In Pennsylvania, there are two primary areas of law that apply to vehicle purchases: The Lemon Law and the Automobile Industry Trade Practices Act. However, there is a small area of Pennsylvania Law that also applies very specifically to new vehicles. It is known as the New Vehicle Damage Disclosure Act. This is a cause of action primarily against the dealership in which you, the purchaser, are claiming that the dealership covered up presale damage of a new car before selling it to you. For more information about this Law, see our New Car Page.
One of the most common new vehicle damage issues we see involves paint. Our client goes to the dealership, buys a new car, and takes it home. After a few washes, he begins to notice issues with the paint on the hood. He investigates a little further and finds out that the hood has been repainted because acid in the rain started to degrade the paint before he bought the car. This is a common trick performed by dealerships to hide paint damage with a temporary clear coat. However, there are machines that will measure the thickness of paint on a car and be able to tell us if paint around the vehicle is of varying thickness, indicating a repainting.
We have also seen cases where the new vehicle is in a fender-bender while on the lot for sale. Someone backs into the bumper and the dealership has to repair it. After you own it for a while, a local mechanic tells you that something is wrong with bumper because it is out of alignment. Cosmetic damage issues don’t apply to used cars. Used cars have to have structural damage to trigger the Auto Fraud Laws. However, cosmetic damage does apply to new cars if it is bad enough. Have you ever seen a News story where someone keyed a bunch of cars at a local dealership? Sometimes, that damage is so severe that repairs will exceed the repair value threshold.
At this point, the potential legal claim becomes all about the cost of the repair. The Pennsylvania Law says the cost of repair must exceed $500 or 3% of the MSPR, whichever is greater. That does not mean 3% of the purchase price. The purchase price is often higher than the MSRP. To make this determination, we need an expert who can look at the vehicle and tell us how much such a repair would cost. Sometimes, we are lucky enough to find the internal dealership invoice showing the internal cost of the repair. However, we have to be skeptical about this number. Dealerships know about the New Vehicle Damage Disclosure Law and will adjust the cost of the repair down to keep it under 3%. In these instances, we may have additional fraud claims if we are able to prove that the dealership intentionally tried to hide the damage.
If you think your new vehicle was damaged before it was sold to you, we need to find proof of that quickly. We have experts we can use to look at your vehicle and value the repairs. We have to start with those numbers because the law gives your cause of action a clear threshold. Over $500 or 3%? You have a claim. Under $500 or 3%? You don’t have a claim.