Car dealing

A California car dealer license is required when buying, selling, or trading vehicles for profit in the state. A dealer license is not required to sell a personal vehicle. California vehicle dealers are licensed and disciplined by the California Department of Motor Vehicles. For all licensing complaints, accusations and possible licensing issues which risk license suspension or revokation, it is imperative to hire a professional licensing attorney who understands the numerous regulations that effect a dealer’s license.

Consider the Following Fictionalized Vignette:

Donny (a car dealer) recently purchased a car dealership in San Jose, California from a retiring dealer. During the purchase, the seller provided the buy-sell agreements which Donny, unfortunately, did not closely review. As he was preparing for an upcoming advertising launch and receiving legal assistance with some regulatory compliance issues, he unexpectedly receives notice that a past customer of the seller has filed a complaint against his dealership with the California DMV. The car buyer is claiming his dealership overcharged for DMV fees and did not transfer registration to the him within 60 days. Donny fears losing his dealer license and doesn’t know what to do next. What type of attorney should Donny hire? How can Donny best protect his license and new business?

Definition of a California Vehicle Dealer

According to the California Vehicle Code §285, a car dealer is someone who:

  • “For commission, money or other thing of value, buys or offers for sale, a vehicle subject to registration, or a motorcycle, snowmobile, or all-terrain vehicle subject to identification, or a trailer subject to registration or identification.
  • Is engaged wholly or in part, in the business of selling, buying, or taking in trade vehicles for the purpose of resale, selling, or offering for sale, consigned to be sold, or otherwise dealing in vehicles, whether or not such vehicles are owned by the person.”

Types of California Dealer Licenses

There are four types of vehicle dealer licenses in California:

1. New/Used: A dealer may sell new and/or used vehicles to the public and other licensed dealers.

2. Used: A dealer may sell only used vehicles to the public and other licensed dealers.

3. Dealer-Wholesale: A dealer may sell vehicles only to other licensed dealers.

4. Autobroker: A dealer arranges, negotiates, and assists a person with the purchase of a new or used vehicle that is not owned by the dealer.

Consumer Complaints Against Car Dealers With Licensing Authorities

All consumer complaints against car dealer licensees are reviewed by the Investigations Division of the California Department of Motor Vehicles.

As stated by the DMV, “DMV investigators conduct selective investigations of these licensees and their activities, based upon the department’s priorities, patterns of misconduct and the availability of personnel. Your complaint will be kept on file in case an investigation is undertaken against this party or firm.”

It is highly recommended that a dealer consult with a professional licensing attorney immediately upon notice of a complaint in an attempt to minimize disciplinary action against a dealer’s license.
Questions California Car Dealers Facing Licensing Issues Should Ask Their Attorney:

  • Do you have expertise in professional licensing law representing car dealers?
  • How many car dealer cases have you won?
  • Have you ever had a client’s license revoked by the California Department of Motor Vehicles?
  • What are the outcomes I can expect for my case?
  • Will the attorney I hire handle my case personally?
  • Do you charge a flat fee or an hourly fee?

The Law Offices of Lucy S. McAllister have successfully represented a wide range of California licensed professionals including car dealers, vehicle salespersons, automotive repair workers among others and are very experienced in handling all types of licensing issues.

If you are a California vehicle dealer facing disciplinary action by the California Department of Motor Vehicles, it is imperative to enlist the assistance of an experienced licensing attorney immediately. We understand the unique legal complexities facing vehicle dealers in California. We have the knowledge and experience to craft a comprehensive strategy and are dedicated to navigating your specific case throughout the disciplinary process to best defend your professional interests. Let us help you protect your professional license, your reputation, and your livelihood.

For additional information or to schedule a consultation on a professional licensing issue, please contact us today at (877) 280-9944.

Disclaimer: This article is intended for educational purposes only and does not constitute specific legal advice or outcome guarantees. This article does not establish an attorney-client relationship between you and the blog/website publisher and should not be used as a substitute for legal advice from a licensed professional attorney.

For Additional Information

Application Requirements For Vehicle Dealers Auto Commercial

California Car Dealer Licensing Requirements |

Application Requirements for a Vehicle Salesperson License

Vehicle Salesperson License Handbook

Vehicle Code Section 11700-11740

State of California DMV – Vehicle Industry Registration Procedures Manual

State of California DMV – 2.015 Dealer (CVC §285)

Filing a Complaint with the Department of Motor Vehicles