My question involves a consumer law issue in the State of: Alabama
I'm a small independent car dealer (a sole owner LLC). I sold a vehicle over two months ago that the buyer just emailed me about threatening to sue. This is the first that I've heard of any problems since the day of the sale.
I bought the car from the local wholesale auction. It was a recent trade-in at a large nationwide used car dealer. I bought through the auction with an "auction guarantee" which means that the seller & auction is guaranteeing that the car has a sound engine and drivetrain.
I sold the car for cash for $3500 6 days after I bought it. KBB suggested retail is $9100 with the same mileage and condition. Even KBB trade-in is almost $5k.
The guy that bought it test drove it and I told him that he was welcome to take it to his mechanic or even take it to the dealer before he bought it. He chose not to.
I advertised the car as an "All wheel drive" as that's what it says on the car and on the title. He now tells me that he just found out that someone has removed part of the drivetrain so it is no longer an "All wheel drive" so he's threatening to sue me over false advertising if I don't agree to pay to repair this.
I CLEARLY had no intent to defraud as I had no reason to think that the car was no longer an AWD. I also bought it with an "auction-guarantee" so I of course assumed that the engine and drivetrain were fine (I still have my auction receipt that shows the "A/G"). I can only assume that whoever traded it in had removed part of the drivetrain for whatever reason. Per Carfax, it was a one-owner vehicle prior to being traded in so that kind of narrows it down.
I sold the car "AS-IS" to which the buyer signed an "AS-IS" statement, as well as a "Warranty Disclaimer" that is a full page explaining that the vehicle has no warranty and he signed the "AS-IS" window decal that all dealer used cars are suppose to display. I have the originals of all three of these documents.
I've only been in business for a year and half and I've sold about 40 cars. This is the first one that I've had a problem with.
On the day of the sale, I gave him copies of everything he signed so I'm sure that he has looked over the AS-IS statements. So, he's threatening to sue over "false advertisement". Does he have a case?
Also, I feel for the guy as I was obviously taken on the deal too assuming that part of the drivetrain was removed when I bought the car. I would actually like to help him with some of the repair costs but in by doing so, am I opening myself up to further litigation? I don't want to seem like I'm admitting any wrong-doing because I don't feel like I did anything wrong.
Thanks for any help!
By the way, EVERY car that I sell I encourage people to take it to the mechanic of their choosing and so far NOBODY has ever taken me up on that offer. I did have one guy drive a truck for the entire day but he "never got around to it" (taking it to his mechanic).