Cornerstone Homes v. Skinner

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No. 101,058

IN THE COURT OF APPEALS OF THE STATE OF KANSAS

CORNERSTONE HOMES, LLC,
Appellee,

v.

SHAWN D. SKINNER, GARY W. SKINNER, and ALBERTA E. SKINNER,
Appellants,

and FHL BANK, TOPEKA, and FORD MOTOR CREDIT COMPANY,
Defendants.


SYLLABUS BY THE COURT

1.
Appellate review of a grant of summary judgment is de novo.

2.
An appellate court has unlimited review of a district court's interpretation of a
statute and the first task of the reviewing court is to determine the legislature's intent
through the language it uses.

3.
The seller of a new mobile home must provide the purchaser with the
manufacturer's statement of origin for the mobile home under K.S.A. 58-4204(e). Failure
to do so, however, does not constitute a fraudulent act or void the sale.

4.
K.S.A. 58-4204(h), which provides that a seller of a preowned mobile home for
which a certificate of title has previously been issued that fails to timely deliver an
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assignment of the certificate of title to the buyer commits a fraudulent act that voids the
transaction, does not apply to the sale of a new mobile home for which there has never
been issued a certificate of title.

5.
Under the facts, where the purchasers of a new mobile home did not dispute they
purchased the home, signed a note and mortgage as a part of the purchase, and then
defaulted on their payments, the district court did not err in granting judgment prior to
trial to the seller on its foreclosure claim once the court determined that the seller's failure
to deliver the manufacturer's statement of origin did not void the sale.

6.
An appellate court has de novo review over a district court's entry of judgment
following the presentation of evidence at trial when the relevant facts are not disputed.

7.
The failure of a supplier of a new mobile home to provide the purchaser with the
manufacturer's statement of origin does not alone constitute a deceptive act under
subsections (b)(l)(A) or (b)(8) of K.S.A. 50-626, nor does it constitute an unconscionable
act under K.S.A. 50-627.

Appeal from Sedgwick District Court; PAUL W. CLARK and JEFFREY E. GOERING, judges.
Opinion filed June 25, 2010. Affirmed.

Barry L. Arbuckle, of Wichita, for appellants.

Jeff Griffith, of Derby, for appellee.

Before HILL, P.J., PIERRON, J., and BUKATY, S.J.

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BUKATY, J.: Cornerstone Homes, LLC (Cornerstone), is a seller of mobile homes,
sometimes referred to as manufactured homes. It sold such a home to Gary, Alberta, and
Shawn Skinner, who made a cash down payment. They signed a note and gave a
mortgage on certain real estate they owned in favor of Cornerstone for the remainder of
the purchase price. The Skinners later defaulted in their payments, and Cornerstone filed
suit to foreclose its mortgage. The Skinners never denied signing the mortgage or
defaulting on their payment obligations. In their defense, they argued that Cornerstone
was guilty of fraud for failing to deliver to them the manufacturer's statement of origin
(MSO) for the mobile home and this precluded Cornerstone from obtaining judgment for
the amount due and for foreclosure of its mortgage. The Skinners also counterclaimed for
damages on various theories all based essentially on Cornerstone's failure to deliver the
MSO. They also sued Jack Hunt, a principal in Cornerstone on these same claims. That
suit was consolidated with Cornerstone's foreclosure action. The district court granted
Cornerstone the judgment it requested and denied all of the Skinners' claims.

All the arguments of the Skinners in this appeal raise as their core issue the
question of whether the failure of a seller of a new mobile home to deliver the MSO to
the buyer as required by statute is fraudulent as a matter of law and voids the sale. We
answer the question, "No." This finding, in essence, defeats the Skinners' defense to
Cornerstone's foreclosure petition and all of their claims against Cornerstone and Hunt.
We affirm.

After negotiations with Cornerstone's principals, Jack and Vicki Hunt, the
Skinners agreed to purchase the home. According to the bill of sale, the total sales price
including tax was $48,258. The Skinners made a down payment of $4,700, and
Cornerstone agreed to finance the remainder of the purchase price at 12% interest. As
collateral, Cornerstone took a 30-year mortgage on the Skinners' real property where the
home would be placed.

