Judson E. Crump, PC

2 Debt Collectors Defeated in Court: Midland Funding and Atlantic Credit & Finance – Alabama Consumer Protection Lawyer Judson E. Crump

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We went to Court on Two Collection Suits in June.  We won both.

One of our clients was sued by Atlantic Credit and Finance Special Finance Unit, LLC.  Isn’t that a ridiculous name for a business?  I suppose they have to keep creating corporate entities to keep things complicated.  These debt buyers love to shut down in one place and open back up in another with the same ownership and management.

Atlantic Credit & Finance Win June 2015Another client was sued by Midland Funding, LLC.  They’re an old name in the junk debt purchasing industry.  They sued him for some alleged credit card debt, and when we went to court, they lacked the evidence to prove their case.

Another Midland Funding Collection Suit Won for the working folks.
Another Midland Funding Collection Suit Won for the working folks.

 

What Makes a Debt Collection Call Illegal? – Alabama Consumer Credit Attorney Judson E. Crump

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Are You Getting Harassing Telephone Calls From Debt Collectors?  They Might Be Illegal!

Sure, a bona fide creditor has a right to ask you for payment, but when do good faith collection efforts end and illegal harassment begin?

There are basically two ways that a phone call can be illegal:

  1. The call itself is illegal (meaning the debt collector never had business making the call in the first place); and
  2. The content of the call is illegal (meaning that the caller breaks the law by saying something deceptive, abusive, or offensive).

I. Categorically Illegal Phone Calls

Let’s start with the first category.  While there is, of course, nobody policing every phone call made (I hope), a business usually should have a legitimate business purpose in order to call someone.  There are two laws that regulate debt collectors’ telephone calls: the Telephone Consumer Protection Act (TCPA) and the Fair Debt Collection Practices Act (FDCPA).

The TCPA says that a business (like a debt collection agency) is not allowed to use automated dialing systems to call or text people without their express consent.  In other words, a debt collector can’t call you without your permission – IF they’re using an automated dialing system.  Fortunately, most collection agencies, mortgage servicers, and other large companies do use autodialers to make collection calls.  The rule is simple, but it has more implications than you may realize.  Here’s some examples of calls that violate the TCPA:

  • Phone calls and text messages intended for another person (like someone who used to have your cell phone number);
  • Phone calls or messages sent to a new cell number that you never gave to the collection agency or your previous creditors – Keep in mind, though, that if you put a phone number on a credit application, collection agencies can use that number to call you.
  • Calls, texts, or voice mails made by a collector after you have told them not to contact you on that number – This is called “revoking consent” and once you have revoked consent to a creditor, it applies to all future debt collectors.  For instance, if you write HSBC and tell them that they’re no longer allowed to call your cell phone, and HSBC later sells that account to Midland Funding, Midland Funding shouldn’t call that number.

The FDCPA also has some categorical restrictions on phone calls.  The two most important ones are:

  1. A collector can’t call you after 9 PM or before 8 AM – YOUR time zone.
  2. They cannot call you once they have been notified that you are represented by an attorney.
  3. They cannot call you at work if they have reason to believe that you’re not allowed to take their calls at work.

After reading this, you should remember that there are a few things you can do right now to reduce your unwanted debt collection calls:

  • Notify them that you revoke permission to call your cell phone.
  • Notify them that you cannot take any calls at work.
  • Hire a lawyer to settle (or “settle”).

II. Illegal Statements or Language in Collection Calls

The second category of illegal debt collector phone calls are those which are illegal because of something the collection agent says.  All communications made by a debt collector to a consumer are governed by the federal Fair Debt Collection Practices Act.  The FDCPA, as we call it, prohibits debt collectors and their employees from doing certain things in their collection calls.  The biggest examples are:

  • Lying.  Debt collectors cannot make any false statement when they’re trying to collect.  For instance, they can’t say that interest is going to accrue if they don’t have the right to collect interest.  They can’t say they have a warrant out for your arrest.  They can’t say that they’re going to take your home.  They can’t report false info on your credit reports.
  • Threatening.  Debt collectors cannot threaten any legal action they either can’t or don’t intend to take.  They can’t say “If you don’t pay us in 2 weeks, we’ll take you to court” if in fact they aren’t really going to take you to court.  They can’t threaten to take your car if they don’t have a lien on the car.
  • Abusive or Foul Language.  A collection agent cannot be obscene, sexually suggestive, insulting, or harassing.  They can’t call you a fatass.  They cannot call you a whore.  They cannot say that you’re a “horrible mother” or a “deadbeat dad.”  They cannot use profanity.
  • Divulging Private Information.  Collection agencies cannot tell other people your business, except your lawyer and your spouse.  Live-in girlfriends are not spouses.  Baby-daddies are not spouses.  If a debt collector calls your house and tells anyone but you or your spouse that you owe money, then they are breaking the law.

