1

I realize contract law may differ between different jurisdictions, so let's narrow this down to countries where it is generally accepted that a courts can adjudicate all contracts as long as long as all parties are private (as opposed to government) entities.

Motivation

I have seen a few Youtube videos where the presenters claim that car dealers are getting into the habit of adding "fees" post signing of purchase contracts and give advice on how to get out of accepting the "services" offered in exchange for those fees.

Question

So this got me thinking. When can the buyer simply walk away without being sued?

Let's say they sign a contract to buy a $60k car, get a loan, and at closing are presented with a tally of various fees due to 3rd parties, to the dealer, and to the government(s) (such as taxes).

Which of these actually break the contract?

Obviously, taxes (being added to the bill) do not break a contract because they are required by the government. But what if a dealer says there are factory-imposed fees for various treatments of the car surface (e.g. "magic dust xyz so that the car keeps shining for 100 years")? What about contractual fees which a dealer says they have to impose because of their contract with a 3rd party?

Obviously it's not fair dealing to not disclose possible fees ahead of time. But where does the law stand on this?

At what point can a consumer walk away without an expectation of being sued for breaking a contract? Is there a point at which a consumer can sue the dealer for breaking their (implied or stated) contract?

I mean, what are the stages of this process, as controlled by law? Unlike buying a house, most people don't hire lawyers to navigate a car purchase. But with standard car prices getting into the $60k-$90k range, it seems like this is something that people should start getting familiar with.

Improve this question
1
  • Cars aren't homes. You get approval for a loan and then you sign the contract with all the numbers in front of you. You don't sign a purchase agreement, have 30 days of due diligence, and a closing like you're buying real estate or a company.
    – user71659
    Commented Jul 3 at 7:14

1 Answer 1

Reset to default
2

Contracts are executed when the contract is signed.

An "Agreement on price" before the document is signed will not hold up as valid. There will be numerous lines in the final contract that say things along the lines of "no other considerations are in place for this transaction."

I have never heard of a dealer having you sign documents and then presenting you with a second contract with higher rates or add-ons. Doing this would require re-doing all the paperwork.

Improve this answer
3
  • Let's say the dealer makes a firm offer (written, making it legally binding, but without anyone signing anything). The consumer secures a loan (going through the expense of $500 for applying for it). The dealer then unrolls the full contract to sign which has additional fees. Can the consumer sue for the $500? What if the dealer secured the loan and spent $500 to do it? Can they sue the consumer for the expense?
    – wrod
    Commented Jul 5 at 19:56
  • 1
    A quote is not a binding contract. freshbooks.com/hub/estimates/is-quote-contract
    – Tiger Guy
    Commented Jul 5 at 20:21
  • from the cursory look, that looks like a guide for small business owners, not for car dealers. Car sales maybe (and usually are) guided by their own sets of laws.
    – wrod
    Commented Jul 5 at 21:00

You must log in to answer this question.

Not the answer you're looking for? Browse other questions tagged .