Dating back to 2009, when the California Court of Appeal decided Mexia v. Rinker Boat Co., there has been a debate about when Song Beverly implied warranty claims must be brought by. Within a year of sale? Within four years? Or later?
The text of the statute can be read to suggest one year: it states that the duration of an implied warranty can last no “more than one year following the sale.” Cal. Civ. Code § 1791.1(c). But Mexia held that with “a latent defect, a product is rendered unmerchantable, and the warranty of merchantability is breached, by the existence of the unseen defect, not by its subsequent discovery.” 95 Cal. Rptr. 3d at 291. Last December, the Ninth Circuit in Daniel v. Ford Motor Co., held that despite the post-Mexia uncertainty of the past 6 years, “there is not convincing evidence that the California Supreme Court would decide the latent defect discovery issue that was presented in Mexia differently.” As a result, the defect need not manifest, and the implied warranty claim need not be brought, within one year of the sale.
The new question, then, is whether there is any deadline for a Song Beverly implied warranty claim. In an opinion issued last week in Philips v. Ford Motor Co., Judge Lucy Koh follows several earlier decisions to conclude that the answer is generally four years from sale (which is the period set by the statute of limitations). Yet Judge Koh went on to hold that the 4-year deadline can be further extended by fraudulent concealment tolling, as long as plaintiffs “(1) pleaded with particularity the facts giving rise to the fraudulent concealment claim and have (2) demonstrated that they used due diligence in an attempt to uncover the facts.”
So, it appears plaintiffs can state an implied warranty claim under Song Beverly as long as they can sufficiently allege
- a defect that renders the product unmerchantable,
- which existed (even if latently) at the point of sale, and
- plaintiffs either brought suit within 4 years of the sale OR were diligent but unable to do so due to the defendant’s fraudulent concealment.