"As is, is as is." If Forest Gump didn't say this, perhaps he should have. Everything else he uttered seemed logical, and this common sense statement of intent which is often found is sales agreements does as well. Unfortunately, in a case I just finished trying on behalf of the defendant seller of a home-built aircraft, even an "as is" clause in a sales contract did not save the seller from the waste of time and money associated with being sued.
   The escalating costs and scarcity of new factory manufactured aircraft, coupled with the rapidly increasing prices of used planes, makes the concept of amateur built airplanes attractive to those who have the time and expertise to undertake such a project. The Questair Venture is a good example of an amateur built plane that is designed to take its owner/builder places far faster than any comparably priced factory manufactured aircraft. In the May, 1994 edition of Air Progress, I wrote an article about the Questair Spirit, after having taken a demonstration ride. The "Spirit" is the fixed gear, lower horsepower version of the "Venture". After listening to the company's president, Bob McClellan, expound upon the virtues of the aircraft, I spent many an hour day dreaming about building and flying this all-metal aircraft that could zoom along at almost 350 miles per hour. My client was also enamored by the prospects of building and owning such an aircraft. In 1990 he purchased a Questair Venture kit for over $57,500.00, along with a brand new Continental IO-550 engine and new propeller. Four years later, after my client and his partner invested over $100,000.00 in the project, not to mention thousands of hours of work, his partner in the project decided he could no longer afford the expenditures necessary to complete the project, and sold his interest to my client. Having no one to help him and having lost interest in the project, my client placed an ad in Trade-A-Plane which listed the component parts as having been 90% completed, a new engine, and a new propeller, all for $60,000.00.
   The buyer was a businessman who owned other aircraft, but was fascinated by the concept of owning a fast little airplane like the Questair Venture. He saw the "For Sale" ad for the $60,000.00 project, called my client, and then went to Oshkosh, where he had conversations with the factory representatives. When he returned from Oshkosh, the buyer flew down to look at the project for sale, liked what he saw, and purchased it for the entire $60,000.00. This buyer had no intention to complete the project himself, and had discussed building it out with several experienced builders in his home town. He took none of them with him to the inspection. Rather, he hired a retired mechanic in the Southern California area, who met him at the airport where much of the project was stored. At the airport hangar they inspected the wings. The inspector told the buyer that the plane "would never be a show piece" and that there were many irregularities in the surface of the wings. They went to the seller's home where they inspected the airframe. My client made all construction photographs available, all plans, all manuals, all contracts, and was open and helpful about everything. He concealed nothing. The inspector advised the buyer that there were many areas that contained filler material, and that the buyer should remove all primer and filler to determine the structural integrity of the airframe underneath. He advised that there were many skins that would have to be removed and replaced, but nonetheless the $60,000.00 price was fair consideration for this project being as the engine and propeller alone were worth at least $30,000.00. The buyer then gave the seller a $1,000.00 deposit and wrote out a simple one page "as is" agreement. The buyer flew back to his home to further discuss the project with mechanics in his area who might build out the remainder of the plane for him. He returned to the seller's home about two weeks later with a mechanic, disassembled portions of the airframe, loaded it onto a truck, and hauled it back to his home base.
   A day after the project was brought to the buyer's hangar, the buyer's "expert" mechanic, who is also an aeronautical engineer, looked at the project and advised the buyer that he should return it immediately. Nonetheless, the buyer kept it, took off primer, sanded out filler material, and came to find that many portions of the airframe would have to be replaced due to unsuitable workmanship. About two months later he wrote a threatening letter to the man who did the inspection on his behalf, accusing him of fraud and negligence. He then wrote to the seller and asked for his money back. The seller refused, and a lawsuit was filed by the buyer for rescission of contract based on: (1) failure of consideration; (2) fraud and concealment; and (3) violation of public policy.
