NEWPORT NEWS, Va., June 16, 2002 - A Newport News jury has found a luxury car dealership guilty of fraud for selling a $50,000 BMW to a collector as "new" when it knew the automobile had been previously titled to a leasing company.
The Circuit Court jury on Wednesday found that Casey Honda/BMW willfully violated the Virginia Consumer Protection Act and committed fraud when it sold a 1998 540i BMW as new even though Casey had previously titled the vehicle and it had been used as a demo, said Richmond attorney John Cole Gayle, Jr. "Using a car as a demo, or titling a vehicle makes it 'used' under Virginia law," Gayle said. "It all could have been avoided if the dealership had followed the law concerning odometer disclosure."
The jury awarded the plaintiff Gerald Wilkins, $113,862.86 in damages in an unusual verdict that both trebled the actual damages and awarded punitive damages as well, Gayle said. The lawsuit was based on the Virginia Consumer Protection Act and a claim of fraud, but relied on Casey’s violation of the Federal Odometer Act to show Casey’s intent to conceal that the car was used. The Federal Odometer Act’s regulations require that mileage disclosures be made on the title and signed by the buyer as opposed to the common practice among auto dealers of issuing a separate disclosure form, said Gayle. "Mr. Wilkins was aware the car had 972 miles on it," said Gayle. "He wasn't aware there had been a previous owner, and had the dealership followed the law and made the odometer disclosures at the time of sale, he would have seen the chain of ownership and would not have bought the car." "This should be a warning to car dealers throughout Virginia to comply with the law instead of relying on standard operating procedure," Gayle said.
Wilkins bought the car on March 31, 1999, and was promised that he would get a Certificate of Origin, which he had specifically requested since he collects cars, stores them and, if new, sells them later with the guarantee that the auto has never been titled, Gayle said. Five weeks after the purchase, Wilkins was mailed the title instead of the Certificate of Origin and discovered the car had in fact been previously titled in a leasing company's name, according to the lawsuit. Casey Honda-BMW claimed the titling of the vehicle was an error, that it contacted the leasing company and had the title assigned back to the dealership, Gayle said. The car then was sold to Wilkins as new.
The two-day case was tried before Circuit Judge E. L. Hubbard.