We have written about myths in the car business – widely-held misbeliefs of dealership personnel about the law. Lawyers representing employees or customers in disputes with dealers have their own myths. Let’s examine some of those.
Before we do that, however, let’s discuss something that dealership employees should understand. Just because a person calls claiming to be an attorney for an employee or a customer doesn’t make it so. It is easy for a disgruntled employee or an unhappy customer to get a friend or relative to call posing as an attorney, hoping to raise dealer concern and force a quick resolution. Dealership personnel should never deal with someone calling the dealership claiming to be an attorney. Personnel should advise the caller it is the dealership’s policy only to respond to written communications from attorneys. Advise the caller that any concerns should be put in writing on the attorney’s letterhead and sent to the dealership. Once dealership personnel receive an attorney’s letter, the dealership’s complaint handling process should kick into gear. The dealership may want its own attorney to handle the communication, or it may want to handle the communication with any necessary advice from an attorney.
Once you get a lawyer letter, be careful of statements of the law that may not be true. Here are some examples.
- “My client is entitled to examine the personnel file under federal law.” There is no federal law entitling an employee to examine his or her personnel file. Some states provide access under certain circumstances, and a dealer should consult its attorney regarding possible state law on the issue.
- “Federal law requires a written statement of the reason for terminating my client’s employment.” There is no federal law applicable to dealerships requiring an employer terminating an employee to provide a written explanation. Again, state law may vary or there may be differences in unionized shops, so consult with an attorney.
- “As a dealer, you are required to allow a customer to review the deal file. Please send me a copy.” A customer has no right to examine the dealership’s deal file. The dealership should provide copies of the deal papers to the customer when the deal is done. But once a deal is complete, a customer has no right to copies without binding compulsory process. It is alright to refuse an attorney’s demand. And even if the dealership receives a subpoena, be careful. Some attorneys send out-of-state subpoenas to a dealership claiming it requires them to produce materials. Except in limited circumstances, they are not binding unless issued by a court in the dealer’s state.
- “My client is entitled to a three day cooling off period to return the vehicle under federal law.” There is no provision in federal law providing for a cooling off period. A customer who signs a contract buys the vehicle, unless there are provisions in the agreement for rescission if an issue occurs with financing.
- “My client speaks Spanish and the dealership was required to do the purchase contract in Spanish under federal law.” There is no provision under federal law requiring deal documents be completed in another language – with one notable exception. The FTC Used Car Rule requires, under certain circumstances, that the used car buyer’s guide be in Spanish. There is no other requirement under federal law. There may be requirements under some state laws, and a dealer should check with its own attorney for advice under state law.