How to Sue Car Dealerships for Bad Cars

By Bonnie Peterson

If you bought a car from a dealership -- new or used -- and the price you paid was higher than the price you were told or what was advertised, the odometer is off, prior damage was not disclosed or the vehicle broke down right away, then you have legal recourse. The lemon law protects you if the car is not performing right. The law varies from state to state, but all states have one. In cases of auto fraud, if you can prove it, you can take it to small claims court, but there are a few things to do first.

Read the fine print. Check the paperwork you received when you bought the car. It will have one or more of these: a time you can return the car by, information about warranties or a clause about mediation before going to the courts. The faster the problem is found, the fewer legal steps you may need.

Contact the dealer. If the dealer is reputable, it will try to make the repairs, modify the price or exchange the car for another one. Most states require you to let the dealer try to amend its mistakes first.

Put your complaints in writing, give the dealer a copy and make a copy for yourself, too, in case you go to court or mediation. Give the dealership a reasonable amount of time to correct the situation. Sometimes a letter of demand is all that is needed to get a dealership to take care of the problem.

Gather the evidence: Depending on the issue, this might consist of: an advertisement with the sales price that turned out to be different that what you were ultimately charged; a witness who was at the dealership with you who heard the salesman state a different price that what you paid for the car; or a mechanic's testimony about defects to the car. These all represent instances of credible evidence. A vehicle history report can also prove prior damages.

Go to USA.gov and follow the steps for filing a complaint against a company, such as an auto dealership. Report your situation and see if others have had problems with the same dealership. Filing a report with the Better Business Bureau could help.

Find your state's specific lemon law requirements. There are different rules from state to state about what qualifies as a lemon and the time period you have to report it. For example, in New York the car must be for personal use only and there are mileage restrictions. Other New York lemon law rules include:

  • The vehicle was covered under a manufacturer's warranty when it was originally delivered to its first buyer.
  • It was bought, leased or transferred in the state of New York within the vehicle's first 18,000 miles or two years fromoriginal delivery, whichever is earlier.
  • It's registered in New York.
  • Under the Used Car Lemon Law, vehicles that come from a dealer must have a warranty if they cost $1,500 or more, at the time of publication, and have been driven fewer than 100,000 mile_._

In California, by contrast, there is a separate law called the Song-Beverly Consumer Warranty Act, which is more expansive than many other states' lemon laws, but includes some restrictions:

  • The car must still be under warranty.
  • The owner must have taken the car in for repair for the same problem four times or more through an authorized dealer.
  • The car must have been inoperable for a total of 30 days -- not necessarily consecutive_._

In all states, prior accidents, flood damage and prior salvage titles have to be reported to the new owner. Make three copies of all documents and photos.

File a claim against the auto dealership: If you qualify for the lemon law or can prove auto fraud and have tried to let the dealer correct the problem, then file a claim at the court nearest to the address of the dealership you are suing. There is a fee for filing, which should be tacked onto the amount you are seeking.

Small claims court deals with issues involving small sums. For example, the amount is $10,000 or less in California and $2,500 or less in Kentucky, at the time of publication. For larger amounts, you must file the case in a regular court. The amount you may get is dependent on the situation. It will probably be one of these:

  • The cost of repairs you had to put into it plus court fees
  • The amount you overpaid for the car
  • All payments made to the car plus court fees
  • The full purchase price of the vehicle plus court fees
  • The full purchase price of the vehicle plus repairs you had to pay and court fees.

The claims forms will include instructions about how to file and serve the court papers.

Go to court. Arrive at the appointed time. You may be asked to go to mediation or you may go in front of a judge. Have your paperwork in order and know what you want to say before you go in.

About the Author

Bonnie Peterson has been an automotive writer and custom automotive painter since 2011. She graduated from Cypress College in the field of Automotive collision repair in 2010 and now has numerous certifications in automotive collision repair, refinishing and detailing.