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Car Dealer wants $ based on carfax

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quinnsgal

Junior Member
What is the name of your state (only U.S. law)? Alabama

My husband traded in his 1985 Mercedes 380SL for a 2006 BMW at an Alabama car dealer. My husband had bought the car about 1 year earlier from a private individual(an elderly lady) who had owned it since 1987. Cosmetically it was perfect-it needed some mechanical work.He had taken the car to be serviced at a shop that specialized in Mercedes Benz (and specifically older models). They also agreed that the car was in excellent cosmetic condition and repaired all of the mechanical issues that my husband asked them to repair. During the time we owned the car, it was fully insured with USAA(this might be an important note once you read further).
My husband realized it probably did not make sense to have this kind of car when you have 2 children who both want to ride in the convertible-so he went to trade it in on a newer larger BMW he found at a dealer. The dealer took the Mercedes in on trade. About a month after he had traded in the Mercedes and purchased the BMW, the dealer that he had purchased the BMW contacted him and said they were trying to sell the Mercedes to someone and did he know that there was a "salvage title" showing up on the car's carfax from 1986. We had never had a carfax on the car as we had purchased from a private individual and based on physical inspection, the Mercedes mechanic inspection and the fact that our insurance company insured it, did not think we needed one. My husband told the dealer this and the dealer said that the car did look like it had never been in an accident, and they believed that it must have been a mistake.Plus, it was before both my husband and the person he bought it from owned it.That was the only time my husband heard from the dealer.
Today we received a letter from the dealer stating that based on the carfax report that they want us to reimburse them $2500 for the "diminished loss of value".The letter they sent states that in "situations such as this the responsibility for the diminished value of $2500 moves backward through the ownership chain."
The car has never been in an accident-it has had no body work done to it.Plus, why did they not do a carfax before they took it as a trade in?
What legal recourse do we have? I would really love to tell them where they could shove their carfax-but, can I legally?What is the name of your state (only U.S. law)?
 


justalayman

Senior Member
from what I can find, Alabama requires both a "rebuilt" title and a sticker to be applied to the door jamb attesting to the fact the vehicle has been rebuilt. If in fact the vehicle is legally required to be titled as a rebuilt vehicle, the dealership does have a cause of action against you/your husband. In turn, you would have an action against the person that sold it to you and on down the line.


The question becomes; does the car actually have a rebuilt title? Since your husband owned the vehicle it would have been obvious if it was and the dealership would have been warned of the fact due to it being indicated on the title he gave the dealership.

So, there are a couple situations I can see:

1. there was a mistake somewhere and the vehicle is not a rebuilt vehicle. Carfax is not a legally dependable source. They are a private company.

2. the car actually is a rebuilt and somewhere along the line a clean title was illegally obtained for the rebuilt.

If #1, dealer has no claim. If #2, then they do.
 

Lordy123

Junior Member
Code of Alabama - Title 32: Motor Vehicles and Traffic - Section 32-8-87

Each person who sells, exchanges, delivers, or otherwise transfers any interest in any vehicle for which a title bearing the designation "salvage" or "rebuilt" has been issued shall disclose in writing the existence of this title to the prospective purchaser, recipient in exchange, recipient by donation, or recipient by other act of transfer.The disclosure, which shall be made at the time of or prior to the completion of the sale, exchange, donation, or other act of transfer, shall contain the following information in no smaller than 10 point type: "This vehicle's title contains the designation 'salvage' or 'rebuilt'.”
Technically they can come after you, but any recourse they would have against you, you would also have against the previous owner.

There are two transaction codes on the face of a title that indicate a brand:
02: Replacement Title
10: Salvage title

I would have the dealer fax you a photocopy of the title, if that transaction code is on there then their case loses a little validity. However you have still failed to comply with the ten point font yada yada.

Good Luck! If I think of anything else I'll post it.
 

antrc170

Member
I suggest going with Lordy123 advise. I would add though, that even if the car should have a rebuilt title attached the dealer admitted it was before you owned the vehicle. I would take that information to court (if you are sued) and argue that you acted in good faith in accepting the vehicle when you purchased it, and sold it in good faith that it was a clean car.
 

quinnsgal

Junior Member
Title reply

Nowhere on the title for the car does it state that it was a salvage title or a a replacement title-so, because the car had no visible signs of bodywork, and because there was no markings on the title, we had no reason to think it was a salvage.
 

Lordy123

Junior Member
Nowhere on the title for the car does it state that it was a salvage title or a a replacement title-so, because the car had no visible signs of bodywork, and because there was no markings on the title, we had no reason to think it was a salvage.
It may not say "Salvage" or "Replacement". You have to look at the transaction code. I'm not sure where this would be on your states title.

Also a "Previous Salvage" title will NOT have and brands on it. If this is the case then you'll need to follow the advice of antrc170 when going to court.
 

justalayman

Senior Member
It may not say "Salvage" or "Replacement". You have to look at the transaction code. I'm not sure where this would be on your states title.

Also a "Previous Salvage" title will NOT have and brands on it. If this is the case then you'll need to follow the advice of antrc170 when going to court.
from what I read, any title post rebuild will be indicated in some way to be a rebuilt vehicle title.


If this were me, I wouldn't even entertain the dealerships harassment without them providing some form of legal support for their claim of the rebuilt title. Carfax is not legal support. Carfax means nothing. The title would have to be researched through the state to verify if is a rebuilt vehicle and unless the dealership does that, I would tell them to piss off.
 

Lordy123

Junior Member
from what I read, any title post rebuild will be indicated in some way to be a rebuilt vehicle title.
98% of the time this is correct, however in AL there are rare exceptions. I'm not sure what criteria makes some titles only have a transaction code with no branding. But I do know that up until a certain year, vehicles coming in state with a "rebuilt"(not salvage) title will be branded as "Previous Salvage", but there will be no branding on the title itself. Given the age of this vehicle I entertained it as a possibility.

If this were me, I wouldn't even entertain the dealerships harassment without them providing some form of legal support for their claim of the rebuilt title. Carfax is not legal support. Carfax means nothing. The title would have to be researched through the state to verify if is a rebuilt vehicle and unless the dealership does that, I would tell them to piss off.
This is correct, I've seen carfax inaccuracies plenty of times. The fact that they contacted you before doing any research is pure laziness.
 

quinnsgal

Junior Member
Title code

The title has the code 03

I think what my husband has decided to do is a mixture of the advice given on the board (telling the dealership where to go ) but also getting our local family attorney to write the dealer a letter stating our position-but we are just letting it lay for now.
What makes it worse is that a couple of weeks after my husband bought the car, we were driving, pulled into a parking space, and the front bumper fell off-obviously either the driver who traded it in or this dealer rigged it so it would stay on just long enough-but, my husband did not call the dealership "demanding" that they pay him -he simply took it to a body shop, payed $700 out of pocket and had it fixed and moved on...so, it really pisses him off that this dealer thinks that he is going to pay them $2500 for something that he had no knowledge of!
Thanks so much for all of the advice -if you think of anything else-please post!
 

cyjeff

Senior Member
When you insured the vehicle in question, you had to provide the VIN to your insurance carrier.

I would contact that carrier and request that VIN.

Using that VIN, I would pull not only your own version of the carfax but also contact the DMV for a title search.

In this manner, you can find out what cards the dealership has to play without actually alerting them to your investigation.
 

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