## Facts

- Larry Poli bought a new 1992 Dodge Spirit on March 23, 1993, and obtained a seven-year/70,000-mile powertrain warranty from DaimlerChrysler.
- The warranty obligated DaimlerChrysler to pay parts and labor to repair defective covered powertrain components during the warranty period, including the engine timing belt.
- The timing belt was repeatedly repaired or replaced under the warranty, including service on December 16, 1993 (16,408 miles), March 21, 1997 (36,149 miles), and additional repairs in May 1997, January 1998, and July 1998.
- Poli alleged the timing belt failed again on July 31, 1998, causing major engine damage, and that repairs took roughly six months.
- Poli sued on December 15, 1998 for breach of warranty, violation of the New Jersey Lemon Law, and violation of the Magnuson-Moss Warranty Act (and initially pleaded a Consumer Fraud Act claim, later withdrawn).
- The trial court granted summary judgment to DaimlerChrysler, dismissing the Lemon Law claim and holding the warranty and Magnuson-Moss claims time-barred under U.C.C. § 2-725’s four-year limitation period.
- Poli appealed.

## Issues

1. When does a cause of action accrue for breach of an express warranty that is essentially a promise to repair defects occurring during the warranty period: at delivery, or upon failure to repair within a reasonable time?
2. Does the same accrual rule apply to a Magnuson-Moss claim premised on the same written repair obligation?
3. Applying the correct accrual rule, were the warranty and Magnuson-Moss claims time-barred under N.J.S.A. 12A:2-725?
4. Did Poli present a legally sufficient New Jersey Lemon Law claim to survive summary judgment?

## Decision

- The Appellate Division affirmed summary judgment dismissing the Lemon Law claim.
- The court reversed summary judgment on the express warranty and Magnuson-Moss claims and remanded for further proceedings.
- The court held that a repair-promise warranty claim accrues when the warrantor fails to perform the required repair within a reasonable time, not upon delivery.
- Because the alleged failure to repair occurred during the 1998 events and repair delay, the December 1998 complaint was timely under the four-year limitations period.
- The Magnuson-Moss claim was governed by the same accrual analysis as the underlying state-law repair obligation and was likewise timely.

## Legal Principles

- Under N.J.S.A. 12A:2-725, traditional breach-of-warranty claims generally accrue at tender of delivery, but warranties that require performance in the future may accrue upon breach or discovery tied to that future performance.
- Where the written warranty is an agreement to repair defects arising during a stated period, the actionable breach is the failure to repair as promised, and accrual occurs when the warrantor fails to complete the required repair within a reasonable time.
- A Magnuson-Moss written-warranty claim premised on the same repair obligation accrues under the same timing rule as the state warranty claim.
- A New Jersey Lemon Law claimant must establish a qualifying nonconformity reported within the earlier of 18,000 miles or two years from delivery and show the manufacturer failed to correct it within a reasonable time after a reasonable number of attempts; insufficient proof of these predicates warrants summary judgment.

## Conclusion

The court held that claims based on a manufacturer’s promise to repair during a warranty period accrue when the manufacturer fails to make the required repairs within a reasonable time, making Poli’s warranty and Magnuson-Moss claims timely, while separately affirming dismissal of the Lemon Law claim for failure to meet statutory notice and proof requirements.


Poli v. DaimlerChrysler Corp., 349 N.J. Super. 169, 793 A.2d 104 (App. Div. 2002)