San Jose Dealership Doesn't Pay 70k Contract - NBC Bay Area
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San Jose Dealership Doesn't Pay 70k Contract

NBC Bay Area investigation leads dealer to pay Santa Cruz woman



    SJ Dealership Doesn't Pay $70k Contract

    NBC Bay Area's chief investigative reporter Tony Kovaleski confronts Stevens Creek Auto Mall owner Ron Battistella with why Flor Madsen of Santa Cruz hasn't received payment for her Ferrari, which sold earlier this year. Madsen fears without the money she'll lose her senior care facility. (Published Tuesday, May 1, 2012)

    The owner of a Santa Cruz senior care facility fears she’ll have to close her home for the elderly if a well-known San Jose car dealer continues to withhold $65,000 she’s owed on the sale of her custom car.

    Flor Madsen came to the NBC Bay Area Investigative Unit after being turned away by police and prosecutors.

    The dealer, who acknowledged that he’s never paid the woman for her 1999 Ferrari, has not been charged with any crime. But the ordeal threatens to put Madsen in financial ruin.

     “I am very sick,” Madsen told NBC Bay Area’s Chief Investigator Tony Kovaleski. “I cannot sleep. That’s all my future and he took it.”

    She’s worried that she won’t have enough money to keep her senior care home up and running.

    “I will not have money to pay them,” she added. “So I guess I have to close and I am thinking where would I go? This is my whole life.”

    After trying to solve the problem on her own with no luck, Madsen and her daughter, Louise Thompson, called NBC Bay Area’s Investigative Unit to shed light on the matter.  Using hidden cameras, the Investigative Unit followed Madsen’s daughter into Stevens Creek Auto Mall to confirm the family’s claims.

    “You stole my mother’s money,” Louise Thompson said to the owner of the dealership.

    “The money is gone,” owner Ron Battistella said in front of NBC Bay Area’s hidden camera.

    Thompson asked: “What did you do with the money?”

    Battistella replied: “It’s operated. It got sucked in a black hole.”

    Madsen and Thompson say they brought the Ferrari – one of only 100 built in the United States – to Stevens Creek Auto Mall in August, in the hopes of selling it on consignment.  The dealership had assessed the Ferrari’s market value at $95,000. And the contract Madsen signed with the dealership stated that if Battistella sold the car, Madsen would be paid $70,000 within 20 days of the sale.

    Madsen needed the money from the car sale to pay bills and save her senior care home, Flor’s Guest Homes and Care Facility in Santa Cruz, from going under.  She had been waiting several months to hear if the car had sold, and when she heard nothing, she began to investigate on her own.

    In March, she discovered the same car – based on the exact same VIN number – was being sold on eBay in Florida. That had to mean, Madsen assumed, that Battistella had sold her beloved Ferrari without notifying her. NBC Bay Area confirmed the car sold in January, by all indications, to a buyer in Florida.

    More than three months after the sale, Madsen hasn’t been paid the money she’s owed.

    “Do you have the money?” Kovaleski asked Madsen.

    “No, I do not,” Madsen answered.

    When NBC Bay Area asked Madsen if she feels like the dealership stole her car, she answered:
    “Yes, they did steal my car.”

    After first declining an interview, Battistella later agreed to sit down with Kovaleski at his San Jose dealership, where he confirmed the facts of the contract. He acknowledged that he has yet to pay Madsen.

    Kovaleski asked the car dealer if he owed Ms. Madsen an apology.  Battistella responded, “yeah.”

    NBC Bay Area uncovered some public records that show Battistella has other large unpaid debts.

    Federal filings show he owes the government $604,682.04 for failing to pay withholding taxes at another of his businesses.

    Madsen and her daughter first took their plight to the Department of Motor Vehicles, where the investigator told NBC Bay Area that he recommended that criminal charges be filed.

    But San Jose police and the District Attorney said they would not pursue criminal charges, saying this was a civil matter because of the contract signed between the parties.

    During the interview at the dealership, Kovaleski asked Battistella to explain his outstanding debt to Madsen and his business decisions.

    “The contract she signed said you were expected to pay her in 20 days,” Kovaleski asked. “That didn’t happen.”

    “Didn’t happen,” Battistella confirmed.

    “Why?” Kovaleski continued.

    “Technicality,” Battistella said. “Can’t explain why.”

    “But it’s a contract,” Kovaleski said.

    “It didn’t happen,” Battistella said.

    “You got paid for the car?” Kovaleski asked.

    “We got paid for the car,” Battistella said.

    “And you didn’t pay her?” Kovaleski asked.

    “At this minute,” Battistella said, “No.”

    “You took her money and you used it to run your business?” Kovaleski asked.

    “If you want to say I did that, that’s fine,” Battistella said.

    “Is that good business?” Kovaleski asked.

    “It’s not good business, no,” Battistella said. “It’s not good business, no. Absolutely not. It’s her money and it’s been delayed.”

    “What Ms. Madsen wants to know is when is she going to see the money?” Kovaleski asked.

    “As I sit here right this second, it’s in the process…” Battistella said. “It’s on its way. Yeah.”

    “Do you expect this will be there in the next week? Two weeks? What do you think?” Kovaleski asked.

    “Yes, yes, yes,” Battistella said. “The answer is yes.”

    On the phone late Monday morning, less than 12 hours before the airing of the NBC Bay Area investigation, Battistella told Kovaleski that the check for $65,000 is “in process.” On the phone, Madsen’s attorney in Santa Cruz acknowledged Battistella’s efforts to pay the debt, saying he was “optimistic” that Madsen soon would have a check in hand.

    Madsen would be only too thrilled if that happened.

    “I am hoping I can get resolve and get my money,” Madsen said. “And I hope that guy won’t do this to anyone.”

    Because if they don’t get that money, the future of Flor’s Care Facility may be in jeopardy.

    “If we lose our business,” Madsen’s daughter said, “some of our residents may not have homes to go to. What my mom does is a gift that not many people are able to provide.”