A federal appeals court has tossed out a National Highway Traffic Safety Administration regulation that exempts motor vehicles more than 10 years old from odometer disclosure requirements.
In a unanimous decision, the three-judge panel in Chicago ruled that Congress did not authorize the secretary of transportation to exclude older vehicles from the disclosure provisions of the Vehicle Information and Cost Savings Act, also known as the Odometer Act.
Unless overturned on further appeal, the decision binds sellers of vehicles in Illinois, Wisconsin and Indiana, the three states covered by the 7th U.S. Circuit Court of Appeals.
Liz Neblett, a NHTSA public affairs officer in Washington, said, 'We are aware of the case but were not named in the suit. We are looking at the situation to see what, if anything, should be done in the future.'
The decision means a seller must provide an odometer disclosure statement to the purchaser of any car or truck, regardless of age, according to Christopher Langone, who argued the appeal for Chicago Car Exchange. His client specializes in classic and antique vehicles.
'Dealerships, whether new or used, should give a disclosure statement with every transaction,' Langone said.
In the same decision, however, the appeals court said plaintiff David Diersen cannot press his odometer fraud claim against Chicago Car Exchange. In 1984, he paid $16,790 for a 1968 Dodge Charger R/T.
He failed to present evidence that the dealership deliberately misrepresented the car's mileage, the 7th Circuit panel said.
Diersen, an auditor for the federal government, contended the disclosure statement he received falsely listed about 22,600 original miles. Instead, he asserted, the actual mileage was about 75,000.
The dealership denied that the statement was inaccurate and said it had no reason to disbelieve the sworn statement of the seller.
Diersen turned down the dealership's offer to refund the full purchase price. A judge dismissed the lawsuit without trial. Diersen, representing himself, appealed.
In the new decision, Appeals Judge John Coffey rejected the dealership's argument that the Odometer Act doesn't cover vehicles more than 10 years old.
The 1988 NHTSA regulation purporting to exempt such vehicles is invalid, according to the court. 'The text of the law does not, either explicitly or implicitly, exempt any class of motor vehicles from its odometer disclosure requirements,' the appeals court said.
Diersen has asked the appeals court for a new hearing on the fraud issue. If he loses there, 'I'm going to the Supreme Court.'