How can auto sale contract be breached

Question

Customer goes to a dealership in Texas to buy a used car. Car is test driven and customer likes it.

Customer makes agreement to buy the car, and they settle on a price. Customer signs a deal with a trade, and pays the down payment. Customer then expects to take delivery of the car.

Dealership says they need to put a part on the car. They say they can have the care ready the next day. I ask why and what is the part but the salesman can't tell me. Or won't tell me. I say ok and intend to come back the next day to get the car.

They tell me they 'ordered' the part and it won't be in until 5 days later and they expect me to be able to pick up the car after it's installed 6 days later.

I tell them no, I want the car now and I'll bring it back to let them install it when the part comes in. They say 'no it might be a liability to them if they release the car and there's an accident.'

I say - wait - you were letting people (myself included) test drive the car at highway speeds and you didn't think it was a liability and now you just don't want to release the car.

I told them I'm paying 15 dollars a day in interest on the car, and you're refusing to deliver my car to me. I consider that a breach of contract. So I want to void the deal. Give me my down payment back.

They want to keep the car but keep me bound to the contract.

Is that legal? It should be my car and my decision as to whether or not I want to drive the car while waiting for a part. Not theirs. And they won't even tell me what part they ordered and want to put on my car.

I've researched it and Texas law doesn't seem to really have many laws requiring a 'cooling off' period. See: Contract Date Vs Date of Possession

Any recourse?

Answer 1

There is a reasonable chance that the amount that you are borrowing and paying interest on is through a third party, so the dealer can't just waive the interest for the period when they are fixing the car. Legal responses would include canceling the sale, and suing for damages. The problem with suing for damages is that this isn't costing you an extra $15/day (the loan gets paid off at a fixed time, regardless of how much you get to actually drive the car). It would be a considerable stretch to argue that you were deprived of a week's worth of enjoyment for the car because of the wrongful acts of the dealer, and should be compensated. Your attorney would be in a good position to tell you, based on the facts and Texas law, whether that approach would be futile.

The legality of the situation primarily depends on what the contract says. It is likely that the contract has clauses that maximally disclaim responsibility to the maximum extent allowed by law. There will be some clause that says something about taking delivery of the car, so you can check whether they have breached the contract on that point: it is possible that there is some escape hatch like "as soon as possible, upon receipt of payment".

It seems pretty clear that they concealed a material fact, in order to induce you to buy the car. For example, the manufacturer may have installed a defective veblitzer which had to be replaced, and a reasonable person would not buy a car with a defective veblitzer, thus the veblitzer is a material fact. Or: the veblitzer may have been damaged in a flood. The fact that the car is, by their representation, not safe to drive in its current state, the mind of fact that would push most people into the "no thanks" category.

To pursue the fraud angle, you need to be more specific about the defective part in your complaint. The only way to force them to reveal the nature of the missing part is to sue them and compel disclosure of the relevant facts during discovery. Again, your attorney would deal with this. You should bear in mind that if the sale is simply cancelled, you may not be able to recover the loan application or processing fee, and the trade-in will no doubt have been sold, so you can't get the old car back.

There are laws against deceptive trade practices which might be applicable, depending on whether they said anything deceptive in their disseminated advertising. Section 17.46 may be applicable, if they patched the car together temporarily with a counterfeit veblitzer.