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The parties closed on the purchase on May 10, 2004. Hunt represented
Cornerstone at the closing. At that time, Hunt did not have in his possession the MSO for
the mobile home. The MSO is required for the Kansas Department of Revenue to issue an
initial certificate of title. See K.S.A. 58-4204(e). According to notes taken by the closing
representative of the title insurer, First American Title/Columbian Title (First American),
Hunt stated: "'He should have [it] in a couple of weeks.'" The home was delivered to the
Skinners' property within 3 days of closing. Cornerstone recorded its mortgage on the
Skinners' real property on May 13.

The Skinners made full, timely payments to Cornerstone for the next year.
However, they were unable to make their full July 2005 payment after Gary Skinner
suffered a heart attack. The Skinners contacted Cornerstone and made a partial payment
for that month. Hunt reacted negatively to this, and the Skinners sought to refinance the
property with another lender as a result.

The Skinners never obtained any alternate financing. First American became
involved, apparently, at the Skinners' request. It was soon discovered that Cornerstone
had never provided the MSO for the mobile home, and, consequently, no certificate of
title had ever been issued. On July 28, 2005, First American sent Cornerstone a letter
requesting information on the status of the mobile home's title. Cornerstone did not
respond to the letter. The Skinners never obtained alternative financing and did not make
any payments to Cornerstone after August 2005. They apparently continued to live in the
home, at least up to the time of the trial.

Cornerstone filed suit to foreclose on the mortgage on March 7, 2006. On April
12, 2006, the Skinners filed a one-page, handwritten response in which they summarily
denied the petition's allegations and stated they were refinancing the property and would
be able to pay in full. On May 1, the district court granted Cornerstone default judgment
and ordered a Sheriff's sale of the mortgaged property to satisfy the judgment.
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In October 2006, the district court set aside the default judgment on the Skinners'
motion and allowed them to file an answer. The Skinners filed an answer and argued that
the transaction with Cornerstone was fraudulent and void under K.S.A. 58-4204 because
Cornerstone never provided them with the MSO or a certificate of title. They claimed the
sale was void and demanded return of their monthly payments, the down payment, and
closing costs plus cancellation of the mortgage.

The Skinners also filed a number of counterclaims against Cornerstone relating to
Cornerstone's failure to provide the MSO. The first claim alleged statutory fraud under
K.S.A. 58-4204. The second alleged that Cornerstone violated the Kansas Consumer
Protection Act (KCPA), K.S.A. 50-623 et seq., by failing to provide them with the MSO,
by filing a false lawsuit, and by acting in an unconscionable manner.

Prior to trial, the district court disposed of the Skinners' claims for statutory fraud
in its ruling on a summary judgment motion filed by Cornerstone. It found that
Cornerstone did not provide the Skinners with the MSO within 30 days of closing.
However, the court agreed with Cornerstone that the Skinners were relying on the wrong
section of K.S.A. 58-4204 as the basis for their fraud claim. Specifically, the court
concluded that K.S.A. 58-4204(e) applied, rather than the section relied upon by the
Skinners—K.S.A. 58-4204(h)—and that the applicable subsection did not provide that
failure to deliver the MSO amounted to a fraudulent act or would it void the transaction
between Cornerstone and the Skinners. The court declined to grant Cornerstone summary
judgment on the Skinners' KCPA claims.

At the time it ruled on the summary judgment motion, the district court also orally
announced a number of factual findings relevant to the foreclosure claim of Cornerstone.
The court found the Skinners had agreed to purchase and Cornerstone had agreed to sell
the manufactured home, Cornerstone did not have possession of the MSO at the time the
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purchase was closed, the purchase was financed with a note and mortgage on real estate
the Skinners owned, and the Skinners were in default for nonpayment of amounts due
Cornerstone. The Skinners did not object to these findings.

The parties then proceeded to trial in June 2008 on the remaining claims. Prior to
hearing evidence on the Skinners' KCPA claims, the district court indicated that based
upon the prior record in the case including the pretrial order and previous findings
entered by the court, it appeared there was no dispute the Skinners had signed the note
and mortgage and they had defaulted on their payment obligations contained in them. The
court further indicated that since there had been a determination that Cornerstone's failure
to deliver the MSO was not a fraudulent act that voided the transaction, Cornerstone was
then entitled to judgment on its foreclosure claim.

