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Car Dealer Held Responsible for Selling Unrepaired Recalled Car

Monday, April 30, 2018By Richard Alexander

In a landmark decision addressing the liability of car dealers for selling unrepaired used cars subject to recalls, the Fifth District Court of Appeal in Fresno, California ruled that CarMax was in violation of California’s Consumer Legal Remedies Act and Unfair Competition Laws. The decision establishes that used car purchasers are entitled to the same protections available to any other consumer with respect to cars that contain defects. After overturning the lower court’s decision, the Appellate court remanded the case for further proceedings.

According to CarMax, each car it sells undergoes a careful inspection and conditioning process before it is sold as a “CarMax Quality Certified” vehicle. The plaintiff purchased a defective Hyundai vehicle in May, 2013 from a CarMax dealer in Bakersfield, California. The dealer certified that the car had passed a “rigorous 125-point inspection” system, which included examining brake lights. Hyundai had previously issued a recall for the plaintiff’s car due to a defective brake light switch. The recall notice stated the switch may periodically malfunction which could cause a number of issues in other systems including irregular functioning of the push-button start feature, the shifter function, cruise control operation, and activation of the Electronic Stability Control indicator and brake light indicator. The final item- faulty operation of the brake lamps- could increase the incidence of a collision according to the notice.

While there were no injuries or deaths as a result of the ignored recall, other used car purchasers could be in danger of operating cars with recalls that have not been addressed. The decision issued by the Court of Appeal does not create formal legal precedent, but it may be considered by other courts in rendering their decisions. The Court specifically found that CarMax had a duty to disclose all the facts related to the recall. Instead, CarMax’s representations regarding the car’s braking system were inadequate and incomplete. The Court determined that a buyer could have erroneously relied on representations that did not fully reveal the circumstances surrounding the recall.

A number of consumer groups, while praising this decision, have also sought to improve consumer safety standards by suing the FTC to overturn Consent Orders issued under the FTC. These Consent Orders permit dealers, such as CarMax, to market cars with unrepaired safety recalls as “safe,” “repaired for safety,” and “certified” if the dealer confirms that the car may be affected by an open safety recall.

If you or a member of your family suffered injury or death as a result of negligence or a defective automobile, contact the attorneys Alexander Law Group, LLP. Our exceptional personal injury lawyers will answer your questions and get you the maximum compensation that is possible. Call 888.777.1776 or contact us online.

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