   After I took the depositions of the plaintiff and the man who did the inspection on the plaintiff's behalf, a trial without jury commenced. Since the plaintiff/buyer had the burden of proof, he presented his evidence first. As witnesses, plaintiff's attorney put on himself and his expert mechanic, who testified as to all of the critical flaws in the construction, as well as the mechanic who originally inspected the aircraft. The well thought out Statement of Decision follows hereafter:
   THE COURT: This is the time, a little after, that I promised the parties to return with my Statement of Decision in this matter. I want to say at the outset that I fully recognize the complexity of the situation and the importance of this decision, not only to these parties, perhaps, but perhaps to others, many others, countless others who are involved and may become involved in airplane kit making. I've had the advantage in this proceeding of not being a pilot, not really knowing anything about the interior of an airplane except to find my reserve seat on a scheduled flight. Those aren't always as represented, so I haven't been inclined to get bogged down in the detail of this situation. I'm going to try to keep it as simple and straightforward as I possibly can. I'm going to go right to the heart of the controversy which consists of the three basic causes of action presented by the Plaintiff, Mr. Ciernia, against the Defendant, Mr. Long, and those causes of action are all basically founded in the broad wrongdoing that we know in the law as fraud. The remedy requested in all cases is rescission, and the specific causes of action presented are failure of consideration, public policy, and fraudulent concealment. I'm going to take each one of these in turn. First let me address the matter of failure of consideration. The evidence shows, I believe, that the Plaintiff paid approximately $60,000 for the unfinished airframe, and an engine, and a propeller and as I understand it some other accumulation of miscellaneous parts and fixtures. A witness for Plaintiff, Mr. Larson, testified that he inspected the plane shortly after Mr. Ciernia brought it back to San Luis Obispo and in his professional opinion the plane was worthless. He suggested to Mr. Ciernia that he try to learn the price for scrap aluminum, multiply that price by the poundage of the airplane, and that was the value that he had in it, and on the basis of that testimony, principally, the Plaintiff has advanced the theory that there was a failure of consideration in this case because what the Plaintiff bought with his money was, in Mr. Larson's word, worthless. To resolve this issue, namely whether there was failure of consideration, I'm going to rely on good old-fashioned, for the most part, Black letter contract law, if counsel know what I'm talking about, and the Black type of the contract treatises tell us that the good consideration or the valuable consideration which is required to support a contract does not necessarily mean adequate consideration. If there is any one guiding principle in the subfield of contract law pertaining to consideration it is that the law does not undertake to measure the adequacy of the consideration, and the famous case we referred to in the course of the trial had to do with a peppercorn, and a peppercorn was in that contract situation -- and I've forgotten what was involved, but the peppercorn was sufficient to support the contract as sufficient or good consideration, even though the value of the peppercorn was no where near what the other party felt the thing being purchased was worth. This is not to say there wasn't some conflict in the testimony which Mr. Larson gave in that regard. Mr. Kallenberger, who was Mr. Ciernia's expert in all of this, testified that he told the Plaintiff when they went down to Mr. Long's house to inspect the fuselage that he, Kallenberger, thought that -- that at that price Mr. Ciernia was going to get his money's worth, and Mr. Kallenberger also testified that in his opinion any plane could be rebuilt, even if -- even if it was down to one rivet. In my judgment Mr. Larson's statement was a little overblown. I'm inclined to believe from the totality of Mr. Larson's testimony that in his heart of hearts he would agree with Mr. Kallenberger that that plane could be rebuilt. As a matter of fact, I had the impression that he rather was expecting to be hired by Mr. Ciernia to build the plane out, and I think that Mr. Larson deep down would admit, if we had pressed him on the subject, that he also would be of the opinion that the plane could be rebuilt. Expensive, time-consuming, but there was something of value in that airframe, and the consideration doesn't always have to be tangible. A consideration can be the satisfaction of a desire, or a hope, or a wish. Maybe there was a little of that mixed in with Mr. Ciernia's willingness to pay that amount of money for what he bought with those dollars, and maybe in Mr. Ciernia's mind what he got was not adequate for the amount he paid, but what Mr. Ciernia received in return for what he paid was, in the opinion of this Court, valuable consideration.
