Section 75 Car purchase question

n217970

Hi, I'll try to give as much detail as possible here - 3 weeks ago I purchased a used car from a well regarded local independant dealer which as part of the agreed deal included a 15 month aftermarket warranty in addition to the 30 days being provided by the dealer - this 15 warranty was being advertised in the dealership at £299.

I paid in full on my CC, and the total price was £7100; the 15 month warranty is detailed on the invoice but I do not beleive it shows an itemised cost price (invoice is at home). A week after the purchase the car had some minor work to fix a couple of small issues at a local garage the dealer sent us to.

I recieved a letter yesterday from the warranty provider advising that the dealer had not paid for the warranty and they had now cancelled it. Today the dealer is uncontactable and the garage we had the work done at says he thinks they have gone bust. I have not been to the actual forecourt as I work in the opposite direction - 90 minutes away.

I intend to ring my CC provider tonight but I have no experience of section 75 - do you think I would have a relevent claim?

TLDR: bought a car that included an aftermarket warranty - dealer gone bust, warranty provider has cancelled policy. Section 75?

eco_warrior

n217970 wrote: »

Hi, I'll try to give as much detail as possible here - 3 weeks ago I purchased a used car from a well regarded local independant dealer which as part of the agreed deal included a 15 month aftermarket warranty in addition to the 30 days being provided by the dealer - this 15 warranty was being advertised in the dealership at £299.

I paid in full on my CC, and the total price was £7100; the 15 month warranty is detailed on the invoice but I do not beleive it shows an itemised cost price (invoice is at home). A week after the purchase the car had some minor work to fix a couple of small issues at a local garage the dealer sent us to.

I recieved a letter yesterday from the warranty provider advising that the dealer had not paid for the warranty and they had now cancelled it. Today the dealer is uncontactable and the garage we had the work done at says he thinks they have gone bust. I have not been to the actual forecourt as I work in the opposite direction - 90 minutes away.

I intend to ring my CC provider tonight but I have no experience of section 75 - do you think I would have a relevent claim?

TLDR: bought a car that included an aftermarket warranty - dealer gone bust, warranty provider has cancelled policy. Section 75?

Sounds ok in theory. Do you want to keep the car and get the £299 back for the warranty?

n217970

eco_warrior wrote: »

Sounds ok in theory. Do you want to keep the car and get the £299 back for the warranty?

Ideally, yes, I am quite happy with the car. The only issue I forsee is I don't think I am able to prove the warranty was being sold for £299 - the agreement with the garage was I paid £6790 for the car and £300 for the warranty. The screen price was £6990.

I have got the wife to send me a scan of the invoice and comes with the 15 month warranty at £0 and £7090 for the car. Foolish in hindsight on my part but I am guessing still breach of contract?

eskbanker

For section 75 to apply, the item value has to be over £100, so if the invoice states that the (separately-itemised) warranty was 'sold' for £0 then I can't see how you could succeed with a s75 claim on the extended warranty....

Are you able to make the case that the work that needed to be done should have been covered by the 30 day dealer warranty rather than the 15 month aftermarket one? I'd have thought that this would be a viable breach claim on an item that falls within s75 value parameters.

eco_warrior

n217970 wrote: »

Ideally, yes, I am quite happy with the car. The only issue I forsee is I don't think I am able to prove the warranty was being sold for £299 - the agreement with the garage was I paid £6790 for the car and £300 for the warranty. The screen price was £6990.

I have got the wife to send me a scan of the invoice and comes with the 15 month warranty at £0 and £7090 for the car. Foolish in hindsight on my part but I am guessing still breach of contract?

I think claiming the £299 back will be difficult without an invoice to back up the value - which seems to be the case. If this was invoiced you could claim a chargeback or look at a S75 claim, both could work.


I would speak to your bank but id be prepared for the possibility of them rejecting the claim on this basis.




Eskbanker makes a good point in his last paragraph, but proving this could be trickly and/or costly. Mightnt be worth it in the long run.

Best of luck

n217970

Yes I see your point. Thanks both, its not a big amount to lose out on but it is annoying - I do not like feeling like I have been "done" - at least the car got the work it needed before they disappeared.

I will keep an eye out on the two guys that ran the garage, if they set up shop elsewhere I will stand outside one Saturday afternoon and cause a scene in front of a few customers. Childish but will make me feel better Sure I can soon cost them £300 in sales.

eddddy

I'd go with the argument that you paid £7090 for a car that came with a free warranty (worth £300).

i.e. The free warranty was an inducement to purchase.

(And they wouldn't have given you a warranty for £0 if you hadn't bought the car.)

But if you could buy a similar warranty elsewhere, for say, £150 - they could just offer you the £150 and tell you to buy that warranty instead.

chattychappy

eskbanker wrote: »

For section 75 to apply, the item value has to be over £100, so if the invoice states that the (separately-itemised) warranty was 'sold' for £0 then I can't see how you could succeed with a s75 claim on the extended warranty....

I would argue that the two were sold together as a package and that the "item price" within the meaning of S75 is not £0, even if shown as "free" or whatever on the invoice. Afterall, it couldn't have been purchased separately for £0. Perhaps there is some caselaw.

Anyway, we don't know exactly what was on the invoice.