A Bethesda, Md., dealership has agreed to pay $14,000 to resolve consumer complaints about its failure to disclose fully repairs it made on new vehicles.
The settlement between Jim Coleman Toyota Inc. and the Montgomery County Department of Housing and Community Affairs provides $2,000 payments to seven customers. The dealership also will pay $6,000 to the agency's consumer education fund.
In addition, Jim Coleman Toyota agreed to disclose fully all repair damages to prospective customers and to provide them with copies of the repair invoices.
Under Maryland law, the settlement is not considered an admission of any violation.
The dealership fully cooperated with the investigation, according to George Rose, chief of the agency's division of consumer affairs.
'We did a fairly comprehensive review of the records,' Rose said. 'The repairs had been performed, but the consumers got less than they expected.'
The president of the dealership, Jim Coleman, said the situation came to light when a customer had problems with an outside mirror and a rattle in the door.
'He came to me. I pulled up his record and he was right,' Coleman said, describing it as 'mostly lot damage' that had been repaired for $600 to $700 but not disclosed. 'We ended up taking the car back and settling with him, even though it was not major damage.'
The customer also complained to the county agency, which inspected the car and contacted the dealership.
Coleman allowed investigators to review the sales files for 1996 through 1998 and found other cars that had been damaged and repaired without full disclosure.
Internal repair orders showed it cost from $630 to $3,800 to fix them, Rose said.
Jim Coleman said customers other than the man who complained had been told there had been previous damage but were not shown the required paperwork. 'Even though they knew what they were buying, (the agency) felt it was not proper disclosure.
'As a result of that investigation, Jim Coleman Toyota has undertaken an extensive review and improvement of its new-car delivery process and especially the manner in which it identifies previously damaged vehicles and discloses that damage,' he said.
Under state and county law, dealers must disclose before a sale any damage to the body of a new vehicle that has been repaired, other than minor touch-up paint and scratches. Rose said that is 'any damage more than a scratch.'