When selling a car, is it mandatory for the owner to inform the buyer about any accident history of the car?

I sold my car couple of days back but didn’t mention that it had a minor accident that was completely repaired an year back. Even he never asked me if my car had any accident before buying it. But now the car is in good shape. The buyer went for a test drive and bought the car. Now he threatens to sue me that I didn’t mention that it had a accident history. As per law should I mention in my advertisement that my car had a accident history.

Asked on September 16, 2011 under Business Law, California

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

Yes, you need to disclose its accident history. A car that's been in the accident is not worth as much as one that has never been in an accident, even if the car is now in good shape. Therefore, the accident history is a material fact that any reasonable buyer would expect to be disclosed and which affects the value of the vehicle. Not disclosing this material (or important) information would very likely be considered fraud; you also might be considered in breach of contract, since an argument can be made that in the absence of a disclosure of the accident history, the agreement to sell the car was an agreement to sell a car which had not been in an accident. Therefore, the buyer may well have good grounds to sue you, and this is something which should be disclosed when selling to avoid liability.


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