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Law Educator, Esq.
Law Educator, Esq., Attorney
Category: Legal
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Experience:  JA Mentor -Attorney Labor/employment, corporate, sports law, admiralty/maritime and civil rights law
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In the state of Texas, when trading a used vehicle to a ...

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In the state of Texas, when trading a used vehicle to a licensed Texas car dealer, am I legally obligated to disclose mechanical problems that are known to me at the time tradeof the ?
Submitted: 6 years ago.
Category: Legal
Expert:  Law Educator, Esq. replied 6 years ago.
No, but you are morally obligated to do so. The dealer is responsible for checking the vehicle mechanically.

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Customer: replied 6 years ago.
Reply to PaulMJD's Post: Is this simply your opinion or is there a Texas statute regarding this issue? If there is a statute, what is it? I understand the moral obligation and agree with you on that regard. However, an automobile dealer, just like a pawn broker, in order to protect their investment, should be solely liable for the thorough inspection of merchandise being bought or traded for prior to making their offer. This dealer looked the truck over and then drove it. He had no questions for me regarding the condition, drivability or reliability of the truck. I felt no obligation to volunteer any information. Had any questions been asked, I would have answered them truthfully. I am in law enforcement and have found the unasked question is one that is usually never answered.
Expert:  Law Educator, Esq. replied 6 years ago.
There is no statute requiring you to disclose the information to a dealer. I based my answer upon the absence of the requirement in the statutes.
Customer: replied 6 years ago.
Reply to PaulMJD's Post: I want to be sure I am understanding you correctly. Your reply is based simply on an opinion? Meaning that if this goes to court, a judge could clearly have a different opinion?
Expert:  Law Educator, Esq. replied 6 years ago.
As with everything else in the law, my interpretation and opinion on the law is based off the opinions of judges and case law. If you asked the same question to 10 different attorneys, the liklihood is you will get 10 different answers. That being said, since the statute does not require disclosure, except on a private sale, a trade in to a dealer is not considered a private sale, and therefore is not included in the statute. You are merely required by law to certify to the dealer that the odometer reading is accurate and it has not been tampered with.

Used vehicles are not covered by the Texas Lemon Law, but used car purchases are governed by the Deceptive Trade Practices - Consumer Protection Act. For example, it is illegal under the Act for a car dealer to entice customers to buy cars by falsely advertising that the dealer is going out of business. It also is illegal for the dealer to make false or misleading statements regarding the reasons for a price reduction. A dealer also may not try to get a consumer to buy a vehicle by failing to disclose information about the car which, if known, would make the consumer unwilling to buy the car. For example, any car that was returned to a manufacturer after a hearing under the Lemon Law must include a notice providing this information to any potential buyer.

The only warranties that accompany a used vehicle are those expressly provided by a dealer or an unexpired manufacturer's warranty. Therefore, it is extremely important for a consumer to thoroughly inspect a used automobile before purchase, and discuss whether the car is covered by any warranty. Federal law requires that all used cars sold through dealers must indicate on the buyer's guide or window sticker whether the car is being sold with or without a warranty. The buyer's guide should clearly state whether the vehicle is being sold "as is" (without any warranty) or "warranty" (with the specific provisions of the warranty listed on the window sticker). Consumers should closely inspect the tires, suspension, engine, drive train, steering, brakes, and interior. In fact, it is probably wise to have a mechanic conduct the inspection.

Because used vehicles are "used," the number of miles a vehicle has been driven is important. Vehicles with lower mileage typically are more valuable than those with higher mileage. Federal and state laws prohibit a seller from rolling back or changing the number of miles on an odometer. Under Texas law, the seller of a used vehicle is required to state on the title assignment the total number of miles the vehicle has traveled. A consumer should get a copy of the odometer statement before signing a contract and if the odometer reading seems suspect, he or she should check the odometer statement that the current owner received when the vehicle was purchased.

Customer: replied 6 years ago.
I traded a 2003 Dodge diesel pickup for a 2005 Dodge Mini Van. The pick up has 87,000 miles and was manufactured in July 2003. Dodge puts a 5 year, 100,000 mile warranty on their engines. The dealer assumed, due to miles and date of manufacture, the truckl was still under factory warranty. I was never asked if the warranty was still in effect. The previous owner of this truck voided the warranty due to lack of maintenance (the truck was red flagged by Chrysler Corp.). This was not disclosed to me when I purchased the truck from the original owner.

I have owned the truck for 1 1/2 years, made payments and kept full coverage insurance on it as required by law. I have discussed my situation with different attorneys, two different repair shops and one judge. They all advised me the cost to sue would not be beneficial since I may get a judgement but my never get any money from the judgement. Their collective suggestion was to trade the truck for something useful.

When I traded the truck, the dealer assumed the warranty was still valid. I did not make that representation, they made the assumption.

Now they (the dealership) are trying to reverse the deal and hold me liable. The vehicle traded for is financed with Ford Motor Credit and they are telling me I am not obligated to the dealer. The truck I traded was financed at a local bank, has been paid off by the dealer, and they are telling me I am not obligated to the dealer.

That is the reason for my original question. I do appreciate your time and your replies but wanted you to know a little more about the situation prior to accepting your answers. Now that you have all the information, I would appreciate a final reply.
Expert:  Law Educator, Esq. replied 6 years ago.
Wow, you were stuck in a quagmire and I now understand the reasoning for all of your questions. Based upon everything you have said, there is no way you should be obligated to the dealer for any of this. The dealer should not have assumed anything about the warranty and if he did not specifically ask you about it, then you are correct, as is the other advice you have gotten, you did not fraudulently misrepresent anything to the dealer and are not liable if the dealer assumed that the warranty was still in effect. Based upon the whole story and my answer above, I did not find any Texas laws that would consider you obligated to the dealer.
Law Educator, Esq., Attorney
Category: Legal
Satisfied Customers: 89622
Experience: JA Mentor -Attorney Labor/employment, corporate, sports law, admiralty/maritime and civil rights law
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