My question involves a consumer law issue in the State of Alabama.
We own two tire and automotive stores. Last July, 2013, a customer, who we know personally and was our child's teacher the entire past school year, came into our store and had a water pump and some hoses replaced on his 2000 Ford Ranger, and some other minor work. We saw and talked to this individual numerous times over the past school year and he never mentioned his vehicle or having any issues with his vehicle after it was repaired at our store. Our company sponsors many events at our children's school, where this individual works and he was perfectly aware that we owned the store in which he had his vehicle repaired. The total for his automotive repairs was approximately $800.00
Fast forward to this July, we received a letter from an attorney stating that the aforementioned individual was planning to sue our company and my husband individually, unless we agreed to pay him approximately $3,000.00, which would be a refund of the money he paid us for repairs, plus compensation for his "pain and suffering." In the complaint, attached to the letter, he basically states that our company had committed fraud and that we had never repaired his vehicle. In the complaint he states that two weeks after we worked on his vehicle that he was still having issues with his truck and the water pump was still leaking and that he brought it back to our store and at that time one of our employees put his truck on a rack to inspect it and made the comment that it might need a water pump. He then goes on to state that he was immediately suspicious of the employee and suspected he had been a victim of fraud. He states that he got his vehicle back at that time and left our store. He then goes on to claim that in November, three months after we repaired his vehicle, he took his truck to another mechanic in a neighboring town and that the mechanic verified we had committed fraud and had never replaced his water pump. We did replace the water pump, but if we had not, there is no way he would have still been driving around 3 months later with his old water pump.
Again, we never heard ANY of these claims or were even aware he was having any issues, until we received the letter and attached complaint from the attorney. We were stunned to say the least, as we had a good, friendly rapport with this individual prior to this action. My husband primarily works at both stores, but was not at this store when this vehicle was repaired or when he came back to the store. We have extensive paperwork on this and all repairs from our store. This repair and the parts had a ONE-YEAR warranty and it was clearly stated on the invoice he signed - which we have a copy of. My husband spoke to our manager, assistant manager and 2 mechanics. It had been over a year, but from what everyone could recollect, he did come back in the store 2 weeks after the water pump was replaced, but before anyone could assess the vehicle, test drive or do any diagnostic analysis, the customer abruptly asked for his vehicle to be removed from the rack and left the premises. My husband specifically asked if he was told he needed another water pump or needed a replacement. The mechanic stated that it was possible he said that, as he had not looked at the vehicle yet or pulled up previous repairs in the computer. He also pointed out that even new parts can be defective or have issues, that's why we and the parts house offer warranties.
Our attorney, who seems completely disinterested in taking this matter to court, recommended that we make him a settlement offer, but we feel that we do not owe him any money. He NEVER contacted either of our managers or my husband to resolve this matter, and his warranty with our company has expired. The part was under warranty and we would have happily fixed his truck free of charge. But, waiting over a year to bring this to our attention, claiming we never actually replaced the water pump, asking for "punative" damages, it makes us feel he is actually the one perpetuating a fraudulent act. Wouldn't any reasonable individual contact a manager or owner to try to resolve this kind of issue, in stead of waiting over a year and hiring an attorney? It just seems bizarre to me. The parts and service warranty expired about a week before the attorney sent us the letter. Also, are we still obligated or liable, since he took the vehicle to another mechanic to have another water pump put on his truck?
Just wondering what we should actually do. They filed suit this past week when we did not make a monetary offer. They have asked for a jury trial and now want $5000 compensation, plus attorney's fees. Personally, I want to fight it and possibly counter-sue him. Our attorney said he will need an initial $2500 up front if we want to fight it. We have NEVER been sued and feel like our business has always had a good reputation in our community. I would appreciate any advice as to where we stand legally and if anyone thinks we should settle or fight this lawsuit. Or if anyone can provide any case law, that would be great.
Thanks so much :-)