Then, as to the Skinners' KCPA claims, the court heard the testimony of Vicki
Hunt. She described the procedures normally taken relative to the procurement of the
MSO for a new mobile home. She testified that the MSO was typically sent directly from
the supplier to the title company after Cornerstone paid the supplier for the unit. She
stated that Cornerstone paid the supplier and had no reason to believe that it would not
issue the MSO for the mobile home. She admitted that no one at Cornerstone followed up
to confirm whether the MSO had in fact been sent. She stated that she had not read First
American's July 28, 2005, letter and was not aware the Skinners had never been provided
with the MSO until October 2006, after Cornerstone had initiated the foreclosure action
against the Skinners. Then once she became aware that the Skinners did not have the
MSO, Cornerstone obtained a duplicate MSO from the mobile home supplier and offered
it to Skinner. The Skinners apparently refused to accept it.

The district court granted Cornerstone's petition for judgment in the amount of
$61,066.33 and for foreclosure of its mortgage. It also granted Cornerstone judgment as a
matter of law on the Skinners' KCPA claims, finding that the Skinners failed to prove by
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a preponderance of the evidence that Cornerstone violated the KCPA in not delivering
the MSO as required in K.S.A. 58-4204(e).

Statutory Fraud

The parties argue this issue on appeal as they did in the district court. The Skinners
contend that the district court erred in not applying the statutory fraud provision of
K.S.A. 58-4204(h) (2007/2008 amendments not applicable) in denying the counterclaim
based upon statutory fraud. Cornerstone counters that under the plain language of the
statute, K.S.A. 58-4204(h) does not apply and the district court properly applied K.S.A.
58-4204(e).

Where there is no factual dispute, appellate review of an order regarding summary
judgment is de novo. Central Natural Resources v. Davis Operating Co., 288 Kan. 234,
240, 201 P.3d 680 (2009). Furthermore, this case requires the court to interpret the
relevant statutes, which is an issue over which an appellate court has unlimited review.
Double M Constr. v. Kansas Corporation Comm'n, 288 Kan. 268, 271, 202 P.3d 7
(2009). An appellate court's first task is to "'ascertain the legislature's intent through the
statutory language it employs, giving ordinary words their ordinary meaning.' [Citation
omitted.]" State v. Gracey, 288 Kan. 252, 257, 200 P.3d 1275 (2009).

The sale of mobile homes in this state is governed by the Kansas Manufactured
Housing Act. K.S.A. 58-4201 et seq. K.S.A. 58-4204 sets out the procedural
requirements for transferring title to such a home. Subsection (e) of that statute governs
the transfer of title of a new mobile home. That section states:

"Dealers shall execute, upon delivery to the purchaser of every new
manufactured home, a manufacturer's statement of origin stating the liens and
encumbrances thereon. Such statement of origin shall be delivered to the purchaser at the
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time of delivery of the manufactured home or at a time agreed upon by the parties, not to
exceed 30 days, inclusive of weekends and holidays. The agreement of the parties shall
be executed on a form approved by the director. In the event delivery of title cannot be
made personally, the seller may deliver the manufacturer's statement of origin by
restricted mail to the address of the purchaser shown on the purchase agreement. The
manufacturer's statement of origin may include an attachment containing assignment of
such statement of origin on forms approved by the director. Upon the presentation to the
division of a manufacturer's statement of origin, by a manufacturer or dealer for a new
manufactured home, sold in this state, a certificate of title shall be issued." K.S.A. 58-
4204(e).

The Skinners contend that another part of K.S.A. 58-4204 applies here, subsection
(h):

"In the event of a sale or transfer of ownership of a manufactured home or mobile
home for which a certificate of title has been issued, which certificate of title is in the
possession of the transferor at the time of delivery of the manufactured home or mobile
home, the holder of such certificate of title shall endorse on the same an assignment
thereof, with warranty of title in a form prescribed by the director and printed thereon,
and the transferor shall deliver the same to the buyer at the time of delivery to the buyer
of the manufactured home or mobile home, or at a time agreed upon by the parties, not to
exceed 30 days, inclusive of weekends and holidays, after the time of delivery. The sale
of a mobile home or manufactured home by a manufactured home dealer without such
delivery of an assigned certificate of title is fraudulent and void, and it shall constitute a
violation of the Kansas manufactured housing act. The agreement of the parties shall be
executed on a form provided by the division. The requirements of this subsection
concerning delivery of an assigned title are satisfied, if the transferor mails to the
transferee, by restricted mail, the assigned certificate of title within the 30 days, and if the
transferor is a dealer, as defined by K.S.A. 58-4202, and amendments thereto, such
transferor shall be deemed to have possession of the certificate of title, if the transferor
has made application therefore to the division." (Emphasis added.) K.S.A. 58-4204.

