Odometer Rollback Laws

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 What Are Transaction Disclosure Terms?

Transaction disclosure terms are terms and provisions that must be disclosed in a contract between two or more parties. The majority of the time, these terms involve important aspects of the products or services that are being exchanged, for example, the history or quality of the product.

Additionally, transaction disclosure terms may, in some cases, deal with the form of the contract itself, in order to make the agreement more readable for the parties. In addition, a clearly drafted contract with all of the important information being disclosed to all parties involved, may help prevent a breach of contract from occurring in the future.

There are various state and federal laws that govern the terms that are required to be disclosed in a contract. These laws may vary by state or jurisdiction.

What if a Transaction Term Is Not Disclosed in the Contract?

If a required transaction disclosure term is not included in a contract when it should be, it may lead to legal consequences. Typically, the non-violating party may be entitled to a damages award to reimburse them for any economic losses caused by the non-disclosure.

For example, under the majority of state car sale laws, the failure to disclose information regarding an altered odometer reading is referred to as odometer fraud. Failing to mention any changes to an odometer may result in a seller being required to reimburse the buyer for actual losses that were caused by the odometer fraud.

What Are Some Examples of Terms that Need to be Disclosed in a Contract?

In general, parties are free to contract as needed and may address various issues in a contract, as long as they remain within legal limits. On the other hand, both state and federal laws may require certain disclosures so that one of the parties does not exercise an unfair advantage over the other.

Examples of transaction disclosure terms that should be included in a contract may include, but are not limited to:

  • The form of the contract: The contract should be readable and clear to all parties. For example, most laws require that if a page of a contract has writing on both sides, the front side should contain a statement that says, “ee other side for further information”, or a similar statement;
  • The nature of the product or services: Transaction disclosure terms are often required if a product has been altered from its original condition before the sale. A common example of this is where the odometer of a used car has been reset from the true mileage. For such contracts, the contract should contain a disclosure term regarding the odometer and the car’s actual mileage; and
  • Methods of transaction: Certain aspects of a transaction need to be disclosed, especially those that involve sales referrals. Many laws prohibit or limit referral sales, or offering discounts or benefits for customers who make referrals to sellers. Thus, a contract should disclose a company’s policies on referrals.

Additionally, general contract principles require the parties to disclose information if withholding the information may make the contract unequal or one-sided. For example, if the parties are mistaken regarding a contract term, the party with knowledge of the true meaning of the term should make a disclosure regarding its meaning.

What Is an Odometer Rollback?

When a motor vehicle is transferred, the seller is required to provide a written odometer statement that discloses the vehicle’s true mileage at the time of transfer. On occasion, an individual or a dealer will alter the mileage of the vehicle’s odometer, referred to as mileage rollback or odometer rollback, to deceive the customer.

To rollback car meters may allow the seller to sell the vehicle at a higher price than if they sold it based on the true mileage.

How Can I Avoid Odometer Fraud?

The best way for an individual to avoid odometer fraud is to examine the chain of title and check to see if the mileage matches the mileage shown on the vehicle. Other things to look for to avoid odometer fraud include:

  • Excessive tire wear for the vehicle’s year or disclosed mileage;
  • Scratches in the odometer area;
  • Missing screws near the dashboard that may indicate the dashboard was opened;
  • Odometer numbers do not line up evenly;
  • Oil change stickers that may contain mileage information;
  • The mileage listed on the title versus the mileage shown on the odometer;
  • Vehicle inspection reports, including oil change reports showing the mileage on the vehicle;
  • The CARFAX vehicle history that includes odometer readings; and
  • The title history from the Department of Motor Vehicles.

If an individual has purchased a vehicle that may have an altered odometer, they should consult with an odometer fraud lawyer.

What Is the Motor Vehicle Information and Cost Savings Act?

The Motor Vehicle Information and Cost Savings Act, otherwise known as the Odometer Act, prohibits certain actions, including:

  • Advertising for sale, sell, use, install, or have installed, a device that makes an odometer register a mileage different from the mileage the vehicle has driven;
  • Disconnecting, reseting, altering, or having disconnected, reset, or altered, an odometer intending to change the mileage registered by the odometer; and
  • Conspiring with others to violate the odometer law.

What Am I Entitled to if I am a Victim of Odometer Fraud?

If an individual has suffered a loss due to rolling back odometers, they may be entitled to three times the damages they suffered plus attorney’s fees. The damages may vary, as there are federal and state laws that may apply to odometer fraud.

Can I Sue a Car Dealership for Odometer Tampering?

If an individual has been an odometer rollback victim, they may be able to sue the car dealership for odometer tampering. The consumer can file a lawsuit against the dealership for violating federal civil law.

Under federal odometer tampering status, altering the mileage reading on a vehicle is a felony. In these cases, the intent of the seller to defraud the buyer is an important element to establish liability.

This intent can be shown by proving the seller engaged in specific acts that are only done to deceive another for financial gain. Fraud may also be proven by showing specific acts taken or words used by the seller to induce the buyer to purchase the vehicle.

In addition to federal laws, each state may have its own laws prohibiting odometer tampering.

Do I Need a Lawyer for my Odometer Fraud Problem?

Odometer fraud can cost a victim thousands of dollars in repairs due to breakdowns. If you believe you have been a victim of odometer fraud, it is important to consult with an auto lawyer as soon as possible.

Your attorney can advise you of the applicable laws in your jurisdiction, including federal and state laws. Your lawyer can check the chain of title on your vehicle for signs of fraud.

If fraud has occurred, your lawyer can help you file a lawsuit and obtain damages. If you have to appear in court, your lawyer will appear with you.

If you have been accused of engaging in odometer fraud, it is important to consult with an attorney. As noted above, it may be a felony charge with serious legal consequences.


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