At the time of their sale, he did not tell Pascal or the purchasers that the odometers did not reflect the vehicles' true mileage. Sometime after Litsey purchased seven vehicles and before he sold them, he became aware that their odometers had been reset. However, if the inventory was too large, he would tell Litsey not to buy any more vehicles. Pascal exercised no day-to-day supervision over Litsey. Pascal provided all the funds, and the net profits were to be split 50/50. An accusation was filed by the DMV alleging that Rob-Mac, directly or through its agent Barry Litsey, reset odometers on seven vehicles in violation of Vehicle Code sections 11713, subdivision (n), and 28051, and caused purchasers of those vehicles to suffer loss by misrepresenting mileage in violation of Vehicle Code section 11705, subdivision (a)(14).Īt a hearing before an administrative law judge, the evidence was that Litsey entered into an agreement with Matthew Pascal, president of Rob-Mac, whereby Litsey would buy vehicles for Imports of Palo Alto and wholesale them to other dealers. Respondent Rob-Mac, Inc., does business as Imports of Palo Alto under a license issued by appellant Department of Motor Vehicles.
The question in this appeal is whether a licensed automobile dealer can be disciplined by the department for the conduct of a salesperson acting under the dealer's license even if that salesperson is an independent contractor rather than an employee. (hereafter Rob-Mac), a California corporation. The Department of Motor Vehicles and its director (hereafter the DMV) appeals from a judgment granting a petition for writ of mandate and ordering it to set aside its decision imposing discipline on respondent Rob-Mac, Inc.
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