There may be lots of reasons to call the police because of a missing vehicle. A thief stealing it from your lot or an identify thief defrauding you into delivering it are clear examples of when you should report the matter to authorities.
When a customer is uncooperative over a spot delivery gone bad, however, your first reaction should not be to call the police and report the vehicle as stolen.
There are reasons a good spot can go bad. There may be a mistake made by the dealership in the paperwork. There may be a mistake made by the dealership in processing the paperwork. There may be a customer misrepresentation or a change in the customer’s circumstances leading the finance source to refuse assignment of the contract.
Usually, consumers are cooperative. They will execute a new contract that can be assigned to a finance source. Sometimes, however, the deal will go off the rails. The customer will refuse to cooperate. Then what? The answer is not to call the police and report the vehicle as stolen. That is the wrong – and potentially very expensive – reaction. In a spot delivery that goes bad, the vehicle was not stolen. You gave the customer possession of the vehicle under the transaction documents.
The amateur lawyers on your staff may contend that even if you cannot go to the police to charge a customer with theft, the dealership can have the customer charged with wrongful use. Once again, however, the customer was given possession of the vehicle and right to use the vehicle under the deal paperwork. A court is most likely to find that because of the contractual rights granted, a customer continuing to hold the vehicle is not wrongful use.
DO NOT CALL THE POLICE SIMPLY BECAUSE YOU HAVE AN UNCOOPERATIVE CUSTOMER IN A SPOT DELIVERY THAT HAS GONE BAD. Charging the customer with either theft or wrongful use can lead to a lawsuit for malicious prosecution. Malicious prosecution cases are expensive for the dealership because juries feel strongly about invoking criminal charges with a serious impact on a consumer’s life because of a civil dispute.
This does not mean the customer gets a free car. The customer still owes the obligation to the dealership to make monthly payments. Notify the customer where those payments must be made, and if they fail to do so they will be in default which will justify retaking the vehicle. Or there may be the basis for a lawsuit if the inability of the dealer to assign the contract resulted from a customer’s misrepresentations. The proper steps to recover are cumbersome and time consuming. However, they are much cheaper than a malicious prosecution lawsuit that often can result from any improper police report.