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Can I unwind a contract I entered with a dealer for a car that is yet to be delivered?

Walnut Creek, CA |

I signed a contract with a dealer to buy a new car today (2/20). The dealer has not got the vehicle from the factory yet, but is expecting it by 2/27. At the dealership I bought warranty on the car. I now realize that I was overcharged on the warranty. I plan to go to the dealership and try negotiate a lower price. The contract is dated today (2/20) & has the following:"Seller agrees to deliver the vehicle to you on the date this contract is signed by the Seller and you. You understand that it may take a few days for the Seller to verify your credit and assign the contract". If the dealer refuses to the reduce the price of the extended warranty, can I hold them responsible for not having delivered the vehicle with the stated VIN on the date of signing of the contract and have it cancelled?

Attorney Answers 3


  1. You might be able to dispute the price on the warranty. However, you probably will not be able to cancel the contract itself based upon the grounds you stated.

    Generally speaking, there is no statutory cancellation period for automobile sales or leases in California. See:

    The information presented here is general in nature and is not intended, nor should be construed, as legal advice. This posting does not create any attorney-client relationship with the author (who is only admitted to practice law in the State of California). For specific advice about your particular situation, consult your own attorney.


  2. 1- There is NO such thing as an extended warranty, instead, it's called a service contract. The main differences are that:
    a- A "warranty" comes with the product and the service contract is paid for;
    b- A warranty has no deductible and a service contract usually has one;
    c- A warranty comes from the manufacturer and a service contract can be any provider;
    2- In CA you can (by law) cancel your service contract any time within 90 days of purchase for a full refund and any time after that for a pro rated refund.

    Good luck with it.


  3. If you entered into a contract for purchase of a new car, and the contract specifically states that the car was going to be delivered on 2/20, and the car was not delivered, then that is a breach of contract.

    Whether that breach alone is enough to get you out of the deal entirely or seek a reduction in the extended warranty will probably depend on the terms and provisions of the contract that you signed.