Asked to Sign Two Contracts

Asked to sign two contracts.

A recent turn of events led me to uncover a series of unfair and deceptive business practices.  The basic scenario is this:  
A customer goes into a California used car dealership that also offers “new car brokering.” With the proper endorsement on the license, dealers are permitted to broker the sale of a new vehicle - even when they are not franchised for that brand.  No issue there.  The customer then goes to pick up the new vehicle and is asked to sign the contract for the new vehicle that was prepared by the franchised new car dealership.  (This is probably a prohibited “off site sale,” but there’s so many other forthcoming issues that I’ll address that topic later).
Auto sales contracts in California have a box on them that needs to be checked if the sale is “brokered.”  It’s just a check-box.  It doesn’t disclose any financial details between the dealer and the broker, so you would think that it wouldn’t be a problem to check it.  Apparently it is, because the box was not checked.  (Again, this is a whole different topic - but some manufacturers will not offer incentives on brokered deals.  In this particular instance, there was incentive financing which might not be honored by the manufacturer if they knew this was a “brokered deal.”)
A technical violation - not the end of the world and a dealer could potentially make a valid claim for reformation of the contract to include the check in the box if the customer knew, as they did in this case, that the deal was actually brokered.
What happened next is the troubling part - the dealer/broker then had the customer sign a contract with them.  It listed themselves as the seller (wrong - a used vehicle dealership cannot sell a “new” car).  The actual terms of lending were different inside the “Federal Truth-in-Lending” Disclosure box.  There were other material differences between the contracts also, such as one having an arbitration clause while the other did not.  Your rights under these circumstances are substantially different.  And in this particular case, the customer does not even know who they should pay - remember, until you are informed otherwise, you are obliged to pay the “seller/creditor” in the top, right box on the contract.  Most of these contracts are assigned to a lender before the first payment is due, but if it is not then you make the payment to the seller (otherwise they can come repossess the car).
What can you do if you are presented with two contracts?  If you sign both, then get a copy of both (get a copy of everything that you sign, initial or are presented with during the negotiation of the sale - take pictures if you have to).  You might then talk to an attorney to discuss your rights under these contracts.


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