Caveat Emptor for Buying and Selling a Used Car

This Story Demonstrates How Both Sides Need To Be Protected

There will always be problems for buyers and sellers but once a title is signed the seller is no longer responsible for the car. Photo © Getty Images

Caveat emptor, which is Latin for buyer beware, is applicable for both the buyer and seller of a used car as demonstrated by a story shared with me by a reader. The seller needs to be aware, too, that once a legitimate sale is done - it's finished. There is no need to accept responsibility once a vehicle changes hands.

Here's the story as related to me (with some minor editing):

"A colleague just started a new job in a city and sold his car because he will no longer be needing it as he will be using public transportation.

This is the funky situation: He just sold the car … and within 15 minutes, the new owner called saying he couldn't get into reverse (it is a stick shift, 5 speed).

"The new owner did test drive the used car and agreed all was running properly and bought the car happily. The sale took place over the course of 2 days. Then this reverse gear situation happened.

"Some background: The car is 11 years old and has been serviced by dealerships only. All prior [service records] (dealership bills) [was] presented in good faith to the new owner. New tires were put on the car and it was serviced in preparation of the sale. My colleague has had no problem with the gear shift/transmission ever.

"Upon receiving the 15 minute post sale call from the new owner, my colleague went to the site where the car had been parked and sold; the new owner had already received title properly."

'Working on the Used Car'

"The new owner and a friend were 'working' on the car, having taken off the gear shift boot and other surrounding covers to actually tinker (for lack of a better word) with the gear shift.

The new owner and friend would not let my colleague try to drive the car and test the reverse and other gears. They said they would take care of it.

"One day later, the new owner emailed my colleague saying he had to roll the car to a mechanic where the mechanic told him he needs a new transmission for $1500.

"What should my colleague do? He really did sell the car in good faith and has never had any problems with the transmission. He hadn't planned on selling it and took care of it to keep as long as he could, in good working condition for himself."

No Refund Due

Guess what? The buyer is stuck in this case and has no expectation of a refund. As I told the writer, there is no expectation of a warranty (implied or not) between two private consumers. It's different for used car dealers, which is why some unethical dealers will break the law and sell used cars as curbstoners (i.e. dealers who pose as private sellers).

My advice to the seller (via his work colleague) was to do absolutely nothing. The seller had no responsibility to the buyer because a vehicle is sold as is unless a warranty is presented in writing - and I would advise against any private seller ever providing a warranty on a vehicle for situations exactly like this one.

The buyer has taken possession of the car, supposedly run into a problem, and then attempted to fix it himself. When his mechanical ineptitude demonstrates itself, he calls the seller and starts to complain that the transmission isn't working properly. No dealership would accept responsibility for repairs on a vehicle that were performed by a non-mechanic on the street.

Once the new owner cracked open that transmission he assumed all responsibility for that car.

A Shakedown?

Plus, I'm going to indulge my cynical journalist side. What's to stop a scam artist from trying to shake down an unsuspecting seller? Most people would want to do the right thing if something sold suddenly broke down right after the deal was signed. After all, most people are genuinely good.

What's to say, though, that the buyer wasn't gaming the system? Say he did something to damage the transmission? He enlists a friendly mechanic to give an inflated repair bill so the seller ends up paying for most of the work. (Does that mean I have dishonest thoughts? After decades of news reporting, I am not immediately trusting of most folks.)

Regardless of the buyer's intent, it's important as a seller to keep in mind that the buyer should have been more proactive in the buying process.

It's not a private seller's responsibility to provide a warranty (nor is it a good idea). Let the buyer purchase an extended warranty at his or her own cost.

This seller owes this buyer nothing,