The Risk of Post-Sale Repair Requests
Dealers know full well that even when the sale of the vehicle was As-Is with no dealer warranty, customers often come back to the dealership for something that might need repair. While sometimes items requiring repair are minor and occur early after sale, some other repairs are costly and occur several months and several thousand miles after sale. Customers who come early for repairs, tend to continue to come to the dealership for more repairs even months after sale for more costly repairs.
A Costly Oversight Avoided with a Settlement Agreement
Very recently, a customer complained that the vehicle they bought had defective windshield wipers. The dealership, who is a member of Auto Legal Group, agreed to fix the windshield wipers even though the vehicle was sold on an As-Is basis. If the customer signed a settlement agreement before receiving a check from the dealer. Because the dealer is an Auto Legal Group member, ALG drafted a settlement and release agreement for the dealer free of charge, which the customer signed. Several weeks later the dealer was served with a lawsuit from a well-known California consumer attorney. ALG immediately forwarded the release to the lawyer (whose client apparently failed to mention it to her). The lawyer dismissed the complaint the next day.
The Danger of DIY Legal Documents
A word of caution, settlement agreements have many legal requirements and need to be drafted properly. Simply having the customer sign a piece of paper, or a Statement of Fact, does not work and in most cases will actually work against the dealer. Homemade documents may also themselves be a violation of the Consumer Legal Remedies Act. ALG highly advises against self-written legal statements and documents.
Why a Proper Release Agreement Matters
California’s laws are very consumer friendly, and Californians are very litigious. Had this dealer simply provided new windshield wipers and not gotten a release signed, it would have been looking at a $15,000 lawsuit instead of a $15 courtesy replacement.
Remember that as an ALG member, ALG provides you with one hour of free advice and settlement agreements without any further charge. So, if you and the customer agree on resolving a dispute involving the sale, let us know right away so we can prepare the paperwork necessary to protect you from a lawsuit or claim in arbitration even if the deal was done in Spanish.
