Automotive Repairs Consumer Remedies for Unauthorized Work

A recent decision by the Wisconsin Court of Appeals, District II, in Kaskin v. John Lynch Chevrolet-Pontiac Sales, Inc., has been widely discussed in the media and has generated many questions from shops engaged in automotive repairs. In this case, the customer alleged that the dealership performed repairs to his vehicle without authorization. When the customer brought the vehicle in for repair, both he and the dealership believed that the repair would be covered by factory warranty and the initial authorization was for the dealership to proceed on the basis there would be no charge to the customer. Upon diagnosing the problem, the dealership found that bad fuel had ruined the fuel injectors which was not covered by the warranty. The dealership repaired the problem, but would not release the vehicle to the customer until the repair was paid.

The customer then sued the dealership under Wisconsin's unfair trade practices law which provides that anyone suffering pecuniary loss as the result of a violation can recover "twice the amount of such pecuniary loss." The dealership argued that even if the repairs were unauthorized, the customer had not suffered any "pecuniary loss" as the vehicle had been repaired and the customer received the value of the repair. The trial court agreed with the dealership and dismissed the claim and the customer appealed.

In its decision reversing the trial court's dismissal of the action, the Court of Appeals determined that Wisconsin's consumer protection laws provide customers with a "right of informed consent" before repairs are made. The Court went on to hold that if a customer is deprived of this right of informed consent, his or her pecuniary losses include the full amount of the costs of the unauthorized repairs. The value of the unauthorized repairs to the customer is not considered.

In reaching this decision, the Court did not overturn a prior case, Huff & Morse, Inc. v. Riordan, in which the Court found that a repair shop could recover the reasonable value of repairs from a customer even though the shop had violated Wisconsin's Motor Vehicle Repair Rule (ATCP 132, Wis. Adm. Code) by not giving the customer a written estimate before proceeding with repairs. The difference in Huff & Morse was that the customer admitted orally authorizing repairs although the authorization failed to comply with Wisconsin Code.

Contrary to the impression given in some press reports, the Kaskin case did not change any requirements of Wisconsin's Motor Vehicle Repair Rule. ATCP 132 provides:

No shop may perform any repair that has not been authorized by the customer. Before a shop starts any repairs whose total price may exceed $50, a shop representative shall record the repair authorization on a written repair order under s. ATCP 132.03.

Under the rule, the content of a written repair order, including price information, is set forth in detail and the customer is required to sign and be given a copy of the order prior to commencement of repairs unless there is no "face to face contact" with the customer at the time of authorization. If authorization is by telephone or other means, the shop is required to provide a description of the repairs along with a good faith estimate of the repair price. The shop in such cases must record: 1) the date and time of such authorization; 2) the name of the person providing the authorization; 3) a description of the work authorized; 4) the total price estimate; and 5) the estimated completion date.

The bottom line is that the Kaskin decision does not change the requirements repair shops must meet under Wisconsin's Motor Vehicle Repair Rule. Those basic requirements have been in place for over thirty years. What the Kaskin case does do is clarify the remedies available to customers when unauthorized repairs are performed. The burden of proof is on repair shops to show what was authorized and how much was authorized in any dispute. If the shop cannot show authorization, the customer is not required to pay.