Budget threatens customer with lawsuit, garnishment after he questions damage claim

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By Christopher Elliott

Just in case you thought my recent critique of the car rental industry’s damage claims practices was over the top — and I assure you, it wasn’t — let me introduce you to Jonathan Kiluk.

He rented a late-model, four-door Toyota Camry from Budget Rent-A-Car in Ontario, Calif., earlier this year and is now being pursued by the company in a way that you might find a little troubling.

Insurance oversight and unexpected costs

Kiluk had researched his insurance needs and determined that he’d be covered under his auto policy. So when he picked up his rental on March 11, he decline the optional (and for Budget, highly-profitable) coverage.

“I signed all of the paperwork, gave them my ID and credit card and was given the key at the counter,” he says. “The man at the counter told me where the car was parked in the lot, and the guard at the gate verified my paperwork.”

That’s it? Weren’t they going to do a walkaround, to inspect the Camry for any pre-existing damage? No.

Kiluk assumed everything was “fine” with the car. After all, it was a 2012 model with 4,659 miles on the odometer — what could possibly be wrong with it? He didn’t conduct an inspection of his own or take any pictures of the vehicle.

That proved to be an expensive mistake.

When we took the car back, the young kid in the parking lot stated that he found a small dent and would have to fill out an incident report.

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I was upset at this point because they didn’t check the car before and I know we didn’t have any issues on the trip. I filled out the incident report stating “I believe that the small dents were present at check-out.

We did not hit anything.

Still, Budget sent him a bill for the damage. And it was firm — maybe a little too firm — in its demand. It insisted on being paid $689 to repair the ding (see photo, above) which included a $100 “administrative” fee.

And if he didn’t? The letter seems to suggest something horrible would happen, although I’m not a lawyer. Read it yourself (PDF).

Budget’s billing battle

Something didn’t look right to me. I can’t imagine that little ding costing $689 to repair, but beyond that, Budget hadn’t really shown that the damage happened on Kiluk’s watch.

My advocacy team and I contacted the company on his behalf. It didn’t respond directly to me, but send him the following letter (PDF).

Here’s an excerpt:

We must demand payment in the above amount. This sum is PAYABLE IMMEDIATELY.

Should this office find it necessary to seek a judgment against you, and same is entered, that judgment will be recorded and a lien on any real property you own may result. Additionally, we will be forced to pursue other legal remedies such a wage garnishment, motor vehicle levies, execution upon your real and personal property wherever located.

Contact this office immediately to make arrangements to pay or arrange for payments on your outstanding debt.

Kiluk just wants a better explanation for this bill. If he makes a claim on his auto insurance, it’ll probably affect his rates. And besides, if he didn’t damage the vehicle, why should he have to pay? (Here’s our guide to renting a car.)

Both parties made mistakes, the way I see it. Kiluk should have inspected the car and if the dent was discovered at the end of his rental, he needed to take responsibility for it. The $100 “administrative” charge — sometimes referred to as a “junk” fee — is negotiable. The rest? Probably not. (Related: Budget says we drove through a hailstorm. Now it wants me to pay $2,133.)

Resolution achieved

Budget’s approach to this customer is so aggressive and borderline hostile, it’s no wonder people have grown to dislike car rental companies. It needs to tone things down if it wants to stay friendly with its own customers.

Update (4:15 p.m.): We have a resolution. Budget has contacted me, and Kiluk confirms the fix.

They had admitted that they were wrong for not completing a walk around and stated that they could not see the dent on video when I left, or returned the car. They still tried to get me to pay a part of the bill, but I did not give in.

I asked the man, “If you were in my shoes and felt like you were not responsible for the damage would you feel it was fair to pay a portion of the bill?”

He replied “No.”

I said, “Okay, there is my answer.” He said he would get back to me at the end of the day.

Budget did get back to him, and has dropped this claim.

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Christopher Elliott

Christopher Elliott is the founder of Elliott Advocacy, a 501(c)(3) nonprofit organization that empowers consumers to solve their problems and helps those who can't. He's the author of numerous books on consumer advocacy and writes three nationally syndicated columns. He also publishes the Elliott Report, a news site for consumers, and Elliott Confidential, a critically acclaimed newsletter about customer service. If you have a consumer problem you can't solve, contact him directly through his advocacy website. You can also follow him on X, Facebook, and LinkedIn, or sign up for his daily newsletter.

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