Ondrej Sabo

A used car dealer brought an action for negligent misrepresentation after purchasing a vehicle from another dealer who represented that the vehicle had not been involved in an accident.

After resale to a consumer, the plaintiff discovered through vehicle history reports that the vehicle had previously been involved in an accident and ultimately repossessed and resold the vehicle at a significant loss.

The court accepted evidence that the seller had represented the vehicle as accident-free and that the buyer relied on that representation when deciding not to conduct its own search.

The court found the corporate seller liable for negligent misrepresentation but declined to impose personal liability on the individual agent who made the representation.

Damages were limited to the diminution in value of the vehicle rather than the plaintiff’s claimed financing-related losses.