Two Baltimore County automobile dealerships have agreed to pay more than $100,000 in restitution to 83 customers who bought Fords and Lincoln Mercurys that, although labeled "new," had been taken out on joy rides, damaged or returned by previous buyers.
The dealers, Koons Ford of Baltimore Inc. at 6970 Security Blvd. and Koons Lincoln Mercury-Merkur at 9610 Reisterstown Road in Owings Mills, sold the cars from 1988 to 1991, according to Assistant Attorney General William D. Gruhn. He said customers would receive checks in the mail from Koons within 10 days.
Under the agreement, the two dealerships agreed to disclose the full history of a vehicle to the customer in the future but denied violating the state's Consumer Protection Act. In addition, a handful of consumers whose cars were damaged and repaired before sale will have the option of exchanging their cars for 1992 models.
Koons also agreed to pay $10,000 to the state to offset costs of the investigation.
Koons attorney Thomas M. Wood IV said yesterday that both Koons dealerships did not believe they had violated any laws but settled the case as a "gesture of goodwill and to keep their customers happy." He said the cars involved a "very small percentage of total sales" and that all cars were sold with their actual mileage on their odometers.
The attorney general's office began its probe after receiving a complaint from a customer who discovered the "new" car he purchased had been previously titled to someone else.
The majority of the cars were sold as new after being delivered to customers who then returned them because they could not obtain financing or didn't like the cars, Mr. Gruhn said. The assistant attorney general said 10 of the 83 cars were stolen from the lots, mostly for joy rides, and recovered by police before being sold as new.
"If a car is stolen from their lot, they have duty to disclose it. Most people think it is an important fact that this car was taken out," he said.
At Koons Ford, the settlement covered 19 cars that had been returned by customers soon after being sold and nine that were stolen, Mr. Wood said.
At Koons Lincoln, 39 cars were sold after being returned by other customers, five after being stolen and 11 after being damaged then repaired by Koons, Mr. Wood said. In all but one case, he said, the damage consisted of scrapes and other minor damage amounting to less than $500.