Used Car Lemon Law in Wisconsin: Dealer May be Liable
One of our recent success stories involves a client who bought a used car from a dealership for about $15,000. The car was sold “as is.” In the course of having the vehicle serviced at another dealership, it was discovered that the identification number on the engine did not correspond to the VIN for the vehicle, which indicated that the engine was not original to the vehicle. The dealership providing service also discovered that the manufacturer had identified the vehicle in its database as having a “branded title.”Used Car Lemon Law in Wisconsin:
While Wisconsin’s lemon law may protect a buyer of a new vehicle from being stuck with an unreliable car, there is no specific used car lemon law in Wisconsin, and used car buyers are not typically afforded the same protection. However, even if you buy a used car “as is,” the seller still must warrant the title to the car. So, if it turns out that the car was a flood or salvage vehicle, and that was not disclosed on the vehicle title, you may have a claim against the seller.
Vehicle Title Branding
Vehicle title branding is the use of a permanent designation on a vehicle’s title document to indicate that a vehicle is, for example, a rebuilt salvage vehicle, fire or flood damaged, subject to a manufacturer buyback or has been transferred to an insurance company pursuant to a damage claim. Wisconsin law requires applicable brands to be contained on the Certificate of Title for the vehicle.Title “Laundering” or “Washing”
The service technician in our client’s case found that the car had significant evidence of prior accident damage. As a result of the undisclosed vehicle damage and mismatched engine, the dealer’s diagnostic equipment was unable to mechanically service the vehicle for operation. The vehicle has been sitting in storage, inoperable for more than two years, while our client continues to make payments on her vehicle loan.A Carfax vehicle history report, purchased by our client after the irregularities were discovered by the service technician indicated that:
- The Vehicle was originally titled in the state of Arkansas in 2004.
- In January, 2006, the Vehicle was reported as a “Total Loss,” and a Salvage Title was issued to an insurance company.
- In March, 2006, a “Rebuilt Title” was issued to an Arkansas motor vehicle dealer.
- In October, 2006, the Vehicle was registered in Illinois. The Illinois title did not indicate that the title was branded as “Rebuilt.” The Carfax report stated, “This car seems to have been registered in IL without the prior AR rebuilt title. This may be a case of title washing.”
Wisconsin’s Warranty of Title Requirement
When a vehicle owner transfers title, he signs the back of the title, where it states, “For value received, I sell, assign or transfer the vehicle described on this document and warrant title to purchaser.” This language is on the back of every Wisconsin Certificate of Title, pursuant to Wis. Stat., § 342.15(1)(a). In a 1975 case, the Wisconsin Supreme Court held that this warranty of title cannot be disclaimed via an “as is” sale. That means, even if a used car is sold “as is,” the seller may be liable to the buyer for any defects in the title. Therefore, where a title brand, such as a salvage or flood vehicle designation, should be on the title, but is not, the buyer may have a cause of action against the seller, if the vehicle was sold “as is.”Success in Court
When these issues were brought to the selling dealer’s attention, it refused to do anything to remedy the situation, stating that the vehicle was sold “as is.” We filed suit on behalf of the buyer, alleging misrepresentation, breach of contract, breach of warranty of title and that the contract was void due to the dealer’s failure to comply with the Wisconsin Administrative Code, which requires used vehicle dealers to make written disclosure of certain information, including title brands and title brands.The Marathon County Circuit Court granted Summary Judgment to our client, finding both that the title brand should have been discovered and disclosed by the seller, and that the seller had breached the statutory warranty of title, despite the “as is” sale.
Used Car Lemon Law in Wisconsin
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