In the world of automotive sales, customer satisfaction is paramount — but not every customer relationship is worth preserving. Illinois’ new car dealers, like other businesses, have the right to refuse service under certain conditions. However, this must be done carefully and in compliance with both Illinois state law and federal regulations to avoid legal repercussions. A dealership must ensure that refusal of service does not violate anti-discrimination or consumer protection laws or breach a contractual obligation. Legal Grounds for Refusing to Do Business Illinois law does not require businesses to serve every customer. Dealers may refuse a sale or service or terminate a customer relationship as long as the decision is not discriminatory or retaliatory or misleading or harmful to the customer or constitute a breach by the dealership of a contractual duty or obligation to the customer or under the dealership’s franchise agreement with the manufacturer. The following circumstances may comprise permissible reasons, among others, to refuse a sale or service: • Abusive or threatening behavior by the customer toward dealership staff. • Repeated attempts to defraud or manipulate financing or other aspects of the business transaction with the dealership. • Failure to comply with dealership policies. • Disruption of dealership business operations. Notably, having a written policy is highly recommended for dealerships that may need to disengage from difficult customers. This helps to ensure consistency, provides some legal protection to the business and supports staff in professionally handling difficult situations with customers. A documented policy illustrates that decisions are based on best practices and business standards, not personal bias, thus helping to insulate and defend against claims of discrimination or unfair treatment. Moreover, a policy ensures all employees follow the same protocol when dealing with problematic customers, reducing the likelihood of confusion and the risk of escalation. It also helps demonstrate the dealership’s legal compliance with applicable Illinois and federal laws, particularly if the customer or state or federal regulators challenge the dealership’s decision. If a customer files a complaint or legal action, the written policy may serve as evidence that the dealership acted within its rights and established policies. The dealership’s written policy should include a definition of unacceptable behavior (e.g., verbal abuse, threats, repeated contract violations) and should outline the steps to be followed by dealership staff for documenting incidents. The policy should also cover procedures to reduce escalation (e.g., warnings, management review) and the conditions under which a sale or service may be refused or terminated. Importantly, the policy should include a statement of compliance with anti-discrimination laws. JULIE CARDOSI, ESQ. Law Office of Julie A. Cardosi, P.C. “No Soup for You” Counselor’s Corner Dealership Best Practices for “Firing” or Legally Refusing Service to a Difficult Customer 8 Illinois Automobile Dealer News
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