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Clearly, K.S.A. 58-4204(e) applies to the sale of new manufactured homes and
requires that the MSO for such a home be delivered by the seller to the buyer within 30
days of delivery of the home. When that MSO is then presented to the Kansas
Department of Revenue, a certificate of title is issued. Nowhere in the section, however,
is there any mention that failure to deliver the MSO is a fraudulent act or that it voids the
sale of the new manufactured home. In contrast, K.S.A. 58-4204(h) which the Skinners
rely on obviously applies to the sale of manufactured homes for which a certificate of
title has already been issued, such as a preowned home. This section provides that the
sale or transfer of such a home without delivery of the certificate of title is fraudulent and
void. In this case we are concerned with the sale of a new manufactured home for which
no certificate of title has yet been issued. Subsection (h) of the statute has no relevance
and is not applicable.

Clearly, subsection (e) of K.S.A. 58-4204 that is applicable to this case is silent as
to whether the failure to comply with delivery of the MSO constitutes fraud. In applying
the plain and ordinary meaning to the words of the subsection, we believe it would read
too much into the statutory subsection to construe it to mean that the failure to deliver the
MSO in the sale of a new home constitutes fraud and voids the transaction. This is
particularly apparent since another subsection specifically provides that failure to deliver
an assigned certificate of title in the sale or transfer of a preowned mobile home for which
a certificate of title has already been issued is fraudulent and void. The absence of a
reference to fraud in the first situation is significant. Had the legislature intended to make
it fraudulent to not timely deliver the MSO in that instance, it very easily could have done
so.

The Skinners' argument that Cornerstone's failure to provide them with the MSO
was fraud is based almost entirely on a 1968 case in which our Supreme Court interpreted
the predecessor statute to K.S.A. 58-4204. In Wilcox Trailer Sales, Inc. v. Miller, 200
Kan. 315, 323, 436 P.2d 860 (1968), the court affirmed a district court's ruling that the
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failure of a dealer to provide a buyer of a mobile home with a "bill of sale" at the time of
purchase of a new home rendered the transaction fraudulent and void. The statute in
effect at that time which governed the sale of mobile homes was the same statute that
governed the transfer of other motor vehicles. It required a dealer to provide the buyer
with a bill of sale at the time of purchase. See K.S.A. 8-135 (Corrick 1964). The court
reasoned that because a certificate of title had not yet been issued, this bill of sale "is the
origin of the purchaser's title to the vehicle." Wilcox, 200 Kan. at 320. The court then
equated a bill of sale with a certificate of title. And, because it was unlawful to buy or sell
any vehicle without transferring a certificate of title and any such sale was fraudulent and
void under the applicable statute, the sale of the mobile home in that case was deemed
fraudulent and void. 200 Kan. at 320-23.

While the facts of Wilcox are very similar to those in this case, the statutes in
effect now that govern the sale and transfer of mobile homes are different. Primarily, the
relevant sections of K.S.A. 8-135 (Corrick 1964) applied to every vehicle transfer
whether it involved a new vehicle or a vehicle for which a certificate of title had
previously been issued. Subsection (c)(3) of the statute required the execution of a bill of
sale "upon delivery to the purchaser of every vehicle" and subsection (c)(6) of K.S.A. 8-
135 (Corrick 1964) made it unlawful "for any person to buy or sell in this state any
vehicle" without the transfer of a certificate of title. K.S.A. 2009 Supp. 8-135 contains
this same language today, but the statute no longer applies to the sale of mobile homes.
The applicable statutory subsections today are K.S.A. 58-4204(e) and (h) which, as we
have pointed out, treat the failure to deliver the MSO for a new home and the failure to
deliver an already issued certificate of title on a preowned mobile home differently as to
whether they constitute fraud. As a result, while K.S.A. 8-135(c)(3) and (c)(6) (Corrick
1964) could be read together because they both applied to every vehicle transaction,
K.S.A. 58-4204(e) and (h) are distinct and different in their application. They apply to
transactions involving different classifications of manufactured homes, new ones and
ones that have previously been issued a certificate of title.
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We are not persuaded by the Skinners' argument that the relevant subsections of
K.S.A. 58-4204 are a mere continuation of K.S.A. 8-135 (Corrick 1964) and that Wilcox
should still control. They cite a number of decisions in support of the argument. None,
however, explain how or why the newer statutory scheme is a mere continuation of the
older one in light of the significant differences in language that we have pointed out.