If you are getting any of the sorts of calls described above, you may be able to sue for cash damages.  If you live in Alabama, call us at 251.272.9148 to discuss your rights.

What Is False Advertising? – Alabama Consumer Protection Lawyer Judson E. Crump

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“False Advertising” happens all the time.  What Can You Do About It?

You Can't Believe Everything You See on TV. But False Advertising is Illegal.
You Can’t Believe Everything You See on TV. But False Advertising is Illegal.

Scenario 1: You open the mailbox.  Tucked in with all the junk mail you see a great offer: a discount on something you’ve been wanting for months, available only for a limited time.  You go to the store to buy the advertised special.  But you get there, and the price advertised isn’t what is being charged.

Scenario 2: An online retailer’s website lists a color printer at $199.  You buy it.  4 days later, the package arrives in the mail, and you open it only to find that the printer is a black and white printer.

Scenario 3: Autotrader.com has a truck listed for $16,990.  You go to the dealership and when you sign the paperwork, you realize that the real price has been jacked up to $18,500.

Scenario 4: You take the family out to dinner at “The Red Crawfish,” where you order a fillet of red snapper.  But it doesn’t taste like snapper.  In fact, the underside of the fillet has some small black scales.  Turns out, you’ve been served mullet instead.

All these scenarios have something obvious in common: they involve false advertising.  False advertising can come in many forms, and new ones are invented every day, it seems.  The reasons are obvious: businesses will do almost anything to get you to buy their products.  And while some exaggeration is harmless and expected, are merchants allowed to lie about the products they sell?  Absolutely not.  And if they do, then they can be taken to court and held responsible.

Like most states, Alabama has a specific statute prohibiting false advertising: the Alabama Deceptive Trade Practices Act, or “ADTPA,” as we lawyers call it.

The ADTPA, which can be found at Ala. Code Title 8, Section 19, contains a list of specific prohibitions.  Here are a few:

  • “Causing confusion or misunderstanding as to the source, sponsorship, approval, or certification of goods or services.”
  • “Causing confusion or misunderstanding as to the affiliation, connection, or association with, or certification by another.”
  • “Using deceptive representations or designations of geographic origin in connection with goods or services.”
  • “Representing that goods or services are of a particular standard, quality, or grade, or that goods are of a particular style or model, if they are of another.”
  • “Advertising goods or services with intent not to sell them as advertised.”
  • “Disparaging the goods, services, or business of another by false or misleading representation of fact.”
  • “Making a false or misleading statement of fact concerning the reasons for, existence of, or amounts of, price reductions.”
  • “Engaging in any other unconscionable, false, misleading, or deceptive act or practice in the conduct of trade or commerce.”

Translated to normal English, here are some examples of what the Alabama Deceptive Trade Practices Act means:

  • They can’t say a product is “Made in the USA” if in fact most of it was made elsewhere.
  • If you sell Grade A Angus Beef, then you can’t serve Grade B Beef, or Grade A Pork/Beef Mix, or Grade A Beef made from any cow other than an Angus.  It must be Grade A, and Angus, and Beef.
  • You cannot advertise that your product has a 2 year warranty if you only provide a 1 year warranty.
  • They cannot put “red snapper” on the menu if what they sell people is something other than a Lutjanus campechanus (a.k.a. Red Snapper).
  • They can sell “Grouper” even if the grouper comes from Madagascar.
  • If a label says “Certified Organic,” then the food must be organic and certified.
  • If a restaurant brags that it was “Voted Best Hamburgers in Alabama,” then it must have some good reason for saying that.
  • If a price is advertised as “25% Off,” then the non-discounted price should be 33% higher than the “discount” price.  (Because (3/4 of A) x 4/3  = A).

