In this article, we’ll discuss the Georgia Fair Business Practices Act and what car dealers should know.
In 1975, the state of Georgia passed Georgia’s Fair Business Practices Act (FBPA). This act prohibits unfair and deceptive acts or practices in the marketplace. This law applies to consumer transactions involving the sale, lease, or rental of goods, services, or property mainly for personal, family, or household purposes. The FBPA is meant to act as a catch-all that protects businesses and consumers from unfair business practices.
The most common customer lawsuits we see brought against dealers are civil violations of the FBPA. These cases can truly damage a business’s reputation and, as a result, its ability to grow. The provisions within the FBPA can be tricky to navigate but not impossible if we clearly unpack the legal language and name specific steps for car dealers to take that ensure their business practices are aligned with the FBPA.
So, what is a violation of the FBPA? How do we define an “unfair business practice”? The best way to define these items is through common examples our firm has seen when representing car dealers.
Auction Disclosures & “As-is” Sales
Plaintiffs’ attorneys in FBPA car dealer cases have argued disclosures at auction that aren’t disclosed to the customer are an unfair business practice because the consumer does not possess the same knowledge as the dealer regarding the vehicle’s history.
Any superior knowledge the dealer has that the customer doesn’t have and the dealer does not disclose may be considered an unfair business practice. In other words, if a dealer is hiding information about a vehicle’s function, history, pricing, etc. to sell a car, the dealer is arguably violating the FBPA. Some dealers believe selling a car labeled “as-is” acts as a catch-all for this very issue; however, that is simply not true. The FBPA may still provide an avenue for a customer to come after a dealer, even in an “as-is” sale. The best way to navigate this type of claim is to provide the consumer with whatever disclosures were provided to the dealer by the auction and also to respond to the consumer’s FBPA demand.
Secretary of State’s Office of Consumer Protection
A finance company cannot sue a dealer for an FBPA violation because that is not a consumer transaction. It is a business-to-business transaction, not a business-to-consumer transaction. Aside from business-to-consumer transactions, the second most common FBPA case is with the Secretary of State’s Office of Consumer Protection. If they receive complaints or if they’re doing an audit or an investigation of a dealer, they might allege that that dealer is committing an unfair business practice and on behalf of the state of Georgia. In this case, they might open that investigation and proceed in a lawsuit against the dealer to enforce the Fair Business Practices Act as a state interest.
The Office of Consumer Protection has an interest in making sure Georgia businesses are not committing unfair business practices. To enforce that, they often open a complaint against the dealer. Those can be messy given that you are dealing directly with a government agency; however, they are negotiable depending on the case and situation.
How to Avoid Georgia Fair Business Act Violations
Valuing honesty and integrity with consumers over sales will always keep FBPA claims at bay. However, there are car dealers that innocently and unknowingly violate the FBPA simply because they lack support, resources, and knowledge. One of the most important sections of the FBPA is 10-1-399. This requires the complainant to send a notice of the violation of the act and a demand in the notice. The defendant (the person/ business being accused) has 30 days to respond to the notice.
Many people don’t know is that the defendant can respond with a reasonable counter-offer or settlement offer. If the consumer sues the dealer, the judge can actually limit the win to the amount of that counter-offer. This is only if the judge finds that the counter-offer is reasonable in light of the circumstances. This section is something many business owners do not know about. In fact, there are even lawyers that don’t know about it. These nuances embedded in the FBPA support business owners. If you do not know they exist, you won’t know how to leverage them.
How Lefkoff Can Serve You
For this reason, it is important to have a knowledgeable law firm that is more interested in seeing your business thrive than pushing clients through their doors. At Lefkoff Law, we provide clients with comprehensive, proactive strategies, as well as consistent educational resources that help them thrive while navigating the law (especially the Georgia Fair Business Practice Act). Schedule your strategy meeting with us today by clicking HERE or join The Driveway, our monthly legal membership program that provides educational resources specifically for dealers— sign-up HERE.
You can also find more information at www.georgiacarlaw.com
