997).
42
See, Chlopek v. Schmall, 224 Neb. 78, 396 N.W.2d 103 (1986); Rose v.
United States Nat. Bank, 218 Neb. 97, 352 N.W.2d 594 (1984); Husebo v.
Ambrosia, Ltd., 204 Neb. 499, 283 N.W.2d 45 (1979).
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not actually rent a substitute chattel,43 at least if the chattel
was for personal use.44 Those who lack the means to rent a
vehicle may nevertheless be inconvenienced and should not
be barred from recovering damages because of their finan-
cial circumstances.45
[10] But McCoolidge could only recover damages for loss
of use for “a reasonable length of time.”46 A reasonable length
of time depends on the facts of the case,47 but should gener-
ally correspond to the length of time the buyer would have
used the vehicle but for the breach of warranty.48 McCoolidge
bought the Element knowing that repairs were necessary
because the roof was “caved in.” He also planned to install
a motorized wheelchair ramp. He did not show how long
the Element would have been inoperable because of the
expected repairs and modifications, apart from the difficulties
43
Warren v. Heartland Auto. Services, Inc., 36 Kan. App. 758, 144 P.3d 73
(2006); Castillo v. Atlanta Cas. Co., 939 P.2d 1204 (Utah App. 1997);
United Truck Rental v. Kleenco Corp., 84 Haw. 86, 929 P.2d 99 (1996);
Cress v. Scott, 117 N.M. 3, 868 P.2d 648 (1994); Camaraza v. Bellavia
Buick Corp., 216 N.J. Super. 263, 523 A.2d 669 (1987); Francis v. Steve
Johnson Pontiac-GMC-Jeep, 724 P.2d 84 (Colo. App. 1986); Luna v.
North Star Dodge Sales, Inc., 667 S.W.2d 115 (Tex. 1984); Mountain View
Coach v Storms, 102 A.D.2d 663, 476 N.Y.S.2d 918 (N.Y. Sup. 1984);
Jacobs v. Rosemount Dodge-Winnebago South, 310 N.W.2d 71 (Minn.
1981); Meakin v. Dreier, 209 So. 2d 252 (Fla. App. 1968); Annot., 18
A.L.R. 3d 497, § 13 (1968). See, also, 2 Anderson, supra note 36, § 11:33.
But see Winchester v. McCulloch Bros. Garage, 388 So. 2d 927 (Ala.
1980).
44
See PurCo Fleet Services, Inc. v. Koenig, 240 P.3d 435 (Colo. App. 2010).
45
See United Truck Rental v. Kleenco Corp., supra note 43; Luna v. North
Star Dodge Sales, Inc., supra note 43.
46
Rose v. United States Nat. Bank, supra note 42, 218 Neb. at 100, 352
N.W.2d at 597. Accord Husebo v. Ambrosia, Ltd., supra note 42.
47
See Husebo v. Ambrosia, Ltd., supra note 42.
48
See, Warren v. Heartland Auto. Services, Inc., supra note 43; Seekings
v. Jimmy GMC of Tucson, Inc., 130 Ariz. 596, 638 P.2d 210 (1981); 18
A.L.R.3d, supra note 43, § 18.
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caused by the lack of good title. McCoolidge did not have to
prove the exact date on which he would have begun to drive
the Element if the sellers gave him satisfactory title,49 but
awarding loss of use damages on the record before us would
require speculation.
Finally, McCoolidge argues that he is entitled to the costs he
incurred “in an attempt to obtain a clear title.”50 He does not
explain what these costs were, and after reviewing the record,
we do not think that the amount of such costs would have been
apparent to the court.
CONCLUSION
The court determined that the sellers breached the warranty
of title by failing to deliver a registrable certificate of title to
McCoolidge. Even after he received a registrable certificate,
McCoolidge claims that the lack of a bill of sale and the pres-
ence of a “third party” on the certificate cast a shadow on his
title. But McCoolidge did not prove the damages he suffered
from these defects. We therefore affirm the court’s judgment
for the defendants.
A ffirmed.
49
See Settell’s, Inc. v. Pitney Bowes, Inc., supra note 18.
50
Brief for appellant at 11.