12 Ways to Recover Even When Lemon Used Cars Are Sold “As Is”

National Consumer Law Center's article setting out possible ways to recover damages if you have problems with a used care sold "As Is."

Dealers selling used cars “as is” should not discourage consumers or their attorneys from seeking relief for vehicle defects or dealer misrepresentations. In almost every case, the consumer still has a viable claim despite the “as is” sale. This article sets out a dozen ways for consumers to recover even when they are sold a lemon used car “as is.”

Most of these ways allow for remedies not just a vehicle’s mechanical defects, but also for other less visible but still serious problems, such as unperformed safety recall repairs, missing airbags, flood damage, or wrecked vehicles improperly repaired. For more information on vehicle problems and investigatory techniques, see NCLC’s Automobile Fraud Chapter 2.

Used car installment sales or other purchase agreements frequently include mandatory arbitration provisions. These too should not discourage litigation to remedy vehicle problems. Arbitration agreements, particularly those drafted by used car dealerships, may have unconscionable provisions that render them unenforceable.

Practitioners also report good success in bringing claims before an arbitrator. In most cases the dealer will have to pay for most of the arbitration costs which often comes as a big surprise to the dealer, and may hasten settlement. Other times the dealer may refuse to pay the arbitration fees or to participate in the arbitration, allowing the consumer instead to bring the claims in court. When dealer practices are egregious, arbitration may be an effective venue to seek punitive damages (as long as the arbitrator is indeed neutral), because, unlike a jury award of punitive damages, there will be little or no court review as to the size of an arbitrator’s award of punitive damages. See NCLC’s Consumer Arbitration Agreements.

1. Odometer Misrepresentations Can Lead to a Minimum of $10,000 Statutory Damages

2. “As Is” Sales Do Not Prevent UDAP Recoveries of Multiple or Statutory Damages and Attorney Fees

3. Fraud Claims for Punitive Damages Unaffected by “As Is” Disclaimer

4. “As Is” Disclaimer Does Not Apply to the Warranty of Good Title

5. Dealer’s “As Is” Disclaimer Does Not Affect Manufacturer Warranties That Can Even Apply to Used Cars

6. Used Car Dealers Make Many Hidden Express Warranties That Cannot Be Disclaimed

7. Federal Magnuson-Moss Warranty Act Sharply Limits “As Is” Sales

8. Seven Jurisdictions Broadly Prohibit “As Is” Sales in Any Consumer Transaction, Including Used Car Sales

9. Most Other States Have Special Legislation Limiting “As Is” Sales of Used Cars

10. Revoking an “As Is” Sale

11. “As Is” Disclaimers Are Not Effective If Disclaimer Not Properly Worded or Disclosed

12. “As Is” Disclaimer Ineffective If Unconscionable, in Bad Faith, or Circumstances Indicate Otherwise

As with any legal problem, if you are having problems with a warranty on a car or a car sold to you on an "as is" basis where certain promises were made by the seller, you should talk to a lawyer for help.