Question

***Please follow the hypothetical case situation below. Your team’s mission is to act as an attorney and spot the potential legal issues presented.***

Dandy Don’s Used Cars runs many advertisements on late night television in the Smithfield area. Michael Jones happens to see on particular ad one evening in which Dandy Don says “No matter how bad your credit is, we WILL finance YOU” and also states all “bargain bin” used cars are “on sale this weekend only for $1,995.00 with a free limited warranty included”.

Michael, needing a different car, decides to go to Dandy Don’s and walks on the car sales lot. He sees a 2003 model in the “bargain bin” lot and begins to look the car over. Dandy Don hastily spots Michael (and in the process spills his coffee all over his red, white, and blue plaid suit jacket, but no harm because it’s polyester) and runs over to him and says “You sir have a terrific eye; this is the best car on the lot, with only 85,000 actual miles”. Michael notices there is no white piece of paper with boxes on the car’s window as he’s seen at other car lots. Michael asks “is there a warranty?” to which Dandy Don replies “as long as it stays on the lot, once you drive it home, it’s ‘as is’”.

Michael purchases the car and uses a separately owned finance company “EZ Loans” for the transactions. After a few weeks the car develops serious mechanical problems. Michael takes the car to his mechanic and the mechanic tells him that the car has serious engine problems (bad valves), likely has over 185,000 miles, and finds evidence the odometer has been altered. Therefore, Michael quits paying on the loan.

Rob Rippov, finance manager for EZ Loans calls Michael at his work phone number and is told by the main operator, that Michael cannot take non-emergency calls during business hours and Rippov says “this is a matter of life and death”. The operator puts the call through to Michael’s cubicle and Rippov tells him “if you don’t pay us, we will report the car as stolen and you’ll be arrested.”

Your team’s mission is to spot all potential legal problems that could have occurred with the entire scenario, including any wrongful acts on the part of Dandy Don, his car lot, and EZ Loans and its finance manager, Rob Rippov. Make sure you state the laws and regulations which might have been violated. Use the information contained in Chapter 45. You may answer in any format you like, however please make sure you clearly label what each problem is and what the specific legal problem is.

Answer 1

Dandy Don had sold the car by misrepresenting about its facts. The car had an actual run of over 185000 miles while it was sold to Michael by claiming that the car has run only for 85000 miles. Michael has full rights to sue Dandy Don for fraudulent misrepresentation of facts about the car and can recover the punitive damages that he may have suffered.

Rob Rippov needs to recover the loan amount from Michael, on behalf of EZ Loans. Though instead of discussing the same with Michael, he started threatening Michael and gave him an ultimatum that if he did not clear the loan, then he will spread rumors about the car being a stolen one and will get Michael arrested for theft. Rippov can be sued by Michael for slander. Rippov is trying to malign Michael’s image and getting him arrested in the false case. Hence this is not ethical.

If Michael stops paying for his loan emi, he will become a defaulter. In such a scenario, the bank can cease his car and degrade his credit rating. However it would have been better that he talks to EZ Loans and clarify his part. He can ask for some time so that he can recover money from Dandy. This will be the most feasible way of solving this case.