Auto & Vehicle Dealership Contract Attorneys 

The Hidden Legal Risks in Auto Dealership Contracts 

Running a car dealership is about more than selling vehicles—it’s about protecting your business from costly legal mistakes. Every contract you sign, whether it’s a franchise agreement, financing deal, or vendor contract, carries serious legal implications. One wrong move, and you could find yourself locked into an unfair deal, facing regulatory fines, or tied up in a lawsuit that drains your profits. 

At Horn Wright, LLP, our transaction attorneys know the legal challenges auto dealers face. Our attorneys specialize in structuring, negotiating, and reviewing dealership contracts to ensure your business stays protected. Whether you're dealing with manufacturers, lenders, suppliers, or employees, having one of the best law firms in America on your side  can mean the difference between a smooth operation and a financial disaster.

Franchise & Dealer Agreements: What’s Really in the Fine Print? 

Franchise agreements set the terms for how dealerships operate, but manufacturers often design them to serve their interests first. Many dealers sign these contracts without fully understanding the long-term risks. Termination clauses, renewal terms, and performance quotas can be written in ways that put your business in jeopardy. 

Key concerns in franchise agreements include: 

• Termination & Renewal Clauses – Some manufacturers impose strict conditions that make it difficult for dealerships to renew agreements or exit without paying heavy penalties. 
• Sales Targets & Inventory Requirements – Unrealistic quotas can push a dealership into financial strain. 
• Dealer Protection Under State Laws – While some state laws offer protection, they can be complex to navigate without legal guidance. 

The best way to avoid these pitfalls? A carefully negotiated contract that ensures your dealership’s rights are protected and that you're not left powerless in future disputes. Speaking with a contract attorney at Horn Wright, LLP, is the best way to make sure your rights are protected. 

Vehicle Sales & Financing Contracts 

Where Small Mistakes Cost Big Money 

Every vehicle sale is a legal agreement, and a poorly written contract can lead to major financial problems. Missing terms, vague language, and compliance missteps can open the door to lawsuits, chargebacks, or penalties from regulatory agencies.  

Financing and lease agreements add even more complexity, with strict rules that dealerships must follow to stay compliant. Some of the common risks in sales and financing contracts include: 

• Vague Purchase Agreements – Unclear terms can lead to customer disputes and legal claims. 
• Regulatory Compliance in Financing & Leasing – Errors in structuring deals can result in fines or license revocation. 
• Return Policies & Warranty Disclaimers – Without precise wording, dealerships may be forced to take back vehicles under unfavorable terms. 

At Horn Wright, LLP, we help auto dealers draft and update sales and financing contracts that minimize risk, ensure compliance, and protect your bottom line. We prepare contracts knowing the risk that it could someday end up in litigation, so you want it to be bulletproof from the start. 

Supplier & Vendor Agreements 

Don’t Let Bad Deals Cut into Your Profits 

Your dealership relies on a network of suppliers for everything from vehicle parts to repair services. But without strong contracts, those partnerships can quickly turn into liabilities. Some suppliers push exclusivity clauses that prevent dealerships from buying parts elsewhere, limiting flexibility and driving up costs. Others impose rigid pricing models or unfavorable payment structures that strain cash flow. 

Service agreements with third-party vendors come with their own risks. If a vendor fails to meet quality standards or delays deliveries, your dealership could face customer complaints, legal claims, or operational setbacks. Worse yet, some agreements shift liability onto the dealership for defective parts or services—leaving you responsible for problems caused by someone else. That’s why it’s a must to negotiate terms that protect your dealership, ensuring you maintain control over pricing, service expectations, and legal liability. 

Hiring in Dealerships: Get Employment Contracts Right the First Time 

Hiring the right employees is essential to running a successful dealership, but poorly structured employment contracts can lead to serious legal troubles. Sales professionals, finance managers, and service technicians often work under unique pay structures that require clear, legally sound agreements. Without proper documentation, disputes over commissions, job classifications, and contract terms can escalate into costly lawsuits. 

Key employment contract issues include: 

• Employee Classification – Misclassifying workers as independent contractors can lead to wage disputes and tax penalties. 
• Commission-Based Pay Structures – Poorly defined terms can result in conflicts over earnings. 
• Non-Compete & Confidentiality Agreements – Prevent former employees from taking customer lists and trade secrets to competitors. 

To safeguard against employment-related legal issues, dealerships need contracts that comply with state and federal labor laws while ensuring that business interests remain protected. Horn Wright, LLP, helps auto dealers draft employment agreements that minimize risk and prevent costly disputes. 

Regulatory & Compliance Contracts—Stay Ahead of the Law 

Auto dealerships are heavily regulated, and failing to meet legal requirements can lead to massive fines or even the loss of your business license. From consumer protection laws to vehicle safety regulations, dealerships must stay on top of compliance or risk severe penalties. 

Areas of compliance concern include: 

• FTC & Advertising Regulations – Misleading ads or undisclosed defects can result in lawsuits and fines. 
• Lemon Laws & Defect Disclosures – Selling vehicles with undisclosed defects can lead to legal liability. 
• Data Privacy & Financial Regulations – Mishandling customer information can lead to serious penalties. 

Regular legal audits and compliance training can help dealerships avoid unintentional violations. At Horn Wright, LLP, we work with auto dealers to ensure they stay compliant with evolving regulations, protecting their businesses from unnecessary legal exposure. 

Protect Your Dealership with the Right Legal Team 

A single contract mistake can cost your dealership millions. Whether it’s a franchise agreement, a supplier contract, or a financing deal, every document you sign has long-term consequences. That’s why having the right legal team matters. 

At Horn Wright, LLP, we specialize in drafting, negotiating, and enforcing dealership contracts that protect your interests. Our attorneys ensure your agreements are airtight, your business remains compliant, and your dealership stays ahead of legal threats. With our legal expertise, you can focus on growing your business with confidence.  

Contact our office today for a consultation to get started.