Refund of second hand car deposit?

sophsters

Hi everyone, i know there have been previous threads about this but no ones story was quite the same as mine so i just wanted a wee bit of advice please.

My husband saw a second hand car for sale at a well established used car garage. He then discussed with the seller that he would like to part exchange our car and they agreed the our car would need to be mot'd before the sale. He then put a deposit of £450 down (pai via visa debit) but signed nothing and nothing said on the reciept about it being non refundable. We have never bought from a second hand dealer before and were naive in not knowing that it was considered as a verbal contract.

When we failed to get the car booked in in time and our finance fell through we called to let the garage know roughly 2 days later we were told that it would be passed to the accounts person from the garage (assumingly to process a refund) and that someone would call us back within the week.

No call as recieved and when i called two weeks later to chase them up i was told that the deposit was non-refundable. The car was going to cost us £2000 after part exchange so the deposit was a quarter of the cost price, i cant be the only one thinking that this is crazy to let them away with that?

Trading standards say they cant help, but i have read online in many places of people going to small claims court and getting thier money back, do i have a chance? £450 is alot of money to us we cant afford to just give in?

Look forward to hearing all views,

sophie

Quentin

If you take it to small claims, you would have to show the judge the deposit was refundable in the event you backed out of the deal. As nothing is in writing, then it falls back on the verbal contract - were there any witnesses you could use?

Otherwise it's just your word against the defendant's and the judge wouldn't be able to decide.

Maybe better to keep on good terms and ask them to take it as a deposit on another car, and this time complete as agreed.

sophsters

Would the judge not take into account that the deposit was very high and had we been told it was non refundable we wouldnt have paid such an amount? If the garage never got us to sign anything or told us it was non refundbale, wouldnt the judge ask them fro proof that it was non refundable as apposed to us proving it wasnt?

thanks

haveibeendone

The point is you entered into a contract to buy (unless you can show it was conditional) and that agreement is binding and a level of compensation needs to be agreed if you want to cancel. As the seller has your money it will be difficult to negotiate a lower sum than that already paid. The seller should only ask for the loss he has incurrred but to prove these sums is not practical in small claims.

You seem to have 3 options.
1. Forget it and accept the loss of £450.
2. Negotiate hard with the dealer for a lower sum. Arguing that he has a duty to you to mitigate his loss.
3. Buy the car as agreed. If he has sold the car it may be argued tgat he has suffered only a minimal loss.

mark5

What would be the point in a garage taking a deposit if it was refundable?

real1314

sophsters wrote: »

My husband saw a second hand car for sale at a well established used car garage.

He then discussed with the seller that he would like to part exchange our car and they agreed the our car would need to be mot'd before the sale.

He then put a deposit of £450 down (pai via visa debit) but signed nothing and nothing said on the reciept about it being non refundable.

To me the bit in bold is crucial. Have you mentioned this bit to trading standards?

The trader could not have formed a fully operative contract as he could not put a valuation on the part-ex value. Once you turned up with it, he could have said "No, don't want that part-ex in the deal". This option makes the "contract" one-sided which is generally considered to be unenforceable.

sophsters

mark5 wrote: »

What would be the point in a garage taking a deposit if it was refundable?

i totaly understand but like i say we were naive and didnt know that it was a 'contract' without signing anything etc.

I understand that the seller may have managed to sell the car in the 2 days between paying the deposit and cancelling but surely £450 is alot to withhold, a partial refund would have gone down better than 'its non refundable'?

Real 1314, im pretty sure i did say that to the trading standards guy but also that we couldnt get the funding so maybe he just heard that and said because we backed out of said 'contract' we had no right to our deposit back?

thanks

haveibeendone

Sophsters

If you feel strongly about the loss of the money you can always use Money Claim Online to start proceedings in the county court arguing that the contract was conditional. It will cost you, unless charges have changed, £25 to start. For the sum of £450 it will go the fast track route which is called small claims. As it is less than £1,500 there should not be any further fees.

The seller may just give in or make you an offer. He may not. You will almost certainly be asked if you will accept mediation. If you agree, and you should, then a mediator will try to find a solution acceptable to both sides. This is normally done on the telephone and will be binding on both parties, assuming that you both agree to a settlement.

If you do not reach a settlement and it goes to a hearing neither party will normally be awarded costs. As you are an individual and the seller is a company the case will be heard in your local court if you and the seller are in different parts of the country.

I should imagine that if you cannot reach an agreement with the seller then £25.00 is worth a chance but make clear from the outset that you consider the contract conditional and give your reasons. It would obviously be a mistake to change your version of events at a later stage.

See the CAB if unsure and get thier advice.

sophsters

Can i use the money claim online if i live in scotland then?

thanks

Quentin

You can if you can use an English address - though you don't have to pretend you live there!

Should it end up in court, note they would allocate it to the court nearest to the address you used.

Quentin

haveibeendone wrote: »

If you feel strongly about the loss of the money you can always use Money Claim Online to start proceedings in the county court arguing that the contract was conditional. It will cost you, unless charges have changed, £25 to start. For the sum of £450 it will go the fast track route which is called small claims. As it is less than £1,500 there should not be any further fees.

No. The court fee structure for MCOL is quite different.

For a £450 claim you first pay a fee to issue the claim (£35). Then if it progresses to a hearing a further fee of £50 is payable. All court fees are non refundable, but get added on to the amount claimed to be paid by the defendant if you win.

If you lose, then you also face paying the defendants expenses for attending court together with loss of earnings.

There could be more fees to pay should you win and the order needs enforcing (though these fees too get added on to the total the defendant must pay the claimant, as long as they can pay!)