Car dealership sells car too cheap, has customer who bought it arrested for theft

[Crazedclerkthe2nd]

http://consumerist.com/2012/10/03/ch...pricing-error/

Summary:

Customer agrees on a contract to buy a vehicle at a certain price. He couldn't decide between a blue or black model but eventually went with the black.

The next day he changed his mind and wanted the blue so the dealership did an even exchange.

HOWEVER, apparently there's a price difference between the black and blue models of around $5000. The dealership tries to get the guy to come back and sign a new contract for the higher price, guy refuses. Dealership then calls the police and has the guy ARRESTED for theft.



There's a bit more to the story:

- The dealership claims the customer verbally agreed to the higher price when the exchange was being done, but there is no evidence to support this.

- Though the dealership intended to involve police merely to verify location of the vehicle because they intended to start a civil action against the buyer, the person from the dealership (who was not the manager) that called the police did say the vehicle in question had been stolen.

- Manager now says he owes the customer an apology and isn't going to pursue further action to try and recoup any money from the price error.

- Customer says "too little, too late", has lawyered up and sued the dealership for $2.2 million

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This is like an EPIC customer service fail. Even IF the customer had verbally agreed to pay the higher price, the dealership had to have known this wasn't going to be enforceable without any proof.

Also, if the customer had agreed on the higher price, do you really think he would have REFUSED when the dealership called him to try and get him to come in, resign for the correct price and pay the remaining money?

And finally, REGARDLESS this dealership gets a massive F for getting the customer arrested and going ballistic over a pricing mistake that any decent business owner would, while not being very happy about it, accept as a cost of doing business.

[telecom_goddess]

Definite fail on the dealer part. And by the way why was there a $5000 difference between colors? That seems extreme.

[bex1218]

OK, $2.2 million is a bit too much. Yes, he should get recouped for the trouble all this has caused, but thats overkill.

[bara]

A verbal agreement can be enforceable in a civil hearing, but unless that other car also included a hell of a lot of upgrade then it will be damn near impossible to prove and even less likely since this was a dealership. I would believe that someone seriously screwed up at the dealership and was trying to protect his job. There can be several options that could easily explain the difference in price, but color alone isn't. But since this is from the consumerist it is tough to take it at face value.

I wouldn't go for 2.2 million, but I think somewhere in the hundred thousand range would be fair for the false arrest and harassment.

[s_stabeler]

OK, i'm going to split off the fails inot category here:

legal fails
1. phoning the police. The customer paid the price in the contract he signed, therefore it isn't theft.
2. trying to get the customer to sign a new contract. The new contract is unenforceable, because there's no consideration on the part of the store. ( the original ( already fulfilled) contract already transferred ownership of the car, so the car can't be consideration) Therefore, even if a verbal agreement was made ( and I have my suspicions about that- specifically, I suspect they told him he had underpaid w/o clarifying the error was theirs ( implying the customer had paid less than agreed))

business fails
the first fail is making the mistake in the first place- what happened was the guy originally bought a black car, then decided he would rater have a blue one. The dealership agreed to let him swap his black car for the blue one, forgetting to charge the extra cost of the blue one.
the second fail is calling the police. The customer had committed no offence, although false arrest is stretching it. The dealership didn't make the arrest.
The third fail is not eating the loss. $5k isn't small, but the damage their boneheaded move will do... I wouldn't want to shop somewhere that changed the price on someone post-sale ( the contract was for the lower price)

[HYHYBT]

Points in the dealership's favor: the guy surely knew there was a significant difference in price beforehand, chose the cheaper, and then tried, successfully, to do an even exchange for the more expensive. He knew he *ought* to owe the difference and was getting away with something. How is it different, other than in scale, than someone trying to exchange a cheap item for an expensive one at the service desk at Walmart? How is it *morally* different than noticing the Bluray player you're buying scanned as a box of pencils and not pointing out the error?

Not that I see any rational way a different color should mean a wildly different price, nor that, once the dealership agreed to the swap they have a right to go after the difference anyway, much less have him arrested.... but still, it's very much an SC thing to do.

[BrenDAnn]

I'm guessing the color actually had nothing to do with the price. The blue one probably had more features/was a better model. Either way, this is a fail all around. Oh, and as to the question of why would the guy refuse to pay after making a verbal agreement...well...go read a few stories on CS, then get back to me on that. some people have an AMAZING ability to forget things they agreed on just a few minutes earlier! I'm not saying that was what happened in this case. I'm just saying it's been known to happen, as I'm sure many of us here have experienced.

[mikoyan29]

Definite fail on the dealer part. And by the way why was there a $5000 difference between colors? That seems extreme.

It probably wasn't just the color...probably the only one they had in blue had different options or something....

[Gravekeeper]

"It's a steal at this price" is suppose to be a figure of speech.

[Cats]

Okay, I know nothing about cars or the legality of purchasing one, but here is what baffles me: why did they let the 2nd car off the lot without making him sign a new contract? Or making sure it was the 'same' car (if there were different options to explain the price difference)? It isn't theft or fault of the customer if they let him have the car for the contractually agreed upon price. It's not like that new set of keys just jumped into his hands.

[Jester]

Also, if the customer had agreed on the higher price, do you really think he would have REFUSED when the dealership called him to try and get him to come in, resign for the correct price and pay the remaining money?

Definitely very possible. It was the dealership's error, but they signed the new contract that gave him the car at the lower-than-it-should-have-been price, so I wouldn't blame him one iota for saying hell no.

I actually went through something that was similar, other than the end game.

A couple of leases ago, my apartment's rent was $1800. I was told that the new lease would have the rent increase to $1890. I told my roommates about this, and while they weren't happy, we all understood that these things happen. And to be perfectly fair, the complex had not raised our rent in a couple of years.

