What to do when customers refuse service work
Every service garage has had it happen to them. It is a situation that is entirely unavoidable when working in this industry, but the solution is simple and should be a part of every shops practice.
A customer drives in for a routine oil change, tire rotation or some other simple repair. In the course of this simple job the technician notices that a more serious repair is required to be performed on the vehicle. A repair that if not done could affect the safe operation of the vehicle. The customer, upon hearing the news refuses the repair, citing a lack of money, a lack of time or the secret suspicion that the service garage is trying to rip him off.
The quandary, for the garage owner, manager and technician, is how to placate the customer so that he does not think he is being gouged, and how to explain to the customer about the safety implications of the repair, and what is the liability to their shop if the customer would drive away, with the unsafe vehicle and had an accident.
All service garages carry liability insurance and one would assume that you would not be liable for the accident damage in this situation.
“I just recently had an oil change on my vehicle and brought it to the dealership because I had some concern that some power steering fluid was leaking,” recounted Pete Karageorgos, manager Consumer and Industry Relations for the Insurance Bureau of Canada, “And so, in addition to that issue, they looked through my car with a fine toothed comb and said, ‘Well, your engine mounts should be replaced, your brakes are jammed, there (is) an issue with the tie rods.’ They gave me a whole list of things that they had discovered. I said, ‘Right now, just do the oil change.’ What they did is that they listed right on the invoice for me all the things that they recommended. I thought that was a pretty smart way to operate.”
The documentation that Karageorgos had on his invoice was detailed and concise. “What this is from a customer service standpoint or from a legal standpoint is that they want to address their liability; they wrote everything on the invoice. So if I, as a consumer, left and noting that my brakes need to be redone and got into an accident shortly after leaving the shop – the shop can say, ‘Well, we put it right on the invoice so the customer knew.’ It is the responsibility of the vehicle owner. They decided not to have the repairs done. From the garage’s perspective, it is a very wise move to document these things.
“I think that what happened to me is that they, over the course of time and maybe with some legal advice, realized that it is always a wise thing to write things down. There is minimal opportunity for misunderstanding when things are written down.”
Having accurate and detailed notes is your best defense according to Michael Teitelbaum a partner at Hughes Amys LLP, which is a member firm of The ARC Group Canada. “If the station owner or mechanic looks at the car and these are the things that need to be done with the car and the customer refuses, then in order to protect themselves, if the customer goes out on the street and the accident arose out of, for example, faulty brakes the service station can then claim that, ‘We saw that there were problems with the faulty breaks and we told him to have them fixed, but the customer did not want to do it.'”
Towing the car from your premises will not necessarily rid you of any liability claims he said. “You get into a whole issue of a host liability situation here where you can paint the analogy that someone says you have had too much to drink and I will not serve you any more. How far does the obligation go to ensure that that person gets home safely? There are many implications here.”
When a customer does refuse work, “the best practice would be to ask the owner of the vehicle to sign a note to that effect,” said Julie Pingree, vice-president of Underwriting Commercial Lines Ontario for Intact Financial Corporation. “That way, if there was an accident and the owner of the vehicle blames the garage for not doing the work, the garage would have written proof that this (work) was not done at the request of the vehicle’s owner. If the recommended work is deemed to be critical to the safe operation of a vehicle, then the service garage manager may want to ask the owner to acknowledge, in writing, that the details were discussed. This is an important practice to adopt.”
The station garage owner or manager has to be aware that now, “Anybody can sue anybody for anything,” said John Nolan, senior vice-president at Aviva Canada Inc., a Canadian insurance group. “The garage owner would have to be deemed negligent for there to be any liability associated with. The best is to buy proper liability insurance that would protect oneself.”
Nolan repeats the mantra that good documentation is the key to successfully protecting ones business. “My advice to any garage owner is to keep good documentation of any conversation with your customer. And when you do up your work order write that you strongly recommended that this work be done; and if the customer does not want the work done write a note that the customer refused service.”
When a dispute of this type heads to court, arbitration or some other resolution mechanism, it is usually the side that has the better documentation that carries the day. “What it boils down to is that somebody is making an allegation that he didn’t do the work that he should have done that turns into a ‘he said, she said’ type of scenario,” says Nolan. “The best course of action is to document all the conversations that you have with your customers.”
He also explains that not everything will be covered by an insurance policy. “General liability insurance policies really only covers the negligence of the operator. If a customer comes onto his premises and slips and falls due to the negligence of the owners then the policy will offer protection. It also covers the completed work so if the garage performs some work and the work causes some other damage or accident later it will be covered by a general liability policy.”
The policy will also cover the (other) customer vehicles that he has under his care and control. “Insurance companies provide a garage automobile policy for those types of exposure,” he said.
His most earnest advice is to seek a qualified expert to put a program together. “I can’t stress that enough to have a good independent insurance broker that will go through an operation and put together an insurance program that will cover all these risks.”
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