## Facts

- David Denison, a developmentally disabled adult, had been under a court-ordered legal guardianship of his parents since 1999.
- In October 2002, David purchased a new Dodge Neon from Kenai Chrysler Center, Inc. without a cosigner; his parents had refused to cosign or provide down-payment funds and told him not to buy a car.
- The transaction included the vehicle price, an extended service plan, and related fees and taxes, financed through the dealership.
- After learning of the purchase, David’s parents (as guardians) notified the dealership of the guardianship and asserted David lacked capacity, making the contract void, and requested rescission.
- The dealership refused to unwind the sale, continued to insist on enforcement, and persisted after receiving repeated warnings from the guardians and others that the sale was void.
- The dealership pursued a probate court petition seeking to modify the guardianship to validate the purchase; the petition was denied.
- The guardians sued for a declaration that the contract was void and for damages under Alaska’s Unfair Trade Practices and Consumer Protection Act (UTPA).
- The superior court ruled on summary judgment that the contract was void; a jury later found UTPA liability and awarded treble damages. The dealership appealed; the guardians cross-appealed on attorney’s fees and sanctions.

## Issues

1. Whether an adult ward subject to a valid court-ordered guardianship has capacity to form an enforceable retail installment sales contract, or whether the purported contract is void.
2. Whether the guardianship order gives constructive notice of incapacity to a contracting merchant, barring the merchant from claiming restitution against the ward or guardians.
3. Whether a dealer’s refusal to rescind and continued efforts to enforce a void transaction after notice of incapacity constitute an unfair or deceptive act or practice under the UTPA, supporting treble damages.
4. Whether waiver of common-law punitive damages precludes statutory treble damages under the UTPA, and whether the trial court abused its discretion regarding attorney’s fees and sanctions.

## Decision

- The Alaska Supreme Court affirmed the superior court’s judgment in full.
- The contract was void because a valid guardianship precluded the formation of a valid contract by the ward.
- The guardianship order provided constructive notice of the ward’s incapacity; the dealer could not claim bona fide status or obtain restitution from the ward based on the void transaction.
- The evidence supported the jury’s finding that the dealer’s post-sale conduct violated the UTPA, and treble damages were properly awarded.
- The guardians’ waiver of punitive damages did not waive statutory treble damages under the UTPA.
- The trial court did not abuse its discretion in its attorney’s-fees rulings and in declining to impose sanctions.

## Legal Principles

- A valid, court-ordered guardianship can preclude contractual capacity and render attempted contracts by the ward void rather than voidable.
- Publicly recorded guardianship orders can supply constructive notice of incapacity to parties contracting with the ward, allocating the risk of loss to the counterparty rather than the ward.
- Under Alaska’s UTPA, conduct may be “unfair” when it offends public policy or is unethical, oppressive, or causes substantial consumer injury; post-transaction refusal to unwind a void sale after notice can satisfy this standard.
- Statutory treble damages under the UTPA are distinct from common-law punitive damages; waiver of punitive damages does not necessarily bar statutory multiple damages.
- Attorney’s fees and litigation sanctions are reviewed for abuse of discretion; appellate courts will uphold such rulings absent a clear error in judgment or failure to preserve the issue.

## Conclusion

The court upheld voidness of a ward’s vehicle purchase made under guardianship, treated the guardianship as constructive notice to the dealer, and affirmed UTPA liability with treble damages based on the dealer’s continued enforcement efforts after notice, while also sustaining the trial court’s discretionary attorney’s-fees and sanctions rulings.


Kenai Chrysler Center, Inc. v. Denison, 167 P.3d 1240 (Alaska 2007)