   There's another basic principle of contract law that guides us here, and that is that a willing overpayment for something does not mean that there was no consideration for the amount that was actually spent. I am compelled to conclude that the Plaintiff has not made the case by a preponderance of the evidence, or I think on the basis of any substantial evidence in this record, that there was a failure of consideration for Mr. Ciernia in this situation. Let me turn to public policy. I understand, or I believe I understand Mr. Last's argument, there's been a concern expressed by the Plaintiff for public safety, and that as a matter of public policy situations of the kind that Mr. Ciernia found himself in here should be interrupted or they should be subject to non-enforcement because of the inherent dangers to public safety arising from this kind of a transaction. While I appreciate the invitation to step outside the role of an officer of the Judicial branch of California's government, I think an attempt on my part to do so would be an invasion of the exclusive province of the Legislature. This public policy argument -- and I recognize the sincerity with which it was made, the importance of it. This public policy argument, this public policy concern is one that has to be addressed at the Legislature. It is beyond the jurisdiction of this Court to either try to resolve or to involve myself in considering it. I want to move to the causes of action for fraud, and I say causes of action for fraud because I think that there were two causes of action for fraud advanced by the Plaintiff. One of them I think was material misrepresentation and the other I think was intentional concealment. These are different causes of action and give us different elements that need to be proved. I believe the Plaintiff is advancing a cause of action grounded in intentional misrepresentation when the Plaintiff said that there were two representations that the Defendant made that the Plaintiff asserted are false, that they were relied upon to the Plaintiff's detriment, and those representations were, No. 1, that this airframe was 90 percent completed, and two -- and while Mr. Last couldn't say to the Court that Mr. Long said this in so many words -- no, I misspoke that. While Mr. Last couldn't say that Mr. Long said it in these precise words, Mr. Last did say that Mr. Long strongly implied or said to the effect that he had built this airframe in accordance with the plans and specifications of the company and the factory. I want to turn to Baji Instruction 12.31, because that is a summary of the law of the fraud, of intentional misrepresentation, and it gives us in precise language the elements of proof that must be at hand before that cause of action can be deemed to have been proved. I want to focus on the fifth element of that cause of action which reads:
   "The Plaintiff must have been unaware of the falsity of the representation. The Plaintiff must have acted in reliance upon the truth of the representation, and must have been justified in relying upon the representation."
Said another way, this element of cause of action says that the misrepresentation must have been acted upon by the Plaintiff, and that the Plaintiff must have been justified in so acting. We're dealing here with some of the basic law of fraud, and in -- I'll cite this for the record. We're referring here to 5 Witkin summary of California law, 9th edition, Sections 711 through Section 715.
   There are two principles of law that governs. One is stated in section 712, as follows:
"If the Plaintiff having access to the necessary information actually makes an independent investigation which the Defendant does not hinder, he, Plaintiff, will be charged with knowledge of the facts which reasonable diligence would have disclosed, and he cannot claim reliance upon the representations."
   There's a supplemental point here, and that is a number of cases in this discussion of the laws of fraud that refer to the reliance upon the opinion of an expert, and in Section 714 of this discussion is a case called Bank of America versus Vannini, decided in 1956, 140 Cal.App.2d, 120. I won't go into the facts of the case, but only to say that when the Plaintiff decides not to rely upon the representations of the Defendant, but rather to rely upon his own investigation, conducted by experts, then the Plaintiff is in the language of our Baji cause of action here not justified in relying upon anything the Defendant says. Now what do we have in the case by way of the relevant facts to those principles of law. Well, we have an Exhibit which -- it's Exhibit 26, and it's a list of 20 defects in this plane which Mr. Larson tells us were plainly visible. Would those defects have been observable? Would the Plaintiff have been made aware of those defects by the exercise of reasonable diligence? I certainly think he would have by and through Mr. Kallenberger. Mr. Kallenberger was obviously a very knowledgeable individual in the field of airframe detail generally, and aircraft specifically. Mr. Kallenberger testified -- and I tried to write this down as close to his words as possible. He said:
