Motor dealer keeping deposit.

ivavoucher

Hi All
I paid a deposit on a car to a trader.
The deposit (£1,000) was paid on my visa debit card.

The deal was £x,xxx plus my car in part exchange.

When I got home (Friday night) I ran a hpi check with Experian and the report gave a warning of outstanding finance on the car.

I telephoned the next morning and explained I would not be buying the car because of the outstanding finance and also I explained prior to the deposit he agreed to do work on the car before collection and after he was very keen to have me pick it up ASAP and without leaving time to do the work.

He replied, the report was wrong and Experian often have out of date information and he would get the finance company to fax me on Monday.

I explained I was not happy and did not want to purchase the car at this point he put the phone down on me.

I did not sign any agreement and there is nothing in writing concerning the deal, cost of car or terms, part exchange etc.

I was under the impression that if no written agreement was in place and it was not stated or displayed that the deposit was none refundable then I would be entitled to a full refund.

I have contacted my bank but they were unable to help.
I did offer for him to keep £200 to settle the matter on the day but he refused and refunded £500 of the £1000 I paid.

He has stated that he already had a buyer for my part exchange car so has lost money on that deal as well.

Any thoughts?

agrinnall

If there's nothing in writing then the dealer could argue that you'd paid him £1000 for whatever he wanted. Did you not even get a reciept for the deposit to say what vehicle it was for and how much it was? I think you may struggle to get the rest of the money back if he can show that he's lost money by not having your p/x to sell.

arcon5

He would be entitled to provable losses only -- and this is unlikely to come anywhere near £1k!! This is assuming he provides evidence that no finance exists on the car. But if they can prove no finance is on the car then why not go ahead with the deal?

If this is the case, you could possibly have a case for a full refund of the deposit. If there is finance on the car -- then isn't it the case that the finance company actually own the vehicle? Therefore the dealer has no powers to sell.

If you did purchase the car though without knowing finance existed on the vehicle -- you would actually have rights as an innocent buyer to stop the car being repossessed by the finance company.

In general, deposits are non-refundable - however deposits should also be a genuine pre-estimate of their losses if you breach the contract. £1k is more of a part-payment towards the vehicle.

ivavoucher

see below responses crossed.

arcon5

You have still formed a contract, they will prove this by showing you paid a deposit. If there is a dispute in the terms of the contract (ie your word against theirs / lack of a signed contract in place) then the judge will base the case on implied terms.

They can deduct actual losses -- not loss of profits and to claim any losses from the part-exchange will be near impossible (loss of bargain on the retailers side comes to mind). I imagine a judge would award an admin fee and that's about it.

ivavoucher

Nothing signed, but I would have thought that the dealer would be required to produce details of the deal if I claimed via small claims.


also, how can the dealer claim losses from the sale of my car when none of his customers had even seen my car.


On the following Monday the dealer did send me via email a fax from lex leasing stating that no finance was outstanding.

I had already stated on Sunday morning I was not going to buy the car.

The dealer was reneging on promises to do work on the car, he was shouting and rude and put the phone down.
A few call took place on that Sunday and it got quite nasty.


My argument is I thought the deposit was refundable and I think it is his responsibillity to display or inform me if otherwise.

arcon5

ivavoucher wrote: »

Nothing signed, but I would have thought that the dealer would be required to produce details of the deal if I claimed via small claims.

Yes, details being them as the seller, you as the buyer, details of the order (ie x car in exchange for £y + z car as p/e).

Verbal contracts are equally as valid as written contracts or purchase orders. It's just harder to prove who said what and what terms was imposed -- in which case a judge would decide whats reasonable.

On the following Monday the dealer did send me via email a fax from lex leasing stating that no finance was outstanding.

Therefore you are in breach of contract by pulling out of the deal and the dealer is entitled to recover their losses from the deposit. In this case they are minimal.

The dealer was reneging on promises to do work on the car, he was shouting and rude and put the phone down.
A few call took place on that Sunday and it got quite nasty.

I'm not surprised, you've rescinded the contract based on false information. They then proved your source was incorrect and the finance is non-existant.. yet despite this you no longer wish to continue with the deal. I'd be annoyed also.

So basically you're not pulling out because of the finance issue but because you have changed your mind.

(not justifying them getting 'nasty' btw)

My argument is I thought the deposit was refundable and I think it is his responsibillity to display or inform me if otherwise.

No.

Why would you think a deposit is refundable in the first place?

By placing a deposit you are committing yourself into purchasing the car, therefore entering into a contract with the dealer. You have no statutory right to cancel. In the same way a retailer (high street retailer) doesn't have to advise you before making a purchase you cannot return goods for a refund or exchange (it's down to you to check their policies and make buying decisions accordingly).

To get out of the deal you are in breach of contract, bringing you back to what's already said -- they can deduct provable losses. £1k isn't representative of their actual losses, so they should refund you this balance less losses (I imagine being a reasonable admin fee).

wealdroam

ivavoucher wrote: »

Nothing signed, but I would have thought that the dealer would be required to produce details of the deal if I claimed via small claims.

The dealer can however prove that you gave him £1000.
I would've thought that you would have ensured that you had a receipt for that money detailing what you had paid for.

ivavoucher wrote: »

The dealer was reneging on promises to do work on the car...

