ALERT: FADA Wins Legal Challenge and DMV Case

November 8, 2017

The judge entered her order this week and our dealers no longer have to be concerned about the titling and registration rule that was being added to consumer actions against dealers.

FADA prevailed and  the entire sentence in this troubling Rule is hereby stricken:

“(5) If an EFS agent charges a fee to the customer for use of the electronic filing system in a title or registration transaction, the fee shall be disclosed separately and in a clear and conspicuous manner in the sales agreement along with the other options for titling and registration. The EFS agent  may not disclose or disguise this as a State or Government fee.”

For years we have attempted to remove this Rule through administrative action and legislation, to no avail.  So in July of this year, you allowed us to hire John Forehand and Craig Spickard of Kurkin Forehand Brandes LLP to file an administrative action seeking to have the rule declared invalid.  The Department, of course, opposed our efforts to have the rule declared invalid, and in September we had a formal hearing regarding the rule with an administrative law judge.

We are pleased to let you know that Monday we received a final order from the administrative law judge declaring the rule invalid.  If the Department does not appeal this final order, the rule will become void in 30 days, and there will no longer be a requirement that dealers using EFS disclose other options for titling and registration.

Please note, however, that the invalidity of this rule has no bearing on your obligation to not disguise or misrepresent the fees you charge.  Any fees you charge for EFS, titling and registration, (or any other fees you charge) must be appropriately disclosed on the buyer’s order accompanied by the appropriate statutory disclosure.

Congratulations and a huge thanks to Kurkin Forehand Brandes and John Forehand and Craig Spickard, our co-counsel in this lawsuit before the Department of Administrative Hearings.

While you may have not impacted by this issue some of our notable members were definitely affected and we have received kudos for your action and willingness to allow FADA to take on this challenge.

This successful challenge is also important as it indicates to the Department that FADA will pursue what is right for our dealers through whatever recourse is available if they fail to respond.

Congrats,

Ted