Well, when we got the lease, they had the new rent amount reflected in it, but the names on it were wrong: while they had me and Mr. Anti-Social, they didn't have Mr. Fix-It, but rather, a prior roommate, who hadn't lived there in some time.

So I brought the incorrect lease back to them, and pointed out the error. They fixed it, and a couple of days later, we received the new lease to sign, with all our correct names on it.

And I noticed that in the corrected lease, somehow the rent was back to being listed as $1800. Not being a complete dumbass, I suggested to Mr. Anti-Social and Mr. Fix-It that we sign that puppy damn fast, and if the complex manager signed it without noticing anything, it was their own damn fault.

Well, we signed it, the manager signed it, I got a copy, and happily went about my business. And this is where my story differs from that of the guy who bought the car. Because I don't know if the manager or anyone else with the complex ever noticed the error, but for the next year, they accepted our $1800 checks each month without comment or complaint. They probably did notice, but realizing that they had signed that legally binding contract themselves, realized it was their mistake, and lived with it as the "cost of doing business."

Our current lease, which followed that one, DID have the new, higher rent in it. Again, without any comment from the management. Not surprising, and since we expected as much, not that big a deal.

Definite fail on the dealer part. And by the way why was there a $5000 difference between colors? That seems extreme.

Probably different level of trim on the blue one. Just because cars are identical other than color, it doesn't mean that they are truly identical. Maybe the blue one had a better stereo, or some other features the black one didn't have.

OK, $2.2 million is a bit too much. Yes, he should get recouped for the trouble all this has caused, but thats overkill.

Perhaps, but I understand the strategy here. The guy's lawyers sue for $2.2 mill, the dealership offers to settle for, say, $500,000, the guy accepts, he gets his money, his lawyers get their cut, and the dealership pays less than what they were sued for. Basic sales technique, ask for more than you are willing to accept. Car salesmen should appreciate this tactic.

But since this is from the consumerist it is tough to take it at face value.

Why is that?

2. trying to get the customer to sign a new contract.

I see no problem with the dealership ASKING the guy to sign a new contract. Best case scenario, he agrees, they rework everything, he pays the higher price. Worst case scenario, he says no, and the dealership, unless they are complete morons, eat the loss. I think we know what happened.

The customer had committed no offence, although false arrest is stretching it. The dealership didn't make the arrest.

I don't think it is stretching it. He was arrested for theft, though he didn't steal anything. Pretty much the definition of false arrest.
And while the dealership didn't make the arrest, they are the ones who brought the complaint to the police that resulted in the false arrest. Which is why the guy is suing the dealership and not the police. I agree that if you are going to sue someone here for false arrest, it's the dealership. The police were just doing their jobs, and thought they were making an arrest for theft, based on the information they were given by the dealership.

"It's a steal at this price" is suppose to be a figure of speech.

Funniest line of this whole thread!

[Panacea]

OK, $2.2 million is a bit too much. Yes, he should get recouped for the trouble all this has caused, but thats overkill.

I second Jester: they'll settle for far less than what they're suing for. Always aim high; you can't go up once you've named your price, but you can always come down to make the deal happen.

2. trying to get the customer to sign a new contract. The new contract is unenforceable, because there's no consideration on the part of the store. ( the original ( already fulfilled) contract already transferred ownership of the car, so the car can't be consideration)

This raises a question in my mind, though. If that's true, then how could the store do an exchange on the car, since the blue car was not the one specified in the contract? Wouldn't they have to cancel the old one and do a new once since the buyer had taken possession of the black car?

the second fail is calling the police. The customer had committed no offence, although false arrest is stretching it. The dealership didn't make the arrest.

If in fact the dealer was not legally justified to claim the car was stolen (as they had GIVEN it to the buyer themselves), then yes, they are liable for false arrest. The police are just acting on the information given by the complaining party; issues of fact are for the courts to decide. It sounds to me that if the cops had been told the whole story, they would have told the dealer to pursue it in civil court. Which would have hurt them financially, because by the time they got the car back, it would be a used not new car.

Points in the dealership's favor: the guy surely knew there was a significant difference in price beforehand, chose the cheaper, and then tried, successfully, to do an even exchange for the more expensive.

Your argument makes sense only if you can prove there was a difference between the two cars other than color. Which could be true; we may not have the whole story. But that doesn't seem to be what the dealer is claiming.

Okay, I know nothing about cars or the legality of purchasing one, but here is what baffles me: why did they let the 2nd car off the lot without making him sign a new contract? Or making sure it was the 'same' car (if there were different options to explain the price difference)? It isn't theft or fault of the customer if they let him have the car for the contractually agreed upon price. It's not like that new set of keys just jumped into his hands.

Excellent question, and the one I am wondering as well.

Anyway you look at it, the dealer screwed the pooch on this one.

[s_stabeler]

I don't think it is stretching it. He was arrested for theft, though he didn't steal anything. Pretty much the definition of false arrest.
And while the dealership didn't make the arrest, they are the ones who brought the complaint to the police that resulted in the false arrest. Which is why the guy is suing the dealership and not the police. I agree that if you are going to sue someone here for false arrest, it's the dealership. The police were just doing their jobs, and thought they were making an arrest for theft, based on the information they were given by the dealership.

Actually, False Arrest is making the arrest without probably cause. The police probably did have probable cause to believe the guy stole the car, so it isn't false arrest. Filing a False Police report, yes. False arrest, no.

This raises a question in my mind, though. If that's true, then how could the store do an exchange on the car, since the blue car was not the one specified in the contract? Wouldn't they have to cancel the old one and do a new once since the buyer had taken possession of the black car?

Simple: the exchange contract has consideration on both sides: the buyer offers the black one as his consideration, and dealer offers the blue one as theirs.