Any Motor trader can advise please? I need your help...
Discussion
So...
A friend see's a car advertised on autotrader by a non franchised dealer with 200 plus cars for sale.
(Also an ebays motors dealer too with all cars listed)
Calls office, pays depo on phone to hold car. Drives the 200 miles to dealer the next day and test drives car.
All good. Tries to negotiate a discount for no px and no finance
and is told nothing off and you must pay £80 admin fee for our hpi checks and mileage check etc.
OK, Invoice is completed and pays the £40K on his debit card.
Dealer keeps V5 and gives pal his part as new keeper.
Drives 200 miles home.
Car is perfect.
V5 arrives from DVLA in his name a few days later.
5 weeks later phone rings and a man from a very well known PLC finance company explains that they have a financial interest in the car.
They gave a stocking loan to the dealer for the car 6 weeks ago, just 7 days before my pal bought it.
4 weeks after the purchase and 3 weeks after receipt of V5, the car dealer goes into liquidation.
(Dealer is still on same site today with same amount of cars and a new trading name)
1 week after that (today) major PLC calls my pal to say he's at risk and to send copies of all paperwork immediately. Upon receipt they tried to pull holes in the paperwork.
I don't think he is at risk at all and I am amazed the finance company have contacted him.
Whats the reality here?
A friend see's a car advertised on autotrader by a non franchised dealer with 200 plus cars for sale.
(Also an ebays motors dealer too with all cars listed)
Calls office, pays depo on phone to hold car. Drives the 200 miles to dealer the next day and test drives car.
All good. Tries to negotiate a discount for no px and no finance
and is told nothing off and you must pay £80 admin fee for our hpi checks and mileage check etc.
OK, Invoice is completed and pays the £40K on his debit card.
Dealer keeps V5 and gives pal his part as new keeper.
Drives 200 miles home.
Car is perfect.
V5 arrives from DVLA in his name a few days later.
5 weeks later phone rings and a man from a very well known PLC finance company explains that they have a financial interest in the car.
They gave a stocking loan to the dealer for the car 6 weeks ago, just 7 days before my pal bought it.
4 weeks after the purchase and 3 weeks after receipt of V5, the car dealer goes into liquidation.
(Dealer is still on same site today with same amount of cars and a new trading name)
1 week after that (today) major PLC calls my pal to say he's at risk and to send copies of all paperwork immediately. Upon receipt they tried to pull holes in the paperwork.
I don't think he is at risk at all and I am amazed the finance company have contacted him.
Whats the reality here?
Sadly, the on-paper reality is your 'friend' has purchased a vehicle which has a financial interest on it. With the debt unsettled, the lender now has a claim for the car.
As I'm sure you know, the 'new' company is on the face of it a completely new legal entity from the company which went under. Nevertheless, they are operating from the same site, same staff etc so your friend should have a leg to stand on... but it would be foolish of him to assume it will sort itself out and to not act proactively. The lender can (and will) ultimately repossess the car if action is not taken.
You mentioned that they sold the car on the condition that an HPI 'Checked and Clear' certificate (for the princely sum of £80) was provided. As it transpires the car was in fact not clear, that constitutes a breach of contract at their end - miss-selling etc. Consumers like your friend have plenty of rights empowered to them under the SOGA in situations like this. Trouble is, those rights aren't that useful if the company has gone under.
I would strongly suggest your friend seeks legal advice as soon as possible - I think it will get sorted but its not a simple one. Keep in mind the new company will have other cars / clients in a similar situation, all of whom are also coming to terms with what has happened and starting to take action. The new company have operating capital which, when push comes to shove, they can use and they'll prioritise which of the 'historic' stocking agreements to settle first based on which clients are making the most noise. So stern letters from a solicitor would be very prudent. ASAP.
By the by, I would also suggest contacting the FCA. Motor traders are heavily regulated by the FCA and pay money to the FCA in annual memberships. Perhaps some of this goes into a kitty to help consumers in these situations? Might be worth checking, I'm not entirely sure. Either way, a few years ago they brought in all this "Treating Customers Fairly" stuff which makes me think they'd be interested in hearing what has happened and offer some form of support.
Good luck to him. I guess the lesson will be learnt not to try save a few grand on a £40k car by visiting a car supermarket. Or to always do your own HPI checks, regardless how seemingly genuine the set up you are buying from looks.
As I'm sure you know, the 'new' company is on the face of it a completely new legal entity from the company which went under. Nevertheless, they are operating from the same site, same staff etc so your friend should have a leg to stand on... but it would be foolish of him to assume it will sort itself out and to not act proactively. The lender can (and will) ultimately repossess the car if action is not taken.
You mentioned that they sold the car on the condition that an HPI 'Checked and Clear' certificate (for the princely sum of £80) was provided. As it transpires the car was in fact not clear, that constitutes a breach of contract at their end - miss-selling etc. Consumers like your friend have plenty of rights empowered to them under the SOGA in situations like this. Trouble is, those rights aren't that useful if the company has gone under.
I would strongly suggest your friend seeks legal advice as soon as possible - I think it will get sorted but its not a simple one. Keep in mind the new company will have other cars / clients in a similar situation, all of whom are also coming to terms with what has happened and starting to take action. The new company have operating capital which, when push comes to shove, they can use and they'll prioritise which of the 'historic' stocking agreements to settle first based on which clients are making the most noise. So stern letters from a solicitor would be very prudent. ASAP.