Even though this case involves the sale of a new manufactured (mobile) home, the
Skinners further argue that we should treat the MSO as the equivalent to a certificate of
title because the two documents are both primary evidence of ownership and the failure
to provide either should result in the same remedy for the purchaser: avoidance of the
transaction. Again, however, the plain language of the applicable statutory subsections
treat the failure to deliver the required documents differently depending on the type of
mobile home involved.

While clearly Cornerstone did not comply with the statutory requirement that it
deliver the MSO to the Skinners, the district court correctly found Cornerstone's failure to
do so did not amount to fraud under the controlling statute and did not void the
transaction. It is the legislature that established in plain language the requirement that a
seller of a new manufactured home deliver the MSO to the buyer and that the seller of a
preowned manufactured home for which a certificate of title has been issued must deliver
the assigned certificate of title to the buyer. It is the legislature that omitted any reference
to fraud when a seller in the first instance fails to deliver the MSO but then specified that
it would constitute fraud when a seller in the second instance fails to deliver the assigned
certificate of title as required. The intent of the legislature is expressed through the plain
language of the applicable statutory subsections and we will not inquire into its intent in
not mentioning a remedy or consequence for failure to deliver the MSO in the first
instance. See Double M Constr., 288 Kan. at 271-72.

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Cornerstone's Judgment on Its Foreclosure Claim

The Skinners next argue that the district court erred in sua sponte granting
Cornerstone's petition to foreclose on their real estate prior to commencement of trial.
They argue that because they never received title to the mobile home, they received no
consideration for signing the purchase agreement. They further argue that Cornerstone
breached the sales contract by failing to provide the MSO.

The Skinners' argument is simply an attempt to reframe their argument that
Cornerstone's failure to provide the Skinners with the MSO should void the sale. Also,
they never raised defenses of failure of consideration and breach of contract to the district
court. They cannot now raise them on appeal. See Miller v. Bartle, 283 Kan. 108, 119,
150 P.3d 1282 (2007).

In any event, the Skinners' arguments on this issue are without merit. We note that
evidence of the Skinners' debt is attached to Cornerstone's amended petition. As we
stated, the district court entered findings at the beginning of the trial, based upon the
record in the case, that Cornerstone had proven the parties had executed the relevant
documents creating the Skinners' debt and mortgage, the Skinners never denied they had
defaulted, and the Skinners never disputed these crucial facts. The Skinners do not
challenge on appeal the sufficiency of those factual findings. Those facts along with the
ruling on summary judgment that failure of delivery of the MSO did not void the
transaction clearly establish that Cornerstone was entitled to judgment on its foreclosure
claim as a matter of law even prior to the court hearing evidence on the Skinners'
counterclaims in the case.

Furthermore, although not raised by either party, it appears that valid title did vest
with the Skinners even though they were not provided with a document of title. This
court has previously held that a sale or purchase of a mobile home is a transaction for the
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sale of goods that is governed in part by the Kansas Uniform Commercial Code (UCC).
Linscott v. Smith, 3 Kan. App. 2d 1, 3, 587 P.2d 1271 (1978); see K.S.A. 84-2-102.
Under K.S.A. 84-2-401(2), title to the goods purchased passes to the buyer on delivery
"even though a document of title is to be delivered at a different time or place." Here, title
passed to the Skinners when the manufactured home was delivered to their property, even
though they had not yet received the MSO.

The district court correctly determined that Cornerstone was entitled to judgment
on its foreclosure claim based upon the record before it.

Claims Under the Kansas Consumer Protection Act

After hearing evidence, the district court denied the Skinners' claims brought
under the KCPA and granted Cornerstone judgment on all of them as a matter of law.
The Skinners claim the court erred in each instance. The parties do not dispute the
relevant facts. Consequently, we have de novo review of the district court's entry of
judgment. See Deal v. Bowman, 286 Kan. 853, 858, 188 P.3d 941 (2008).

