Military Law Newsletter - Spring 2012
Servicmembers, Car Dealers, and Bird-Dogging: How Attorneys can Protect Servicmembers
LT Jennifer Wilt, JAGC, USN
All too often young servicemembers find themselves trapped in a car deal they regret. Their monthly payments are more than they can afford. The car isn’t what they thought they were getting. The purchase price is much greater than the market value. The fact that servicemembers end up in these situations may be surprising to some, however, the problem is not new. Many servicemembers fresh out of boot camp have spent weeks of intensive training learning how to trust their shipmates, have a steady paycheck, perhaps for the first time, and many have never purchased a car from a dealership.. Unscrupulous car dealers know this and have taken advantage of servicemembers for years.
“Bird-Dogging” is a one way car dealers prey upon servicemembers. Car dealers hire people with access to military installations to bring servicemembers to the car dealerships. For example, when servicemembers return from deployments they often find people waiting for them in flashy cars. These people approach the servicemembers with promises of a flashy car and a better lifestyle. In effect (and under Virginia law), the person waiting for them is a “salesman,” even though they do not have a license to sell motor vehicles. The “salesman” drives the servicemember to a dealership and begins showing the servicemember several cars personally or hands the servicemember off to another salesman at the dealership. If the servicemember decides he or she wants to think about the transaction before making a purchase on the spot, the process turns into a one-way trip. The individual that brought the servicemember to the dealership leaves and the servicemember must find his or her own ride back to base. This adds to the pressure the servicemember is already feeling to buy the car and may cause the servicemember to relent and just buy a car in order to get back to base.
The practice of bird-dogging, of course, is not limited to this one example and can take many different forms. Regardless of the form of the transaction, however, if a dealership compensates an unlicensed individual to go pick-up servicemembers and bring them back to the dealership, it is illegal. Under Virginia State Code 46.2-1537, it is “unlawful for any motor vehicle dealer or sales person licensed under this chapter, directly or indirectly, to solicit the sale of a motor vehicle through a pecuniarily interested person, or to pay, or cause to be paid, any commission or compensation in any form whatsoever to any person in connection with the sale of a motor vehicle, unless the person is duly licensed as a sales person employed by the dealer.” What these dealerships are doing is against the law. But most servicemembers don’t know that. All these servicemembers see is a nice person, in a flashy car, promising the deal of the century.
After the servicemember realizes he or she has been tricked into a bad deal, the servicemember may visit a Naval Legal Service Office (NLSO) looking for help. Generally, servicemembers come to NLSO with one of three problems, or some combination thereof. First problem: the servicemember entered into a contract where the purchase price of the vehicle was significantly higher than its actual market value. Second problem: the servicemember purchased an unnecessary service plan that cost thousands of dollars more than it was worth. Third problem: the servicemember purchased a car that became inoperable shortly after its purchase. Although there is some potential legal recourse for each of these problems, the solution is generally not immediate and may involve civilian counsel. The better solution is to avoid these transactions all together or, at least, be an informed buyer.
NLSO’s Navy judge advocates assist the servicemembers who have entered into these bad deals, reviewing all the paperwork associated with the transaction and working with the servicemember to determine the best remedy available. The primary issues with these transactions include, among others, missing buyer’s orders, misrepresentation of the terms of the agreement, and purchase of an unnecessary and overpriced extended warranty.
Due to strict limitations regarding representation at civilian courts, the majority of the service judge advocates provide is limited to renegotiating the terms of the contract. JAGs accompany servicemembers to the car dealership to discuss possible remedies, and in many instances, have been successful in obtaining full refunds or changing the terms of the contract.
Beyond assisting servicemembers trapped in bad deal, JAGs also strive to stop these transactions from happening in the first place. The Armed Forces Disciplinary Review Board—a panel that can review the practices of local businesses—has successfully placed numerous businesses “off-limits” to servicemembers. When a business is placed “off-limits,” a servicemember could receive non-judicial punishment for frequenting that business. This discourages servicemembers from purchasing vehicles at these dealerships, resulting in a loss of profits to the dealership. This significant potential loss of customers and income influences many to modify predatory practices in order to avoid placement on the list.
Car dealerships located near military installations know junior servicemembers are unfamiliar with the process of buying and selling vehicles and prey on the servicemember’s vulnerability. Many of these transactions violate the law and do a disservice both to our servicemembers and the legitimate business operating legally. While many servicemembers who become entangled in the bird-dogging trap may truly believe they are getting a good deal, it is often only a matter of time before they discover the car’s latent defects or the contract’s harsh terms. Our most effective defense against predatory dealership action is accountability enforced by attorneys to protect the vulnerable.