Misrepresentation By Seller

Weatherford attorneys as well as attorneys in Mineral Wells, Aledo, Azle, Springtown, Willow Park, Hudson Oaks, Brock, Millsap, or anywhere else in Parker County can help their clients by understanding when a misrepresentation is made that violates the Texas Deceptive Trade Practices Act (DTPA).
A Houston Court of Appeals, First District, case decided in 1984, which sheds light on how to understand one of the ways a misrepresentation can be made. The style of the case is Lone Star Ford, Inc. v. John McGlashan & Teresa McGlashan.
This is an appeal from a judgment rendered in favor of the McGlashans in their suit for damages based on alleged deceptive trade practices. The case was tried without a jury. Finding of fact and conclusions of law were filed.
The McGlashans purchased a 1979 Ford Thunderbird vehicle from Lone Star in 1979. The McGlashans were unaware that the vehicle had a salvage title and that this title had never been transferred into their name. They found out two years later when trying to get a license for the vehicle.
Lone Star argued that there in not any evidence they ever told the McGlashans that Lone Star had good, clear, and marketable title to the automobile, nor that such title would be transferred to the McGlashans upon payment of the purchase price.
The McGlashans assert several violations of the Texas Business & Commerce Code, Section 17.46, otherwise known as the DTPA.
Lone Star says they could not have possibly violated the DTPA because they never made any representations regarding the clear and transferable title, and there was no duty to disclose the status of the vehicle’s title.
The trial court said that the dealer’s act of representing to used car buyers that he can provide them with a properly assigned certificate of title, and failing to do so, is a violation of the DTPA.
The court then said that the DTPA mandates that when a dealer represents that he can sell used cars, he necessarily represents that he can transfer a legal title to the new owner in order to consummate a valid sale. These two representations go hand in hand; otherwise, the dealer falsely represents that he can legally sell the car to the consumer.
So what does this ruling mean?
Here, there was never an actual oral or written representation made to the McGlashans. So, what the court said was the that the act of selling the car itself was an “implied” representation. And since the “implied” representation was false. i.e. Lone Star did not have title itself and thus was unable to transfer it to the McGlashans, they made a misrepresentation and the misrepresentation was a violation of the DTPA.
In this case, the judge went further. The trial judge found that the automobile purchased by the McGlashans was entirely unfit and useless for the purpose for which it was purchased, and that there was no reasonable market value for the automobile. This due to the salvage title.
This case, wherein a misrepresentation was found to be “implied” can be hard to apply to a lot of situations. What is important is that depending on the circumstances of a particular situation that even when there is nothing verbalized or written, that there can be an “implied” representation and if that representation turns out to be wrong, it becomes a misrepresentation to the consumer and that misrepresentation can be actionable as a violation of the DTPA.
The DTPA has remedies for the consumer when this happens.