A New Year, a new court victory for a Lawgistics dealer

It is always nice to start a new year with good news and already we have notched up a court win for one of our clients.

This was a case in which the consumer had issues with his vehicle. Our dealer had helped the consumer out on a goodwill basis earlier in the ownership but the consumer had returned as the warranty company had deemed the latest issue as one of wear and tear. As an issue of wear and tear, our dealer had no obligation either but still made a goodwill gesture in the name of customer service. However, the consumer wanted more and so approached the finance company. They also refused on the basis of wear and tear and so the consumer decided to take our dealer to court.

Right from the beginning, we advised that the consumer had no right to take our dealer to court as the consumer’s contract was with the finance company and not our dealer. Yes our dealer had previously helped him out but that was on a goodwill basis. The consumer couldn’t or didn’t want to see this as in his mind, perhaps understandably, he had bought the car from our dealer to whom he had given his part exchange and the dealer had helped him previously. We set out that the p/x was essentially a deposit on the finance deal and encouraged the consumer to look at the finance document and the invoice both of which showed that yes our dealer sold the car but, under the nature of the deal they sold it to the finance company who hired it to the consumer under a Conditional Sale Agreement. This all meant his contract was with the finance company and so his action should have been against them. When the case reached court, the judge agreed with us and dismissed the case, awarding our client his costs of attending plus travel costs.  

To be clear, it is fine to assist customers who have purchased their vehicle on finance but this is always as a goodwill gesture as legally their recourse is with the finance company. On a purely practical and reputational level, most dealers will help out in such circumstances but a dealer should never feel obligated in situations where the consumer has over inflated expectations and demands.

Should you wish advice on when and what you should pay out for Lawgistics members can talk to a legal advisor.

Authors: Nona Bowkis

Published: 26 Jan 2017


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