The Skinners first argue that Cornerstone's failure to provide the MSO amounted
to a per se deceptive act which is prohibited under two subsections of K.S.A. 50-626,
specifically, (b)(1)(A) and (b)(8) (2009 amendments not applicable). Under K.S.A. 50-
626(b)(1)(A), it is a deceptive act to make a representation "knowingly or with reason to
know" that "[p]roperty or services have sponsorship, approval, accessories,
characteristics, ingredients, uses, benefits or quantities that they do not have." Under
K.S.A. 50-626(b)(8), a supplier is prohibited from "falsely stating, knowingly or with
reason to know, that a consumer transaction involves consumer rights, remedies or
obligations."

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In essence, the Skinners argue that the failure to comply with a requirement in
another separate and distinct statute to provide the MSO constitutes a violation of these
KCPA sections. They provide no persuasive authority that is on point for this position.
Nor have they established that Cornerstone's failure to deliver the MSO constitutes the
type of violation described in the subsections they cite.

As to the Skinners' claim under K.S.A. 50-626(b)(l)(A), the undisputed facts
contain no mention or reference to any misrepresentation Cornerstone made knowingly
or with reason to know of its falsehood. It is true that if a supplier commits a "deceptive
act" under the subsection, the buyer does not have to prove it relied upon the
representation to obtain relief under the KCPA. However, the buyer still must establish
that there was a misrepresentation of the type described in the subsection. While
Cornerstone did not comply with the requirement that it deliver the MSO, it made no
misrepresentations that can be construed as deceptive under this statute.

The Skinners contend that Cornerstone, as the seller of the manufactured home,
represented as a matter of law it would comply with the law governing the sale and
deliver the MSO and that its subsequent failure to do so renders the prior representation a
falsehood. The Skinners base this argument on the proposition that the statutory law
governing transactions are a part of those transactions. The Skinners extend this argument
to imply that the supplier makes an affirmative statement that it already had or would
comply with that statutory law and its failure to comply would then subject it to liability
under the KCPA. However, none of the cases they cite in support of this argument are on
point as they all involve actual misrepresentations made in addition to violations of a
separate statute. The Skinners provide no other authority to support their argument, and
we are not persuaded by it. To conclude otherwise would render any consumer
transaction that involved noncompliance with a separate statute a violation of the KCPA.
With no statutory basis to do so, we cannot make that stretch.

15

In addition, even if we imputed an affirmative statement in these circumstances to
a supplier to the effect that it had or would timely deliver the MSO, such a statement is
not the type described in K.S.A. 50-626(b)(l)(A) which would then subject it to liability
under the KCPA. To aid in the application of this subsection, the Kansas comment to the
section states that it "forbids such conduct as misrepresenting the durability or
components of a product, or the efficacy of a service." K.S.A. 50-626, comment 2. Both
the plain language of the subsection and its accompanying comment indicate that it refers
to misrepresentations relating to the physical or qualitative properties of the subject
matter of the transaction.

The Skinners also argue that Cornerstone's failure to provide the MSO violated
K.S.A. 50-626(b)(8). That statute prohibits a supplier from "falsely stating, knowingly or
with reason to know that a consumer transaction involves consumer rights, remedies or
obligations." The Kansas comment for this subsection states that it "proscribes statements
such as one asserting that an installment contract must be paid in full irrespective of a
defense, or that a supplier can [garnish] exempt wages." K.S.A. 50-626, comment 2. The
Skinners have not established how Cornerstone's failure to provide the MSO somehow
constitutes a statement about the their rights which would bring the statement within the
proscriptions of this subsection. The Skinners' claim here is without merit.

The Skinners also argue that Cornerstone violated K.S.A. 50-626(b)(8) by filing
and maintaining its foreclosure action against the them. They claim that because the
transaction was void under K.S.A. 58-4204(h), Cornerstone had no legal basis to pursue
foreclosure and, in doing so, engaged in an impermissible debt collection practice
allegedly prohibited by K.S.A. 50-626(b)(8).

Obviously, this argument is based on the fact the sale of the manufactured home
was void as a matter of law. We have concluded otherwise in our analysis of the first
issue discussed in this opinion. Additionally, we have previously set out the provisions of
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K.S.A. 50-626(b)(8). They make no mention of debt collection practices or the manner in
which a seller might exercise its remedies. This claim of the Skinners is also without
merit.