The Alabama Deceptive Trade Practices Act also forbids false advertising of services in many instances.  For example:

  • If a debt settlement company claims it can cut your debt by 50%, and you pay them to do so, but they don’t perform, then they’re false advertising.
  • If a credit repair service claims to be able to boost your score by 100 points, then they better be able to do it.
  • A car finance company or dealer who says that “If you have a job and $500, you can get a new car!” must have new cars that they are actually willing to sell to anyone who has a job and $500.

How to Prepare A False Advertising Case

There are a few things you need to cover before you rush to a lawyer’s office, though.

First, you must get proof of the actual advertised terms.

If advertisements are written, then they are usually allowed to have footnotes and fine print that “explain” the terms they are advertising.  You must obtain a copy or printout of any written, TV, or internet advertisement.  Read the whole thing.  Make sure you paid attention to it before you went to buy the advertised product.  If a “disclaimer” or “Explanation” was hidden, it may not have any legal effect.

Oral or radio advertisements may have a similar explanation at some point during the advertisement.  If you have been cheated or scammed by a radio advertisement, you need to listen for the advertisement that fooled you and record it.

Second, you must show that you bought the falsely advertised product or service.

This is pretty easy.  If you have a receipt, bill of sale, credit card statement, or any other record of your purchase, then you can show that you were in fact the victim of the false advertising.

If you’ve been cheated by false advertising, it is important to take action quickly.  The Alabama Deceptive Trade Practices Act only has a 1 year statute of limitations, which means that you have 1 year to take them to court once you’ve discovered (or should have discovered) the false advertising.  Furthermore, you have to write a letter demanding compensation at least 15 days before you sue them.

The content of this letter should be drafted with the assistance of a consumer protection attorney, because if not drafted properly, it will not have legal effect.

We take false advertising seriously.  It hurts real people and the entire economy.  If you’ve been the victim of false advertising in Alabama, call us today at 251.272.9148.

Who is Convergence Receivables? – Alabama Consumer Credit Lawyer Judson E. Crump

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Have you received a lawsuit summons from Convergence Receivables, LC?  Who are they?  What do they want?

 

Hey folks.  I am Judson Crump, an Alabama consumer protection lawyer.  One of my specialties is defending people who have been sued by companies they’ve never heard of.  One such company is Convergence Receivables, LC.

Convergence Receivables, LC is a debt buyer.  This means that they purchase old charged off accounts from banks, credit card companies, auto finance companies, or other creditors, and then try to collect them.  Sometimes, you may never get a phone call, letter, or any contact whatsoever from a debt buyer, then WHAM!  You get a lawsuit demanding thousands of dollars.

To make things worse, a lot of times, debt buyer lawsuits don’t even bother to explain why they think you owe them so much money.  They just hope that you don’t answer the complaint and they can get a default judgment and try to garnish your wages or bank account.  Or scare you into paying them.

The most important thing to remember about debt buyer lawsuits is that even if you really did owe money to someone in the past, that doesn’t automatically mean that any collector who comes along can get it from you.  Here’s why:

Imagine if you borrowed $100 from your friend, Will.  You admit that you owe Will $100, but you can’t pay him right now because work is slow and you have 3 kids.

One day, as you are walking into work, a guy named Bubba comes up to you and says “Give me $100.”  What would you say?

“Hell no, I’m not giving you $100.”

“You owe Will $100 and I paid Will $5 for your debt.  So give me $100.”

“I want some proof.”

Well, that’s the problem.  Anyone claiming to sue on behalf of another must prove not just that the money was owed, but that they have the right to the money.

So if you get sued by Convergence Receivables, LC, or some other debt buyer, you don’t have to file bankruptcy, and you may have a good chance at beating them in court and saving thousands.

The key is to call a lawyer with experience fighting these sorts of cases.  I’ve beaten dozens of collection lawsuits.

If you live in Alabama and are facing a lawsuit or abusive collection tactics by Convergence Receivables, then call me at 251.272.9148.

Credit Reports & Mortgage Payments After Bankruptcy – Alabama Consumer Credit Attorney Judson E. Crump

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“I filed bankruptcy a few years ago, but I kept my house and have made my mortgage payments.  Why isn’t my good payment history being reported on my credit reports?”

A lot of consumers in Alabama have been noticing an unexpected problem with their credit reports after bankruptcy: their mortgage payments disappear!  This is particularly distressing to some people because having gone through bankruptcy, they’re trying to work their way back towards financial stability, and making those mortgage payments on time every month isn’t always easy.

