TIADA Releases New Disclosure Form In Effort To Protect Dealers
If I sell a vehicle "as is", does that remove or eliminate any risk of being sued by a customer?
If I sell a vehicle "as is", does that remove or eliminate any risk of being sued by a customer? In this week's blog, TIADA highlights a few of the key points TIADA Counsel Michael W. Dunagan discusses in the June issue of Texas Dealer.
“The enactment of the Texas Deceptive Trade Practices Act (DTPA) many years ago had an immediate and dramatic effect on the relationship between sellers and buyers. Selling ‘as is' did, and still does, eliminate warranties. The DTPA, however, created a new cause of action for misrepresentation, among other things, that went beyond whether or not warranties existed or a breach of warranty had occurred.”
As Dunagan discusses in his article, this cause of action created by the DTPA among other things:
- Could be based on oral statements
- Did not require proof that the seller knew of the defect or condition complained of; and
- Did not require proof that the alleged misrepresentation was made intentionally or knowingly.
In short, while selling ‘as-is' eliminates causes of action for breach of warranty, a buyer could still bring a claim for misrepresentation under the DTPA. This may explain why some sellers place an announcement of frame/unibody damage on vehicles independently of whether the vehicles have damage or not. By including an announcement, sellers may want to protect themselves from future liability for damage they may not be aware of, writes Dunagan. Sellers may consider it less risky (and less costly) to devalue their vehicles by including an announcement, particularly if damage is later detected.
Dunagan delves deeper into the issue by discussing a related case and its findings. To read the details of the case, read the full article here.
TIADA developed a Used Car Condition Disclosure form that members may want to consider using when selling a vehicle.
View sample of Used Car Condition disclosure (TIADA member login required)