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Automobile Dealership Report – Summer 2016

First class action filed on new spot delivery law

By Steven R. Freeman, Freeman Rauch, LLC, July 2016

Within the past few months, the first class action was filed against a Maryland automobile dealership alleging violations of the newly enacted Md. Code Ann., Transp. § 15-311.3 (Notice to buyer prior to third-party approval of dealer-arranged financing or leasing agreement) which came into effect on October 1, 2015. The suit alleges that the dealer failed to provide its customer notice that the dealer-arranged financing had not been funded within four (4) days of the delivery of the vehicle to the customer, among other things. Although the customer returned the vehicle to the dealer and, allegedly, the dealer “unwound” the deal, it was alleged that it did not do so in a timely manner and failed to return the deposit, titling fees, taxes, and dealer processing charge. The suit further alleges that at the time of the sale, the dealer failed to provide the customer with a copy of the statutory notice required by law and signed by the dealer and the customer.