The Fifth Circuit held that the 15-year Texas statute of repose barred a family’s claims regarding the rollover of a truck. The court was required to interpret the statutory language “date of the sale of the product,” finding that the repose period started when the automaker transferred the truck to the dealership, and not when it was first sold by the dealer to a customer. The court also held that the Texas tolling exception for minors does not apply to the product liability statute of repose.
In Camacho v. Ford Motor Company, No. 5:19-cv-23, the plaintiffs alleged they were injured when their F-150 truck rolled over on August 6, 2017. They filed a product liability action against Ford Motor Company on January 10, 2019, under Texas law. Ford moved for summary judgment, arguing that the plaintiffs’ claims were barred by Texas’s 15-year statute of repose for product liability claims set forth in § 16.012(b) of the Texas Civil Practice and Remedies Code. Under § 16.012(b), “a claimant must commence a products liability action against a manufacturer or seller of a product before the end of 15 years after the date of sale of the product by the defendant.”
The district court determined that the statute of repose began to run on October 6, 2003, the day that Ford “released” the new truck to the dealership. Because the lawsuit was filed more than 15 years after this date, the court granted Ford’s summary judgment motion. The plaintiffs appealed. Reviewing this decision de novo, the Fifth Circuit affirmed the district court’s decision following analysis of two issues.
First, the Fifth Circuit analyzed the meaning of “the date of the sale of the product by the defendant” in Texas’s product liability statute of repose given the product’s chain of distribution. The plaintiffs argued that the court should import the definition of “first sale” from the Certificate of Title Act in the Texas Transportation Code. Ford argued that the court should import the definition of “sale” from the Uniform Commercial Code in the Texas Business and Commerce Code, which provides that a “sale” consists of the passing of title from a seller to a buyer for a price, which usually occurs at the time and place at which the seller completes his performance with regard to physical delivery of the good.
The Fifth Circuit found that by immediately resorting to other statutes for the definition of “sale,” the parties skipped a step in “the statutory analysis.” The court emphasized that when faced with an undefined statutory term, the first step is to apply the “common, ordinary meaning.” Comparing the Oxford English Dictionary’s definition of “sale” with the statutory definitions from the UCC and the Certificate of Title Act, the Fifth Circuit found that the former’s definition of “sale” comported with the plain meaning of the term “sale,” while the latter’s definition of “first sale” did not. The Fifth Circuit held the “sale of the product by the defendant” occurred on October 6, 2003, when Ford released the truck to the dealership. Therefore, because the statute of repose began running on October 6, 2003, plaintiffs’ lawsuit, filed more than 15 years later, was barred by the statute of repose.
One of the plaintiffs was a minor and claimed the statute of repose on his claim was tolled during the period of his minority. Accordingly, the Fifth Circuit next turned to the issue of whether the Texas statutory rule that a period of minority is “not included in a limitations period” tolled the statute of repose. Carefully analyzing the text and purpose of § 16.001 of the Texas Civil Practice and Remedies Code, the court held that § 16.001’s tolling provision applies only to toll the statute of limitations, and does not apply to Texas’s product liability statute of repose. Therefore, the court affirmed the grant of summary judgment in favor of the vehicle manufacturer.
Beyond its interesting exercise in statutory interpretation, the Camacho decision is an important one for product manufacturers. To begin, Camacho provides clarity for auto manufacturers doing business in Texas. And, not all products fly off the shelves or the dealer’s lot, and allowing the statute of repose to commence when the defendant manufacturer releases ownership in the chain of distribution helps preserve the vitality and further the goals of a repose statute.