Dealer refusing to refund deposit.

sirfragalot84

Hi,

Yesterday (13th July 2013) my wife and I went to look at a car being sold by xxxxxx. I also took a friend with me who knows the type of car (Mk2 Golf) to provide advice.

At the time I felt pressured by the dealer to purchase the vehicle and due to the nature of the vehicle decided to place a £400 deposit down in cash (About 10% of the value) to ensure the seller didn't sell it to anybody else and also so he was able to Tax the vehicle prior to me taking delivery.

At no point was it mentioned that this deposit was non-refundable and my wife and I did not sign any paperwork. He simple wrote a receipt for the deposit by hand.

We drove home and during the evening I decided that I no longer wished to purchase the vehicle, because I felt I had been hasty and there were a few defects with the vehicle that I wasn't overly happy with. (My wife and friend could smell fuel in the vehicle whilst on the test drive). The dealer assured me that his mechanic had checked the car over and there were no fuel leaks, and as it was such a hot day, even the smallest amount of fuel spilt around the filler would cause this smell to become apparent.

This morning (not even 24hours of leaving the deposit), and after a night of consideration and research I rang the dealer and explained the situation with great regret as we loved the car but my head was telling me not to buy it.

I proposed to the dealer that for his inconvenience I would be happy to let him keep £100 to cover any expenses and as goodwill gesture for wasting his time.

He immediately refused this gesture and became very aggressive over the telephone and stated this was a contract (even though nothing was signed and he didn't take any of our details) and he would not be prepared to refund me any of my deposit. I asked him again to reconsider, but then he claimed to be a qualified barrister and he could in fact pursue me for the full value and force me to buy the vehicle.(basically, he tried to bully me into writing this deposit off).

Where do I stand? I think I have been more than fair offering to let him to keep £100. (at no point did he remove the vehicle from sale (eBay and his site) He also stated I was the 1st person to view the vehicle and nobody else had made arrangements to view, so he hasn't lost out in anyway shape or form. He couldn't have taxed the vehicle as today is Sunday so unless he did it online. (he claimed he didn't have a computer and was not tech savvie so this would not be the case)

Am I entitled to my deposit back or should I write this off as bad judgement and move on?

May I add, £400 is a lot of money to my wife and I, and really can't afford to lose this money due to our circumstances recently changing.

Any help gratefully received.

Guest101

Ok basically this comes down to a burden of proof. No where does it say this deposit is non-refundable. So it's a verbal contract. You could counter it by saying, well the agreed price was £2400, so i'll pay the 2k and collect the car tomorrow.

Stick it on ebay, make an easy 1k and move on.

Let's be fair he's not a qualified barrister, he's trying it on. Obviously.

I would write to him, confiring the details, as i suggested. If he refuses to the 'original' price of £2400, simply say, you have breached the contract by not honouring the deal, i therefore require my deposit back.

Not saying it'll be that easy, but everyone knows if it aint written down, it aint real

sirfragalot84

Guest101 wrote: »

Ok basically this comes down to a burden of proof. No where does it say this deposit is non-refundable. So it's a verbal contract. You could counter it by saying, well the agreed price was £2400, so i'll pay the 2k and collect the car tomorrow.

Stick it on ebay, make an easy 1k and move on.

Let's be fair he's not a qualified barrister, he's trying it on. Obviously.

I would write to him, confiring the details, as i suggested. If he refuses to the 'original' price of £2400, simply say, you have breached the contract by not honouring the deal, i therefore require my deposit back.

Not saying it'll be that easy, but everyone knows if it aint written down, it aint real

Thank you, but unfortunately this is not an option. The remaining balance is £3500 and I need a vehicle. If I were to sell the vehicle privately I do not think I would be able sell it straight away or for that matter guaranty I wouldn't lose even more money. The smell of fuel really concerns me. If I were to buy and it were to burst into flames or heaven forbid I sold this on knowing there may be a fuel issue and it ended up killing someone I would not be able to live with myself.

