If you need help or would like to speak with an experienced attorney, please call 801-365-1030 or click here to contact us.
Buying a car is often a much more difficult experience than most people ever expect. When shopping for a car, you must be meticulous in looking for the best deal while also weeding out cars that don’t fit your needs. The most careful shopper trying to find the best deal, however, can fall into the dangerous trap of purchasing a car with a salvage title. A salvage title, to most people, is the scarlet letter of the vehicle-purchasing world. Even so, some car buyers find themselves having purchased one without realizing it. Fortunately, if you find yourself in this situation, there are laws in Utah that can help you recover the damages caused to you.
If you’ve purchased a vehicle with a salvage title and were not properly notified by the seller, you may have legal recourse. In this article, I’ll discuss what a salvage title is, notice requirements for sellers, and the civil penalties that may be claimed against sellers who fail to properly disclose information about a salvage title.
Definition of Salvage Title
Salvage titles are titles issued to salvaged vehicles. The Motor Vehicles Act (MVA) defines a salvaged vehicle as “a vehicle that has been declared a total loss by an insurer and that the insurer has acquired ownership of or has paid a claim to the owner for the total loss of the vehicle.” Salvaged vehicles can be repaired and put back on the road, but they must pass a safety inspection before they can be titled and registered. Salvage titles are also referred to as “Branded” titles.
Notice Requirements for Sellers
The UMA generally requires a seller of a vehicle with a salvage title to provide written notice to the buyer that the vehicle has a salvage title. The notice must also have specific language demonstrated in subsection 2 of Utah Code Section 41-1a-1005.3. Additionally, an advertisement for the sale of a vehicle with a salvage title must disclose the status of the title. The advertisement must display the disclosure of salvage title in the same manner as the rest of the content on the advertisement. Moreover, if the salvage certificate or branded title has been issued, the advertisement must use the words “salvage certificate” or “branded title” or use the words “insurer declared total loss.” See Utah code § 41-1a-1004.
Civil Penalties Under Utah Statutes
Knowingly failing to disclose a salvage title by a seller carries with it specific civil penalties. If the seller is a dealer, the Utah Motor Vehicles Business Regulation Act (MVBRA) states that knowingly selling a salvage vehicle without disclosing that the salvage vehicle has been repaired or rebuilt is a civil violation. The MVBRA goes on to describe the specific civil penalties a seller would owe to the buyer, which is “not less than $1,000.00, or treble the actual damages caused by the person, whichever is greater; and reasonable attorney fees and costs of the action.” Such actions can be brought through a private action or through the Utah Motor Vehicle Enforcement Division.
If the seller is not a dealer, then another statute applies. This law is very similar to the one dealing with dealers but adds that the purchaser can opt to simply rescind the contract and get its money back for the purchase. This section also defines what constitutes “Actual damages” and includes the difference between the actual market value of the salvage vehicle at the time of purchase and the contract price. Actual damages may also include repairs, towing, lease charges, etc.
Calculating Damages
As described above, a buyer of an undisclosed salvaged title is entitled to a variety of damages. This includes $1,000.00 or treble the actual damages, whichever is greater. Treble damages is a legal term that typically means you get three times the damages you would get otherwise. So let’s say, for instance, you purchase a car for $30,000.00 that has a salvage title. The status of the title was not disclosed to you despite the seller’s knowing it was a salvaged vehicle. Let’s say that your car with a salvage title is actually worth $18,000. Per Kelley Blue Book, a salvage title car can be worth 20% to 40% less than a similar car with clean title. That means you would have actual damages of $12,000 and treble damages means you would times that number by three, giving you treble damages of $36,000. This example also does not take into account any of the additional damages you may incur, such as repairs, or vehicle rentals. In addition, if you were to bring this matter to court and win, your attorney fees would be paid for as well. As you can see, the value of such claims can be worth much more than what it appears on its face.
Additional Consideration
It is important to understand that these particular statutes have a “mens rea” requirement—which is a state-of-mind requirement. To claim the penalties, you must prove that the seller sold a vehicle without the necessary disclosures and did so “knowingly.” Utah Code Section 76-2-103(2) defines knowingly as “with knowledge, with respect to his conduct or to circumstances surrounding his conduct when he is aware of the nature of his conduct or the existing circumstances. A person acts knowingly, or with knowledge, with respect to a result of his conduct when he is aware that his conduct is reasonably certain to cause the result.” Thus, it is important that a person evaluate whether the seller knew that they sold a salvaged vehicle without giving the proper disclosures. With a dealership, it is difficult to see a situation where they would not know of the salvage title.
Another consideration is the value of your claim. If you bought a car for $2,000.00 and the actual damages you could claim would be nominal, it would likely be best to bring your action through an administrator of the Utah Motor Vehicle Enforcement Division. You can file a complaint with that division here, which can be submitted by email to mved@utah.gov. However, if your claim is worth more, like the example given above, it would likely be worth it to hire an attorney. An attorney can help you evaluate your claim, calculate the value, help negotiate settlement, or assist with taking the matter to trial as well. Attorney fees are contemplated in the law as well, so a successful case will allow you to recover that expense.
Conclusion
Buying a vehicle can be a risky proposition. If you have purchased a vehicle where the seller did not properly disclose a salvage title, it’s important to take immediate action to protect your rights. Such claims can be particularly valuable, and you can either pursue such claims with the Utah Motor Vehicle Enforcement Division or with an attorney in a private action.
If you ever find yourself in the situation described above or if you are looking to sell a car and want help making sure you are in compliance, we are happy to help.
If you need help or would like to speak with an experienced attorney, please call 801-365-1030 or click here to contact us.