Cars
A customer came to the showroom three days ago, and put down a deposit of £100 on a car. He agreed to pay me the balance in a week’s time. I’ve had two other people since then who have expressed an interest in the car, but I’ve told them it is sold. Now, the customer has changed his mind and no longer wants the car. He also wants the deposit back. Do I have to give it to him?
A customer has placed an order with us for a new car. Unfortunately, the manufacturer has raised the price, which I cannot afford to just absorb, and I need to pass it on to the consumer. What should I do?
A customer left their car with us for minor repairs. However, when he collected it, he pointed to a scratch on the bonnet and said we had caused it. My mechanics are adamant they did not cause this damage, and that it must have been there already. I have a big sign up in my garage saying ‘no liability accepted for damage, howsoever caused’. Am I in the clear?
I sold a 9 year old car 1 month ago to a consumer. It had a very high mileage on it, and I only charged £1,200 for it. Because of its age, mileage and price, I told the buyer that I couldn't give him my usual 3 month warranty. He seemed happy with this, but is now complaining that the engine has blown up and needs replacing. Even using a reconditioned engine, this will cost several hundreds of pounds. He has threatened to sue me if I don't help towards the cost of the repair - surely this can't be right?
I sold a car yesterday to a consumer for £500. At such a low price, I told him it was 'sold as seen'. He accepted this. Now, he's complained because the exhaust has fallen off, and he sys the clutch is going. I've told him that he agreed it was sold as seen and he hasn't any comeback.
A customer came into the showroom yesterday and we agreed a price for a car she was interested in, and she paid a deposit. However, I have now discovered that we have made a mistake with the price, as we had the wrong information about the engine size - the car should cost another £500. I want to back out of the deal, but the customer isn't happy and won't pay the extra, even though I've told her it was an honest mistake. Where do we stand?
A customer came to the showroom three days ago, and put down a deposit of £100 on a car. He agreed to pay me the balance in a week’s time. I’ve had two other people since then who have expressed an interest in the car, but I’ve told them it is sold. Now, the customer has changed his mind and no longer wants the car. He also wants the deposit back. Do I have to give it to him?
The short answer is no! When your customer paid a deposit, he entered into a legally binding contract – you agreed to give him the car, and he agreed to pay you money. By turning away other customers who were interested, you were keeping to your side of the bargain, but by cancelling the agreement to buy the car, your customer is in breach of contract. The law would say it would probably be reasonable for you to keep the deposit as compensation for losing the sale. If you can show that you suffered any further financial losses as a result of this breach, you could also claim for these, provided that they are reasonable, provable and foreseeable.
A customer has placed an order with us for a new car. Unfortunately, the manufacturer has raised the price, which I cannot afford to just absorb, and I need to pass it on to the consumer. What should I do?
Generally, the normal rules of contract will apply here, i.e. if the consumer has secured the contract by paying a deposit, then it is likely you will be in a binding contract. Unless your contract terms or sales agreement specifies that you reserve the right to pass on increases outside your control, you may have to bear the cost of the increase.
A customer left their car with us for minor repairs. However, when he collected it, he pointed to a scratch on the bonnet and said we had caused it. My mechanics are adamant they did not cause this damage, and that it must have been there already. I have a big sign up in my garage saying 'no liability accepted for damage, howsoever caused'. Am I in the clear?
Regarding the damage first: the customer has a right to expect you to take reasonable care of his property whilst it is in your possession. If he can prove that the damage was not there beforehand, then he might, on the balance of probabilities, be able to hold you liable for the repair. But the burden of proof lies with him, and ultimately, it is up to a court to look at all the evidence and weigh up all the facts, before deciding who is liable.
The disclaimer notice that you display will not allow you to avoid liability. The unfair Contract Terms Act 1977 prevents you from avoiding liability unless you can show that it is fair and reasonable to do so. The consumer could ask a court to set the disclaimer aside as being potentially unfair.
See also: Trader's Guide: Supply of Goods & Services
I sold a 9 year old car 1 month ago to a consumer. It had a very high mileage on it, and I only charged £1,200 for it. Because of its age, mileage and price, I told the buyer that I couldn't give him my usual 3 month warranty. He seemed happy with this, but is now complaining that the engine has blown up and needs replacing. Even using a reconditioned engine, this will cost several hundreds of pounds. He has threatened to sue me if I don't help towards the cost of the repair - surely this can't be right?
When you sold the car, you entered into a contract regulated by the Sale of Goods Act 1979 (as amended). The provisions of this Act come into force automatically, and nothing you can waive your liability under this Act - any warranty you provide is considered to be entirely voluntary and in addition to these rights. The Act states that your client is entitled to expect the car to be of a 'satisfactory quality', having regard to important factors such as age, condition, mileage etc. Therefore, the buyer's expectations about how the car should perform would almost certainly have to be lowered because of these factors, but he would still be able to expect reasonable performance from the car.
He would be entitled to 'reasonable compensation' from you, which would probably amount to a fair contribution towards the cost of repair. If you can't agree on what constitutes a fair amount, then you might have to take the matter to arbitration under the Retail Motor Federation Code of Practice, or refer the case to the County Court as a Small Claim.
See also: Trader's Guide: Supply of Goods & Services
I sold a car yesterday to a consumer for £500. At such a low price, I told him it was 'sold as seen'. He accepted this. Now, he's complained because the exhaust has fallen off, and he sys the clutch is going. I've told him that he agreed it was sold as seen and he hasn't any comeback.
'Sold as seen' in this context is a meaningless statement. You can only apply this reasonably to the way the car looks, or something that can be easily seen on a visual inspection, perhaps scratched or dented bodywork for example. However, it is not reasonable to expect a faulty exhaust or clutch to be picked up on the basis of a visual examination, and the consumer is probably entitled to complain. This soon into the contract, the Sale of Goods Act 1979 (as amended) would most likely allow him to reject the car and have a full refund.
Using the term 'sold as seen' in these circumstances may also be a criminal offence under the Consumer Transactions (Restrictions on Statements) Order, as it would be seen as an attempt to restrict a consumer's legal rights. If you want to use any disclaimers, either in contracts or in signs on the garage premises, it is best to seek advice from Trading Standards or your company solicitor first.
A customer came into the showroom yesterday and we agreed a price for a car she was interested in, and she paid a deposit. However, I have now discovered that we have made a mistake with the price, as we had the wrong information about the engine size - the car should cost another £500. I want to back out of the deal, but the customer isn't happy and won't pay the extra, even though I've told her it was an honest mistake. Where do we stand?
By taking the customer's money you have entered into a legally binding contract, and all the important terms have been agreed on, including the price. If you back away from the deal now, you will be in breach of contract, and your client could be entitled to claim compensation from you for that breach, over and above the return of the deposit.
Also in circumstances such as this where the contract was for a unique and specific item, such as a car, the customer may be able to sue you for 'specific performance'. This means she could ask a court to make you supply that particular car. You may also have committed a criminal offence by applying a misleading price indication to the car. You should, therefore, think very carefully before pulling out of the deal, and ask yourself whether you could lose more money in the long term!
The Frequently Asked Questions were developed by the Crossing the Boundaries partnership (CtB) of Oxfordshire, Gloucestershire, Warwickshire, Worcestershire and Shropshire.