Most of us know that a bankruptcy filing will remain on your credit reports for 10 years from the day you file the petition with the bankruptcy court.  That’s damage enough, right?  So at the very least, it only seems fair that if you continue paying some of your debts after bankruptcy, you should get credit for that good behavior.

That’s true.  But the law is a bit more complicated than that.  Whether or not your mortgage payments should be on your credit report depends on several aspects of your bankruptcy proceeding, like what chapter you filed and whether a reaffirmation agreement was signed and approved by the Bankruptcy Court.

A common scenario looks like this: you file Chapter 7 bankruptcy.  Your lawyer prepares the petition and does the paperwork, and you go to court for your 341 Meeting.  You answer the Trustee’s questions and you are told that you’re free to go.  You get your discharge a few months later.  As for the mortgage, your lawyer only says: “Just keep making your payments and they can’t take your home.”  But you don’t sign anything in writing stating that you’re going to keep paying the mortgage.  You just do what your lawyer says and make your payments.

Then, a few months after you’ve gotten your discharge, you notice that all those good, current payments of hard-earned money aren’t even being reported on your credit.  And worse, the mortgage that you’re paying every month is reported as having been discharged in bankruptcy!    How is that possible?  You’re living in the house and paying every month!

Well, it is possible.  Because in order for a dischargeable debt to survive a Chapter 7 bankruptcy, you must sign a reaffirmation agreement and file it with the Bankruptcy Court.  And the Court must approve the reaffirmation agreement.  If you didn’t sign a reaffirmation agreement (or a “Re-Aff,” as we lawyers call it), then the debt is legally considered discharged.  Which is both good and bad.  It is good because that mortgage company cannot go after you for the money you owe if they end up foreclosing.  Normally, if you owe $150,000 on a home mortgage and the home sells at foreclosure for $100,00, then the bank can sue you for that $50,000 deficiency balance.  But if you didn’t sign a Re-Aff, you’re off the hook.

The downside is that the bank has a duty to report the real legal situation: that debt was discharged.  Furthermore, the Fair Credit Reporting Act does not require any creditor to report positive information.  It only prohibits creditors from reporting false negative information.

If that’s the case, then why doesn’t the bank foreclose immediately?  Two reasons: First, their mortgage lien cannot be foreclosed unless you default on the contract, and if you never default, then they cannot take your vested interest in your own property.  Second, mortgage companies lose money in foreclosures.  If you’re paying, they have no reason to foreclose unless you have a LOT of equity in your home.  And if you just filed bankruptcy, you probably don’t have much equity in your home.

Why didn’t your lawyer tell you this?  I can’t say.  Good lawyers explain these sorts of things to their clients.  But a lot of bankruptcy lawyers just process their clients through the system as quickly and inexpensively as possible, because they run a volume practice.

If you’re thinking about filing Chapter 7 bankruptcy, then you need to consider the advantages and disadvantages of reaffirmation agreements.  If you are fairly certain that you can afford to pay the mortgage and you know for sure that you want to keep that home, then a reaffirmation is probably a good idea, because the positive payment history will help you rebuild your credit faster.  But if you’re not sure about keeping the home or your ability to maintain the payments in the future, then you should avoid a reaffirmation.

If you are considering Chapter 7 bankruptcy in South Alabama, call us at 251.272.9148.

What is Wrong with Alabama’s Lemon Law? – Alabama Consumer Protection Lawyer Judson E. Crump

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“I bought a car and it was a complete lemon.  Should I sue them under the Lemon Law?”

If you are like most people, if you buy a car that turns out to be a piece of junk, you probably assume that your rights are governed by this thing called “the Lemon Law.”  Which makes a certain kind of sense: they sold you a “lemon,” you paid good money for a bad car, shouldn’t they have to take it back?

If only.

The problem is that Alabama’s Lemon Law sucks.  I’ve written about the Lemon Law generally in previous articles.  And I have to say here that as a true lover of lemonade, lemon merengue pie, lemon bars from Pollman’s Bake Shop, lemon juice as the acidifier in my canned homegrown tomatoes, and pretty much all things lemon, I really don’t like the name of the law.  We should give bad cars a bad label.  We should call it the Grapefruit Law.

