MLF News — The Miles Law Firm

Miles Law Firm Begins Auto Law Training

November 6, 2010 By admin

THE MILES LAW FIRM has announced its new online legal compliance training for the auto industry, AUTO LAW TRAINING.

“This is the natural extension of counselling our many auto industry clients on the many laws with which they have to comply,” said Larry Miles, the Firm’s senior attorney and principal instructor for AUTO WORLD LEGAL. “Our online legal training will help dealers ensure that their employees are legally compliant with those laws.”

The web portal for AUTO LAW TRAINING is at www.autolawtraining.com. The inaugural course is F&I 101, An Introduction to Legal Compliance in the Finance and Insurance Office. Interested dealerships and prospective students can review this “Free Sample Course,” which is the introductory session for F&I 101, and then check out the entire course coverage in F&I 101 by going to “Our Courses”. A prospective student can enroll for any course by going to AUTO LAW TRAINING portal which is accessed from the “Getting Started” page.

Dealers should contact AUTO LAW TRAINING directly at autolaw@autolawtraining.com to arrange for bulk enrollment discounts or prospective students can enroll directly through the AUTO WORLD LEGAL portal.

Filed Under: Auto Industry, MLF News

Miles Wins Big Securities FINRA Arbitration

October 25, 2010 By admin

The Miles Law Firm’s Larry Miles won a significant arbitration award of $118,347 in a case decided in August against a major securities firm on behalf of our client, securing a judgment before a three arbitrator panel.

“I’m pleased we were able to assist our client in vindicating his case and obtaining reasonable compensation for his loss,” Miles said.

The two day arbitration was before the Financial Industry Regulatory Authority (FINRA). Miles argued that the securities firm failed to properly place a significant options order and then failed to use reasonable care to discover and correct the mistake. The order was placed on one of the most volatile days in market history.

Filed Under: Commercial Law, Litigation, MLF News Tagged With: FINRA

Miles Law Firm Wins Important Appellate Decision

September 30, 2010 By admin

In Brashers Cascade Auto Auction vs. Valley Auto Sales, et. al., 119 Cal. App. 4th 1038, 15 Cal. Rptr. 3d 70 (5th dist. 2004), the Appellate Court held that a used car dealer who purchased 32 vehicles from a wholesaler without obtaining the titles had to show adherence to commercial reasonableness to be considered a buyer in the ordinary course of business, reversing the trial court judge. Mr. Miles argued the significant commercial law case before the Fifth District Court of Appeals involving the good-faith standard required of auto dealers in certain types of commercial law cases.

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” … a used car dealer who purchased 32 vehicles from a wholesaler without obtaining the titles had to show adherence to commercial reasonableness to be considered a buyer in the ordinary course of business.”

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Wholesaler Fails To Pay

The wholesaler purchased the vehicles from Brashers Cascade Auto Auction, accepted payment from the used car dealer, but failed to pay the auction.

The case involved two relatively innocent parties: the used car dealer who paid once for the vehicles (albeit without demanding titles at the time he paid), and the auto auction who complied with all laws necessary to perfects its security interest in the wholesaler’s vehicle inventory.

The Miles Law Firm, on behalf of its client Brashers Sacramento Auto Auction, sued the wholesaler and the used car dealer. The wholesaler went out of business. In the case against the used car dealer, Miles argued that the Auction’s perfected security interest in the wholesaler’s inventory permitted the Auction to recover the vehicles from the used car dealer. However, the Trial Court ruled that the used car dealer was a buyer in the ordinary course of business, and thus took free and clear of the auction’s perfected security interest in the wholesaler’s vehicle inventory.

“We thought the Trial Court used the wrong legal standard,” attorney Larry Miles observed. “The Court used the same standard for the used car dealer as it would have used for an ordinary consumer, despite the fact that the used car dealer knew the risk he was taking in failing to obtain the titles and, in our view, failed to adhere to reasonable industry standards.”

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“The Brashers case will become one of the leading cases in the country on establishing the proper standard for considering the good-faith of a merchant …”

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“The Brashers case will become one of the leading cases in the country on establishing the proper standard for considering the good-faith of a merchant who buys vehicles or other inventory that is the subject of a lien by a secured party,” Miles said. “Merchants should be held to standards of commercial reasonableness in assessing whether they acted in good-faith, and are thus buyers in the ordinary course of business.”

“We commend Brashers Auto Auctions for appealing this case and establishing this important precedent.” Miles concluded. The Appeals Court returned the case to Fresno for further proceedings.

Filed Under: Appellate Advocacy, Auto Industry, Commercial Law, MLF News

Miles Wins Precedent Setting NTSB Case

September 30, 2010 By admin

Mr. Miles' prior plane, a B-55 Baron.