By the by, I would also suggest contacting the FCA. Motor traders are heavily regulated by the FCA and pay money to the FCA in annual memberships. Perhaps some of this goes into a kitty to help consumers in these situations? Might be worth checking, I'm not entirely sure. Either way, a few years ago they brought in all this "Treating Customers Fairly" stuff which makes me think they'd be interested in hearing what has happened and offer some form of support.
Good luck to him. I guess the lesson will be learnt not to try save a few grand on a £40k car by visiting a car supermarket. Or to always do your own HPI checks, regardless how seemingly genuine the set up you are buying from looks.
This thread sums it up nicely http://www.pistonheads.com/gassing/topic.asp?t=157...
I have been in the motor trade for many years, and would suggest that most dealers have their vehicle stock on some kind of stocking plan with a finance company. As far as I know in this case, the finance company would have no comeback against a person who has bought a car from a company that goes out of business and the finance company has no rights to try and recover their money from your friend. The agreement was between the dealer and the finance company who would usually use the services of an independent auditor to check the dealer stock on a very regular basis. I once remember the case of a large retail franchise dealer who had over 50 used vehicles on a stocking plan with more than one finance company. All hell broke out when he suddenly went out of business, with several finance companies all trying to claim the rights to the same vehicles. He had also not been paying off the vehicles that had been sold in the previous weeks before going out of business, but none of the customers were out of pocket.
If they had 200 cars it would be more likely to be a floating charge over the stock rather than a charge on each car (would be difficult to manage). In which case there should be no comeback on indiviidu all cars that are sold. But of course receivers do like to try these things on just to see what they can get
Had the opposite myself about 10 years ago... PX a car, the dealer should have settled the finance but didn't. Long legal fight later the court was clear, I still owed the finance company money. I cannot see why this would be any different, whoever took out the finance should remain responsible for settling it?
Hmmm, it's a perplexing one. I'd favour the approach that your friend MAY be ok. I've worked in the retail motor industry for 25 years now, and mostly franchised dealerships. Some of them had stocking plans (not uncommon) but the agreement is between the dealership and the finance company, and therefore they are in breach of their payment, not your friend. The finance company will try to recover their losses, but that's from THEIR customer (the dealer) and the stocking plan facility shouldn't be secured on particular cars unless it's new car /demo car stock from a manufacturer based lender. Obviously this is not the case here, hence my opinion they have no comeback on him. He paid for the car in good faith upon receipt of formal documentation that it was clear of any financial encumbrance, therefore any court should be willing to judge in his favour.
That said, and this is meant with huge respect, I'd find it very difficult not to have alarm bells ringing when they charge the customer for their due diligence. That would have been way too much of a warning signal to me to walk away.
That said, and this is meant with huge respect, I'd find it very difficult not to have alarm bells ringing when they charge the customer for their due diligence. That would have been way too much of a warning signal to me to walk away.
It is such a shame that P.H operates a "no Name & Shame policy". Members and viewers should be made aware of these CRIMINALS so that whatever name they are currently using and those used in the past, can be investigated by a potential buyer.
I had my thread about a high profile dealer in Oxfordshire (still trading despite the many bad reviews) taken down because I "named and shamed".
Despite receiving "thanks" on this very forum for posting up my experiences and P.M's thanking me for same.
I can understand scurrilous, unsubstantiated claims being removed but when one has bought legal action against a firm and they have admitted guilt by refunding costs in full, I fail to see how any suggestion of "libel" or "defamation" could be considered a concern by P.H because the dealer had already admitted their guilt.
Further, everything was documented- ready for a court hearing and I would have been more than happy to post any of that information here and in any other public domain. Still am in fact.
Reading about the O.P's pal, just shows me that my case could have been even worse and how many of these CRIMINALS there are at large in the "prestige car market".
Unfortunately, after "Govt cutbacks", we found Tradings Standards (previous an excellent stick with which to beat a rogue trader), totally impotent and not really interested. It doesn't help that it is all now "outsourced" via the Citizens Advice Bureau to some company in Somerset !
Well done O.P and pal . :-)
I had my thread about a high profile dealer in Oxfordshire (still trading despite the many bad reviews) taken down because I "named and shamed".
Despite receiving "thanks" on this very forum for posting up my experiences and P.M's thanking me for same.
I can understand scurrilous, unsubstantiated claims being removed but when one has bought legal action against a firm and they have admitted guilt by refunding costs in full, I fail to see how any suggestion of "libel" or "defamation" could be considered a concern by P.H because the dealer had already admitted their guilt.
Further, everything was documented- ready for a court hearing and I would have been more than happy to post any of that information here and in any other public domain. Still am in fact.
Reading about the O.P's pal, just shows me that my case could have been even worse and how many of these CRIMINALS there are at large in the "prestige car market".
Unfortunately, after "Govt cutbacks", we found Tradings Standards (previous an excellent stick with which to beat a rogue trader), totally impotent and not really interested. It doesn't help that it is all now "outsourced" via the Citizens Advice Bureau to some company in Somerset !
Well done O.P and pal . :-)
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