Alabama’s Lemon Law (Ala. Code 8-20A-1) has three huge weaknesses.  First, it can only be used against manufacturers.  So dealers who sell lemons get away Scot-free, even if they know that they’re selling junk.  I don’t think this is fair.  But car dealers have a very well organized lobbyist machine in Montgomery and Washington, D.C. so this isn’t changing anytime soon.

Second, it doesn’t apply to used cars.  Even if they’re barely used.  Most cars that are sold are used cars, and most fraud happens in used car sales, so this takes away lemon law rights from the people who need them the most.

Third, and most importantly in my opinion, the Lemon Law requires you to give the Manufacturer too many chances to fix the problem.  In a nutshell, if you buy a vehicle with a major defect that pops up in the first 12,000 miles, then you have to give the manufacturer a reasonable opportunity to fix the car.  What is a “reasonable opportunity?”  That question is left to judges (and more often, arbitrators) to a certain degree, but the standard is this: Three repair attempts or 30 days in the shop.  All 30 days or 3 attempts have to be directed at the same defect.  If your vehicle has a window that won’t roll up and a clunky transmission, if you take it in the shop twice for the window and once for the transmission, you haven’t met the lemon law’s definition of “reasonable.”

But this isn’t the problem.  Most people generally do give a dealer or manufacturer 3 chances to fix the malfunctioning part.  The problem is that even after you’ve been reasonable, you have to jump through yet another hoop: you have to send the manufacturer a letter demanding that they fix the vehicle within 14 days.  You have to send it to the proper address, which is designated by the manufacturer.  And you have to send it certified mail.  And you have to give them another chance to fix it.

If the defect is a radio that sounds funny, then a 4th repair attempt isn’t a big deal.  But what if it is the power steering?  Or the brakes?  Who in their right mind would drive (or put their children in) a vehicle whose steering or braking is liable to malfunction at any moment?  Nobody!

And this is the problem.  You’re not going to take anyone to court over a radio.  There just isn’t enough monetary damage involved.  So for small defects, there’s no point in the Lemon Law because your case isn’t worth suing over.  But for big defects, the ones that really affect the car’s performance or safety, you’re not going to jump through that extra hoop.  The manufacturer is lucky if they get 3 chances to fix a car whose brakes fail without warning.  No sane person is going to give them a 4th.  But Alabama’s Lemon Law requires you to do just that.  Which means that for cases involving serious defects, the Lemon Law is virtually useless.

So What Do You Do?

Fortunately, you still have other legal claims that probably apply.  The best one in the case of a serious defect is typically breach of warranty.  If your car came with a warranty, and the car didn’t perform as it was warranted, then you can sue for breach of warranty.  You still have to give the dealer a reasonable chance to fix the problem, and you still have to follow the manufacturer’s procedures for resolving a warranty dispute, but if that fails, then you can go to court without any certified letter or 4th repair attempt.

If someone has been seriously hurt or killed by a dangerous defect, then you can take the dealer and/or manufacturer to court for product liability.  This only applies to situations where someone has been personally injured, but if there are injuries, a product liability action can be very powerful.

The Bottom Line: If you’ve bought a new car that has turned out to be a piece of junk, then you should give them a few chances to fix it.  If that doesn’t fix the problem, you can call us at 251.272.9148.

$30,000 Student Loan Collection Suit Defeated at Trial – Alabama Consumer Protection Attorney Judson E. Crump

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One of our clients was sued by a debt collector for a $31,000 student loan.  We beat them at trial.

Jefferson Capital Systems, LLC, a purchaser of uncollected accounts, sued my client for an alleged student loan debt.  They alleged that my client had obtained a student loan years before, and had failed to pay it, and therefore that he owed them over $31,000.

We challenged them at trial and won a judgment for the defendant.  The threat of such a large judgment hanging over his head was immensely stressful for our client.  Needless to say, winning this case took a huge load off his shoulders.

If you need help dealing with Jefferson Capital Systems, call us today at 251.272.9148.

$31,000 Student Loan Lawsuit Dismissed.
$31,000 Student Loan Lawsuit Dismissed.

Dealer Didn’t Pay Off Your Trade-In? What To Do About It – Alabama Consumer Protection Lawyer Judson E. Crump

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“My Trade-In Vehicle wasn’t paid off by the Dealer.  Now it’s still on my credit report as past due.  What can I do?”