In FAA vs. Fahning, a 2003 decision by the NTSB, Larry Miles persuaded the NTSB in an emergency Petition to overrule the FAA’s issuance of an immediate Emergency Revocation (“ER”) of Mr. Fahning’s pilots and mechanics licenses. The Petition at the time was just the third case in which an airman had persuaded the NTSB to overrule the FAA on the issuance of an ER.

“This was a horrible case in which the FAA conducted a sloppy investigation, and erroneously concluded that Mr. Fahning, a commercial pilot and mechanic with a long and impressive aviation career, had falsified aircraft logs,” Miles commented.

Immediate Response Needed

“This case was incredibly difficult because the law gives an aggrieved airman or mechanic just a few days to respond to an Emergency Revocation, and is heavily biased in favor of the FAA’s determination,” Miles observed. “The time to respond has already elapsed by the time most pilots or mechanics talk with an attorney. In this case, our Petition contesting the FAA’s action was due the day after we first saw our client,”

The Fahning decision is now a national precedent in NTSB practice, standing for the proposition that the Board, which must assume the truth of the facts alleged by the FAA in an Emergency Revocation may, nonetheless, consider other facts to establish the “context” of the alleged violations, and thus the appropriateness and necessity to immediately revoke the licenses in controversy.

Aviation Practice

In addition to helping aviation professionals and businesses with administrative proceedings, Miles advises his aviation clientele in a variety of areas, ranging from the acquisition of aircraft, to mediating and arbitrating aviation lawsuits. A pilot for over thirty years, Miles also serves as a panel attorney for the Airplane Owners and Pilot Association’s (“AOPA”) Legal Panel, and is a member of the Lawyer-Pilot’s Bar Association and the NTSB Bar Association. Miles is a commercial pilot, instrument rated, with land and seaplane ratings. He flies a Bonanza A-36.

Filed Under: Appellate Advocacy, Aviation, Litigation, MLF News Tagged With: FAA

LEGAL BULLETIN: Car Buyer’s Bill of Rights

September 30, 2010 By Larry Miles

The “Car Buyer’s Bill of Rights” was enacted effective July 1, 2006. The bill started out with what some industry advocates said were draconian measures, but ended up being significantly amended. Among the key provisions of the new law are requirements for a “contract cancellation provision,” limitations on the use of the phrase “certified” in the sale of used vehicles, and limitations on the amount of finance reserve a dealer can make.

Contract Cancellation Option

The contract cancellation provision only applies to consumer sales involving used vehicles (not including motorcycles or RV) with a purchase price of less than $40,000. Retail installment sales contracts will have new disclosure language added that informs customers of their rights to have the contract cancellation option.

The law will require the dealer to offer a 2 day/250 miles contract cancellation option. It will also permit dealers to charge for the Option, and then charge a restocking fee (less the cost of the Option) if the consumer actually cancels the contract.

“Certification”

The bill also imposed some limitations on a dealer’s ability to advertise a used vehicle as “certified”. A dealer cannot advertise a vehicle if any of the following apply:

(1) The dealer knows or should have known that the odometer on the vehicle does not indicate actual mileage, has been rolled back or otherwise altered to show fewer miles, or replaced with an odometer showing fewer miles than actually driven.

(2) The dealer knows or should have known that the vehicle was reacquired by the vehicle’s manufacturer or a dealer pursuant to state or federal warranty laws.

(3) The title to the vehicle has been inscribed with the notation “Lemon Law Buyback,” “manufacturer repurchase,” “salvage,” “junk,” “nonrepairable,” “flood,” or similar title designation required by this state or another state.

(4) The vehicle has sustained damage in an impact, fire, or flood, that after repair prior to sale substantially impairs the use or safety of the vehicle.

(5) The dealer knows or should have known that the vehicle has sustained frame damage.

(6) Prior to sale, the dealer fails to provide the buyer with a completed inspection report indicating all the components inspected.

(7) The dealer disclaims any warranties of merchantability on the vehicle.

(8) The vehicle is sold “AS IS.”

Contract Disclosures

Although most dealers already itemize theft deterrent, surface protection, or GAP products on the sales contract, the new law will require both a disclosure on the sales contract and an additional disclosure signed prior to execution of the sales contract. The new form will have to disclose, “Installment Payment EXCLUDING Listed Items,” and then set forth the disclosed items:

* a service contract,

* any insurance product,

* debt cancellation agreement,

* theft deterrent device,

* surface protection product, and

* vehicle contract cancellation option agreement.

The form will then have to state the installment payment INCLUDING the items listed.

Credit Disclosures

Dealers who obtain a consumer credit score (which is basically every dealer) will also have to provide a new form, “Notice to Vehicle Credit Applicant”. The form informs consumers about the use of consumer credit scores in the extension of credit.

The Miles Law Firm has provided training and seminars for auto dealers regarding the Car Buyer’s Bill of Rights, as well as audits to ensure legal compliance.

Filed Under: Auto Industry, Legal Bulletins