Articles Posted in Car Dealership Fraud

New Jersey is a notice state which means there are very liberal pleading requirements for most claims BUT some specificity is required for fraud. The following is an example of a complaint that was filed against a car dealership in New Jersey.

CARTON AND RUDNICK 788 SHREWSBURY AVENUE BUILDING 2, SUITE 204 TINTON FALLS, N.J. 07724 732-842-2070 FAX: 732-879-0213

ATTORNEYS FOR PLAINTIFFS.

New Jersey law defines bait and switch within Administrative Code regulations. As an example, the regulation specifically says that when you advertise a vehicle and it is part of a plan not to sell it or lease it at the advertised price is considered bait and switch.

As an example, if a car dealership would advertise a car for $1, lure potential consumers into the car dealership to purchase a car for $1, and not have it actually ready or available or willing to sell it for $1, this would be considered bait and switch.

There are also terms in the industry such as the golden hammer. An example of this is when there might be a vehicle advertised at a very good price, however, when ultimately, the consumer, arrives at the dealership, it is damaged or has some dings or dents to it and the customer does not want to buy it even at the advertised price.

Buying a Car is Awful Because… Tell me…

I have represented over a thousand people and have purchased many cars myself. Almost every experience related to me is the same. It sucked. The reasons are different BUT the results are the same. It sucked!! Take a look! Here too about the tricks.

I would describe it as follows:

THE PAROLE EVIDENCE RULE DOES NOT APPLY TO THE FACTS OF THE CASE

The defendant’s claim that the plaintiff is barred by the ‘parole evidence rule’ is without merit. The current case has nothing to do with the terms and the contents of the agreement between the parties. The issue is the conduct of the defendants after the default on the agreement and GEMB obligation under the UCC and the Consumer Fraud Act. The court in Slowinski v. Valley National Bank 264 N.J.Super 172 (App.Div 1993) accepts this basic concept. If the defendant’s position was adopted the Slowinski holding would, effectively, be overruled. What does parole have to do with wrongful repossession? The alleged parole evidence does not fall within the definition of parole.

It is only after the meaning of the contract is discerned that the parole evidence rule comes into play to prohibit the introduction of extrinsic evidence to vary the terms of the contract. Conway v. 287 Corporate Ctr. Associates, 187 N.J. 259, 270 (2006). Even if the court were to apply the parole evidence rule to the facts here they fall within the fraud exception.

THE DEFENDANT SHOULD BE ESTOPPED FORM ASSERTING THE ARBITRATION CLAUSE THIS LATE IN THE LITIGATION, ESPECIALLY SINCE THEY 1) FILED A COUNTERCLAIM IN BREACH OF THEIR OWN AGREEMENT; 2) MOVED TO HAVE JUDGMENT ENTERED ON THAT COUNTERCLAIM AGAIN BREACHING THEIR OWN AGREEMENT TO HAVE ALL DISPUTES BETWEEN THE PARTIES

The defendant should be prohibited for enforcing the arbitration agreement because of (1) the extent of the time which they took to enforce the arbitration agreement, and (2) the making of a counterclaim clearly breached the agreement between the parties. The defendants breached the agreement by making a counterclaim rather than demanding arbitration and as such cannot enforce the agreement. Not only have they made a counterclaim but they have moved to enter a judgment on those pleadings.

It is black letter contract law that a material breach by either party to a bilateral contract excuses the other party from rendering any further contractual performance. Magnet Res., Inc. v. Summit MRI, Inc., 318 N.J. Super. 275, 285, 723 A.2d 976, 981 (App.Div. 1998). The court should hold that the defendants have waived their right to assert the matter should be arbitrated. The Supreme Court addressed the issue of waiver in Wein v. Morris, 194 N.J. 364, 376 (2008) and held the following:

In lawsuits usually you are permitted to demand documents from any car dealership to help you prove your case. In a damaged vehicle case you need to establish, at a minimum, that the dealership knew or should have known that the car was damaged when they sold it.

Most dealerships are run the same, or substantially similar, so the following documents request should be helpful.

Good Luck

This is part of a closing argument that was recently submitted to AAA, the American Arbitration Association.

The plaintiff has proved that the defendant has committed fraud/consumer fraud. The dealer advised the plaintiff that the car was without accident both verbally and in writing. The plaintiff proved (CARFAX) and it was admitted (Defense expert testimony) that the car was in a previous accident.

Defense only disputed severity of the accident. Defense expert and the General Manager, admitted that the dealer probably knew of the prior damage. He actually testified that the dealer did know that the car was in an accident. The car was inspected by used car manager, technicians, certification process (MFGR trained techs looking for accident damage) and elcometer use on car acquisitions. (THE USED CAR MANAGER NEVER TURNED UP TO TESTIFY) Even more significant is that this was a Manufacturer authorized dealer!!

One option in lawsuits against dealers is instituting suit against the owners and/or employees. New Jersey laws held that the owners or the individual employees can be liable if they directly participated in the fraud or consumer fraud.

The New Jersey Consumer Fraud Act indicates that persons are liable, which includes fictitious persons – such as corporations – and real persons, such as individuals.

One resource is the Department of Treasury, State of New Jersey, wherein you can find out who the owners and the officers of the dealership are in order to assist your investigation.

Did a dealership do the following:

* Sell you a damaged car * Sell you a defective car * Lie to you about financing * Lie to you about a warranty * Lie to you about the history of a car * Lie to you about the mechanical condition of the car * Lie to you about the repair history * Lie to you about the price * Lie to you about the advertised price
Call The Law Office of Jonathan Rudnick for help