Legal Question in Consumer Law in Tennessee

I decided to purchase a used car from a dealership and planned to trade in my car (that was paid for).... long story short - we signed the contracts, i paid the amount they had asked for, i drove off the car lot and later received a call from the dealership saying i needed to pay another $1300 or return the car.

Here's the whole timeline...

Day 1 - I found a car i liked then let the dealership inspect my car, I gave them all the info i knew on my car including the VIN number. In turn the dealership gave me the trade-in value of my car and I got a buyers order to take to my personal bank. Gave the buyers order to the bank that day for processing and was approved.

Day 2 - Called and confirmed with the dealership that the loan was good to go and that i would be by as soon as all the paperwork was complete.

Day 3 - Completed the paperwork and received the check from the bank. Went to the dealership with check, trade-in car, title, and proof of registration. Met with salesperson i had been working with the entire time and he directed me to his coworker that would complete the contracts. He had all of my paperwork including title and registration of trade-in car. All of the contracts were printed

and were signed by myself and the dealership. Keys in hand, happy, drove off the lot. Only later the salesperson would call and say i'm going to have to pay an additional $1300 or bring the new car back. His excuse was there was history on the car that he didn't know about - rebuilt body work?....

I disclosed EVERYTHING I knew about this car. It is 8 years old, i have only had it for 2 years and haven't had any trouble out of it. I bought via private party through the AutoTrader website in August 2007. It had come from a nice man that had just moved from CA and he raved about what a good car it had been.

I had no knowlege of major damage and had NO trouble... I thought by giving the dealership the VIN in the beginning and let them inspect it they would find out everything they need to know about it.

I'm at a loss and don't know what to do - what are mine and the dealership's rights and legal obligations?

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