   "I pointed out many areas of poor construction quality", and he also testified that he assumed that the plane would have to be stripped for a thorough inspection and he told that to the Plaintiff. There's no question in this case that Mr. Ciernia was given an opportunity for reasonable diligence in inspecting the plane. Mr. Ciernia took advantage of that opportunity and went to the place where the plane was, with an expert, and the expert did conduct an investigation of the airplane. I see no reason at all why Mr. Kallenberger could not have seen, and I do not know of any reason to suggest that he did not see some or all of those 20 defects that were visible in accordance with Mr. Larson's testimony. There's a conflict in the testimony here between Mr. Ciernia and Mr. Kallenberger as to exactly what Mr. Kallenberger said to Mr. Ciernia about what he found in his investigation of-- the plane, particularly the fuselage. Mr. Kallenberger testified that he was for the -- most of the time there during that inspection within earshot of Mr. Ciernia, that he was making statements to Mr. Ciernia and not getting very much feed-back, that Mr. Ciernia was taking notes, and that he, Kallenberger, had the right to believe that even though Mr. Ciernia was not feeding back, even though Mr. Ciernia was not making specific comments in response to Mr. Kallenberger's observations, he, Mr. Kallenberger, had the right to assume that Mr. Ciernia was hearing what he said, that he understood what he said, and that he, Kallenberger, was getting his message across to Mr. Ciernia, namely, that this airplane had a lot of problems. I think it's also reasonable to infer that Mr. Ciernia had enough information given to him by Mr. Kallenberger to have drawn a very reasonable assumption down there at the time they all were looking at that fuselage, and that was with all this smoke there certainly must be fire. But Mr. Ciernia, I think, had his heart set, had his mind set, on buying that plane. He really wanted to buy that plane. He took in what Mr. Kallenberger said to him but it didn't change his feeling or his opinion about buying the airplane. On that basis, I think the conclusion is inescapable that if there were these representations made by the Defendant that the Plaintiff was not justified in relying upon, and, by the way, with reference to the 90 percent completion figure, Kallenberger testified, and that testimony stands uncontroverted, that he, Kallenberger, said to Mr. Ciernia, "This plane is not 90 percent built out, this plane is about 30 percent built out, and 20 percent of what has already been built has to be rebuilt."
   I can only infer from all of the facts and circumstances, including the fact that Mr. Ciernia was himself at this point right there looking at this fuselage, looking at the fact that there was no engine in it, looking at the fact that there was no seating or cowling in it, looking at the fact that the wings weren't on it, looking at the fact -- and Mr. Ciernia knew enough about airplanes to know that the controls weren't there, the plumbing wasn't there, the outward surface was very rough hewn in many parts, I think it would be more fair to the Defendant to suggest that this plane is 90 percent built out was more puffery than it was representation. If it was a representation, I think, for the reasons I've discussed, again Mr. Ciernia was not entitled to rely upon such a representation.
   I think for all of the reasons I've stated I would conclude and find that the Plaintiff cannot claim reliance upon these representations, the 90 percent built out, and the construction according to plans and specs, and that even if he could, such reliance was not justified, so I would find by the preponderance of the evidence that that cause of action has not been proved.    We get to the final cause of action which I think is perhaps more fully addressed by the evidence in the record, and that is the cause of action for fraud based upon concealment, referring now to Baji 12.35. There are two elements of the cause of action for fraud in the concealment, and those are these:
   No. 2, is that the Defendant must have been under a duty to disclose the fact to the Plaintiff; And 3, that the Defendant must have intentionally concealed or suppressed the fact with intent to defraud the Plaintiff. Let me first address this question of duty. We talked about it extensively during closing argument. Counsel looked at the cases, and so did I. Mr. Last cited to the Court several cases that treat with -- the question of whether a seller in this situation has a duty to disclose defects that might not be plainly visible. I've read the cases cited by Mr. Last. I don't think any of them apply specifically, but I want to read from one. I don't think they apply specifically -- Well, one of them, the first one -- the first one held that there was no cause of action and concealment stated. The other one, the Newhall Land and Farming Company case was a case grounded in negligence, not fraud. The other two cases have a statement of a general principle, and I would read the statement from the case in two parts. The case is the McCue case versus Bruce Enterprises, Inc., 1964, 228 Cal.App.2d, 21. On Page 27 of that case, the Court said this: "Even though there may be no duty upon a vendor", that would be the Defendant in this case, "To speak upon a subject affecting the desirability of the sale to which he is a party" -- I'm going to stop there. Counsel and I, I think, agreed that the general principle in this whole area of duty was that unless there is a confidential relationship of some kind between the parties there's no duty to disclose material facts, one party to the other. I think this McCue case makes the same statement, that as a general principle unless there is this fiduciary duty there's no duty to disclose; fiduciary relationship, there's no duty to disclose.
Another general principle in this field is that there may be a duty to disclose without any confidential relationship, for the Defendant alone has knowledge of material facts which are not accessible to the Plaintiff.
