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If there is a contract executed between Buyer and Champion, then the contract is enforceable regardless of the fraud committed by the salesman. The salesman is the agent for the dealership and his signature binds the dealership. So, yes there is an enforceable contract. But that does not truly end the matter. The real question is this: What is the remedy? In a breach of contract case, there are two primary remedies. One remedy is a claim for specific performance (force the parties to do what the contract said, i.e. sell the customer the specific car that they bargained for).
The other remedy is a claim for money damages. In most cases, this would simply be a refund of the deposit paid, plus any attorneys fees and costs incurred. But, in some cases, this could also include a claim for lost profits. For example, if the customer was paying MSRP for a GT2RS and the GT2RS was actually worth $100k over MSRP, then the customer could claim lost profit damages. Although, most contracts limit "consequential damages" such as lost profits.
The remedies are mutually exclusive, You cannot force specific performance of the contract (get the car) and recover money damages (the deposit and or lost profits).
Specific performance does not seem like a real option with Porsche GT cars - simply because of the limited number of cars available. If there is no real car to sell to the Buyer, then specific performance is impossible. Thus, the Buyer is left with recovering the deposit.
While the Buyer's (or their lawyers) might not be able to connect Champion with the actual fraud, they can prevail on either a breach of contract claim or a negligence claim to recover the deposits from Champions.
Shiraaz has always taken care of me since 2007.
nothing but good experiences with him and the guys at Motorsports.
Even though I don’t buy my new cars there, I’ve done business with him.
Great guy.
Im sure the family has a tough time.
I think we have different definitions of "great guy".
That remains to be seen. If in the end Champion has to pony up $2.5m to customers who were scammed by one more several of their employees, they are the victims.
Of course, if they tell everyone to get bent than they aren't.
If there is a contract executed between Buyer and Champion, then the contract is enforceable regardless of the fraud committed by the salesman. The salesman is the agent for the dealership and his signature binds the dealership. So, yes there is an enforceable contract. But that does not truly end the matter. The real question is this: What is the remedy? In a breach of contract case, there are two primary remedies. One remedy is a claim for specific performance (force the parties to do what the contract said, i.e. sell the customer the specific car that they bargained for).
The other remedy is a claim for money damages. In most cases, this would simply be a refund of the deposit paid, plus any attorneys fees and costs incurred. But, in some cases, this could also include a claim for lost profits. For example, if the customer was paying MSRP for a GT2RS and the GT2RS was actually worth $100k over MSRP, then the customer could claim lost profit damages. Although, most contracts limit "consequential damages" such as lost profits.
The remedies are mutually exclusive, You cannot force specific performance of the contract (get the car) and recover money damages (the deposit and or lost profits).
Specific performance does not seem like a real option with Porsche GT cars - simply because of the limited number of cars available. If there is no real car to sell to the Buyer, then specific performance is impossible. Thus, the Buyer is left with recovering the deposit.
While the Buyer's (or their lawyers) might not be able to connect Champion with the actual fraud, they can prevail on either a breach of contract claim or a negligence claim to recover the deposits from Champions.
Side note: I've had similar cases over the years. One case was eerily similar - my client was a pool contractor that sells and constructs swimming pools (average sale price of $150,000). A salesman for my client set up a company that was very similar in name to my client's name. The salesman would "sell" the pool and take a deposit. Then, he would negotiate the check and deposit it in his similarly named company account. So the customer thinks it has a contract and my client's agent signed the contract, so it was bound to the contract. But, my client never received the deposit. Although the only real recourse against the pool company was for refund of the deposits (or if they are stand-up like my client, they build the pool per the contract terms and have to take a loss to preserve their reputation and make the customer happy).
Something to add, the Buyer’s Order you sign explicitly specifies that the dealership is not liable if the manufacturer can’t produce the car, so they’d just refund your deposit.
Well said. Why isn't this resolution on the table already? It must be mind boggling?
I imagine Champion would want to confirm all the details of the fraud before doling out monies, especially if there is no paper trail. And, I'd assume an NDA along with that check. I can see this taking a few weeks, easily.
Something to add, the Buyer’s Order you sign explicitly specifies that the dealership is not liable if the manufacturer can’t produce the car, so they’d just refund your deposit.
Thanks for the addition - I havent seen one of Champions Buyers Orders, but that would add some clarity.
That remains to be seen. If in the end Champion has to pony up $2.5m to customers who were scammed by one more several of their employees, they are the victims.
Of course, if they tell everyone to get bent than they aren't.
Will end up being a hell of a lot more. Champion had prior knowledge of intentional acts which vicariously binds them.
Every dealer has insurance for this circumstance because the insurance company compels them to have it as a regular course of business.
Check or credit card was given and always payable to the dealership not the sale rep.
I cant believe anyone handed this guy cash or a check payable to him personally.
Read the articles. One needs to do their homework before making comments.
He set up a shill company called Champion Autosports and was collecting deposits there while employed as a VP at Champion. He had buyers sent to him by brokers and other customers.
I agree. I believe with all the recent media attention this will push them to resolve this as soon as possible. They will likely take accelerated actions now, where if not for the unwanted publicity victims would be in a lot worse situation going forward.
By the way, the damage from the negative public relations due to their poor handling of this has easily surpassed $2.5MM alone. There are literally 100's of thousands of views on all these articles. Will surpass 1,000,000 impressions easily by next week. Better to be proactive than try and put out a five alarm fire after the fact.
I hope you are correct as that is the proper response but I am not sure people have the fortitude to do that. If champion keeps on selling porsches, they could take out ad saying GT car at MSRP and all of RL would line up for one. If they said MSRP - $1 they would need to hire security to keep the mob of buyers in order. Plus macan and cayenne owner just assume this is some rich GT car thing that doesn't bother them
Read the articles. One needs to do their homework before making comments.
He set up a shill company called Champion Autosports and was collecting deposits there while employed as a VP at Champion. He had buyers sent to him by brokers and other customers.
Shell company or not I dont believe I would ever make a check payable to other than the dealer.
Fraudulently stolen deposits in question totaling around $2.5 million that he took from customers for Porsche GT car deposits.
Shiraaz Sookralli was VP of Marketing at Champion Porsche and handled all GT car sales and allocations. They are the #1 volume Porsche dealer in the USA. He is now missing and on the run.
He set up his own shill company called Champion Autosports and took deposits for Porsche GT car allocations through it.
He is now missing. He was also involved in some fraudulent activity at Champion Porsche earlier this year and last year regarding a 911R. He was allowed to continue his employment with them after that which allowed him to further his $2.5MM fraud. He has supposedly been with Champion Porsche around 10 years.
There are PDF's of public court filings linked below on the 911R fraud incident and this new one on the stolen $2.5MM. His wife Devika Budhram is also listed as an accomplice.
It looks as if Champion IS NOT honoring their deposits right now, but directing victims to their attorney. Champion is also calling themselves a "victim". Bad customer relations treating their customers like this. They have offered no apologies and management isn't taking victims calls.
I feel very sorry for the guys who were taken advantage of here. Hopefully some resolution by PCNA / Porsche Cars North America and Champion Porsche here happens.
What a joke this whole Porsche GT car deposit thing is. Some USA dealers are probably holding a couple million $$ each in interest free $$.
09-15-2018, 12:46 PM
