Motor trader beware!

legal updates

On the face of it the HPI reports in these particular cases do not appear to be worth the paper they are written upon given the lenders failure to update the records!

Read our disclaimer keyboard_arrow_down

This website content is intended as a general guide to law as it applies to the motor trade. Lawgistics has taken every effort to ensure that the contents are as accurate and up to date as at the date of first publication.

The laws and opinions expressed within this website may be varied as the law develops. As such we cannot accept liability for or the consequence of, any change of law, or official guidelines since publication or any misuse of the information provided.

The opinions in this website are based upon the experience of the authors and it must be recognised that only the courts and recognised tribunals can interpret the law with authority.

Examples given within the website are based on the experience of the authors and centre upon issues that commonly give rise to disputes. Each situation in practice will be different and may comprise several points commented upon.

If you have any doubt about the correct legal position you should seek further legal advice from Lawgistics or a suitably qualified solicitor. We cannot accept liability for your failure to take professional advice where it should reasonably be sought by a prudent person.

All characters are fictitious and should not be taken as referring to any person living or dead.

Use of this website shall be considered acceptance of the terms of the disclaimer presented above.

We have seen two cases this last week, involving the same lender, where a motor trader purchased a vehicle after a clear HPI search to discover many months later that the lender has now registered its interest under a hire purchase agreement late – in one case almost a year after the HP Agreement was entered into and many months after purchase by the wholly innocent motor trader.

Under section 27 (6) (a) of the Hire Purchase Act 1964 ‘…where the debtor disposes of the motor vehicle to a trade or finance purchaser, nothing in this section shall exonerate…that trade or finance purchaser…from any liability (whether criminal of civil) to which he would be subject apart from this section’.

On the face of it the HPI reports in these particular cases do not appear to be worth the paper they are written upon given the lenders failure to update the records!

What can be done?

In the immortal words of Paul Daniels ‘not a lot’ it would seem short of being fortunate enough to buy the vehicle from an innocent private purchaser who is able to pass on good clear title to the motor trader under the 1964 Act.

If lenders by neglect or design, fail to register their interest in a timely fashion or at all, then this would seem to make a mockery of the registration process and leave the motor trader vulnerable on every purchase from a private seller who may knowingly be selling a vehicle, which is subject to outstanding finance.

Should any of our readers have any similar experiences then please do let us know and if there is evidence of lenders employing such practices then there may be scope for raising issue of the Financial Conduct Authority (FCA) in the first instance.

Wearewood Services LtdMotor Trade Web Specialists

We offer an all-encompassing web, digital & design service specially tailored to the Motor Industry.

Howard TilneyHead of Strategy / Legal AdvisorRead More by this author

Related Legal Updates

While We Wait: Preparing for the FCA’s Review on Motor Finance Commissions

As anticipated, the FCA was not particularly helpful when questioned about the various issues of investigating complaints that were outside of the standard retention periods for documentation.

FCA Commission Review: Separating fact from fiction in the wake of scaremongering

Attend a complimentary seminar hosted by the FCA for first-hand information – Scheduled for Wednesday, 24 January 2024.

The FOS reports over 10,000 motor finance complaints: Are we really surprised?

The good news currently is the FCA is focussing its attention on the lender and not our members.

The FCA means business

The FCA are closely monitoring how firms are putting their new rules in place and will take action against those that aren’t following them.

Financial promotion on social media

The FCA’s supervisory approach to financial promotions in social media was issued in 2015.

Another victory, but the problem has still not gone away!

The FOS confirmed in the article they had not yet published any final decisions on commission-related complaints.

Mental Capacity – a person’s ability to make a decision

This is not a “one size fits all”, and you will need practices and procedures in place for such an eventuality.

Get in touch

Complete the form to get in touch or via our details below:

Phone
01480 455500
Address

Vinpenta House
High Causeway
Whittlesey
Peterborough
PE7 1AE

By submitting this quote you agree to our Terms & Conditions and Privacy & Cookies Policy.

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.