Believe it or not, this question comes up fairly often.  You go car shopping, and you find a car you like, negotiate a value for your trade-in vehicle, sign the papers and drive off in your new ride.  You start making your new payments and all is well.  Until you find out that your old car loan – the one that the dealer was supposed to pay off – hasn’t been paid off.  And now you’re getting collection calls, and past due negative marks on your credit report.

Sometimes, it is a (mostly) honest mistake.  Your old car note information got lost in a stack of other deals and the dealer didn’t send the check to the old lien holder until a couple of months had gone by.  They eventually pay, but not before your credit takes a hit.

Other times, it is a regular practice of shady dealers.  They gladly take your trade-in, and they give you credit for its value, minus the previous lien, and they’re supposed to pay off the old lien.  But sometimes they don’t pay off anything for a couple of months, because they are waiting to see if they can obtain financing for your deal.  Even though you’ve signed the papers and already driven off in the car.  In the worst cases, they may not pay it off at all.

Regardless of their reasons, and even if they did it by mistake, a dealer’s failure to promptly pay off the lien on your trade-in vehicle can have serious negative consequences for you.  See, the lienholder will blame you for their late payment.  Your previous lienholder doesn’t care whose fault it is – all they know is that your payment is due on the first of the month, and if it is 30 days late, they’re going to report that to the credit bureaus, and it’s not going on the dealer’s credit report.  It’s going on yours.

If you have otherwise clean recent credit history, this can have a serious impact on your ability to obtain a mortgage and can increase the cost of things like credit cards and other loans.

To make matters worse, the credit bureaus don’t care whose fault it is either.  The Fair Credit Reporting Act only requires that the information they publish be as accurate as possible – not that it be a fair reflection of who is to blame for your negative credit marks.  So if you dispute a “Past Due” amount on a car loan that was only past due because the dealer screwed up, they don’t have to fix it.  And therefore they probably won’t.

So What Can You Do About It?

You’re not without hope, though.  By taking your trade-in and adding the balance of your previous lien to the cost of your new vehicle, the Dealer is being entrusted with your property.  They are taking your property partially for your benefit: to be liquidated to pay off your old lien.  And they have a contractual duty to do just that.  When they do not do so, they can be held liable to you for the damages caused by that failure.

The most common problem facing a buyer in these cases is proving that the dealer’s irresponsibility caused you damages, and proving the amount of those damages.  Most often, the only financial harm that is caused by a dealer’s failure to pay off a trade-in is in the form of credit denials and increased cost of credit.  While there have been cases of buyers who were unable to buy a home because of a dealer’s failure to promptly pay off a trade-in, this usually is not the case.  Credit reports contain lots of information, and unless you can obtain evidence from a lender that you were denied credit, or your interest rate was higher primarily due to the unpaid previous car loan, then obtaining significant compensation from the dealer is going to be hard.

So where the dealer simply waited a month or two to pay off a trade-in, it may not be worth the money of filing a lawsuit unless you can show specific harm.  You may simply want to file a small claims lawsuit or post a few negative reviews and BBB complaints against the seller.

However, if several months go by and the debt remains unpaid, then the dealer’s failure to pay the lien may be a sign of serious fraud, and you should talk to a lawyer immediately.  Particularly if the previous lien holder begins pursuing you to collect the unpaid debt.  Yes, this can happen.

This situation often involves two victims – you and the person that the fraudulent dealer sold your old car to.  I’ve had clients who were sold vehicles that the dealer didn’t even own.  If a dealer sells you a car that has a valid lien on it, then the previous lien holder may repossess the car from you – even though you never owed them a dime!

This can be immensely frustrating and disruptive to your whole life.  The loss of your transportation can cause you to miss work and family commitments, not to mention the money that you’ve paid in good faith for the car.  If you suspect that you’ve been sold a vehicle without clear title, then you need to call a lawyer immediately.

What to Do When a Manufacturer Won’t Honor a Warranty – Alabama Consumer Protection Lawyer Judson E. Crump

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Warranties are most of the reason why we buy cars new instead of used.  But what do we do when we buy cars that don’t perform as they’re warranted?

Sometimes, a car just isn’t built right.  Maybe somebody in the factory was sleeping at the assembly line.  Maybe there was a weak piece of steel somewhere in the frame.  But whatever the reason, sometimes you buy a car that just doesn’t work.  This happens with every sort of consumer product – from canteloupes to cell phones to cars.  And ancient rules of commercial practice – most of which have been enshrined in the Uniform Commercial Code, which is now the law in 49 of the 50 United States – provide a simple remedy: if it doesn’t work the way it is normally expected to work, then you can get a refund.  This is true, even if there is no written warranty, and it is something we lawyers call the “implied warranty of merchantability.”  Basically, if a product you buy doesn’t work the way it should, then the default rule is that the merchant should pay you back the purchase price.