To say nothing of you reneging on a promise to buy the car.
OK, maybe you didn't promise to do that, it's not clear, but you have no proof either way.

ivavoucher wrote: »

My argument is I thought the deposit was refundable and I think it is his responsibillity to display or inform me if otherwise.

I think it is at least partly your responsibility to ensure that you and he both understand the terms on which you have given him some of your money.

Incidently, why did you leave a deposit?
I thought a deposit was a part payment towards a purchase, made at the time a purchase is certain and to ensure the thing is not sold to someone else.

ivavoucher

Thank you both for your responses.

I placed a deposit on the car fully intending to purchase.
Up to the point of me paying the deposit the trader was promising to complete required cosmetic work to the car.

Once I had paid the deposit, he wanted me to collect the car that night if possible.
I said the earliest would be tomorrow. (50 miles away) and I was not in the part-ex car.

On the way home it was my wife who said "how is he going to have the time to do the work he promised". so that night when I paid Experian for a report on the car I was already unhappy.

When I called the trader the next day he was very unfriendly and would not discus the matter, (put the phone down)
At this point I lost all trust in him and wondered what other lies he may have spun me.

Arcon5 and wealdrome, thank you again for your responses and you both seem very sure of what you are saying.

can I ask, do you know for a fact that the following is not a requirement: a motor trader must state in documentation or on the wall as signage that all deposits are none refundable because this is what I have been lead to believe.

arcon5

Up to the point of me paying the deposit the trader was promising to complete required cosmetic work to the car.

Once I had paid the deposit, he wanted me to collect the car that night if possible.
I said the earliest would be tomorrow. (50 miles away) and I was not in the part-ex car.

On the way home it was my wife who said "how is he going to have the time to do the work he promised". so that night when I paid Experian for a report on the car I was already unhappy.

Oh right, I understand now.

This is why it's important to get things in writing. Although you could potentially have a case for a full refund due to their breach of contract (if they don't intend to complete the cosmetic works), you are now in a situation whereby it's your word against theirs (if they deny it that is). A court would base their judgement on the balance of probabilities.

I would recommend at this point keep a diary of events (including past events). Write down the date/time, who you speak to, the nature of the telephone conversation and other relevant information. If it does eventally go to court you can provide telephone records which will help verify your diary of events (although doesn't prove what was actually said). It may or may not push to balance in your favour -- but you loose nothing by doing it and stand to gain if successful.

can I ask, do you know for a fact that the following is not a requirement: a motor trader must state in documentation or on the wall as signage that all deposits are none refundable because this is what I have been lead to believe.

If this is a requirement when taking deposits, this would be written in law somewhere... so surely whoever told you this was the case is in a better position to substantiate it? As proving you don't have to do something is much more difficult.

It's no different to a shop(B&M) not displaying a returns policy, there is no statutory right to return goods if you change your mind - therefore no obligation for the store to accept returns or inform you before sale. If you want to return you would check what their policy is on this (which then forms part of the contract of sale with the retailer).

You don't put a deposit on something if your still thinking about it or haven't agreed the terms of sale. Your putting a deposit down to secure the order/form the contract. As in the above example, you have no rights to now cancel -- you can either a) breach the contract (already discussed) b) if they are not willing to do the said repairs, reject the car for a full refund (Sales of Goods Act, not as described) - whch also carries complications (already discussed).

ivavoucher

Thanks again

The person who advised me that it needs to be stated that the deposit was none refundable was from:
just answer . com

I am not sure how reliable the advice would be from them but here it is.
Would you be kind enough to read it and tell me what you think.

I am teetering on just forgetting the £500 but the trader has now sold the car and I feel that £500 is far too much.

QUESTION

I paid a deposit of £1000 by debit card on a used car yesterday, the car was due to be collected earlier today.
No contract was signed and it was not stated that the deposit was non-refundable.
When I got home I ran a hpi check through experian and it came up with a warning that their was a loan or finance held against the car.

I phoned the dealer and explained due to hpi check failing I no longer wanted to purchase the car. He has said I can't have my deposit back and that he can get the finance company to write to me to confirm they no longer have an interest in the car.

I have told him I do not want to wait for the finance company to write to me and no longer want the car.

Can he keep the deposit and can he sue for breach of contract?




RESPONSE
If there was no contract stating that the despot was non refundable or any notices at the dealer then yes he is in breach and you can sue for your deposit for breach of contract.

There must be an understanding that any despot can not be refunded,

MY RESPONSE
The trader has now sent me a copy of a fax from the finance company as evidence that no finace is outstanding on the vehicle.I have explained that I have now found a replacement car.Can the trader sue me for breach of contract and any consequential losses?There is no paperwork completed so nothing in writing stating the purchase price or terms.

REPLY
No the seller can not. No contract was signed, he would have problems showing it existed.

MY RESPONSE
Would the fact that I had paid a deposit and he has some of my car documents that was going to be used in paert exchange not imply a contract was in place?

REPLY
It could but then there is nothing to say the deposit can not be refunded.

MY RESPONSE
I am happy I will get my deposit returned but am concerned that the trader could sue for breach of contract.

REPLY
He cant because he can not prove the deposit is non refundable.