Used Car Sale - Terms & Conditions

ManuelT

Ok let's go back to basics.

What is the law regarding deposits or are there none? I've re-read the thread and some other people picked up on some salient points, If the deposit is always basicly refundable (minus direct costs) does this work both ways? I.E. that the garage was still under no obligation to sell it too him, Just return his deposit (minus reasonable expenses).

I've personally been a victim of the "can we have our desposit back" and it left me significatly out of pocket (I did return the deposit, however we will no longer be dealing with that client) so I have a vested interest in the logic that basicly my ex-client was correct and as such our loses were only potential. I.E. we might as well shut up shop since we can't force our clients to pay anything (deposits held in case the cancel) yet how out goings like insurance which will remain static regardless.

clarkey3262

http://www.oft.gov.uk/shared_oft/reports/unfair_contract_terms/oft311.pdf

Group 4 and 5, that covers it

If the garage sold the car to someone else then they would have to return the full deposit regardless. If you really want to be sure of not needing to return a deposit ensure it covers only costs and you can prove it, then you should (I think) have a defendable case

somethingcorporate

clarkey3262 wrote: »

http://www.oft.gov.uk/shared_oft/reports/unfair_contract_terms/oft311.pdf

Group 4 and 5, that covers it

If the garage sold the car to someone else then they would have to return the full deposit regardless. If you really want to be sure of not needing to return a deposit ensure it covers only costs and you can prove it, then you should (I think) have a defendable case

Great link, thank you.

If a deposit covers a genuine pre-estimate of loss (read costs incurred) then it is retainable. If it is an arbitrary or high figure that could be construed as a financial penalty if retained it would fall under the unfair terms as described in the previously linked PDF. This is the case in this thread - the £500 does not have any correlation to the loss incurred by the seller as a result of the breach.

clarkey3262

somethingcorporate wrote: »

Great link, thank you.

If a deposit covers a genuine pre-estimate of loss (read costs incurred) then it is retainable. If it is an arbitrary or high figure that could be construed as a financial penalty if retained it would fall under the unfair terms as described in the previously linked PDF. This is the case in this thread - the £500 does not have any correlation to the loss incurred by the seller as a result of the breach.

Or so you think, there could well be enough factors that make the £500 more than valid, unlikely, but it could

ManuelT

I would still argue.

"4.6 Alternatively, the prepayment may be set low enough that it merely reflects
the ordinary expenses necessarily entailed for the supplier. A genuine
'deposit'– which is a reservation fee not an advance payment – can quite
legitimately be kept in full, as payment for the reservation. But of course
such a deposit will not normally be more than a small percentage of the
price, otherwise it is liable to be seen as a disguised penalty (see paragraph
5.8)."

Given that the PX was for 4K I imagine the purchase price is probably over 10K which would mean it's <5% of the purchase price. That would qualify as a small percentage in my mind.

So OP what was the price of the new car?

Equaliser123

ManuelT wrote: »

Sorry, should have said intent. In the small claims track of the county courts then then very much to keep things simple and look at the intent of both parties. Which seems fairly open and shut. The OP wanted to buy a car agreed a £500 deposit then changed his mind and now wants his money back.

Whichever track of the County Court applies, the law is the same.

somethingcorporate

clarkey3262 wrote: »

Or so you think, there could well be enough factors that make the £500 more than valid, unlikely, but it could

And in the county court it would be down to the seller to prove their losses are genuinely £500. I would struggle to see how this could legitimately amount to such a figure.

Flyboy152

ManuelT wrote: »

Apart from the 2.5% credit card processing fee,

Acceptable cost; so that's twelve pounds fifty. The seller would have to of course supply details of their accounts to the OP to prove this. Assuming of course, the deposit was paid by credit card and not debit card or cash.

The half hour spent prefilling the paperwork so the customer would have a quick visit when they came to pick up the car.

That's about three pounds. But I don't think that would would be classed as an reasonable cost. If the paperwork was completed before the OP turned up, that would have been the choice of the seller.

The valet for the car had so the car would look nice when the customer picked it up.

Not acceptable as a loss. The car would have been cleaned anyway.

The fact that they had a phone call about the car after they had sold it and said sorry it's sold so lost out on that potential sale.

The onus is on the seller to prove this. They would also have to prove that the telephone call would have resulted in a sale if the car was available. Seeing as the car was still being advertised for sale, it would be impossible to quantify this

Yep not a single loss there!

The quote was "their losses are minimal to nothing." Seeing as thee costs are less than minimal, I'd say the remark was accurate.

When the OP agreed the deposit he also agree that it was a fair sum to cover the expenses of the other party if he pulled out of the transaction, If he didn't why on earth would he have paid it.

:wall:

Flyboy152

somethingcorporate wrote: »

You quote me but then don't even read what I say! I said minimal to nothing. They have a loss of sub-£100 which I suggested in a previous post of mine. The above does not equate to the retention of £500. I also posted hypothetically if I had left a £10k deposit on a £20k car they would be entitled to keep the lot? (that's rhetorical, obviously they are not allowed to).

The seller is obliged to mitigate their losses and can retain damages for actual financial losses (not speculative ones) due to the breach of contract so they can make a reasonable deduction for the above that are quantifiable, not the arbitrary retention of the full amount.

A point I have made several times on other threads and remarkably, some actually believe it would be acceptable for a dealer to retain all of it. :eek:

Flyboy152

clarkey3262 wrote: »

http://www.oft.gov.uk/shared_oft/reports/unfair_contract_terms/oft311.pdf

Group 4 and 5, that covers it

If the garage sold the car to someone else then they would have to return the full deposit regardless. If you really want to be sure of not needing to return a deposit ensure it covers only costs and you can prove it, then you should (I think) have a defendable case

somethingcorporate wrote: »

Great link, thank you.

If a deposit covers a genuine pre-estimate of loss (read costs incurred) then it is retainable. If it is an arbitrary or high figure that could be construed as a financial penalty if retained it would fall under the unfair terms as described in the previously linked PDF. This is the case in this thread - the £500 does not have any correlation to the loss incurred by the seller as a result of the breach.

Does ths seattle the issue once and for all. If it does, can we have the OFT's guide as a sticky?