If you’ve ever returned a faulty ceiling fan or toy at Wal-Mart, then you’ve dealt with the Implied Warranty of Merchantability.  When you take the item back and get a refund, Wal-Mart isn’t just giving your money back out of sheer generosity or great customer service.  They’re doing it because they have to.

And car dealers have similar obligations.  Of course, because automobiles have big price tags and car dealers make lots of money by moving deals along, rather than unwinding them when things go wrong, car dealers put a LOT of effort into avoiding their warranty obligations.  In fact, most dealers have worse customer service than Wal-Mart.  And Wal-Mart isn’t always known for great customer service.  But I assure you, if you buy something from Wal-Mart that doesn’t work, you won’t have to take Wal-Mart to court to get a refund.  With car dealers, however, filing a lawsuit is pretty much bound to happen if you buy a vehicle that doesn’t perform well.

So What do You Do?

Once you determine that you’ve been sold a vehicle that isn’t up to standard, there are two basic rules to how you proceed to fix the situation.  First, you must give the manufacturer a “reasonable opportunity” to fix the problem.  What does this mean?  Basically, you need to take it back and let them try to repair the defect.  If the product you’ve been sold is defective, then before asking for a refund, you do have to give them a chance to fix the defect.  And you may have to give them multiple chances to fix the problem.  How many chances?  That depends on the nature of the problem.  For a minor issue like a radio that doesn’t sound right, you have to give them several chances.  For a dangerous problem like brakes that don’t stop the car quickly, two repair attempts may be sufficient.  “Reasonable” is a question that is decided for each case as the facts dictate.  It is reasonable to expect several tries to fix a radio, but not brakes, because brakes are just essential to the function of a vehicle.  No reasonable person can be expected to drive a car whose brakes have failed after several repair attempts.

Second, you must follow the manufacturer’s written procedures for making warranty claims.  Your manufacturer’s warranty should be in the Owner’s Manual or a separate booklet.  Wherever it is, you need to read it and follow it to the letter.  It may direct you to take the car to a licensed dealer.  If so, then you have to do that.  It may require you to submit your warranty claim to BBB Auto Line or some other ‘neutral’ warranty dispute resolution process.  If so, then you have to do that.

Whatever the process is, you should follow it to the letter.  Failure to follow the contractual procedure is the number 1 slimy defense that makers and sellers of bad products use to avoid the consequences of selling junk to innocent buyers.  Don’t let it happen to you.

As a final thought, most of the rules that apply to automobile warranties also apply to all warranties for major consumer goods, like boats, RVs, and even mobile homes.

If you’ve been damaged by a defective or dangerous product that hasn’t been fixed, call us at 251.272.9148 for a consultation.

Car Paid for but still no Title? What you can do about it. Alabama Consumer Finance Attorney Judson E. Crump

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You’ve worked hard.  You made your payments, and finally, the vehicle is YOURS!  Right?

 

So after your hard work and dedication, after you’ve made every payment that was due, you expect a free & clear certificate of title to your vehicle.  After all, that is what the contract entitles you to, right?  So you wait and check the mail every day, but weeks go by and nothing comes.  What do you do?

Believe it or not, this actually happens sometimes.  Particularly with poorly run buy-here-pay-here car dealerships.  Sometimes, the dealer may just be lazy, and if so, you can probably resolve the issue with a quick phone call.

If a phone call doesn’t get you the title within a week, you need to write a letter.  A title demand letter.  You can see a copy of one HERE: Title Demand after payoff.doc  (It is an MS Word Document that you can adapt to your own use).

In Alabama, they have 10 days after they receive this letter to send you your title.  Be sure to send it to the right address.  As you make your payments, you need to be sure to have their current address at all times.  Sometimes they move away from the business location where you bought the car, so you need to keep up with their whereabouts.

If they don’t give you the title in 10 days, then you may need to take them to court to compel them to release the title.  Very often, a refusal to deliver a title after full payment is a sign that they defrauded you by selling a vehicle they didn’t even own.  If this happens, you need to talk to an attorney as soon as possible.

 

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