Can a co-signer be released from a car loan if the signature was obtained under duress (threat of physical harm)?

Asked almost 4 years ago - Sunnyvale, CA

My sister co-signed a loan for her boyfriend's car while she was in a physically abusive relationship. He was arrested for domestic violence at least once while she was in this relationship, and she had more than one hospital visit from physical injuries.
Now, three years after the co-signing, the boyfriend has abandoned his financial responsibility on the car and she is left with a large loan balance and large monthly payments. She doesn't want or need the car and it has never even been registered in her name. Does she have any recourse to have the contract (loan) voided because it was made under duress (in this case the threat of physical harm)?
She now lives in California but the car was purchased in Nevada. Would this be a matter for the court in CA, or in NV?

Attorney answers (1)

  1. Robert Harlan Stempler

    Contributor Level 19

    Answered . The law that governs the contract entered in Nevada would be Nevada state law and if she were to sue, she would probably need to sue in Nevada, since the defendant dealership is located in Nevada. Also, the contract deficiency lawsuit could be brought in either California (where she lives) or in Nevada (where she lived when she entered into the contract and where the contract was signed).

    Threat of physical harm may be valid grounds to claim duress, under any state's laws, but proving this defense would be challenging. For instance, was there a police report filed and criminal prosecution for making such threat? How imminent was it? Did the dealership know about it or participate in the atmosphere of threatening her? These are examples of questions that may need to be answered.

    I have provided a link to the consumer lawyer's association, which has several in Nevada, whom you can contact directly to find out more about whether her rights were violated and any potential defenses she may have to the contract, under Nevada law. And what steps she can take to better protect herself from a lawsuit. Please be aware that she should act promptly, because there is a statute of limitations on any lawsuit claims, such as the claim of fraud or misrepresentation, if any.

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