Close up on the front bumpers of a line of cars

Why Does My Auto Dealership Need a Lawyer?

Civil litigation covers a range of practice areas, including auto dealerships. Car dealerships may seem like an odd or specific focus of civil litigation, but considering the financial agreements, negotiations, contracts, and recalls your dealership must handle on a daily basis, it makes sense to hire a lawyer who can help provide you with proper representation.

Agreements, Negotiations, and Contracts

When starting any new business, especially one that handles contracts and negotiations on a daily basis, it’s helpful to have a lawyer to review and put together proper documents and terms and conditions before signing on new customers. Your car dealership will handle these types of contracts day in and day out, further complicated by negotiations, sales, and discounts along the way.

Putting together a business plan and a process for your employees to follow can help alleviate issues and claims in the future. If your dealership also sells used cars, there’s an extra layer of federal protection that covers your customers. Ensuring that you’re adhering to each of the laws and regulations can be crucial to avoid unnecessary lawsuits in the future.

Recalls and Auto Fraud

Your dealership must adhere to certain consumer rights and safety regulations when selling vehicles to your customers. Additionally, manufacturer recalls and defect claims could happen to any vehicle on your lot. The National Highway Traffic Safety Administration can hold multiple parties in the vehicle’s distribution chain (including the retailer) liable for these defects or recalls. If your dealership gets hit with an auto fraud or unfair business practices suit, you’ll want a lawyer that can represent you and already understands those specific laws.

On the other hand, if your dealership purchases used vehicles for reselling, you must also be aware of trade-in fraud happening to you. Vehicle sellers may try to scam your business and claim that they were not paid the correct value of their vehicle after the sale is said and done. Having a lawyer on retainer can help ensure your contracts and trade-in processes are running smoothly without a chance of fraud.

Lemon Laws

The California Lemon Law covers vehicles that are “defective and cannot be repaired after a ‘reasonable’ number of attempts.” This law protects consumers so that other dealerships may not use deceptive practices when selling their customers a vehicle. However, sometimes lemons happen. Having a skilled civil litigation lawyer can help your dealership handle the arbitration process in case you find yourself dealing with a lemon law dispute.

If you have questions and would like to speak to one of our lawyers today, please contact us. Our offices are open, and we’re looking forward to hearing from you.