Finally, the Skinners argue that Cornerstone's failure to provide the MSO was an
unconscionable act under K.S.A. 50-627. Subsection (a) of the statute prohibits
unconscionable acts or practices by a supplier in connection with a consumer transaction.
Subsection (b) then provides a nonexclusive list of seven circumstances which, if the
district court finds are present in a transaction and the supplier knew or had reason to
know of them, may result in a determination that the transaction was unconscionable and
subject to remedy under the KCPA. The Skinners argue that five of the factors are
relevant, but they discuss only three of them.

We first note generally that the failure to deliver the MSO does not appear to be of
the type of conduct this statute is intended to protect against. The Kansas comment to the
subsection states that it "forbids unconscionable advertising techniques, unconscionable
contract terms, and unconscionable debt collection practices." K.S.A. 50-627, comment
1. The statute also protects against the limitation of implied warranties, but application of
the statute is generally limited to conduct that fits under one of these categories. See State
ex rel. Stovall v. ConfiMed.com., 272 Kan. 1313, 1320-21, 38 P.3d 707 (2002).
Cornerstone's actions do not involve any of the above types of conduct, and the Skinners
fail to explain how or why the conduct here should be treated as such.

Against the backdrop of this general observation, we turn to the factors under the
statute that the Skinners urge us to apply.

They first claim that Cornerstone took advantage of the their inability to
reasonably protect their interests because of the Skinners' "physical infirmity, ignorance,
illiteracy, inability to understand the language of an agreement or similar factor" as
17

recognized by K.S.A. 50-627(b)(1). They claim that Cornerstone's failure to deliver the
MSO was somehow unconscionable because Cornerstone was an experienced mobile
home dealer. However, the statute does not mention the status of the supplier as a factor
in determining unconscionability. It refers instead to the supplier's wrongful
capitalization of a buyer's weakness. The record here lacks any claims or evidence
relating to any infirmity that would put the Skinners in a disadvantageous bargaining
position that was different from any other "average" buyer who was making a purchase
from an experienced seller of manufactured homes.

The Skinners assertion under K.S.A. 50-627(b)(2) is also unfounded. That
subsection protects against the sale of property at a grossly excessive price when similar
property can otherwise be obtained. The Skinners claim that Cornerstone sold them the
mobile home at a 63% markup and over-collateralized the loan. Most importantly, the
purchase price bears no relation to Cornerstone's failure to provide the MSO. Also, the
Skinners provided no evidence that the price or the value of the collateral were
unreasonable or that they were excessive in comparison to other mobile home sales.

The Skinners argument under subsection K.S.A. 50-627(b)(3) also falls short. It
protects consumers who are "unable to receive a material benefit from the subject of the
transaction." K.S.A. 50-627(b)(3). They claim that Cornerstone's failure to provide the
MSO resulted in their inability to title the mobile home as a real property and, thus, they
did not receive a material benefit of the transaction. Again, the Kansas comment to the
subsection is informative. It states that this subsection "includes such conduct as the sale
of two expensive vacuum cleaners to two poor families whom the salesman knows, or
has reason to know, share the same apartment and the same rug." K.S.A. 50-627,
comment 2. The comment indicates that the statute applies to the practical use of property
as opposed to legal rights surrounding it. Here, the Skinners clearly had the benefit of
owning the manufactured home and living in it as long as they continued to make the
payments they agreed to.
18


The district court correctly ruled that the Skinners' claims against Cornerstone for
violations of the KCPA were without merit and that Cornerstone should have judgment
against the Skinners.

In conclusion, we do not trivialize or render meaningless the requirement that a
supplier of a new mobile home must provide the buyer with the MSO under K.S.A. 58-
4204(e). Under the language of the statute, the fact that a supplier fails to do so does not
alone void the sale and allow the purchaser to avoid his or her obligations to pay for the
home. Nor does that failure to deliver the MSO alone constitute violations of the KCPA
subsections as claimed by the buyers here. The requirement is not without significance,
however. It may be that a buyer who proves he or she incurred specific and identifiable
damages directly related to the failure of a supplier to provide the MSO has a cause of
action based upon the seller's noncompliance with the statutory requirement. But that is
not the situation present in this case, and we offer no opinion in that regard.

Affirmed.