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If a car dealership sold you a car that was in an accident or if a dealer sold you a car with structural damage, frame damage, or other substantial damage without disclosing it to you, then you may have a claim under California law. This article will help answer the critical question as to California used car purchases: Dealer sold me a car that was in an accident, what rights do I have?
According to California DMV statistics, about 400,000 collisions occur per year in California alone. Some of these collisions result in a structural damage, frame damage, or substantial accident damage to cars, the vast majority of which are resold within the United States.
These cars are a prime target for car dealerships that want to increase their profit margins. By acquiring damaged and repaired used vehicles that have only been in an accident recently, used car dealers can sell you a car that has been in an accident without disclosing it to you. The trick is to sell you a previously damaged car before the accident report is obtained by CarFax or AutoCheck vehicle history reporting companies. So, do not be surprised if there is a clean CarFax, but the car you just bought was in an accident.
Are car dealerships required to disclose accidents? Does a dealer have to disclose that the car that you are about to buy was in an accident?
Short answer is: most likely. California law defines four main instances where one party to the transaction has a duty to disclose facts to the other party. These apply to dealerships that are selling you a car. In layperson terms, these instances occur when (1) the dealer has exclusive knowledge of material facts about the car’s condition or history that are not reasonably discoverable by you; (2) the dealer has made some representations about the history of the car which would be misleading if the dealership did not disclose material facts about the full history; (3) the dealership has actively concealed material facts about the car’s condition or history from you; and when (4) the dealership has lied to you about the condition of the car.
In sum, dealerships are required to disclose an accident on a car that you are buying if one of these conditions is present. If you found damage on a used car after purchase, do not panic. If you are in California, our dealer fraud attorneys will be able to help you pursue your claims without any out-of-pocket fees.
Our law firm has successfully obtained complete refunds in dealer fraud cases, where our clients have received their down payment, all monthly payments, and registration fee payments back from the dealer. Moreover, we have successfully obtained our attorney’s fees from dealers without charging anything out-of-pocket from our clients so that our representation ends up completely free for dealer fraud victims.
This is possible because of statutes such as California Consumer Legal Remedies Act and the Unfair Competition Law. These statutes contain fee shifting provisions that allow consumers to receive their attorney’s fees from the dealers that are engaged in unfair, unlawful, or fraudulent acts or practices. We, in turn, do not charge our clients out-of-pocket and rely on our ability to obtain our fee from the dealer upon completion of the case.
If the car dealer did not disclose an accident, it is important to pursue your rights.
Some consumers are hesitant to pursue their rights or delay doing so for one reason or another. This may only cause problems in the future. Once you learn that the car dealer didn’t disclose an accident, you must act fast. There are several reasons for not delaying your claim:
First, what some consumers do not realize is that they have paid premium for a used car with a ‘clean history.’ Since most people do not want to buy cars with a prior accident damage, used cars that have been involved in an accident are universally worth less than those without prior accident damage. This only becomes apparent when the consumer wants to resell the car or to trade it in for another car. A dealer considering your vehicle for a trade-in will check your car’s history and will thoroughly inspect your car for any prior damage. Once they learn that your vehicle had a prior accident they will only pay the fraction of the price you intended to sell it for.
Consequently, when you buy a previously damaged vehicle from the dealer without knowing about it, you immediately lose money, since once you sign the purchase contract and leave the lot, you agree to paying a higher amount than what the vehicle was worth at that moment because of the diminution in value attributed to the prior accident damage.
Second, the statute of limitations will place a complete bar on your recovery if you delay making your claim and filing a lawsuit against the dealership that sold you a car that was in an accident. Once you miss the statutory period to sue the dealer for lying to you, you will not be able to obtain a compensation.
Third, a previously damaged car may be unsafe to drive. By driving a previously damaged vehicle you are not only putting yourself at danger, but are also giving the dealer an opportunity to argue that you in fact did not care if the vehicle was previously involved in an accident, because you continued to drive it without making a claim after you learned about that fact.
Forth, if you continue driving a previously damaged vehicle for an extended period of time without making a claim, it will be very hard for you to convince the jury that you would have never bought that vehicle had you known that the vehicle was involved in an accident.
To sum up, do not delay hiring an experienced counsel. Because you do not have to pay anything out-of-pocket, there is no reason to not have your claim reviewed by a lawyer.
FAQs about pursuing your dealer fraud claim
My car has a clean title, but frame damage or structural damage, how is that possible?
To answer this question, we should first analyze what a branded or a salvage title means. A car is branded a salvage when it is damaged to an extent that it is cheaper for the insurance company to declare the car a total loss, to auction it off, and to pay the fair market price of the car to its owner, than to repair the car. So, the cars that have been ‘totaled’ or have a salvage title are practically either irreparable cars or cars that the insurance company decided are too expensive to repair. Cars with a frame or structural damage can have a clean title. This can happen due to at least three reasons: (1) there was no policy of insurance that would cover the damage to the car so someone repaired or tried to repair it on their own and the car was eventually sold to you; (2) It had a frame or structural damage which was not impossible to repair, at least in theory, so it got repaired; (3) the insurance policy limit was not enough to pay the fair market value of the car to its owner, so the owner chose to take the full policy limit and to repair the car on their own. In all three instances you may end up with a car that has a clean title, but a frame or structural damage.
Will going after a dealer affect my credit score?
Making a dealer fraud claim will not have a negative impact on your credit score if you continue making payments on your vehicle on time. Since the financing company is usually a different entity than the dealer, we advise our clients to continue making timely finance payments on their vehicle while their case is pending. If the dealer agrees to buyback the car, your credit report will show that the loan on that vehicle was paid off, just like in case of a trade-in.
Can I sue a dealer for lying if I signed a paper that says the car was involved in an accident at the time of sale?
Dealers usually disclose whether the car was involved in an accident in a document called “Buyer’s Guide.” If the Buyer’s Guide or other documents provided to you prior to purchase disclosed the fact that the vehicle was involved in an accident, according to our research and experience you will not have a claim.
Can I sue a private party for selling me a previously damaged car?
You will most likely have a claim against a private party for selling you a previously damaged car, but unfortunately the laws that allow us to recover attorney’s fees from the dealer do not apply to private transactions. Because of this, we do not handle cases against private parties.
Can a Certified Preowned Vehicle have a prior accident damage history?
Yes. Even though according to the policies of most manufacturers and distributors certified preowned vehicles are not supposed to have a prior accident history, in practice some dealers manage to sell previously damaged vehicles as certified preowned. If you purchased a certified preowned vehicle with a prior accident history, feel free to call us for a free consultation.
Legal matters are subject to various outcomes. Call us at 747-777-2977 to discuss your specific matter.