State Laws That Automotive Dealers Need to Know

Helping car dealers comply with and contest state consumer protection laws

Used and new automotive dealers need to understand the state and federal laws that govern all aspects of their business. Specifically, they must understand the consumer protection laws of Ohio, or else they risk complaints to, or even investigations and lawsuits by the state attorney general. A failure to comply with these laws can mean substantial fines and penalties, termination of the contracts, and damage to the reputation and brand of the company.

At Gertsburg Licata, we take proactive measures to help you comply with state laws so that you minimize customer complaints and civil lawsuits. Our Cleveland business attorneys understand which laws apply, which dealers must meet those laws, and the requirements of each law. Our lawyers review your documents and writing, and educate your staff. If litigation occurs, we defend lawsuits by asserting all proper defenses. In many cases, we can defeat the complaint or reach a reasonable settlement.

Ohio automotive dealer laws

Our Cleveland business lawyers understand which laws Ohio dealers must satisfy, and how to bring your dealership into compliance. We offer counsel for automotive dealers who may face difficulties because of:

The Ohio Consumer Sales Practices Act. (Ohio Rev. Code § 1345.01 et seq.)

This set of laws is designed to protect consumers from business conduct that is fraudulent, deceptive, misleading, and unconscionable. The law applies to many businesses, large and small, including automotive dealers. It is principally aimed at false advertising.

At Gertsburg Licata, our lawyers advise automotive companies about what steps are needed to comply with the law. We defend consumer lawsuits when dealers are accused of violating the law. We also explain which acts can be considered deceptive or unconscionable, such as:

  • Saying something is free when it is not
  • Misrepresenting the length and terms of warranties
  • Indicating a car does not have known problems when the dealer knows the car does
  • Providing a car with different mileage, make, or other material characteristics
  • A price advantage exists when it does not

Our attorneys review all written documents for accuracy and clarity, including purchase agreements, leases, franchise agreements, and advertisements.

Retail Installment Sales Act

This consumer protection law covers sales, including car sales, where the purchase is financed by making payments in installments. Some of the many requirements our Cleveland business attorneys review are:

  • Every installment agreement must be in writing
  • The seller has the right to detail the indebtedness in writing
  • The defenses the buyer is allowed to assert, including that the car sold did not match the terms of the agreement, that improper warranties or no warranties were given, or that the agreement did not cover all relevant terms, including the amount of the purchase and the payment terms
  • The terms of any finance charges and any delinquencies charges
  • How defaults should be addressed
  • When and how the dealer can repossess the vehicle

There are many other provisions with minute, but crucial, details we can review with you.

Ohio motor vehicle title laws

These laws govern how automobiles should be titled, how title can be transferred, how out-of-state vehicles should be handled, who can obtain a license, and the rules of the road for vehicle operations. Automotive dealers need to understand the proper way to title the vehicles and how liens can properly be placed on the vehicles.

For example, with few exceptions, the dealer must provide the buyer a new title 30 days after the purchase date. Typically, the buyer pays the sales tax and use tax when they buy the new vehicle.

Additionally, there are Ohio lemon laws that protect consumers when the car has less than 18,000 miles on it, and the claim is brought less than one year after the purchase date.

Speak with a knowledgeable automotive dealer state law attorney today

Delay in reviewing the applicable laws and how to comply with them usually means costly litigation. For help in understanding Ohio’s consumer protection laws and how they apply to automotive dealers, please arrange to speak with a business lawyer at Gertsburg Licata as soon as you can. You can reach us at 216-573-6000 or complete our contact form to schedule an appointment.