Auto, Motorcycle, RV Fraud – Car Accident, Lemon Law and Auto Fraud Lawyer (2024)

California Car Buyer’s Bill of Rights

California Consumer Legal Remedies Act

California Business and Professions Code

Although not as historically significant as the Bill of Rights to the United States Constitution, the California Car Buyer’s Bill of Rights packs a powerful legal punch. Licensed car dealerships must provide prospective buyers with a detailed itemized list for each financial component that makes up the total price of a car, truck, motorcycle, or RV for sale. Car dealers must also present each customer’s credit score and explain how the business plans to use the score in determining creditworthiness.

The California Car Buyer’s Bill of Rights places a financing fee cap on car loans. Anytime a car dealer offers a certified new or used car for sale, it must present a customer with a copy of the inspection report that verifies the vehicle is certified. A limit placed on contract cancellation fees, as well as restocking fees, ensures car dealers do not attempt to price gouge car buyers.

California is considered the leader on a large number of social, political, and economic initiatives. On the economic front, one of the most influential consumer protection laws in the country is called the California Consumer Legal Remedies Act (CLRA). The landmark California law not only lists numerous fraudulent business practices, but also gives consumers legal remedies to get justice.

The unlawful practices mentioned in the CLRA describe generic “goods and services.” However, the CLRA clearly has legal relevance for auto dealerships that engage in fraudulent business practices. Under the CLRA, businesses are prohibited from implementing the following practices:

• Lying about the source of goods or services
• Claiming goods are new when in fact they have deteriorated in condition
• Denigrating the quality of the goods and services offered by another business
• Making false statements regarding the reason(s) for a price reduction of a good or service
• Claiming a good or service is needed, when in fact it is not
• Misleading consumers into thinking a sales agent or representative has the authority to close deals
• Adding an unreasonable provision into a sales contract
• Stating a good or service is one thing when it is quite another thing

The last prohibited practice applies especially to car dealerships that claim the auto repair shop used manufacturer parts when the shop used aftermarket parts.

According to the CLRA, legal remedies for consumers that fall victim to fraudulent business practice, include restitution, actual damages, punitive damages, and an order issued by a judge that prevents a dealership from implementing future fraudulent business practices.

The California Business and Professions Code addresses issues that consumers bring up regarding dealer auto fraud. However, most consumers do not know what protections the California Business and Professions Code grants them.

Auto dealerships must post a notice in a high-traffic area of a dealership that states there is not a no-cancellation policy for leased and purchased vehicles. Consumers have the right to cancel a contract for cause, such as in the case of fraudulent activities. Auto dealerships also must offer a two-day cancellation option for some pre-owned car sales that have a purchase price under $40,000.

Without understanding the provisions written into the California Business and Professions Code, many consumers might notice a no-cancellation policy and believe they have to follow the policy.