Car dealership will not refund patron's deposit


POSTED: Monday, March 02, 2009

Question: I recently went new-car shopping at a local dealer. The dealer did not have the specific car I was looking for, but had one coming in on an inbound shipment. The color, trim level and available option package were what I wanted, so I placed a deposit. Nothing was customized. In the meantime, another dealer had exactly the same car and options available, so I decided to get the car from that dealer. The first dealer now won't refund my deposit. Is this legal? If not, what recourse do I have?

Answer: It all depends on the figurative or literal fine print.

You can contact the state Regulated Industries Complaints Office at 587-3222 to see whether you have any recourse.

Without knowing the specifics of what transpired, there does not appear to be a specific motor vehicle licensing law that covers the situation you describe, said JoAnn Uchida, RICO's complaints officer.

Much would depend upon whether, at the time you placed your deposit, you also signed a sales contract, and what that contract said regarding a deposit, she said.

We also contacted the state Office of Consumer Protection to ask about “;forfeited deposits”;—the extent to which a seller can keep some or all of a deposit on a sale that does not go through.

“;You have to look at the circumstances under which (an item) was ordered,”; especially if a contract is involved, said Stephen Levins, executive director. He was speaking generally about any kind of sales transaction.

Even if a seller says a deposit on a special good is nonrefundable, that doesn't necessarily mean it is nonrefundable, he said.

As an example, someone makes a $500 deposit, leaves, then returns within a minute, saying he changed his mind.

“;In a circumstance like that, it's going to be unreasonable for the merchant to say, 'I'm not going to give your deposit back,' because they've done nothing in that instance to act on the deposit to warrant them retaining the full amount,”; Levins said.

If the action is made a penalty, “;most consumer protection laws would regard that as an 'unconscionable provision,' meaning it's fundamentally unfair to the consumer,”; he said.

However, if a merchant “;sets it all out”; in advance, telling you that a deposit is nonrefundable because he has to do a lot of work to secure the merchandise, the merchandise has to be shipped in, it's a special order, etc., then “;it may very well be appropriate ... for the merchant to keep a portion or all of the deposit,”; Levins said.


Class Ring Update

Thanks to Gerald Kwock, who happens to collect high school yearbooks, the search for the owner of a 1947 Kaimuki High School class ring has been narrowed to three men.

In our Feb. 25 column, someone asked for help in finding the owner of the ring, with the initials “;WKO,”; which had been stashed in a utility drawer for years. She said it did not belong to either of her parents.

Kwock said he found three people with the pertinent initials: Walter Ojima, Walter Okamoto and Wallace Okimoto.

If any of those three men, or their relatives, think the ring might be theirs, please call “;Kokua Line”; at 529-4773 and leave a message.