Colorado: Dealer Gave Incorrect Information About A Deal-breaker Feature, Now Says A “perfected Title” Prevents Unwinding The Sale

location: Colorado

I’m trying to understand whether the following facts could support a viable Colorado misrepresentation/rescission claim arising from a new vehicle purchase.

Before signing, I asked the salesperson a specific factual question about a feature on the exact vehicle I was considering. I told him it was a deal-breaker for me and that I would only proceed with the purchase if it could be disabled.

The salesperson told me that it could be disabled and indicated that another dealership employee could show me how. I relied on that answer and purchased the vehicle.

Within days, I discovered that the feature could not actually be disabled. The dealership itself did not initially appear to know the correct answer. Its service department investigated, tested other vehicles, involved the manufacturer, and ultimately confirmed and documented that the feature could not be disabled.

I promptly asked the dealership to reverse the transaction. Since the dispute began, the vehicle has largely remained at the dealership rather than being used normally.

The salesperson later acknowledged that he did not know at the time of the sale that the feature could not be disabled.

I also later met with the dealership GM. During that conversation, he acknowledged that the salesperson likely gave me the wrong answer and said he would try to find a way to resolve the situation.

The dealership has now formally denied that any misrepresentation occurred.

One of its stated reasons is that there is no written agreement in which the dealership promised to modify or disable the feature. But that is not what I am claiming happened: I am not saying the dealership promised to perform a future modification. I asked a factual question before signing about whether the vehicle already had the capability to have that feature disabled, made clear that the answer determined whether I would buy it, was told yes, and relied on that answer.

The dealership also argues that because the transaction has been funded and title perfected with the lender, there is no legal or administrative mechanism to unwind it in Colorado.

They have instead offered to purchase the vehicle from me or apply its value toward another vehicle, but either option would leave me absorbing a substantial multi-thousand-dollar loss.

The retail installment contract’s Seller’s Assignment provision also states, as part of the dealership’s warranties to the lender, that the vehicle “was not misrepresented in any way to Buyer.”

My main legal questions are:

1. Based on these facts, could the salesperson’s incorrect oral statement support a Colorado misrepresentation claim and rescission, given that I told him the issue was a deal-breaker, relied on his answer when I bought the vehicle, and the dealership later confirmed that his answer was wrong?
2. Does the fact that the statement was not in writing, or that title has already been perfected with the lender, prevent rescission if the misrepresentation claim is otherwise valid?
3. Does the dealership’s representation to the lender that the vehicle “was not misrepresented in any way to Buyer” have any legal significance in evaluating that claim?
4. Given that the dealership allegedly misrepresented a material fact to me, while also warranting to the lender that the vehicle “was not misrepresented in any way to Buyer,” does that give me a meaningful basis to involve the lender in seeking rescission or otherwise disputing the transaction?