Jim and Bonnie Hyler enjoyed traveling about the country with a camping trailer that they pulled behind their car. Jim sustained a back injury that left his right leg numb and he was unable to hook up the trailer to the car.  The Hylers visited Autorama and explained to a salesman that because of Jim’s disability, they needed a low-maintenance recreational vehicle with a solid warranty. The salesman recommended a $62,000 Lexington Mallard R.V.He explained that the vehicle came with three warranties:  one from the chassis manufacturer, one from the engine manufacturer, and one from Mallard for the coach. The Mallard warranty said that if the dealer did not provide satisfactory service, the buyer could contact the manufacturer directly. The salesman persuaded the Hylers to buy the vehicle.

The Hylers had constant problems with their R.V. The television, air conditioner, and defroster were loosely attached, a bumper was defective, the windows would not shut tight, the shower door fell off, a fuel tank leaked, the side walls separated from the floor, and the windshield began to fall out. Autorama fixed some but not all of the problems, which it characterized as routine. The Hylers contacted Mallard, only to learn that it was bankrupt. After Autorama made a third attempt to repair the defective windshield, the dealer refused to return the vehicle to the Hylers until they acknowledged in writing that Autorama had complied with all warranties and had no further warranty liability. Jim Hyler told Autorama to keep the vehicle and sued for rescission. 

The trial court found that Autorama had misrepresented the warranties because the dealer knew that Mallard was in bankruptcy and would be unable to assist a dissatisfied customer. The court ordered rescission and Autorama appealed. 

Questions:

1. Were the Hylers entitled to rescission based on misrepresentation?

2. What did the trial court consider in the Hylers’ claim of misrepresentation?

3. What does Autorama argue?