Can I sue a car dealer?
Did you purchase a car or truck and later find out it had been wrecked? You likely can sue the auto dealer if the dealer did not adequately inform you about the prior wreck damage and repairs.
New Mexico law provides strong protections concerning the sale of wrecked vehicles.
No doubt motivated by widespread fraud in auto sales, in the early 1970s, the New Mexico Legislature singled out a particular species of fraud for special protections: sale of a prior-wrecked vehicle without meaningful disclosure. The Legislature added a provision to the Unfair Practices Act. The enacted provision, § 57-12-6, provides that auto dealers must disclose prior wreck damage via an affidavit furnished to the buyer at the time of sale. The disclosure threshold is very low, with disclosure by affidavit required for any vehicle with prior damage where repair costs would equal or exceed six percent of the vehicle’s sales price, thus capturing all but the most insignificant prior damage.
Disclosure by any method other than affidavit is not sufficient. The New Mexico Legislature specifically provides that the “failure to provide an affidavit . . . when there has been repair for which disclosure is required shall constitute prima facie evidence of willful misrepresentation.” The Legislature further provides that “[a]ny person” who fails to provide the required affidavit “is guilty of a misdemeanor.”
Section 57-12-6’s protections were not enough to stem the tide of sales of prior-wrecked vehicles without appropriate disclosure. Accordingly, in 2014, the New Mexico Attorney General enacted regulations that further address the sales of prior-wrecked vehicles. Per these regulations, auto dealers must perform a comprehensive pre-sale inspection on all vehicles – with the inspection designed to catch tell-tale signs of prior wreck damage or repairs – before the vehicles can be offered to the public, with disclosure to be provided at the time of sale via an affidavit, plus an inspection report which documents the extent of the prior wreck and states whether the vehicle is unsafe. The stated purpose of these regulations is to “deter misrepresentation” by mandating “uniform disclosure of material information.”
As the New Mexico Court of Appeals recently affirmed, auto dealers must strictly comply with these regulations. Two disclosure documents must be provided: an affidavit that discloses whether the vehicle had been in a prior accident and an inspection report in the form required by the regulations.
Dealers often don’t follow the law. They provide a Carfax report that shows no accident, telling the consumer that the vehicle has never been in a prior accident. (Carfax often fails to report a prior accident.) They claim the prior accident was a “minor’ accident or “fender bender,” when the truth is the vehicle was in a bad wreck and perhaps is unsafe. They get a consumer to sign on a tablet, or tell them to “sign here” without showing what is being signed, then claim that disclosure was provided.
If you believe you have been sold a wrecked vehicle without adequate disclosure, please contact us. Treinen Law Office may be able to help.