By Camilo Smith
By Craig Malisow
By Jeff Balke
By Angelica Leicht
By Jeff Balke
By Sean Pendergast
By Sean Pendergast
By Jeff Balke
Kohli finally took her car back in September 1993, almost a year after her accident. When she did, she says, she discovered that one of the doors wouldn't shut properly, the dome light remained on, the sunroof leaked and the steering wheel shook. She returned the Mazda to CRS, where it spent the rest of 1993.
In the spring of 1994 two Mazda dealers checked Kohli's car. One refused to work on it, and the other charged her an additional $1,800 to correct some still existing problems. Kohli finally got her car back in June of last year. She parked it in her garage, insisting it remained undrivable. Last September, she used the Mazda as a trade-in for another car.
Once the Mazda that Kohli drove for two months and let sit for two years was history, she pinned her hopes for recovering her losses on her lawsuit against CRS. She was looking for more than compensation; she was also looking for revenge. But she's gotten neither. As the December trial date of her suit approached, Wesley Spence, doing business as CRS, filed for Chapter 13 bankruptcy, effectively putting all lawsuits against the company on hold.
That maneuver baffles and angers Kohli, since CRS hasn't closed, though it has moved its operation from 6343 Beverly Hill to 6909 Hillcroft near Bellaire. The landlord on Beverly Hill was listed as a creditor in CRS' bankruptcy filing.
"I know they are not bankrupt, because they opened up another place on Hillcroft, they moved. I have no idea about the law. I have no idea what is going on," says Kohli. "But I can tell you I paid lots of money. I wanted my money back. And they should suffer, they should pay for it."
Kohli's not alone in her frustration with CRS. At least two other disgruntled car owners had lawsuits pending against the repair shop when Spence filed for Chapter 13 protection. Yet another, David Person, resolved his dispute with CRS only when a business associated with the shop, American Auto Storage Lot, agreed to pay for his damages. Person's success at securing a settlement points up the subsurface network of agreements among some accident entrepreneurs.
After his 1986 Lincoln Continental was damaged in an accident last March, Person's car was towed by a CRS E-tag wrecker to American Auto Storage Lot. The lot and the wrecker driver, he says, referred him to CRS for repairs. His car was towed there, and Person says he advanced CRS a cashier's check for $1,500 to cover about half of the damage to his Lincoln's front end. He was promised his car back in seven to 10 days.
Person says that it wasn't until 33 days later that he was able to retrieve his Lincoln, and when he did, he didn't get far. He noticed a problem with the front end and immediately drove his car to another repair shop, where it was discovered that the front end for a 1988 Lincoln had been placed on his '86 model. After having already paid CRS $3,400, Person paid the second repair shop an additional $700 to fix the problem. Person, a lawyer himself, obtained counsel and sued CRS.
He says he was eventually able to collect a settlement from American Auto Storage Lot based on an written agreement between the lot and CRS that, he claims, in effect made them business partners. That agreement, which called for CRS to sell its storage lot business to the owner of American Auto Storage, included a provision in which CRS agreed to pay the storage lot 10 percent "of the gross amount of any collision repair work" on vehicles the lot referred to CRS. In return, CRS agreed to have its wreckers, as well as other wrecker drivers, deliver "a minimum of 150 motor vehicles" each month to the storage lot; for each vehicle a non-CRS wrecker brought to American Auto Storage, CRS was to get $5.
Gerald Birnberg, an attorney who is principal owner of American Auto Storage, says he wasn't aware of the referral fee when he signed the document, and he insists that the arrangements spelled out in the agreement were never acted upon.
"We never received a penny from that and we never referred anyone to them that I'm aware of," Birnberg says, suggesting that favoring one repair shop would be bad for the storage lot's business. CRS wreckers did deliver -- and continue to deliver -- cars to his lot, Birnberg says, but nowhere near 150 a month.
Ellis Milam, the administrator of the city's wrecker permits office, says he's heard talk of such arrangements, in which storage lots get a cut of repair costs in return for referrals, but hasn't seen evidence that they exist. Even if they do, he doesn't sound too concerned about it.
"I don't know anything illegal about it," Milam says. "They [storage lots] are advertising for some body shop. There's nothing wrong with that. I don't know if I want to take that guy's advice, but there's nothing wrong with him doing it."
What is clearly illegal, though by some accounts common, is the use of wrecker drivers as "runners" to solicit business for personal injury lawyers. In such instances, the drivers recommend lawyers to accident victims, giving them business cards or even having them sign contingency-fee retainer agreements at an accident site. The practice is known as barratry, and it can be a felony.