NAPOLEAN ROACHE, Petitioner,
PELE and EASTER UIA, Respondents.
High Court of American Samoa
 Hidden defects of an item for
sale were material facts which the seller had a duty to disclose to the
 Seller’s intentional
misrepresentation of known hidden defects permit the buyer to return the
purchased item for a refund, terminating the contract without further liability
for the purchase price.
Before RICHMOND, Associate Justice, LOGOAI, Chief
Associate Judge, and SAGAPOLUTELE, Associate Judge.
OPINION AND ORDER
Respondents Pele Uia (“Pele”) and Easter Uia (together “the
Uias”) initiated this small claims action in the District Court to claim a
refund of $1,400 they paid to Petitioner Napoleon Roache (“Napoleon”) towards
purchase of a motor vehicle. Napoleon
counterclaimed in the District Court for his costs of repairing the vehicle
after its return by Pele and a payment due under the purchase contract. At the District Court trial, but not in this
Court, Napoleon also sought refund of his cost of roundtrip airfare to defend
against the refund claim and prosecute the repair cost claim. The District Court denied Napoleon’s
counterclaim and, after holding that $300 per month was the fair value of Uias’
use of the vehicle, ordered Napoleon to refund the balance of $800 to the
Uias. Napoleon appealed to this Court
for a trial de novo, in accordance
with A.S.C.A. § 43.0421. Trial de novo was held on February 28,
2003. Napoleon and Pele were present and
Findings of Fact
Despite the witnesses’ mutual recriminations muddying the
waters, the essential material facts are clear.
On September 23, 2002, the Uias purchased a 1992 Toyota Camry
station wagon from Napoleon. The contract
established a purchase price of $10,500 to be paid in 15 monthly installments
of $700 each, payable on the third day of each month, beginning October 3,
2002. The vehicle was sold in an “as is”
condition. The Uias made the first two
payments on October 2 and November 2, 2002.
However, on November 29, 2002, the Uias returned the vehicle to
Napoleon, because of defects in its condition when the Uias took possession on
September 23, 2002, and Napoleon’s failure to correct the defects. Napoleon accepted return of the vehicle.
The CD system in the vehicle did not properly work; the brake
system did not function without adding brake fluid every other day; and after
an earlier accident, undisclosed at the time of sale to the Uias, the
windshield had been replaced in a shoddy manner, allowing water to enter the
interior through a gap between the windshield and roof. Pele sought Napoleon’s attention to these
problems with the vehicle, on the assumption Napoleon was responsible for
correcting them. Pele left numerous
unreturned telephone messages for Napoleon.
However, he was able to personally contact Napoleon on occasion, but
Napoleon gave him the proverbial runaround when they met and, in any event, did
nothing to constructively address the problems.
Though not specifically cited by Pele
when the Uias returned the vehicle to Napoleon, there were other defects at the
time of sale. The right front door lock,
left front seat movement mechanisms, and air conditioning system were
defective; the colors of the dashboard and rest of the interior were not the
same; and various exterior dents also existed.
However, except perhaps for the air conditioning system, these defects
were readily discernible to the Uias when they took possession of the vehicle.
While they had possession of the
vehicle, the Uias also added to the vehicle tinted windows, four new tires, and
rear mudguards at a total cost of $379.95, but the Uias did not include these
expenditures in their small claims demand.
After regaining possession of the
vehicle, Napoleon expended approximately $1,480.00 in repairs, including the
defects cited by Pele as reasons for returning the vehicle. Though Napoleon claimed the Uias abused the
vehicle while they used it, the repairs were made to defects existing at the
time of sale.
The reasonable remaining life
expectancy of a 1992 vehicle is approximately five years.
Conclusions of Law
[1-2] Napoleon was certainly aware of both
the evident and hidden defects in the vehicle at the time of sale to the Uias. He deliberately chose not to reveal the
hidden defects at that time. The hidden
defects were material facts, which Napoleon had a duty to disclose to the Uias. See
Hill v. Jones, 725
P.2d 1115, 1118 (Ariz. 1986) (citing Restatement
(Second) of Contracts § 16 (1981)); see
also Am. Samoa Gov’t Employees Fed. Credit Union v. Sele, 28 A.S.R.2d 21, 23 (Trial
Div. 1995) (defining fraud as anything calculated to deceive, including
suppression of the truth). Although the
Uias agreed to purchase the vehicle “as is,” Napoleon’s intentional
misrepresentation of known hidden defects gave the Uias justification to return
the vehicle and terminate the contract without liability for the purchase
price. See Hill, 725
P.2d at 1118; Restatement (Second) of
Contracts § 164.
The Uias did have use of the vehicle
for approximately two months, and Napoleon is entitled to receive reasonable
compensation for this period of time.
Given the purchase price of $10,500 and a reasonable remaining life
expectancy of five years, the monthly fair value of use is approximately
$175.00, providing a fair total use value of $350.00 for two months.
However, this amount is offset by the
Uias’ expenditure of $379.95 in improving the vehicle, and unless Napoleon’s
counterclaim is valid, the Uias’ claim for refund of the two monthly payments,
totaling $1,400.00, is not subject to any reduction.
Napoleon expended approximately $1,480.00 for repairs of the
vehicle after he regained possession.
However, this expense principally corrected defects existing when the
Uias took possession of the vehicle.
None of these repairs are traced to the Uias’ use of the vehicle. The evidentiary support for Napoleon’s
counterclaim is lacking.
Accordingly, we conclude that
Napoleon takes nothing by his counterclaim against the Uias, and that the Uias
are entitled to a refund from Napoleon of the full amount of $1,400.00 paid on
the purchase price of the vehicle.
Napoleon’s counterclaim against the Uias is dismissed. Napoleon shall pay the Uias $1,400.00, plus
court costs of $15.00, a total of $1,415.00.
The Clerk of the Court shall pay the $815.00 deposited by Napoleon in
the registry to the Uias. Napoleon shall
pay, within 14 days of entry of this judgment, the balance of $600.00 to the
Clerk of the Court, who shall disburse this amount to the Uias. Interest on any portion of the unpaid $600.00
balance of the total judgment not paid within the 14-day period shall accrue at 6% per annum until the judgment is
paid in full.
It is so ordered.