Car Dealership Not Giving Back Deposit

[bolugo]

My question involves a consumer law issue in the State of: Minnesota, my question is that I went and seen a car I liked put a down payment of $2,000. A month later they call and say they need the car back because I could not get financed. I gave the car back they told me the next week they will give me my check it's been 2 weeks I called them today aNd they said they are figuring out how much they are going to give back since I took it for a month??? Can they do this? This is the second car they have me by the way the first one they said was mine and I gave it back the second one same thing. Is this a scam they pull because I'm a single young mom? I also signed for both cars!!

[Mr. Knowitall]

They can claim the reasonable value of your use of the car over the course of the month you drove it. I expect that's spelled out in your contract.

[bolugo]

Well I looked at it was exactly 15 days that I had the car. They made a contract saying that they will give me the money back the following week? does that make a difference or no?

[antrc170]

What does the original contract state about the use of the vehicle?

Do you have any subsequent promises in writing?

[bolugo]

It doesn't say anything about the use of the vehicle. And yeah they signed a paper that I will get my money the following week and I never received anything.

As a matter of fact the contact says I put 3,000 down. I only put 2,000 down though.

[antrc170]

I suggest send a certified letter to the dealership stating that you expect complete reciept of your total down payment no later than 10 business after getting the letter.

If they fail to do that or provide a partial refund, you should file a civil suit in the local small claims court. You should argue that the down payment was for the ownership of the vehicle and in the absense of any language in the contract to the contrary, the use of the vehicle prior to financial security was a loan of the vehicle. Explain that the dealer never made mention of any of the payment being used or applied to the lease of the vehicle, but to sole ownership and the monies are not transferrable without your approval. In addition, the dealership waived any claim to the money when they promised a full refund which was not provided.

[Mr. Knowitall]

That won't fly in court, but I guess the theory is "if you don't ask, you won't get"?

The contract is being rescinded due to bolugo's inability to secure financing, whether through the dealership or on her own initiative. Rescission is about restoring the parties to their original condition, not about giving a party a windfall. The car was driven for fifteen days, those miles aren't coming off of the car, and the dealer is entitled to be compensated for the resulting impact on the value of the vehicle.

[antrc170]

I disagree.

The dealership granted the use of the vehicle while waiting for financing. The financing did not happen and the OP returned the vehicle. Both parties satisfied that portion of the contract. The mileage cost is the dealerships gamble that the vehicle will be financed, most of the time it can be, this time they lost.

Depending on the wording of the contract, the money was used as a down payment for the vehicle. Since the vehicle ownership is not being completed the down payment is to be returned in whole. The dealership can't take it and claim the OP "rented" the car during the usage.

[Mr. Knowitall]

I disagree.

The dealership granted the use of the vehicle while waiting for financing.

You disagree based on what legal authority? Because your opinion and a couple of bucks will get her a cup of coffee.

As separate and distinct compensation, defendants [in this rescission action] assert that the trial court should have compensated them for plaintiffs' use of the property so as "to do equity between the parties". Defendants did not seek this relief in their counterclaim. Arguably, this omission would not be fatal because in an equitable action, the court has the inherent power to adjust equity between the parties. Watson v. Harris, supra at 676; Reliable Life Ins. Co. v. Bell, 246 S.W.2d 371, 376 (Mo.App.1952). Moreover, in invoking the equitable jurisdiction of the court to rescind and cancel the instruments in question, plaintiffs indicated their willingness to make whatever restitution the case required. West v. Witschner, 482 S.W.2d 733, 737 (Mo.1972); Sebree v. Rosen, 374 S.W.2d 132, 138 (Mo.1964).

[antrc170]

That won't fly in court, but I guess the theory is "if you don't ask, you won't get"?

Based on what legal authority?

You disagree based on what legal authority? Because your opinion and a couple of bucks will get her a cup of coffee.

The case you cite doesn't match up with the OP's situation. In that case the people purchased a home and lived in the home in good faith that they had purchased the property. The OP never accepted the terms of the sale and was never assumed the owner of the vehicle. (Plus, that case is from MO).

Further, MN law dictates that "Every retail installment contract shall be in writing, shall contain all the agreements of the parties, shall be signed by the retail buyer and seller, and a copy signed by the retail buyer shall be furnished to such retail buyer at the time the retail buyer executes the contract. (MN 53C.08). The contract was never executed because the sale never happened and the vehicle must be returned to the dealer. The dealer must also return any consideration they recieved, in this case the down payment. Without language to the contrary, the dealer cannot force the buyer to "rent" the car during the time period it was in the buyers possession by subtracting from the down payment.

The OP can sue for the full return of the down payment if there is no contract to rent the vehicle. The use of the vehicle must be contracted which was not done in this case.