Again any advice that doesn't increase the risk to me or any other party would be appreciated. :-)

Guest101

Who/where does it say that the price you agrred, was £3900. He may have it advertised for that, but you used your expert negotiating skills, no doubt, and secured it for a fraction of the cost. Didnt you?

Richard53

As I understand it, a verbal contract is just as valid in law as a written one. However, the seller has no proof that the deposit was non-refundable, and I reckon he is trying it on. I think you have been very fair in offering to give him £100 for his trouble, and if it came to court I imagine this would stand in your favour. However, it may need legal action (or the threat of it) to get your money back. I would forget this car, buy another, and then try to get the deposit returned afterwards, but it may not be easy. If he tries to sue you for the full purchase price without written evidence of a contract, he will have a hard time.

I would suggest a quick chat with a solicitor or the CAB.

sirfragalot84

Guest101 wrote: »

Who/where does it say that the price you agrred, was £3900. He may have it advertised for that, but you used your expert negotiating skills, no doubt, and secured it for a fraction of the cost. Didnt you?

The hand-written receipt states the deposit and the agreed price of £3700 plus the price of a year's road tax which is £225.

Guest101

sirfragalot84 wrote: »

The hand-written receipt states the deposit and the agreed price of £3700 plus the price of a year's road tax which is £225.

So all you do is get him to acknowledge the deposit and lose the receipt.

Also how did you pay for this deposit - please say credit card...

Netwizard

£4,000 for a MK2 Golf? I know the 80s emporium sell some nice cars from back in the day but jesus christ!

To be fair, a deposit is just that! A safeguard, so that if you pull out of buying the car, dealer keeps the deposit.

A lot of people just expect deposits to be refundable, but if thats always the case, why bother with a deposit in the first place if you can just ask for it back if and when you want it.

I'd say you have had a lucky escape. Least you haven't parted with £4k for a MK2 Golf!!

Chalk it up to experience, and don't leave a deposit in future unless a million % sure you want the car

sirfragalot84

Contrary to your beliefs; good, honest mk2s are fetching in excess of £7000 and are going up in value. I have seen a 1 owner mk2 with 20k on the clock go for £10k. This particular one is almost exactly as it was back in 1990. By no means is it perfect but it is not a rot box, and has full history and is in an ultra rare colour. FYI Mk1 Golfs can fetch double that if they are completely original. (I know because I have one sat in the garage!)

By no means am I undervaluing your opinion, but legally do I not have case? Doesn't Schedule 2, Regulation 1(d) of the Unfair Terms in Consumer Contracts Regulations 1999 apply here. It states that if the contract has been cancelled after a deposit has been placed the buyer is entitled to have the deposit returned in full, unless the seller has spent time, effort and money, in which case they can deduct reasonable expenses. Even if some expenses have been incurred, if these are subsequently recovered, for example by selling the item to someone else, the deposit should still be returned in full. It follows that a blanket non-refundable clause that entitles the seller to keep the deposit in all circumstances is most likely going to be unfair and unlawful.
!
At the end of the day I was more than reasonable in suggesting he keep £100 of the £400 deposit paid as a gesture of good will.!

sirfragalot84

Richard53 wrote: »

As I understand it, a verbal contract is just as valid in law as a written one. However, the seller has no proof that the deposit was non-refundable, and I reckon he is trying it on. I think you have been very fair in offering to give him £100 for his trouble, and if it came to court I imagine this would stand in your favour. However, it may need legal action (or the threat of it) to get your money back. I would forget this car, buy another, and then try to get the deposit returned afterwards, but it may not be easy. If he tries to sue you for the full purchase price without written evidence of a contract, he will have a hard time.

I would suggest a quick chat with a solicitor or the CAB.

Thank you, this sounds more sensible advice.

sirfragalot84

Guest101 wrote: »

So all you do is get him to acknowledge the deposit and lose the receipt.

Also how did you pay for this deposit - please say credit card...

Unfortunately, I paid cash as he has no card facilities. :-(