Holloway v. Gulf Motors

Rita Jo Holloway (plaintiff) sued Gulf Motors, Inc. (Gulf) (defendant) to rescind the sale of an allegedly defective 1989 Buick Century. Gulf failed to respond to the complaint, and Holloway sought a default judgment. At a hearing to confirm the default, Holloway testified that she purchased the car from Gulf on October 18, 1988, and soon discovered several problems with the car. Holloway testified that her husband, a mechanic, heard a ticking sound in the car’s engine and said that the car was not safe to drive. Holloway testified that she brought the car to Gulf on October 25, 1988, but that Gulf told Holloway that nothing was wrong with the car. Holloway testified that two days later, she again brought the car to Gulf, and Gulf’s service manager, Mr. Carter, told Holloway that a faulty clutch was causing the problems. Gulf replaced the clutch and returned the car to Holloway. However, the original problems were still present, and the car had started making a popping sound during sharp turns. Holloway testified that she then spoke to Gulf’s manager, Mr. Russell, who told Holloway that Gulf would replace the car’s transmission. However, replacing the transmission did not fix the problems, either. Holloway testified that she spoke with Gulf’s new manager, Mr. Veazey, in December of 1998, and Veazey advised Holloway to bring the car back for further repairs. Those repairs slightly alleviated the popping and clicking, but Holloway subsequently discovered more problems with the car. Holloway testified that at that point, she decided that she no longer wanted the car and asked Carter to take the car back, but Carter refused. The trial court entered a default judgment in Holloway’s favor. Gulf appealed, arguing, among other things, that the judgment was not based on competent evidence because Mr. Holloway’s assessment of the ticking in the engine was hearsay and could not be used to prove that the car was defective.