Legal Article - Business Law

The Importance of using Mileage Disclaimers

Over a number of years the practice of using mileage disclaimer stickers has evolved and found favour with the Courts.

There is some disagreement as to whether the disclaimer system negates the original description and therefore there is no offence or whether the disclaimer is merely one of a number of precautions that should be taken.

Whilst this is of some academic interest practically, the courts have been in agreement.

“A system of mileage disclaimer stickers should be used”.

If they are not, although not invalidating a defence system, it does seriously impair it. In several leading cases the High Court have said that the use of mileage disclaimers and vehicle mileage checks are essential precautions.

Mileage Disclaimers MUST be used in all circumstances where the mileage has not been confirmed in writing by all previous owners of a car, registered keepers or the vehicles drivers or where there is other evidence of the mileage being incorrect.

A satisfactory mileage disclaimer is one that negates any description on each and every occasion the mileage may be seen or is entered into the documentation. The right words must be put in the right place at the right time.
Please Note If someone clocks a vehicle or has it clocked for them then subsequently disclaiming it will offer NO protection.

• The Right Words
To be effective the words used in a mileage disclaimer must be as bold, precise and as compelling as the original description.

If you use a phrase such as “ we cannot guarantee the accuracy of the odometer reading” then this will not negate the description.
Whilst it is common knowledge that you cannot guarantee the accuracy of the odometer the original odometer reading remains there and is a trade description. If incorrect it is a false trade description.

To be effective a positive statement such as “and must be disregarded” or “ and must be considered incorrect” must be added to negate the original description.
Suggested wording which has been accepted as being effective is:

i. We have been unable to confirm the mileage recorded on this odometer and therefore it must be considered incorrect.
ii. We have been unable to confirm this mileage reading. Please disregard it.

• The Right Place
To be effective any disclaimer must be as bold, precise and as compelling as the original description.

This means that wherever the mileage reading can be seen – (on the vehicle, on the warranty, on the Sales Invoice, on the Order Form or on any other documentation) there MUST be accompanying that description a suitably worded disclaimer in close proximity to the original description.

On a vehicle this means that the disclaimer should be placed over or adjacent to the odometer reading so that it is either obscured or that both may be read together.
On any documentation the disclaimer MUST be in close proximity to the mileage reading and marked by means of an asterisk.

In addition to the above it is also a sensible policy to have the same wording placed on the wall of the office where the sales transaction is to be completed and/or throughout the showroom. The purpose of such a notice is to remind customers and staff alike of the Company Policy and to ensure that the customer is clear that mileage is not an express term of the contract.

• The Right Time
A mileage reading becomes a trade description as soon as it is made available to a member of the public to view it.
To protect yourself the mileage disclaimer must be placed over or in close proximity to that reading BEFORE it is placed on view.

Remember even if you have a vehicle that has not yet been prepared for sale but show it to a prospective customer you are exposing the mileage reading and therefore making a trade description.
It is equivalent to a vehicle being supplied to a customer where a mileage reading displayed. That is a trade description and if wrong then you have supplied a vehicle with a false trade description.

All vehicles should be supplied with the disclaimer still inset. If you wish to remove the disclaimer then ask the customer if they wish it to be removed at the time of supply.

Published: 17 Mar 2011


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