   I won't repeat what I've already said about Mr. Ciernia's inspection of the plane not only personally but with an expert retained by him to accompany and advise him, and those 20-some odd visible defects in the fuselage of the plane were certainly accessible to the Plaintiff, Mr. Ciernia. The other half of the statement in this McCue case is this:
   "However, if he does speak, whether voluntarily or in response to an inquiry, he must make a full disclosure and may not withhold or conceal any information within his knowledge bearing upon the subject about which he speaks, that materially affects the desirability of the property to be sold", and the citation -- and counsel have already referred to that, is Civil Code Section 1710, subsection (3). In other words, if Mr. Long had said some things he would have had to have said all things.
   If he had spoken only partially about this or that kind of a problem, he would have had to disclose everything he knew about the problems of the plane, but I think if there's anything clear in the evidence in this case is that there were no such statements forthcoming from Mr. Long. He not only did not say anything about any problems in the plane, Mr. Long was -- at pains to say, "I've been in constant touch with the factory, I've been in touch, I've been checking with them as I've gone along here building this thing according to plans and specs." He said, "Here, do you want to see my phone bills." Mr. Ciernia said, "No, I don't want to see your phone bills, I'll take your word for it." Mr. Long said, "Well, here are the plans, here are the blueprints, here are the books, do you want to look at those?" Well, they were out on the table, and Mr. Ciernia said he glanced at them, and Mr. Kallenberger said he looked at them cursorily, but we don't have a word of evidence in this record that Mr. Long was saying anything about -- or even inferring anything about any problem that there might be with the plane. There's a fuller treatment of this subject which I think is very enlightening in 5 Witkin Summary of Law, Section 799.
   For all of that, I have to conclude that the Defendant was not under a duty to the Plaintiff to say anything to Mr. Ciernia about any defect in the plane, even if Mr. Long had thought there was a defect in the plane.
We turn then to the third element of this cause of action which is the intentional concealment. "Defendant must have intentionally concealed or suppressed with intent to defraud the Plaintiff." There's a separate Baji instruction that gives us a definition of intentional concealment, and that's 12.37. It reads:
   "Intentional concealment exists where a party, (1) knows of defects in a property and intentionally conceals them." I don't think, as I have just mentioned, that we have any evidence at all that Mr. Long knew of any defect or that he intentionally concealed saying anything about them.
   "Two, actively prevents investigation and discovery of the material facts by the other party." The evidence in this case is overwhelming that quite the contrary was true, that Mr. Long was attempting to facilitate the inspection of this plane, and to make everything that he knew about the plane available to the Plaintiff and Mr. Kallenberger, plans, specs, kit books, all laid out, all open for inspection, no obstruction in the inspection, no hurrying through the inspection, no impediment to the inspection at all. Mr. Long's life was an open book to Mr. Ciernia and Mr. Kallenberger on the occasion of that inspection.
   "No. 3, while under no duty to speak, nevertheless does so, but does not speak honestly or makes misleading statements."
   As I have already discussed in connection with the McCue case, we have no evidence of the Defendant having spoken partially but not fully. Well, that brings me down to one final point, and that is the as-is language in the contract. There seems to be some difference of recollection as to how that language got there, but nevertheless, it is there, and both parties signed the contract, and the Black letter law involved with the law of sales in California tells us that all implied -- and I'm referring now to 3 Witkin Summary, Section 83.
   "All implied warranties may be excluded by a disclaimer in the language that in common understanding explain that there is no implied warranty. Examples of sufficient language are in, quote, 'as-is', unquote, or, quote, 'As they stand', and so forth." So what "as-is" did for the parties was to embody an agreement between them that there were no warranties being made between the parties as to marketability, suitability for purpose, or any of the other kinds of warnings that normally flow in a business transaction. The conclusions that I come to are that the causes of action for fraud and misrepresentation has not been proved by a preponderance of the evidence, and that a cause of action for intentional concealment has not been proved by a preponderance of the evidence, and that the contract between the two parties, Mr. Ciernia and Mr. Long, was a valid contract, an enforceable contract, and that it carried with it no promises of warranty or guarantee. What all of this comes down to, counsel, is that I grant Mr. Finkel's motion for judgment.